Foreclosures up 17%; Obama's refusal to push for mortgage cram-down is biting homeowners

[brentspeak]

http://www.washingtonpost.com/wp-dyn/content/article/2009/09/09/AR2009090901697.html">As expected, Obama's "Making Homes Affordable" plan is way too weak to do much about the foreclosure tsunami. Basically, Obama's plan was this: give lenders (i.e. banks) taxpayer dollars, and hope that the lenders will be nice enough to lower underwater homeowner's mortgage rates. However, as the article makes clear, the plan is so unwieldy with all kinds of red tape/paperwork that many applications for help are simply being put in a banks "To do -- much later" wastepaper basket.

Rather than attempting to bribe banks with taxpayer dollars, cramdown -- allowing bankruptcy judges to force banks to renegotiate mortgage terms -- would be vastly more effective, more immediate, and way less costly.

Obama has yet to explain why he http://www.politico.com/news/stories/0409/21962.html">spinelessly caved-in on an issue he campaigned for as Candidate Obama. He can, however, make up for it by getting on the airwaves and the soapbox and push for cramdown. Do what presidents like TR, FDR, Truman, and Eisenhower did: tell the bank executives to go jump in a lake with a anvil tied around their ankles.

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[Thrill]

2. Blame your Senators. Durbin said in the middle of the Senate floor

that the Senate was bought and paid for. Obama said he was for it.

But I'm sure this fits your blame Obama for everything logic.

[bluestateguy]

3. He did "push for" cramdown

Congress simply ignored him. Presidents can "push for" anything they want (think of Bush and Social Security privatization in 2005), but Congress often ignores them.

and hard as it may be for professional victimologists to swallow, the fact is that some of the people being foreclosed upon made irresponsible decisions, just like the banks did.

[brentspeak]

6. The article explains that Obama did NOT push for cramdown

http://www.politico.com/news/stories/0409/21962.html

Another supporter, Senate Banking Committee Chairman Chris Dodd (D-Conn.), said the Obama administration always showed “some ambivalence” about the bankruptcy legislation. “The administration said they were for it,” he said. “I wouldn’t expect much more, probably. Credit cards is a larger issue. It’s a lot more pieces.”

As the bankruptcy bill founders, the credit card legislation is on a glide path to becoming law — possibly as early as next week.

As a candidate, Obama advocated the bankruptcy change, widely known as “cramdown” because it would allow brankruptcy judges to force lenders to accept reductions in the interest rates and principle amounts of home loans. But after Inauguration Day, the new administration sounded cautionary notes on the bill, with top officials emphasizing the need for “tailored” and “targeted” legislation.

“We are supportive of carefully designed changes” to bankruptcy law, Treasury Secretary Timothy Geithner said in response to a question at a recent hearing. “It’s a difficult balance to get right, as you know.”

Beyond such tepid endorsements, the administration was largely absent as the debate moved to the Senate. Durbin said he kept in touch with administration officials as he worked on his bill. But there were no high-profile meetings at the White House or the Treasury, no arm-twisting calls for votes from the president or other intervention when months of Senate negotiations stalled.

[ingac70]

4. Are banks suppose to just give them the houses?

If they can't afford it, it is time to move on. A small number of people could be helped simply by refinancing, but that is not the case with all.

[RepublicanElephant]

5. things would be a heckuva lot easier if obama were dictator.

:eyes:

[brentspeak]

7. How about being a President who simply gets things done?

TR

FDR

Truman

Ike

JFK

[amandabeech]

23. Don't forget LBJ.

He was the arm-twister-in-chief and a champion of political persuasion.

[Demobrat]

8. A cramdown has nothing to do with terms.

A cramdown is a court-ordered reduction of the secured balance due on a home mortgage loan. Just FYI, so you don't look like an idiot next time.

[brentspeak]

10. ...

http://www.bloomberg.com/apps/news?pid=20601087&sid=aoyMWtlsj27A&refer=home

The so-called cram-down bill would allow federal judges to lengthen terms, cut interest rates and reduce mortgage balances of bankrupt homeowners. It also would permanently increase the Federal Deposit Insurance Corp.’s coverage of bank deposits to $250,000. The measure, which passed the House 234-191, now goes to the Senate.

[alcibiades_mystery]

9. Yeesh

if (economic news)>0
=>post
=>print("If Obama had only" var);

else=>ignore

[Baltoman991]

11. Ah, WaPo

and Politico. Why does it not surprise me that you would use two of the biggest Obama hating "news" sources to yet again slam away at Obama and ignore the reality and thats that Congress isn't doing a fucking thing.

Must suck to be so hateful.

[Dawgs]

12. Can't to see your posts when CONGRESS doesn't include a public option.

I'm sure you'll find some way to blame Obama.

You're a joke.

[dionysus]

14. aren't jokes supposed to be funny?

:shrug: :P

[taught_me_patience]

13. This has nothing to do with Obama

and everything to do with people buying homes they couldn't afford, at the peak of the market, with zero money down.

[Dreamer Tatum]

15. So your idea is to make homes more affordable by...

...um...CRAMDOWN, which just makes bankruptcy a little more palatable for consumers, which I suppose would, at the margin, increase
the stock of vacant homes, which should lower market prices?

Is that your idea? To force people into bankruptcy in order to secure better mortgage terms?

Because that's the only sense in which cramdowns would help the overall market.

[Better Believe It]

22. Are you a banker by any chance?

[Dreamer Tatum]

24. What if I am? nt

[JTFrog]

16. As expected

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=132x8678045">As expected, bs spreads more BS.

And fuck politico and all those who worship there.

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[depakid]

18. Can't really blame Obama for the Republicrats here

Although it would have been more helpful speak up more forcefully, to call them out at the time- and let it be known that this behavior would meet with consequences.

Having failed to do so- these folks are now actively undermining Obama's agenda and attacking the progressive reform with impunity. This despite the fact that their actions will result in many of them losing their own seats.

[branders seine]

25. K&R

truth hurts

[Name removed]

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