I am upset about the mortgage relief plan proposed by President Bush (trying to pre-empt the Democrats). Here is an excerpt from the NYT
On Mortgage Relief, Who Gains the Most?
By EDMUND L. ANDREWS
'The number of people who actually obtain help would be smaller,
because each borrower would face tests aimed at weeding out those
considered too hopelessly in debt and those who make too much money to
In one curious twist, the plan could eliminate many who have good
credit scores or managed to improve their credit scores, because the
good ratings would be a sign they do not need help.
"Talk about moral hazard," remarked Representative Barney Frank,
Democrat of Massachusetts and chairman of the House Financial Services
Committee. "We've all told people, don't go any more deeply into debt.
Now we're saying that people who go more deeply into debt will have an
advantage over people who don't go more deeply into debt."'
In general, I don't the government should be pressuring lenders to
change the terms of mortgages. If the homebuyer can't pay the
mortgage, he needs to vacate the house and rent. Lots of us do. If the
lender can cut losses by changing the terms of the mortgage, there is
no need for government pressure.
If changes are going to be made on a wide scale under government
pressure, I think hard cut-offs based on credit scores that punish
people for maintaining good credit send a horrible message -- paying
your bills on time and not over-extending yourself will *cost* you
If you agree with me, please consider contacting your congressman or
other elected officials.
- posted 12 years ago