Does it surprise you that over 50% of the loan modifications made for homeowners are defaulting again?
by Mortgage Rates on Friday, October 22nd, 2010 | 8 Comments
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The approach was retarded from the start on the governments part.
I would have made it simple.
Banks you will take all ARM loans return them to their introductory rate and this will be the fixed rate.
Homeowners if you default at this rate then you lose your home end of story.
Unfortunately the majority of Americans will never learn that central planning never works until they are starving in the streets.
Was there ever any doubt it wouldn’t happen? If they couldn’t afford it in the beginning, they couldn’t afford it after!! Wait until the commercial market starts collapsing!! It’s beginning to start now!
Not in the least bit surprising. And how much taxpayer money was used for that fiasco?
no
Most of the money that was given to the bank was fraud , and yes some of those loans should not have been given. I blame them all from the bank to the realtor to the person receiving the loan. I bought my house in 2006 at the age 25 and knew what I could spend each month and what I could not.
I am not surprised. Getting a lower interest rate on the mortgage leaving the amount of the mortgages unchanged, was never likely to convince people not to walk away if their mortgages are more that the market value of their home. People are acting like bossiness, making the “smart” financial decision about their home, and since home prices have continued to falling in some regions, the 105% mortgages offered for loan modification a year ago can be significantly under water by now.
It is also to be expected the local banks would make better decisions, because the are aware of local market conditions.
I think you are wrong in making the assumption the most of the defaults are because people can not pay although I am sure some are.
I don’t think it surprises anyone that these people are re-defaulting on their loans. If it happened in the first place, chances are it would happen again.. again.. and again. Just because the economy went bad, doesn’t mean they shouldn’t be held liable for their choices! Other Americans that pay their taxes and mortgages are now bailing out the ones that took out extravagant loans knowing they couldn’t afford them.
Why don’t we all go rob a bank and say it’s because we’re unemployed and need the money? That’s what their basically doing now – robbing banks to compensate for their lack of initial knowledge, lack of care, and overall greed ( 105% mortgage). If everyone thought about what COULD happen if I lose my job, what WILL happen if I can’t pay my mortgage, then 99.999% of these people wouldn’t have taken out loans they can’t afford to pay off. If you were willing to take the money in the first place, you should be willing to live with the consequences it brings! Don’t make it everyone else’s tax paying responsibility to bail you a$$ out because you didn’t plan for the future!
It’s not surprise, unfortunately. Most people that default once, will default again. It’s like criminals – once you end up in jail, 75% of people will go back again and again.
I think these people that have defaulted a 2nd time should be foreclosed on and then, and only then, will they learn that every choice has a consequence.. and everyone is responsible for their choices, and thusly, the consequences that come from them.
Government sponsored modification programs weren’t effective?!?! NO WAY?! REALLY?! And OJ was innocent! These people obviously have issues and need to be educated in effective management of funds… not to mention not being given more money than they can afford to pay back! Just because the value of your house depreciates doesn’t mean you should get your payments lowered to compensate. My car depreciates in value every month, but I don’t tell BMW to lower my monthly payments cause of that! And if I can’t pay for it or lose my job, they tow it away, screw my credit, and I’m stuck taking the bus… there’s no pity party for me if I can’t pay for it… but because it’s a home, it’s different?
The ONLY thing that is good about this is HOPEFULLY people will get a swift kick in the A$* and realize even the government can’t bail em out every time they mess up!