The facts remain that without provisions mandating loan workouts and loan modifications, increased regulation on mortgage servicers, servicer accountability and without complete 100% control of these mortgages, themselves, this bailout plan WILL NOT work.
Well, at least for the people on Main Street losing their homes.
The proposed $700 bailout proposed by U.S. Treasury Secretary Henry Paulson, in its current form, will do absolutely NOTHING to help you, your family or your neighbors on Main Street. This bill’s costs will be gargantuan, yet it is suffering from famine in the substance department.
Meaning there is no meat and potatoes for Main Street. Only more gravy for Wall Street.
The way this bailout bill is written, our government and the Treasury would have very limited ability to gain “complete” control of troubled mortgages. What the Treasury has planned is to buy troubled assets from the various banks and investment banking institutions consisting of mostly residential and commercial mortgage-backed securities.
To put this is layman’s terms for my readers. The US Treasury, oops I mean us, the American people are going to buy up Wall Street’s bad and toxic investments in an effort to try stabilize Wall Street for a just a “little” bit longer.
Paulson has claimed that after the Treasury buys these bad assets, the purchase will have benefits that will trickle down to Main Street in the form of restored liquidity and credit for making mortgages and other credit to consumers available.
Why the plan will not help homeowners.
Every single Hope Now, FHA Secure, plan, bill and initative has made it “only voluntary” for mortgage servicers to comply and participate in these proposed solutions to our mortgage and housing crisis. Meaning they do not have to do anything they do not want to do and all of this Hope Now talk and puffing of foreclosure prevention chests has been nothing more than botoxed lip service and media propaganda.
This is all about the Benjamin’s (money) people. Please, never think, for a mili-second that this is about what is morally and ethically right. It’s business and servicers are in the business of collecting, demanding and making money off of homeowners.
They are definitely NOT in the home saving business!
Mortgage servicers have absolutely no or little financial incentive to help struggling homeowners. They are severely inundated and bottle necked with calls, faxes, pleas, cries, delinquent mortgages, short sales, loan modifications, foreclosure sale dates, disgruntled and under paid employees. They do not have enough space, staff and phone lines to properly assist the people who are seeking it.
Couple that with the facts that they actually make money when you’re delinquent on your mortgage and they also fear possible liability in the form of lawsuits from disgruntled investors.
The Mortgage Servicing Industry Has Failed! It’s broke and in need of immediate repair, cash and help. They know it, the banks know it, our Secretary Treasury and our government knows it.
Yet, nothing is being done to fix it.
Americans on Main Street need to demand that this bill provides relief to struggling homeowners:
Ø Open home preservation centers that are operated by third parties such as non-profits and legal aid agencies to insure consumer protection and safety.
Ø The bill must mandate all servicers to perform some type of loan workouts (whether it be a loan modification, repayment plan, short sale or deed in lieu, judicial or non-judicial).
Ø Foreclosure moratoriums on primary residences
Ø New mortgage servicing regulation
Ø Loan workout accountability and tracking system
Ø Prosecute and fine lawless mortgage servicers
Ø Give us all a do over like Wall Street gets!
Please write your state Senator who is supposed to represent you, the people, and tell them what you think and want. A silent voice will never be heard!