Jack M. Guttentag The Mortgage Professor

Yahoo! Finance User - Thursday, January 15, 2009, 8:29PM ET  Report Abuse

• Overall: 2/5

NO WAY should the government get someone rght side up when the are upside down on their loan. They borrowed it - they owe it

Elmer - Sunday, November 9, 2008, 8:57PM ET  Report Abuse

• Overall: 1/5

You should pay your mortgage because you agreed to pay it. If you are in an upside down mortgage you should still pay it. You should not wait around for government to come in and help. What terrible advice! Where is our pride in ourselves? The market will come back, it may take 5 or even 10 years but it will come back. We need to work on developing pride back in ourselves and this means taking our lumps sometimes. This type of advice is exactly why we are in this situation and why the new administration will only make it worse.

Yahoo! Finance User - Saturday, November 1, 2008, 3:15PM ET  Report Abuse

• Overall: 3/5

Homeowners have a fiduciary responsibility as agreed to in their mortgage agreement etc. If for some reason, whether in their control or out of their control, the howeowner cannot or will not meet that obligation, it is the lendors option to forclose and take possession of the property. That's BIZ! However if the lenders were as smart as they think they are they would stop crying in their milk and take advantage of the situation. The lenders could make a deals with the homeowners something like this: Make an agreement with the homeowner that the lender will take back the property and lease the property back to the homeowner for a specified short term of 3-5-8-10 years or something, at a lease payment amount that the homeowner can easily afford. The lender marks the property to actual market and gets to take a loss against current income. The lendor still has an income producing asset on it's books with @75% value but also collecting lease payment income qualifying for depreciation deductions as well to offset current income. The homeowner agrees to fulfill the lease obligation by making payments for the full term of the lease etc. and the bank will not report forclosure proceedures or whatever preserving the homeowners credit rating so long as he fulfills lease. When the lease is up in the future and the real estate market stabilizes, the lendor might be able to re-mortgage the property back to the homeowner at a reduced value basis. The reduced basis would be based on the sum of all value that the lender accumulated through lease income, depreciation, and the original capital loss written off ect. from the original mortgage amount. Maybe??? This sounds more complicated than it is and the details would have to be worked out of course to make sure that it could work for both parties. - This is just agreement restructuring and accounting - The lenders could still come out clean long term. Just a quick thought....

Yahoo! Finance User - Wednesday, October 29, 2008, 5:13PM ET  Report Abuse

• Overall: 1/5

Are you also proposing everyone upside down on their car loans should hand in their keys. Give me a break. No wonder this country is in the tank.

Ken - Tuesday, October 28, 2008, 12:34PM ET  Report Abuse

• Overall: 3/5

Just my thought on a NEW BAILOUT IDEA... Why can't the government help everyone else instead of the people who are in trouble? Imagine this... through government intervention, which is already in place with the $700B bailout, 1. GOV'T SPONSORED LENDING: Working through banks, force the 30 yr mortgage lending rate to 1 or 2% for everyone using taxpayer money. It may even work with 3%, but please keep reading. 2. Allow people to refi if they wish to do so. 3. ENSURE THE TERMS ARE RESONABLE AND THAT PEOPLE CAN REPAY. 20% down etc. 4. Ensure banks will not make too much on the easy money with their crazy fees, but will make enough to stay in business. 5. REGULATE THE CRAP OUT OF IT SO IDIOT BANKS DONT END UP WHERE THEY WERE AGAIN!!!!!!!!!!!! 6. Probably other things will need to be in place, but this is the main idea. BENEFITS: 1. 95% of people with good credit and good standing can refi legally without ruining the credit system. this gives money to the economy to get restarted. 2. This will bring buyers out of the woodwork to buy new houses. 3. This will keep a % of the foreclosures from happening because the borrowers could refi into more reasonable terms. 4. MORE CHANCE "THE PEOPLE" GET PAID BACK WITH THEIR TAX MONEY AT RISK. It will guarantee that money will likely get paid back to the people UNLIKE the current $700B bailout. 5. There are plenty more benefits, too many to list here. 2nd way to implement this idea: You could even do the GOV'T SPONSORED LOANS in steps by starting at 5% and see where it goes, if it is not enough drop to 4%, then to 3% and keep dropping until the refi biz can get the economy back on its feet. In this 2nd scenario, the kicker will be that borrowers will not know how low the gov't will go thus spurring refi's at every level until the economy picks up. It may never have to reach 2%.