Welcome to Home Mortgages
Mortgage Geelong Article
This is a selection made from among articles on Mortgage Geelong. For a permanent link to this article, or to bookmark it for future reading, click here.
from:
Mortgage Bailout - What Does It Mean for Homeowners? Too Little Too Late or Just Plain Wrong?
By Lin Ennis
A recent political cartoon in my small-town newspaper showed a little man with big ears standing in a boat wherein a fat man sat smiling and smoking a cigar. The fat man was labeled "Banks"-obviously one of the two being rescued. The small guy with big ears-the other person being rescued-was bailing water from their beleaguered craft, to keep it from sinking into the black as night sea called "SUBPRIME." Trouble was, as the bucket's contents were hurled with great speed (indicated by the ferocity of the cartoonist's splash marks), they hit the face and chest of a passerby in another boat-labeled "Homeowners."
According to "saman" at Foreclosure DataOnline, "There is, of course, a difference between steps that can be taken to prevent foreclosures and a bailout, but many people fail to recognize the difference and remain steadfastly against both. Some economists even believe that proposed remedies might do just the opposite of what they are for, and actually make things worse."
Lenders, by and large, are not known for holding their customers' interests closest to heart. That's why they didn't offer fixed rate loans to 45% of people of color (Black or Hispanic) who qualified for them! And of course, by reselling the mortgages as securities, lenders including the government's Freddie Mac entered into contracts with investors. Now that really complicates saving anybody besides the government and the lenders, with the possible exception of investors.
Jack Hough, over at SmartMoney.com, is clear the bailout will hurt homeowners far more than it will help them. But his reasons may surprise you. Here's Hough:
"The government's new 'teaser freezer' plan would extend for five years the artificially low introductory rates on mortgages made to some buyers with spotty credit between January 2005 and this past July, a period that contained the real-estate market's bubbliest months. A typical such mortgage carries a teaser rate of 7% to 9% for the first two years, and an ordinary rate of 9% to 11% thereafter. Without government intervention, monthly mortgage payments on these loans will increase as much as 30% over the next two and a half years...The president's plan will keep some of these people in their homes, no question.
"But it will also make them poorer. That's because if two percentage points on a mortgage rate decides whether someone can afford to keep their house or not, then they can't afford to keep their house. They're paying too much. By continuing to pay too much, they'll divert their would-be savings to an asset that's likely twice as expensive as it should be right now, and even if it's not, tends to produce poor returns over long time periods."
Hough himself rents, and has good reasons for doing so. He goes so far as to say that renting would make more sense for most people in this day and age. As a homeowner, and a renter until five years ago, no one appreciates his point more than I. He dumps his "excess cash" (my term, not his) into business investments, which even at 1% profit have a greater yield than the house you live in. (The house you live in generates no yield until you sell it, and even at what most folks call a huge profit, may not cover maintenance during the time of ownership.)
He says if the government intervenes at all, it should do so in a way that will make folks wealthier, not poorer. I like that idea. Let's make sure every homeowner in America gets a comparable favor or cash flow similar to what's being forgiven those who can't pay. Then we'll all be wealthier!
And get my free report "Three Easy Ways to Own Your Home Sooner". You can also leave your name at the end of that report for more free tips on saving thousands by avoiding mortgage interest.
Article Source: http://EzineArticles.com/?expert=Lin_Ennis
http://EzineArticles.com/?Mortgage-Bailout---What-Does-It-Mean-for-Homeowners?-Too-Little-Too-Late-or-Just-Plain-Wrong?&id=935659
Mortgage Geelong Specific links
Blinkx Video Search
- World's largest video search engine. Over 26 million hours of video.
-- http://www.blinkx.com/
Watch Free Videos At Mevio!
- Tons of Free Videos, Only At Mevio.com
-- http://www.mevio.com/
Free Tech and Gadget Reviews!
- Watch GeekBrief With Cali Lewis on Mevio!
-- http://www.geekbrief.mevio.com/
Free tech talk and news video!
- Watch Tech5 with John C. Dvorak now!
-- http://www.tech5top5.mevio.com/
Discover New Music
- Music Fans Discover, Enjoy & Reward The Best New Bands. Join Today.
-- http://www.ourstage.com/
Mortgage Geelong News
Harold Mitchell sizes up his career - The Age
YOU know when Harold Mitchell is in the room. He's a big presence. He's not your ordinary company chairman. And despite a share price that's fallen, his shareholders love him. At his Mitchell Communications Group's annual meeting this week, he ...
Read more...Bargain for nobody - The Australian
KEVIN Rudd declares war on unemployment but then shoots the labour market in the foot by imposing more rules and penalties on employment-generating businesses. But it's OK. Ruddy reckons handing an extra $15.1 billion to the states for health ...
Read more...Ford Geelong plant gets reprieve - Australian Broadcasting Corp.
Audio: Ford decides against Geelong plant closure (The World Today) Map: Geelong 3220 Related Story: 'One in ten' Vic car yards face foreclosure The Ford motor company has cancelled plans to close its engine production plant in the Victorian city of ...
Read more...Tut-tut, NSW, it's your turn for finger-pointing - Age
W HAT goes around comes around. It's taken almost 20 years but now the people of NSW are going to learn what it is like to live in a state that is the butt of jokes and to be derided as part of the national problem rather than the solution. As the ...
Read more...Britain faces crisis as negative equity to reach 2 million - Times Online
Collapsing house prices are plunging 60,000 homeowners a month into negative equity, which means the country is on course for a worse crisis than the 1990s crash. At current trends, 2m households will enter negative equity by 2010, outstripping the 1 ...
Read more...Legal & General cuts with-profit bonus rates - Times Online
Legal & General has become the latest insurer to cut terminal bonus rates on with profits funds. The FTSE 100 company is cutting rates by between 5 and 9 per cent in the wake of falling and turbulent stock markets. The move means that a 25-year £50 ...
Read more...Beating the sneaks - News.com.au
FOR far too long the only innovation in banking has been new and improved sneaky fees but new technology is turning the tide back in favour of savvy consumers. So let's take a sneak peak at the latest financial innovations that will to rock your ...
Read more...Provincial Victoria Thursday and Friday - Harness Link.com
Golden Showgirl, one of last season's top two-year-old fillies and a Breeders Crown heat and consolation winner, made a triumphant winning return at the Maryborough midweek meeting. Starting at the prohibitive quote of $1.20, the daughter of Armbro ...
Read more...Saving car giants will cause havoc, Gordon Brown warns US - Times Online
In a veiled warning to the next American President, Gordon Brown described protectionism as the “road to ruin” yesterday as international tensions surfaced at the start of the G20 summit in Washington. As world leaders assembled for dinner at the ...
Read more...Labor seats gain from 'rort-proof' grants - The Australian
KEVIN Rudd's $250 million fiscal stimulus to local government stands to provide a boost to Labor MPs in key government electorates, with six out of the top 10 biggest council grant winners straddling government seats. The list of the top 10 grant ...
Read more...