Federal Reserve passes "safeguards" for lazy deadbeats

Scottsdale will love this one since it applies to most of them: The Federal Reserve is instituting protections and safeguards for subprime borrowers.

In other words, subprime borrowers - people with bad credit who are generally lazy deadbeats who don't pay their bills - will now get special protections and preferential treatment from the government regarding their mortgages.

I have a question: Why the f*ck did we even give loans to deadbeats with bad credit in the first place?

This is just another example of our government punishing those who produce and rewarding those who don't produce. And I'm sick and tired of it.

But at least maybe some of Scottsdale's subprime scum "homeowners" - the ones who fueled the boom - won't get completely wiped out. They'll get to keep their Escalades and H2s and continue with the Botox treatments.

Comments

[war_shu_duck]

Frank I am as disgusted as you are at what a little nanny state the government is turning this country into. Whatever happened to the rugged indivualist spirit this country was founded on? We are becoming a nation with far too many Elton John's and not enough John Wayne's.

With that said I dont see how any of these government programs are going to help many of these poor saps. Freezing there interest rate does nothing to help with the fact that many of these liars are upside down in there homes. Do to all the false floors created by homes changing hands so quickly some of these people who got into the game late are a few hundred thousand upside down in there homes. Whats the incentive to stay in a home you owe more than its worth even if you can afford the payment? If I was in there shoes I would stop making the payments( it takes about a year to get someone out of a house). All the money I was putting toward the payment I would save. With the money saved you can either rent or buy a similar house for less than they owe. Sure your credit is shot but if your a subprime borrower your credit wasn't good anyway.

[Frank Rumbauskas]

Here's what pisses me off:

After leaving school I couldn't pay my student loan bills on time and couldn't qualify for a deferment (because I'm a white male) and as a result I suffered from bad credit for several years.

Due to my credit rating, I couldn't get credit and had to learn to pay cash for things I wanted, including cars. (Or, best case, 50% down with high interest rates). Incidentally, it was being forced to come up with cash for the things I wanted that gave me the drive and ambition to start my businesses and become as successful as I am today.

Now it is the opposite today: People with bad credit are being REWARDED with PREFERENTIAL treatment and LOWER interest rates???? All motivation to pay bills on time and have good credit is gone. Not to mention that by allowing people to have unlimited access to easy credit, they will NEVER have the motivation to become successful like I did when I had bad credit.

It's easy to fix America's problems. Want to lower the divorce rate. Then STOP giving women preferential treatment in divorce court. Want to end the credit crisis? Then STOP giving handouts and bailouts to deadbeats who REFUSE to pay bills. Want to balance the budget once and for all? Then STOP giving handouts to lazy people who REFUSE to work.

What a joke. Enough is enough already.

[Foreseer of unintended consequences]

If you can't afford your subprime loan payments:

1. Bank seizes collateral property
2. Bank sells property at auction
3. Bank applies sale value to total debtor owes
4. Debtor now has remainder of loan period to pay back remaining amount that was borrowed, but not recovered by auction

If debtor was able to qualify for original loan surely they would have no problem paying the reduced amount. Just the fact that the payments wouldn't include fire insurance nor property tax might be enough to help them meet their contractual obligation.

The bank depositors get all their money back. The failed house flippers get to keep their credit ratings. The housing market is free to set price based upon supply and demand.

Unfortunately the Bushtard has signed legislation removing taxation on the canceled debts. This was exactly opposite of what should have happened. Joe Blow now has every incentive to walk away from his $400k loan on his $200k house, then purchase the nicer $205k house across the street using his spouse’s, uncles, mother’s, sister’s clean credit.

Congress and the Bushtard should have placed a 105% tax on canceled debt, with the proceeds from the tax going to pay FDIC insurance claims of failed banks.