Just to summarize the storyline to date: During the housing boom of the last five years, people with bad credit histories, many of whom lied about their income and nature of employment, got mortgage loans they weren't qualified for to buy homes they couldn't afford. Now that home prices have stopped rising, and the house can't be refinanced or sold at a profit, Congress wants the taxpayer to subsidize the mortgages so these folks can remain in their unaffordable homes.There are more of us that can't, or never could, afford to purchase our own home at all (including me) than those who are now in mortgages they can't and probably never really could afford.
I do personally know of 1 case where the buyer unexpectedly lost out due to timing of sale because of a recent surprise work transfer. He ended up upside down on his home loan even though his employer bought the home from him. However, he also had previously used the equity in his home to speculate (with no luck) in the stock market so he had very little equity at the time of sale. The point is, though, he COULD afford the mortgage, had no plans to sell and would have ridden out the current storm.
One place you can visit is the NoBailout.org site if you feel your tax dollars should not be used to bail out the lenders and holders of bad mortgages.
I believe these massive bailouts are bad for market economies. Since when did speculation mean 'win only'?
Shouldn't the market, like water, be left to find its own level?
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