MucheDumbre

I had a very interesting conversation with my Tony Soprano mortgage company the other day. With the layoff and the client list dwindling, I’m paying about 65% of my income to my mortgage. Yeah I know, which is why I’ve been keeping up with all the socialistic mortgage aid programs. Think what you want about me but I’m not afriad to admit when I’m wrong or ask for help when I need it.

So the phone call when something like…

“Hello Mr. Soprano, this is EeKay Gee, how are you today?”

“Well Mrs. Gee, if you would stay on time with your payments I would be better.”

“That is exactly why I called…. I believe I have a solution to both of our problems.. I found a program that goes into effect on December 15, the plan is a basically a loan modification. These are already in existance for hardships, but this is a streamlined version that gets the process started and over with in a matter of minutes.”

A loan Modification can be for many purposes, but basically what they are is the borrower asking the lender for either some plan to repay their past arrearages over time, a reduction in the price that they pay or a payment deferment for X amount of time.

In order to get approved for a loan modification the borrow has to jump through many hoops like a

Image by Lori Spindler via Flickr

good little poodle. There is a hardship letter explaining why you want a loan modification and what you would like that modification to be. Past years tax returns,full financial statements including 401k,retirements,annuities,insurance benefits,bank statements,letters from your boss,medical records, stock and bond statements,pay stubs,disability,unemplyment-retirement and/or Social Security benfits you have applied for… and finally a credit check.

Because anyone asking for a loan modification is sure to have steller credit.

The new streamline approach forgives all of that and asks for 3 simple things,

• that you are able to pay no more than 38% of your income
• that you certify your gross monthly wages
• that you haven’t filed for bankruptcy

easy peasey-pudding pie.

Image via Wikipedia

“You see Mr. Soprano, this new system makes it all so much faster and easier.”

“Yeah, but Mrs. Gee this is for Fannie,Freddie and Indymac mortgages only.. By the way,Big Pussy will be stopping by your house later tonight.”

“Mr. Soprano, I’d love to have Pussy for dinner, but while this plan is only mandated for Fredddie,Fannie and IndyMac, many other major lenders are following the same plan. The FDIC is recommending all lenders, including private ones such as yourself, follow the plan.”

The plan is not only easy-peasy in it’s application, it’s simple in it’s problem solving abilities. The lender will rework the loan to make sure the borrower is not paying anymore than 38% of their income, there are various way to do this, as this .pdf explains. Lowering the interest rates and extending the term of the mortgage are just a couple of options. The idea is to keep people in their homes at a payment they can afford and keep the mortgage company from losing more and more money when borrowers default.Which leave their homes vacant and all the unsold homes bringing the market down even farther.

“Mr. Soparno, if you would lower my interest rate from 13% to 6 percent for 5 years and then raise that interest 1% a year until it reaches the Freddie Mortgage Survey Rate you would still be making money off the money you loaned me and I would be able to stay in my home”

“Let me get this straight, you want me to reduce the money I”m going to make so you don’t have to pay me back for something that you promised to pay back?”

“Yes.”

“I’ll give this, you have balls. But Mrs Gee, we don’t give free stuff to people in this country and you … “

“I’m not getting anything for free though, I’m getting something at a 6% interest rate for 5 years and then an increase of 1% until it matches the prime mortgage rate, that’s extra money for you off of your investment. I know this is non-tradional, but the biggie lenders are seeking out and cold calling their borrrowers and offering this to them in an effort to keep people paying on their loans and not defaulting on them. JP Morgan, Citigroup and WellsFargo all are using the program voluntarily. Which the FDIC hopes that all lenders will follow.”

“Mrs Gee, this program doesn’t benefit me in any way so why would I offer it to you?”

“But it does Mr. Soprano. I will be paying you back on your loan instead of not paying you anything and that is a benefit to you.”

“No, a benefit is when I get something out of what I put in, why would I reduce the interest rate to such a small level when I can make double that leaving it what it is now?”

“Mr. Soprano, you won’t be making double anything if I default on this mortgage, with this plan you will atleast get your investment back plus 6%.”

“Yeah, but I want 13%.”

“..and I want wishes to flow from my ass like raindrops, but I’m willing to let that dream go if I….”

“What did you just say?”

“nothing….”

“That’s what I thought. Look Mrs. G, as I said, this plan isn’t for your type of loan, I will send you the loan modification papers that we have always used and you get me everything on the requirement list, if you don’t have something, write a note explaining why you don’t have it and then take it to a notary and get the note notarized. Do this for each individual item, you can’t just make a blanket note covering all the things on one paper. After we receive this paper work from you, we will pull your credit report and if your credit is above average, we will go from there.”

“You would rather get nothing than get something.. “

“That’s the gist of it, yes.”

“Can I ask why”

“Because I do not believe anyone should get a free ride, I worked hard to get where I am at and if I can do it anyone can. If I reduce your interest rate I will be losing 7 points and I am not in the buisness to lose money, a 6% return is not good enough when a year ago I was getting 13%.”

“..and 6% will seem like a butt-load of money when you are getting zero.”

“Oh, I will be getting something..I will get your house.”

“Not right now you won’t. Now you’ll force me to file bankrupcty and while we are dragging that process out for 6-9 months you won’t be getting anything, and when congress approves the plan to allow bankrupcty judges to re-work mortgages into the FDIC plan, I will start paying you back your money with a 6% return on your investment”

“That won’t happen, you forget I have more money to spend on lawyers than you do..Pussy will be there to collect my return shortly”

He’s right of course, it was my responsibility to repay him the money he loaned me at the rate he charged. I have done that each and every month but now, through no fault of my own, I can’t keep paying 65% of my income out to one creditor. To give me and the millions of others like me this plan is not giving us scumbags something for nothing. It’s just smart buisness. According the Joint Economic Committee of Congress, the average foreclosure costs $77,935 while preventing a foreclosure runs $3,300.

When the best interest for all is to take a little less than you hoped to get.. isn’t something better than nothing? Especially when to do so cost pennies that can be put back on to the borrow compared to tens of thousands that can’t be put onto to anyone other than the lender.

I guess not…

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What kind of America are we leaving for our children?

Over the last few years individual rights have become a shadow of their former selves while the government exploded in size and spending. We have all sat back and ignored the slow plan for the Government to take over full control of our lives. All my life I have heard people say “We’re the United States of America, that would never happened” and yet when it does happen,little by little, we ignore it because we are too busy running to hide under our beds because the terror alert level has changed colors. The world has been pulled over our eyes to blind us from the truth. …and we have allowed it

In 2005, the supreme court ruled in favor of Emminent Domain. In other words the power of the state to take private property for public use with payment of compensation to the owner.. The court decided that we no longer have the right to keep our homes when big buisness wants them. If the Government or big business would rather have your land or your home, they can take it from you. They decide who gets to keep their homes and who doesn’t.

And we watched and said nothing.

In 2001 the Patriot Act was signed into law. Among many other civil rights violations,it allows for the secret search,seizure and hidden detainement of anyone the Government suspects is a threat. They don’t have to prove a threat and with the new FBI law set to take place on Oct 1, they don’t even have to have any evidence you are a threat. They just have to think that you might be dangerous.

Read that again, they only have to think that you might be dangerous.

This is not just for international terrorism anymore. Ironically that has always be the ‘pro’ argument. That this kind of thing was A-OK because it only affected the international terrorist and would never be used against the people of this country. I have had many arguments over just this thing. I have said that once you open the door to one level, it opens the doors to the entire spectrum. The pro argument has always been, “We’re the United States of America, that would never happen”. Well it is, starting Oct 1, those new guidelines go in place for criminal activities on the local level.

That door only needed to be opened a little and over the last 8 years it was beaten down with a battering ram.

This year the Government stepped in to save 2 mortgage giants, Fanny and Freddie Mac, from certain ruin. No matter how you look at it this was needed, the alternative was the total collapse of the housing market and the ruination of wall streeet. But while this was needed to head off financial destruction the end result is that we let Government step in a gain more control of our personal lives. Now they not only own the mortgages to our homes, with Eminant Domain they decide who can keep them.

And we watched and said nothing.

Also this year the Government stepped in to bail our Bear Sterns. J.P. Morgan bought the troubled company with a guarantee that the Government (the taxpayers) would absorb Billions of potential loss. Today, Lehman Brothers is looking for the same deal. They are looking towards China to buy them out with our Government (the taxpayers) absorbing the potiential loss. Tomorrow it will be the 3 Detroit giants. They are on the verge of collapse and as of right now are trying to stop it on their own but if they are unable, will look to the Government for another Bear Sterns-like deal.

I was asked how I could convince someone who against big Government to vote for Barack Obama when he’s had over 800 bills in his short time in office. My answer was to look at the bills before deciding that they were all bad and all about bigger Government. My answer should have been; in the last 8 years has the Government gotten smaller while the individual has gotten bigger? That answer is a resounding NO! So why would any Republican still vote for the party that has not just become big Government, but an almost totally controlling Government that spends outrageous amounts of money?

Where are the free market Republicans?

On the liberal front. To disagree with the Govermennt has now become UnAmerican and Unpatriotic.We’ve even allowed it to become criminal. Protesting is now just a jaw-tingling, acid-flashback. Today you are put in an area away from that which you are protesting. You are hidden, your voices muffled.

And we still watch and say nothing.

The things that the liberals have been screaming about for the last 8 years and the same things the conservatives have mocked and laughed at are almost all in place. The Government decides when dissent is unpatriotic and criminal, they decide where to hide anyone who voices out against them, they control the financial and housing market and before long the automakers.They spend every taxpayers money like there is an endless supply of it. They decide on an international and local level just who is a criminal, who should be secretly investigated and secretly detained without legal counsel,without evidence and just because they ‘think’ you ‘might’ be doing something.

This isn’t what the Republican vision is. This is Orwell’s predictions.

We are the country that stops this from happening to other countries. We are the worlds police. Whether asked or not, we will fight for other countries rights to individuality, we will die for their rights to vote and to chose their way of life. We are the world’s police and we don’t let the bad guys win. But ask yourself this.

Who is going to help us?

There isn’t another country out there like ours who would or could come in and help us as a nation of people. Oh they might come in to help themselves (see china), but they wouldn’t be here for our benefit. WE are our last hope. Face it, we are the only ones out there who can help us. We are the ones who have to make a difference and change the path that we have been on. True Red Republicans don’t like what’s been done to their party anymore than liberal Democrats like what’s been done to their country.

Experience has lead us down this path of destruction, you only have to look over the last 8 years to see what we have lost and what the Government has gained and how bloated and massive it has grown. Maybe it is time to let inexperience take control. If that doesn’t work then in 4 years change it. If that still doesn’t work….change it again.!

If the definition of insanity is to do the same thing over and over expecting different results, what is it when you do the same thing over and over, knowing the results are going to be against all of your core beliefs and you keep on doing it anyway.

Vote early
Vote often
And if we’re lucky, the rumor I heard that gas will be a $1 in March 2009, will be a fact.