Did you know? How will it effect our future?

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Did you know? How will it effect our future?
Congress passed a loan bill taking over/bailing mortgage loans? That put us officially 3 trillion in debt. And thus taking over about 90% of home loans.
Congress passed a bill making the government the only source for student loans.
That is two freedoms of choice gone in one day.
How will it effect our future?

First, I am not a socialist. Normally.

Second, I think that I have a plan that would resolve the mortgage and credit crises and leave everyone a winner.

1. Government buys up bad mortgate debt (already happening).
2. Government buys up good mortgate debt at the borrower’s option (if they want to participtate in this plan I have).
3. Government turns over to everyone a title, free and clear, of their home property.
4. Government imposes a tax of 50% of the typical mortgage payment the borrower had. This tax lasts until the principal (not principal + interest) is paid off. Note: for folks who were on floating interest rate loans, we’d pinpoint the standard payment before things went crazy, then make them pay 50% of that.

Why this all works. A typical mortgage is 30 years and you end up paying about 3 times the price of your home, if you count the interest. If you could pay 50% of your monthly payment over 20 years, you’d cover the principal portion of your loan and still have plenty of cash left over to reduce other debt or to make new purchases.

Think about it. Say your mortage payment is $ 2,000 per month and finances are real tight (you might have credit card debt too). If someone handed you your title and you took on a 20 year tax commitment of paying $ 1,000 per month, then not only would you have equity, but if you stayed in your home you would have the other $ 1,000 you used to pay in your mortgate freed up for other things.

Is this socialist? Yep, a little bit, but perhaps a necessary move, a one-time event, to clean this mess up.

If you hear either candidate propose something like this, you heard it from Mr. Freedom first.

Think this might work? Thoughts?
Matthew, I think this plan would kick the nation’s economy into high gear and more than pay for itself over time. While I understand your point about folks being fiscally responsible, I do think that once in awhile, we need to “stand all the pieces on the chessboard back up.”
No, I think a clause is that if you sell your house, proceeds must satisfy your personal tax debt first. So you might walk away owning nothing and owing nothing.

9 Comments
  1. Reply
    Racoon
    February 2, 2011 at 11:48 am

    we are almost 12 trillion in debt right now. it think its 11.8
    http://www.usdebtclock.org/

  2. Reply
    *SuMmEr*Bella is here!
    February 2, 2011 at 12:46 pm

    You’re just now figuring that out? Where the hell have you been?

    I am personally fine with both decisions…

  3. Reply
    purrsephanie
    February 2, 2011 at 1:44 pm

    Ummm isn’t that the point of LOANS- aren’t they going to be paid back… with interest… so how will that change our future.

  4. Reply
    lillith25
    February 2, 2011 at 2:05 pm

    Seems to me the government will be able to decide who does and doesn’t receive loans. Could it mean that if a person perhaps doesn’t agree with the current government policies they could be turned down for loans. Or maybe the government decides if someone is a practicing christian they will not be eligible for a student loan? Or perhaps someone who is pro life could be turned down for loans? Or someone who believes in their right to bare arms, their right to free speech, etc.? Why doesn’t this current administration and Congress scare the hell out of people?

  5. Reply
    jimwoytek
    February 2, 2011 at 2:47 pm

    well, we can always fall back on……….UHC !!!!!!!!

  6. Reply
    Matthew M
    February 2, 2011 at 3:08 pm

    If we pay our own bills like we agreed to do why do we need a socialist government program?????

  7. Reply
    Reena
    February 2, 2011 at 3:57 pm

    Great plan… but what do you do when everybody “sold” their
    house and ran off with the profit in a couple of years?

    The new owners will be back at square one. Regular mortgage.

    The ones that got the deal are laughing themselves silly.
    They got their mortgage reduced, were able to sell the house
    then pay off the reduced mortgage and ran off with the rest.
    While they never put in a single penny in down payment they are allowed to reap the harvest?

    And we, the taxpayers are on the hook for this?

    And if you didn’t allow them to sell their houses then what?
    People have to move all the time. Can you force somebody to
    stay in a place when he gets sent to another state thru work?
    When he has to move back to help his/her parents?

    Are you telling these people that they have to give up their right
    to move, their essential freedom as an American to move about as they please? You can’t make them prisoners of their property for 20 to 30 years. They have to have the right sell when they need to move.

  8. Reply
    dennisgonzalezdgm
    February 2, 2011 at 4:04 pm

    Are you high? What we need to do is put people in homes they can afford instead of letting them buy more house than they can pay. Some people like to blame banks because they have a 40K job and want a 300K house because its in a “nice neighborhood”. We don’t need socialist , we just need realist.

  9. Reply
    Texican
    February 2, 2011 at 4:16 pm

    This would be an extreme move, but I cannot find a flaw in your reasoning. I think this just might work.

    Imagine a nation freed from personal debt and finally able to tackle national debt. America would emerge a powerhouse.

    Pity that you are not running for president, Sir. You have the grace and wisdom of a Churchill, a Washington, and a Lincoln all rolled into one.

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