The New York Times reports the provisions of the plan:
The homeowner must be current on their payments. The plan excludes any borrower whose introductory rate expires before January 1, 2008. The plan excludes borrowers whom the mortgage companies conclude are making enough money to afford the higher monthly payments.
It is estimated that roughly 12 percent of all subprime borrowers will get relief with the Bush plan.
Read the entire New York Times article here.
plez sez: WTF?!?
ok... we (the u.s.) have been mired in the after effects of this "mortgage price gouging" scheme for alittle over a year now, and this is the best that george "lining the pockets of his friends" bush can come up with?!? people are being put out of their homes, entire neighborhoods (mainly in minority areas where this scheme was perpetrated) are boarded up eye sores, and the economy is on the brink of a recession; and this is the best they could come up with?
i live in an area that is predominantly Black and the surrounding neighborhoods are in trouble. especially, for homes that cost more than $300,000, it is becoming increasingly difficult to resell homes and new developments are sitting idle because of this mortgage mess. this has been going on for more than a year, but leave it to bush to provide token assistance for those homeowners who were FLEECED by the mortgage companies as they used loan shark tactics to sell their tainted products. i have former neighbors who were taken in by the bait-and-switch, start-'em-low mortgages that balloon into a behemoth payment that the borrower would never be able to afford... and the bad part is that many borrowers didn't know about the increases until the mortgage coupon appeared in their mailbox.
if you take a look at the bush plan, you will see that we can spend BILLIONS of dollars attacking foreign countries, but will barely lift a finger to defend AMERICANS from predatory lenders:
- The homeowner must be current on their payments.
this plan will only help those whose payments have not ballooned, the New York Times states: "it is estimated that 22 percent of all subprime borrowers are behind in their payments." this plan is not going to help over a fifth of all of the people who have these mortgages AND it does not even touch the ones whose homes are already in foreclosure or have been sold on the courthouse steps. why not freeze ALL subprime loans or provide a mechanism to pull their rates in line with a traditional mortgage (around 6 percent)?
- The plan excludes any borrower whose introductory rate expires before January 1, 2008.
correct me if i'm wrong, but hasn't this "problem" been around for over a year (by some estimates, it has been over two years)? it is estimated that $57 billion in subprime loans are scheduled to be reset at higher rates before the end of 2007. this provision of the plan just goes to exclude more homeowners and does nothing for those who are on the brink of foreclosure. since the mortgage companies are dealing with federally insured funds, why not require that the mortgage companies refinance all subprime loans to traditional loans, as a punishment for this predatory practice?
- The plan excludes borrowers whom the mortgage companies conclude are making enough money to afford the higher monthly payments.
this mortgage mess has depressed home values all over the country, thus stripping away the investment value of home ownership... ALL subprime loans should be refinanced to a traditional loan.
in typical bush fashion, he rides in on his white horse to save the damsel in distress: unfortunately he shows up late and goes to the wrong address!
bush's plan was created in concert with the mortgage lenders and wall street firms in an effort to minimize the affect on their business, but does little to help the people who are struggling under the burden of the mortgage companies' predatory lending habits of the past 3 years.
WTF were they thinking?!?