http://www.reuters.com/article/gc03/idUSN2830318520080328
By performing this act, the city has just told people to stop paying their mortgages. They also told people to stop paying their property taxes.
(Renters, of course, being second-class citizens, must still pay their rents or they will be evicted.)
You can't legislate the price of houses or disconnect the right of ownership. Banks will then refuse to lend.
You also can't keep this up since the prices of homes will fall until at least 2013-14. A so-called moratorium can't last for 5 fucking years.
Philadelphia's gone batshit insane. I'm hearing that Cleveland is considering the same insanity. And if Cleveland does it, then Toledo won't be far behind.
Remember, folks, no one's going to be homeless from all these foreclosures. We have a HUGE GLUT of empty homes and condos and apartments in the nation. If they can't be sold, they will just be rented. All this false sentiment of "putting millions in the street" is pure bullshit.
Also, it's time to stop using the term "homeowner". These people are homeDEBTors. They don't own SHIT except a huge note that they unwisely signed and that they could not pay off over the life of the loan. Remember, these folks threw their money away on renting money from a bank. That's why their downpayments were nearly ZERO. They brought nothing to the table except an extremely manipulated credit rating and lies, Lies, LIES on their mortgage application.
I don't see how this is even remotely legal. Lenders have legal contracts with buyers and should be able to recoup their loans through forced sales if payment is not made. We are moving into some kind of twilight zone here where buyers are not responsible for their debts. How can the state mandate this, legally?
Since debt forgiveness seems to be a huge trend these days, maybe I should inquire with my mortgage company.
My loan is only 20% of my house - the rest is all mine. Think it would fly if I told the mortgage people "look, home prices are falling and your 20% doesn't exist anymore. I'm going to stop sending you payments."
(Sigh...just kidding. But it does irk me that I went the responsible route on my home, while all these irresponsible folks are getting bailed out rather than facing the consequences of their decisions. Grrrrr.)
CNN.com has recently featured profiles of people in financial crisis, and every time I read one of them I think "okay, I do feel some sympathy for you BUT...I can also see a pattern of wrong decisions on your part." Like the lady who signed an interest only mortgage because "it was the only way she could afford her house." Well honey, if the only way you can afford your house is on an interest only mortgage, then you shouldn't have bought it to begin with.
“Politics is the art of looking for trouble, finding it everywhere, diagnosing it incorrectly, and applying the wrong remedies.”
--Groucho Marx