One of the more difficult problems facing the Obama Administration is that there are houses out there that have significantly lost their value. Some people have been defaulting on these houses as a way to not lose their savings making payments on houses that are worth half of what they’ve paid for them.
Still others have found themselves unable to make payments because of job loss or a interest rate change, so in rides the government, eager to help.
Under on idea that’s being discussed, the government would let you stay in your house, and may even start making house payments for you:
U.S. government officials are weighing a plan that would let borrowers who have fallen behind on their mortgage payments avoid eviction by renting their homes instead, sources familiar with the administration’s thinking said on Tuesday.
Under one idea being discussed, delinquent homeowners would surrender ownership of their homes but would continue to live in the property for several years, the sources told Reuters.
Officials are also considering whether the government should make mortgage payments on behalf of borrowers who cannot keep up with their home loans, tapping an unused portion of a $50 billion housing aid kitty.
As part of this plan, jobless borrowers might receive a housing stipend along with regular unemployment benefits, the sources said. [Obama mulls rental option for some homeowners – Reuters]
So, let me get this straight. If I’m out of work, not only will the government give me unemployment but it will also give me money to pay my mortgage on top of it? Or I could give my home to the government, they would make payments, but I could still live in it?
Why would I want to make my own payments, or find work?
This, my friends, is just more government control of things as well as more debt that the taxpayers would be liable for.
What would have been a much better solution is one I heard around the time of President Obama’s first stimulus, which would have included taking a much smaller number of dollars and giving enough to each American to pay off their mortgage. They would keep their property, the price tag would have been much less, and credit would have been freed up because the banks would have had all their money back.
For President Obama, every solution is one that ends with government control.
Scary, isn’t it?