A Clear and Clarion Call for Home-owner's Insurance Reform!

[Frisco_Slug_Esq]

Fannie Mae, that little spendthrift tartlet and loose date for the Democrats, has found a new way to squander money and wreck America's financial institutions;* homeowners in foreclosure may now be allowed to switch from ownership to renting their property. Fannie's Deed for Lease" program would allow homeowners who do not qualify for mortgage adjustments to deed the property back to the lender who would then rent it back to them at market rate.

I work for one of the largest "scattered site" property management companies in St. Louis, and have years of experience with rental property. While this may sound like a reasonable idea, it is anything but; when I told my broker about this harebrained scheme his jaw hit the floor.

For starters, the people who will qualify will be people who cannot pay their mortgages. There is a reason why they cannot get their loans modified; there is simply no way to adjust them so the homeowner can afford to pay them. I frequently explain to tenants that rental houses generally cost more than a home mortgage, because the landlord has to pay a mortgage himself, plus pay for maintenance and any utilities he is willing (or required) to pay.* (Sewer service often cannot be taken out of the owner's name, since a sewer cannot be disconnected for non-payment.) The premise here is that rent will be cheaper than the mortgage, and that is not necessarily so. In point of fact, for the homeowner to convert to a tenant the rent will have to be lowered, and likely by a large amount. Already the bank is losing money on their "investment", an investment they did not want but were required to make.

Of course, the new tenants are not likely to be particularly careful with the property that they used to own; many will be angry that they made mortgage payments to the bank only to surrender their property anyway. Since many of these tenants were sub-prime mortgage holders, one can fairly make the case that there will be higher incidents of damage, which the newly minted landlord will be required to repair. Overdue rent will have to be collected, and it seems likely that many of the tenants will find it just as difficult to pay their rent as it was to pay their mortgages. Evictions take time (and in places like California are notoriously difficult to obtain) and many of these investments will end-up as vacant buildings stripped of copper pipes, furnace, appliances, and with windows broken out.

These accidental landlords will find they need a considerable amount of help in managing these properties; they will either have to create a property management division in their company or hire an outside management firm.* Management companies generally charge 10% of all moneys collected -- or more -- for their services, and that means further financial loss for the bank.* Also, banks are large corporate entities, and maintenance issues occur at any time of day on any day of the year; what happens if a tenant's furnace dies at 3 a.m. Christmas morning?* Management companies keep people on call to deal with issues like these, and if the bank hires a management company they will still have to have someone who can authorize the necessary expenses when the manager calls.* If they run their own management they will have to keep a number of people on-call. And there must be maintenance people who can deal with issues like this at any given time. You cannot wait for a contractor to reopen after the Christmas break. Decisions must be made quickly, and banks are just too top heavy for quick action. This will be especially true of non-emergency maintenance; it may take months to get a simple broken window repaired.

Then, too, there is the matter of a security deposit. There won't be one for the property, so the house in question will not be protected and the bank's investment will be jeopardized.* People who couldn't pay their mortgages will not be able to come up with a large chunk of change on short notice.

The tenants will also be unhappy that they will not be covered by the landlord's insurance policy; they will have to buy renter's insurance or their personal property will not be protected.

Another example of how rich greedy insurance rips off the little guy.

It's time to fight for the little guy; we need a mandatory government option for renters and subsidies for those who simply cannot afford it. How can you live a productive life without a roof over your head and the security of having all your stuff protected?

__________________
"The Great Depression, like most other periods of severe unemployment, was produced by government mismanagement rather than by any inherent instability of the private economy."
Milton Friedman

[SaintPeter]

Damn fine idea with all the vacant houses we have around here.

[Frisco_Slug_Esq]

Call Kenya, invite the rest of the Obama family to come live illegally...





You know that Freddie is asking for more bailout money don't you...




i
__________________
I invented the i in iPod
Algore

[SaintPeter]

They can stay at my house.



u

[Frisco_Slug_Esq]

Where will Ralphie go?




i

__________________
I invented the i in iPod
Algore

[SaintPeter]

Originally Posted by Frisco_Slug_Esq

Where will Ralphie go?




i

__________________
I invented the i in iPod
Algore

In the end zone like he always does.


u:cleanitup:

[Frisco_Slug_Esq]

Isn't that too much load for your back?




Yiks

[Ishmael]

One no longer has to move to the slums, the slums are coming to you.

Ishmael

[Frisco_Slug_Esq]

Originally Posted by Ishmael

One no longer has to move to the slums, the slums are coming to you.

Ishmael

So what if it's a jobless recovery?

It's become that good, gentle, long-overdue, benefit recovery...

[Ishmael]

Originally Posted by Frisco_Slug_Esq

So what if it's a jobless recovery?

It's become that good, gentle, long-overdue, benefit recovery...

You know as well as I do that that's no recovery at all. People on welfare, no matter what fancy label you want to attach to it, do not grow economies or create jobs.

Ishmael

[SaintPeter]

Somebody has to be working. Look at all the Christmas junk WalMart is selling.

[Frisco_Slug_Esq]

I'm trying to be neutral, fair, balanced and am attempting to give Pres_ent Obama full and proper props for his salvation of "his" America and the support and reasoning for him to expand his expansive agenda into every facet of the days of our lives...




i

[Frisco_Slug_Esq]

Originally Posted by SaintPeter

Somebody has to be working. Look at all the Christmas junk WalMart is selling.

Evil Walmart! Yeah boy,


*ispit*

Then we go back and "git" Walmart...

[Frisco_Slug_Esq]

Come Mr. Tally man tally me Banana Republic...

In Venezuela, Chávez — who continues to face increasing domestic problems and whose popular support seems to be slipping away — said socialism will solve domestic problems but forecasted three years of battle to improve living standards and meet basic needs.

In his Lineas Dominicales (Sunday Lines), Chávez announced the delivery of apartments in Portuguesa at $83,000, half of capitalist market prices, as part of a subsidized housing project that will charge a 4.5 percent interest rate over 30 years. Chávez also honored Simon Bolivar by promising to give everyone as much joy as possible.

One must wonder how many residents of the Caracas barrios — who have long been without water and electricity due to continuing infrastructure problems — will be able to buy the new apartments at $83,000, even with 4.5 percent interest rates.

http://pajamasmedia.com/blog/u-s-bel...-goes-quiet/3/

__________________
Generally speaking we get the joke. We know that the free market is nonsense. We know that the whole point is to game the system, to beat the market, or at least find someone who will pay you a lot of money because they're convinced that there is a free lunch. We know this is largely about power, that it's an adults only, no limit game. We kind of agree with Mao that political power comes largely from the barrel of a gun. And we get it that if you want a friend, you should get a dog.
Ron Bloom
Car Czar

[vetteman]

Originally Posted by Ishmael

You know as well as I do that that's no recovery at all. People on welfare, no matter what fancy label you want to attach to it, do not grow economies or create jobs.

Ishmael

They are consumers of wealth.

[Ishmael]

Originally Posted by vetteman

They are consumers of wealth.

Parasites would be the more precise discriptive term.

Ishmael

[Frisco_Slug_Esq]

Originally Posted by vetteman

They are consumers of wealth.

Trickle up poverty levels the playing field every time for all but the political elite class...





__________________
Oliver Wendell Holmes said, "Think things, not words." In words, many see a need for "social justice" to override "the dictates of the market." In reality, what is called "the market" consists of human beings making their own choices at their own cost. What is called "social justice" is government imposition of the notions of third parties, who pay no price for being wrong.
Thomas Sowell

[SaintPeter]

Union Yes!


uies

[Frisco_Slug_Esq]

Originally Posted by SaintPeter

Union Yes!


uies

The Union is a redundancy that we can't afford because government has taken over its role...


iPMS
i

[Frisco_Slug_Esq]

^^^^^^




Works on two levels; slow down and think about it.

[SaintPeter]

Originally Posted by Frisco_Slug_Esq

^^^^^^




Works on two levels; slow down and think about it.

Originally Posted by Frisco_Slug_Esq

iPMS
i

You are a sad pussy?

[Frisco_Slug_Esq]

i

[Frisco_Slug_Esq]

Representative Barney Frank, September 25, 2003

It was six years ago that Mr. Frank announced his famous dice roll on Fannie Mae and Freddie Mac in the name of affordable housing. Mr. Frank got his wish, and the losses keep rolling in, with no end in sight as Washington finds new ways for the companies to serve political purposes.

Last week, Fannie Mae posted a quarterly loss of $19.8 billion—which believe it or not was an improvement on the $29.4 billion that it lost a year earlier. Last quarter's results came with yet another request for government aid—$15 billion worth. That brings the total tab for Fannie and Freddie to $111 billion since they were put into conservatorship in September 2008.

It would be bad enough if Fannie and Freddie's continuing losses were merely the product of bad bets made amid the housing bubble in 2006 and 2007. But the latest red ink is in large part the result of a deliberate choice to run their businesses at a loss over the past year to support White House housing policies.

The most recent losses include $22 billion of what Fannie Mae calls "credit-related expenses," which in English means foreclosure costs and losses on loans that are "worth" more than the house. Of that amount, $7.7 billion comes straight from Fannie's support of the Obama Administration's mortgage-modification program. Fannie and Freddie have been buying mortgages out of the securities they were bundled into and are then modifying the terms, which invariably means taking a loss on the loan.

Through this program, taxpayers are directly subsidizing homeowners who borrowed more than they could afford, or more than their house is now worth, or both. The government is doing this under the cover of losses at Fannie and Freddie because Congress and the White House know these programs are both expensive and unpopular with the poor saps still paying their mortgages on time.

The dynamic duo's delinquency rates also continue to climb, even on modified loans and on mortgages on which Fan and Fred have chosen to forbear from demanding repayment. The $400 billion that Congress has appropriated to keep Fan and Fred afloat, in other words, has quietly morphed from emergency aid into a $400 billion housing subsidy program. On current trends this will all be spent before President Obama is up for re-election, and, judging by the results so far, taxpayers will have little to show for it.

Having ruined the U.S. mortgage market, Fan and Fred have become the tools for its continued nationalization and a never-ending bailout of mortgage borrowers. This is one reason we advised former Treasury Secretary Hank Paulson to put the companies into receivership and leave them in run-off mode when he had the chance.

Instead, Mr. Paulson placed them in conservatorship and sent them out to lend more and more. In the past year, they have all but erased the private mortgage market, at great cost to both the taxpayer and the integrity of the private financial system. They will roll snake-eyes for taxpayers for years to come.

Wall Street Journal

[Frisco_Slug_Esq]

The non-outdoorsman....




Knows exactly how to run your life; knows NOTHING about the things happening in HIS life.

Prostitution ring.
Lover at the institute he oversees...
Boyfriend growing pot out in the back yard...

[Frisco_Slug_Esq]

The Supreme Court's 2005 decision in Kelo v. City of New London stands as one of the worst in recent years, handing local governments carte blanche to seize private property in the name of economic development. Now, four years after that decision gave Susette Kelo's land to private developers for a project including a hotel and offices intended to enhance Pfizer Inc.'s nearby corporate facility, the pharmaceutical giant has announced it will close its research and development headquarters in New London, Connecticut.

The aftermath of Kelo is the latest example of the futility of using eminent domain as corporate welfare. While Ms. Kelo and her neighbors lost their homes, the city and the state spent some $78 million to bulldoze private property for high-end condos and other "desirable" elements. Instead, the wrecked and condemned neighborhood still stands vacant, without any of the touted tax benefits or job creation.

That's especially galling because the five Supreme Court Justices cited the development plan as a major factor in rationalizing their Kelo decision. Justice Anthony Kennedy called the plan "comprehensive," while Justice John Paul Stevens insisted that "The city has carefully formulated a development plan that it believes will provide appreciable benefits to the community, including, but not limited to, new jobs and increased tax revenue." So much for that.

Kelo's silver lining has been that it transformed eminent domain from an arcane government power into a major concern of voters who suddenly wonder if their own homes are at risk. According to the Institute for Justice, which represented Susette Kelo, 43 states have since passed laws that place limits and safeguards on eminent domain, giving property owners greater security in their homes. State courts have also held local development projects to a higher standard than what prevailed against the condemned neighborhood in New London.

If there is a lesson from Connecticut's misfortune, it is that economic development that relies on the strong arm of government will never be the kind to create sustainable growth.

Wall Street Journal

King of the castle, eh?