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I was thinking about this morning and thought I would post it. The government seems hell bent on keeping people in their homes. Some of these people shouldn't have bought in the first place but thats another story. I have heard everything from lowering interest rates to forgiving principle. Lowering rates will not work because they will not bring the payment down low enough. Forgiving principle is just flat out wrong and I think the majority of us are against that.
My suggestion would be extending the loans up to 60 years out. This will in theory reduce the monthly payments dramatically. Now this is only for people that are currently in their homes and are having a hard time paying the notes. Once we get out of this deep recession we are in they can then re-fi, or pay down their mortgages with larger payments and can pay their homes off much sooner than 60 years.
For all of the foreclosed homes out there I think they need to sell them at firesale prices to move them. If they sold these houses for half of what they were worth it would cost the country billions of dollars but would also bring revenue in the form of property taxes to some states that are in bad shape like CA, Arizona, etc. It would also instantly bring money to these banks. Yes, they will have to write down the other half but at least they are getting something from them instead of them sitting there and wasting away.
The only thing that will help the housing crisis is for the 'next new industry' to get rolling - early 90's telecoms, late 90's internet, early 2000's housing----what each of these did was to create well paying jobs and indirect industries sprung up from that----until the next new thing comes along we will stay where we are....
The only thing that will help the housing crisis is for the 'next new industry' to get rolling - early 90's telecoms, late 90's internet, early 2000's housing----what each of these did was to create well paying jobs and indirect industries sprung up from that----until the next new thing comes along we will stay where we are....
The problem is everything you mentioned are bubbles. All a bubble will do is set us back further. It's just temporary and in time it will make the situation worse.
bubbles exist in any new boom industry.... or you get slow to no growth in the economy, personal wealth, etc..
I would rather have boom and bust cycles - personally - this allows for innovation and wealth creation at a faster rate--- and I would say lead to larger industry during the 'next' cycle...just my opinion...
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