Angela Quellette’s letter to the editor of the Palm Beach Post sounds sensible enough except for a couple of flaws. Angela claims banks could have prevented much of the foreclosure calamity had they just ignored the adjustable rate clause in the mortgages that eventually went belly up. After the fact, this is an easy solution but the home lenders were making decisions in the present and could not have foreseen the mortgage meltdown that wrecked the lives of many Americans.
The second flaw in her reasoning is that mortgage foreclosure is not equivalent to kicking somebody out of their house. The house never was owned by the person who took out the mortgage. The mortgage company OWNS THE HOME until one makes the last payment!!
A lot of us are getting tired of listening to people cry about getting evicted from a home they never owned or Postal workers who have sucked on the fat tit of the government finally having to worry about cutting it in the real world.
Foreclosure a disaster for banks; so why do it?
Randy Schultz’s column, “Start getting real (estate) about what the economy needs,” hit the nail right on the head. The economy is not going to heal until we mend the bleeding wound of foreclosures.
How simple it would have been if, when this landslide started, banks just ignored the “adjustable rate” clause in those Countrywide mortgages and simply let the old rates stand. Banks would have continued to get their mortgage payments every month and wouldn’t have had to close, and homeowners would have been able to keep their homes. What resulted instead was a domino effect that resulted in business closings and job losses, because banks had no money to lend.
To fix this problem, the original “wound” must be attended to. That “F-word” Mr. Schultz refers to – “foreclosure” – must first be mended. But even if we forgave the foreclosures and allowed people to keep their homes, they still couldn’t pay the mortgage
, because they’ve lost their jobs.
If President Obama really had wanted to “stimulate” the economy, he should have loaned billions to those banks to first keep their doors open – but on the condition that they allow people to keep their homes.(Angela does not understand that “your home” is actually the banks or lender’s home until final mortgage payment is made!!) This would have given banks money to lend to businesses. The way it stands now, we are bringing chaos upon ourselves because we are forced to follow the rules.
Drastic times call for drastic measures. Otherwise, there will be no end to this cycle. When one really thinks about it, just what do banks have to gain by a foreclosure? Are they not cutting off their noses to spite their faces? Have you ever heard of anything so stupid?