The housing bill passed recently by the U.S. House has a few good points. The program it creates would be voluntary. It would tighten regulation of the mortgage giants, Fannie Mae and Freddie Mac — something Congress has resisted for far too long.
But overall, the legislation goes too far in its attempt to fix the housing sector, where corrective market forces are already at work.
Probably the best course is to let the market sort out the mess on a case-by-case basis, with some government assistance for low-income individuals who were duped by unscrupulous lenders.
The bill, sponsored by Rep. Barney Frank, a Massachusetts Democrat, would allow use of government credit to refinance troubled mortgages.
Lenders would receive guaranteed repayment on a new loan, valued at 85 percent of the current assessed value of a home. Borrowers would have lower payments.
But taxpayers would be left on the hook, which is worrisome for several reasons.
Lenders would be encouraged to funnel the most troubled loans to the government. That’s one reason why the Congressional Budget Office estimates that up to a third of the proposed refinancings would still end in defaults and foreclosure.
This would add to the dozens of trillions of dollars in unfunded federal liabilities that American taxpayers already face.
It would be difficult, and sometimes impossible, to separate borrowers who got in trouble through no fault of their own from reckless speculators who believed that home prices would rise forever — or those who lied about their incomes to obtain loans.
The Senate must still act on this measure, and the legislative process could take so long that the crisis will have passed anyway. The legislative schedule already looks tight, with breaks for summer holidays and the political conventions.
It should be remembered that falling house prices aren’t bad for everyone; they benefit young couples seeking their first home.
Low-income homeowners should receive some assistance. Government at various levels has a responsibility to ensure that people on the lower rungs of the economic ladder, including children, have adequate housing.
But bailing out lenders, speculators and homeowners who behaved irresponsibility would be a bad message for Washington to send — one that would be likely to encourage other financial bubbles in the future.
Mayor Antonio Villaraigosa, California's governor and the bunch of sheep in city hall, who timidly follow without question the dictates of the Hispanic Caucus. It is estimated their are 1.5 million illegal immigrants living in Los Angeles county. They all bow to the special interests groups, that run a monopoly in Los Angeles. They illegally strangled proposition 187, then added added the Sanctuary city ordinance (Special order 40).
Its consequences has been massacres by out-of-control street gangs, that threatens anybody who steps in their neighborhood. It killed a young black man, whose only crime was to be on their turf at the wrong time. 'Jamiels Law' should be enacted to protect innocent citizens and Chief of Police Bratton's Special Order 40 should be eradicated and leave the police enquirer the status of anybody they question.
According to the grieving family of the murdered young man, that even the Prosecutor on the case tried to intimidate them The family, stated they are determined to prosecute this case as a 'Hate Crime' So Police chief Bratton wants to keep the abhorrent 'Special order 40' as a law, even though hundreds of people have been heinously slaughtered by animals in street gangs. Jamiels family has a petition at (www.jamielslaw.com, to rescind this law, that has allowed dangerous gangs to propagate. I signed the petition today, so that this tormented family can get this law on a ballot measure. You too can also sign the petition! The fact that the majority of the street gangs in any community across the county are illegal aliens, including the MS 13 violent animals, who threaten and kill indiscriminately.
Californian citizens demand their Democratic lawmakers co-author the pending federal SAVE ACT (H.R.4088) it will not only strengthen other state laws, but also remove the obnoxious stain from Los Angeles called a SANCTUARY CITY. Los Angeles and other city governments around this nation needs a good cleaning and its putrefaction should be emptied down the gutter and washed away with the other waste.