T Nation

Obama Admin Serious About Housing Finance Reform?

Politics and World Issues
#1

If he pursues this (legitimately), he gets credit where credit is due from me:

[i]Responding to the collapse in home prices and the huge number of foreclosures, the Obama administration is pursuing an overhaul of government policy that could diverge from the emphasis on homeownership embraced by former administrations.
â??In previous eras, we havenâ??t seen people question whether homeownership was the right decision. It was just assumed thatâ??s where you want to go,â?? said Raphael Bostic, a senior official in the Department of Housing and Urban Development. â??Youâ??re not going to hear us say that.â??

Bostic, who has published leading scholarship on homeownership, added that owning a home has a lot of value, but â??what weâ??ve seen in the last four years is that there really is an underside to homeownership.â??

The administrationâ??s narrower view of who should own a home and what the government should to do to support them could have major implications for the economy as well as borrowers. Broadly, the administration may wind down some government backing for home loans, but increase the focus on affordable rentals.

The shift in approach could mean higher down payments and interest rates on loans, more barriers to lower-income people buying houses, and fewer homeowners overall, government officials said. But it could also pave the way for a more stable housing market, one with fewer taxpayer dollars on the line and less of a risk that homeowners will not be able to pay their mortgages. And it could spell changes throughout the financial markets, as investors choose new places to put their money if the government withdraws some incentives for investing in the U.S. mortgage market.[/i]

http://www.washingtonpost.com/wp-dyn/content/article/2010/07/20/AR2010072005946.html

#2

Have to give him credit on this one.

#3

“And it could spell changes throughout the financial markets, as investors choose new places to put their money if the government withdraws some incentives for investing in the U.S. mortgage market.”

Translation: removal of the home mortgage deduction from taxes.

Reason: more revenue for Washington to gobble and spread around to cronies.

#4

And, isn’t this sort of an admission…

#5

So basicly he is telling loan companies who they can and cant do business with. I smell a socialist. How bout this, loan want you want to who you want, and if they cant pay it that is there problem. They should not buy a $200,000 house when they can only afford $125,000. Call me old fashioned but I believe in good ol personal responsibility. I know the bank approved them for way more than they couls afford, but they did not have to take it, so dont even start that argument. I was approved for $250,000, but I bought one for $85,00 with $20,000 equity in it because I have a brain and dont care about keeping up with the jones’

#6

[quote]SUPER-T wrote:
So basicly he is telling loan companies who they can and cant do business with. I smell a socialist. How bout this, loan want you want to who you want, and if they cant pay it that is there problem. They should not buy a $200,000 house when they can only afford $125,000. Call me old fashioned but I believe in good ol personal responsibility. I know the bank approved them for way more than they couls afford, but they did not have to take it, so dont even start that argument. I was approved for $250,000, but I bought one for $85,00 with $20,000 equity in it because I have a brain and dont care about keeping up with the jones’[/quote]

We keep handing power over to the Nanny State, until we are powerless.

#7

here’s an idea…quit building so many GOD DAMN NEW HOUSES!!! All these $800,000 McMansions that they built around DC two years ago and are still sitting empty now selling for $500,000 are killing the values of those of us with $300,000 homes. As people migrate to other cities looking for work they can’t sell their houses, so they default on the loan because it’s cheaper than selling an undervalued home.

#8

[quote]Sloth wrote:

And, isn’t this sort of an admission…[/quote]

Exactly right.

#9

[quote]SUPER-T wrote:

So basicly he is telling loan companies who they can and cant do business with. I smell a socialist. How bout this, loan want you want to who you want, and if they cant pay it that is there problem. They should not buy a $200,000 house when they can only afford $125,000. Call me old fashioned but I believe in good ol personal responsibility. I know the bank approved them for way more than they couls afford, but they did not have to take it, so dont even start that argument. I was approved for $250,000, but I bought one for $85,00 with $20,000 equity in it because I have a brain and dont care about keeping up with the jones’[/quote]

You may want to reread the article.

#10

[quote]thunderbolt23 wrote:

[quote]SUPER-T wrote:

So basicly he is telling loan companies who they can and cant do business with. I smell a socialist. How bout this, loan want you want to who you want, and if they cant pay it that is there problem. They should not buy a $200,000 house when they can only afford $125,000. Call me old fashioned but I believe in good ol personal responsibility. I know the bank approved them for way more than they couls afford, but they did not have to take it, so dont even start that argument. I was approved for $250,000, but I bought one for $85,00 with $20,000 equity in it because I have a brain and dont care about keeping up with the jones’[/quote]

You may want to reread the article.
[/quote]

I read it and still stand by my statement. The only thing I got out of it is the admin has a narrow view of who SHOULD own a home, and they prefer rentals. Is the gov gonna start renting apartments now, oh wait they do, it is called the projects. Low income buyers did not cause the mess, it was people living beyond thier means, both low and high income.

#11

Wait, Obama wants to cut a subsidy, and you CONS are screaming socialism??? WHAT THE F***

Some of you are confused.

#12

The “right” to home ownership is bullshit. Who didn’t smell a crisis coming when everyday schmoos (sp?) were “gettin inta real estate”. When you have half hour radio infomercials, and when there are 30 second spots that claim in the monster truck rally voice…"don’t have verifiable income? we can get you into a house.

Money was too cheap. Idiots were not looking at the total cost of what they were borrowing, they looked only at what the lenders said they could afford. “what’s my monthly?” No idiot, what are you borrowing and what are you paying?
People that lose their home don’t own their home. The bank does.

If the bank chooses to loan $ to unqualified high risk people, then they should eat the loss, if there is one.
I applaud him if he is saying that responsible lending needs to return,. Hell when I sold real estate in the mid 80’s, rates were high and people got turned down for loans for very little. They should.

The dream of home ownership can’t come true for some. Sorry. Some are life long renters.
NO, he shouldn’t tell banks to whom they can make loans. There should be stringent requirements on what and which loans mortgage insurance, if federally funded, can be extended.
Private companies, you wanna loan to job hopping career part time bartenders with bad credit? Hell do it. Charge high rates. Have whatever it takes to lessen your risk. If you go out of business, sorry.

#13

[quote]SUPER-T wrote:

[quote]thunderbolt23 wrote:

[quote]SUPER-T wrote:

So basicly he is telling loan companies who they can and cant do business with. I smell a socialist. How bout this, loan want you want to who you want, and if they cant pay it that is there problem. They should not buy a $200,000 house when they can only afford $125,000. Call me old fashioned but I believe in good ol personal responsibility. I know the bank approved them for way more than they couls afford, but they did not have to take it, so dont even start that argument. I was approved for $250,000, but I bought one for $85,00 with $20,000 equity in it because I have a brain and dont care about keeping up with the jones’[/quote]

You may want to reread the article.
[/quote]

I read it and still stand by my statement. The only thing I got out of it is the admin has a narrow view of who SHOULD own a home, and they prefer rentals. Is the gov gonna start renting apartments now, oh wait they do, it is called the projects. Low income buyers did not cause the mess, it was people living beyond thier means, both low and high income.[/quote]

Reread it again. That’s not what it’s about. It’s about government support and [ending] artificially incentivizing and promoting home ownership.

#14

Wait, Obama wants to cut a subsidy, and you CONS are screaming socialism??? WHAT THE F***

Some of you are confused (end quote)

He also wants to tell the bank who to lend to, and force them to charge high interest and high down payments. That is what I was talking about the socialism. If you want we can just say dictator.

#15

[quote]jp_dubya wrote:
The “right” to home ownership is bullshit. Who didn’t smell a crisis coming when everyday schmoos (sp?) were “gettin inta real estate”. When you have half hour radio infomercials, and when there are 30 second spots that claim in the monster truck rally voice…"don’t have verifiable income? we can get you into a house.
Money was too cheap. Idiots were not looking at the total cost of what they were borrowing, they looked only at what the lenders said they could afford. “what’s my monthly?” No idiot, what are you borrowing and what are you paying?
People that lose their home don’t own their home. The bank does.
If the bank chooses to loan $ to unqualified high risk people, then they should eat the loss, if there is one.
I applaud him if he is saying that responsible lending needs to return,. Hell when I sold real estate in the mid 80’s, rates were high and people got turned down for loans for very little. They should.
The dream of home ownership can’t come true for some. Sorry. Some are life long renters.
NO, he shouldn’t tell banks to whom they can make loans. There should be stringent requirements on what and which loans mortgage insurance, if federally funded, can be extended.
Private companies, you wanna loan to job hopping career part time bartenders with bad credit? Hell do it. Charge high rates. Have whatever it takes to lessen your risk. If you go out of business, sorry.

[/quote]

Home ownership is not a right, but it is the banks right to loan to who they want

#16

[quote]SUPER-T wrote:
Wait, Obama wants to cut a subsidy, and you CONS are screaming socialism??? WHAT THE F***

Some of you are confused (end quote)

He also wants to tell the bank who to lend to, and force them to charge high interest and high down payments. That is what I was talking about the socialism. If you want we can just say dictator.[/quote]

Where does it say anything about that? The article does not talk about dictating the terms of home loans to private banks. It talks about GOVERNMENT support of home loans. Unless you know something that is not discussed. In which case, I would be interested in seeing it linked here.

#17

[quote]SUPER-T wrote:
Wait, Obama wants to cut a subsidy, and you CONS are screaming socialism??? WHAT THE F***

Some of you are confused (end quote)

He also wants to tell the bank who to lend to, and force them to charge high interest and high down payments. That is what I was talking about the socialism. If you want we can just say dictator.[/quote]

No, if Obama ends this government subsidy, it could cause a MARKET increase in rates and down payments. This is a good idea, let’s see if he nuts up and follows through with it.

#18

[quote]PAINTRAINDave wrote:
Wait, Obama wants to cut a subsidy, and you CONS are screaming socialism??? WHAT THE F***

Some of you are confused.[/quote]

Nope. I would have no problem if Obama was REALLY getting rid of the mortgage deduction for everyone.

But what they are actually doing is making the income tax rate more progressive (i.e., less fair).

They will get rid of the deduction for:

(1) people in certain “advantaged” (read: white, Jewish, or Red-State) areas on some sort of zip-code basis as yet another color-biased giveaway and

(2) phase out the deduction for high-income people (e.g., increase their tax rate).

It’s just another way of sticking it to the 20% who pay 80% of the total taxes in this country.

I kind of like it though — I’m a lawyer specializing in off-shore business formations.

Capital is fleeing Obamastan and its socialist tax structure by the trillions.

Only an idiot would invest in the USA or hire new people here. Scale down and MOVE. There is no future for Obamastan.

#19

[quote]Jewbacca wrote:

I kind of like it though — I’m a lawyer specializing in off-shore business formations.

Capital is fleeing Obamastan and its socialist tax structure by the trillions.

Only an idiot would invest in the USA or hire new people here. Scale down and MOVE. There is no future for Obamastan. [/quote]

As my new Lawyer, of which I have paid nothing to keep you on retainer, which country would you recommend me to move to? I am thinking Australia, or maybe New Zeland but Mak makes moving to New Zeland difficult.

#20

[quote]dmaddox wrote:

[quote]Jewbacca wrote:

I kind of like it though — I’m a lawyer specializing in off-shore business formations.

Capital is fleeing Obamastan and its socialist tax structure by the trillions.

Only an idiot would invest in the USA or hire new people here. Scale down and MOVE. There is no future for Obamastan. [/quote]

As my new Lawyer, of which I have paid nothing to keep you on retainer, which country would you recommend me to move to? I am thinking Australia, or maybe New Zeland but Mak makes moving to New Zeland difficult.[/quote]

The up-and-coming countries are really better. Peru, for example.