Good lord, here we go again.
Yet another news item that could've been written at any time during the past 2 or 3 years.
The Obama administration wants to help more struggling Americans stay in their homes by reducing the amount they owe on their troubled mortgages, a top Treasury official said Saturday.(italics, ours)
"We are very definitely trying to facilitate more principal reductions," said Timothy Massad, Treasury's acting assistant secretary for financial stability. "It is a very important piece of the overall solution," he said.
The administration is trying through taxpayer-funded programs to prevent homeowners from losing their homes. Nearly $50 billion has been set aside from the $700 billion bank bailout known as the Troubled Asset Relief Program, or TARP, to help distressed homeowners.
Persistently high unemployment and a weak housing market pose a threat to President Obama's re-election prospects next year.
So far, one of the programs has helped some 670,000 distressed homeowners win lower mortgage payments. But that has done very little to help the overall housing market, which remains depressed even as other parts of the economy have started to recover.
(ed. note: And these parts would be..?)
A glut of houses for sale, foreclosures, tight credit and little demand have impeded the housing recovery. Recent data showed that home prices dropped below the low seen in April 2009 during the financial crisis.
It has yet to dawn upon the economic illiterates of this administration that all they are doing is prolonging the agony of this recession. To no avail. And the best part is that they are using your tax-dollars to do it. That's right: a pending double-dip recession paid for with your money.
One housing counselor expressed frustration with the servicers, saying more people would still be in their homes if their principal was reduced.
"Servicers are not required to do it," said Shaneece Hudson, a mortgage adviser with the National Community Reinvestment Coalition. "Principal reduction is an option (for the servicers.) But they don't do it. They will do everything else first," she said.
Crazy, we know, that servicers would not want to lose money in a voluntarily-entered contract with the home-buyer.
"There is no silver bullet. But I think there are a lot of programs out there that are providing help to people," said Massad. "If anyone has specific ideas that haven't been tried, I am happy to hear about them."How about doing nothing? Really. Quit pouring billions of dollars into a zombified housing market so a true recovery can start taking place.
If the definition of insanity is doing the same thing over and over and getting the same results then check out why B-Daddy thinks the President ought to get his money back from Harvard and Columbia.