Refi Madness: Use Fannie and Freddie to Solve the Housing Crisis, Hubbard Says

We all know the money is tied up with the banks, if adjustments to mortgages are not made soon. foreclosures will triple and money and finances will be tied up for several years and the world will follow.... its just the way it is..

They have already been paid for due to TARP program implemented back when Reagen was president . The only person who will benefit from this again is WALL STREET AKA BIG GOV.

Not a bad idea. However I wonder how we treat the loan being paid off with the new refi loan. I think the old loan holders (basically the security holders) should get say 80 cents on the dollar and not get a full payout. Paying 100% of the old loan balance is akin to the government bailout of AIG where Goldman and others benefited from getting full value of their credit default swaps backed by AIG.

Furthermore, I think the new loans should have a rider attached that allows the government to share in the profit on a future sale of the property. In the end, the program may even by a windfall for Uncle Sam.

The present sytem of home ownership is really a mirage. It is only the bank and the peolple who owns the bank really the owners and really the landlords. You pay your mortgages by working day and night and finally end up holding valueless piece of abode at the end of the final payment. At the evening of your life they come again with the draconic program of reverse mortgage to snatch your home . You own a home only when you can pass it on to next generation. Compared to many other nations the per capita land in this country is huge and beyond imagination. So think you fellow midlle class guys

I had figured this out long ago. Some people cannot determine who holds their mortgage, because it was bundled and sold off by financial business folk who were betting against them in the "free market." How do you adjust such mortgages? Why not allow this to happen? It should have been what was done from the start in dealing with this mess.

More importantly, why is it that the Fed. Reserve can only tamper with overnight lending to adjust interest rates? Why not adjust the prime rate, Glenn Hubbard?

A GREAT SOLUTION, RIGHT ON!!...I've said it for months and it has taken this long to surface. So many can't refinance because of the LTV, NOT because of getting in over their heads but because appraisers are basing property values on foreclosure sales which are not fair market values!!! GET IT? As long as they do this we will spiral down. Appraised Values are sometimes so far out of line that they are lower than the land lot values. PLUS $50-$60 Billion cash into the economy! It should be for all property owners and not just Owner Occupied as well. It should be done NOW! NOW! It is a no brainer.

The ONLY thing I agree with him about is eliminating the mortgage interest deduction. It's time to stop pretending that owning a house is some kind of patriotic exercise. If it's such a good thing, people will do it without expensive government rewards. It's time to get the real estate industry OFF the government teat.

Nowhere does anyone consider the fact that the people who are in their houses still won't be able to make their payments, or, worse yet, just refuse to make their payments and use their mortgage payment money for paying other bills, etc.

Then what? Another round of foreclosures?

Get real, folks. Let everything go its natural course; the sooner the better. It takes a wash out. Get government to take a hike and get rid of the biggest problem of all in 2010 and 2012: Obama and the dems.

PS: Put Barney Frank, Chris Dodd, Raines, Gorelick, Emanuel, Rubins, Paulson, Greenspan, Bernanke and little Timmy Geithner all in the same jail cell so they can play Monopoly with real fake money which is what they know best.

It will not impact the foreclosures, only a small percentage. The reason is a large portion of ones in foreclosure have been a financial disaster to begin with and even with the modification, will not manage their debt sufficiently to pay the mortgage on time. This is the reason the modifications ended up in foreclosure. Alot of these loans were a "stated income" and adjustables that would have never been approved without this lie of income. I know because I reviewed these modifications and foreclosures and the "fraud" was an everyday occurance.

I agree that you cannot refinance the ones "under water" to a better rate and term and not those who have paid on a timely basis! You cannot reward those who cannot pay and not reward those who can. If there is a solution, all must benefit!