TOS,
Bush was guilty of contributing to the bad policies that had been put into place over 60 years ago. He is very guilty of trying to claim credit for these policies before the disaster.
You seem to forget the origins of Fannie and Freddie, you ignore the CRA, you ignore the red lining lawsuits and threats to the banks by Attorney General Reno with the help of Acorn and Obama in June of 1994,
You ignore Clinton and his dreams and speechs on home ownership and the elimination of Glass/Steagle on his watch.
You ignore the Congressional hearings during the Bush Administration with the Black Caucus preventing any reigning in of Fannie and Freddie. You ignore Maxine Waters, Charles Schumer, Cris Dodd, N.Y.Congressman Meeks and Barney singing the praise of Johnson and Raines and the success of Fannae and Freddie.
An honest debate without right or left wing Kool aid drinkers would obviously show that many politicians right and left for their own power and parties sold us down the river.
For you to blame Bush for the mess as Obama does cannot be seen by Non partisan people as honest --just left spin which is just as bad as right spin.
I am not a Bush Cheerleader and still today would remove troops from EVERYWHERE around the world to take care of America first.
Many Liberals think with their hearts and are not bad people --but decisions and social engineerining projects that are instituted with the best of intentions have hurt all of us -BIG TIME.
Saying Bush did it or Obama did it or Clinton did it would only be PARTIAL TRUTH. I try to live in the world of REALITY. Most politicians live in a fantasy word --Right and Left -I will not cheerlead for either side.
Call it like I see it. You are MUCH smarter than that. The person in the mirror will tell you the truth --look in her eyes once in a while--a really good person is in there.
Island,
Again, lets put the talking points away and deal with reality. You said BUSH only used policies that were in place for 60 years? Seriously? What policies? Clinton nor Barney Frank had ANYTHING to do with zero downpayments. Clinton nor Barney Frank had anything to do with arranging with friend and friend 440 billion dollars for low income loans or low income bad credit loans. Clinton nor Barney Frank had anything to do with removing the "barriers" of home ownership.
The only spatter of truth to your statements are that every president since 1900 has run on a platform of home ownership. Clinton helped to make affordable homes available but he NEVER advocated zero downpayments, interest only loans, loans to bad credit risks, loans to low income minorities to the tune of 1.5 million blacks and 1.5 million hispanics.
IT was BUSH who advocated for all the things that went wrong in the housing bubble. You dont possibly believe all the loans that went bad are loans written in the 1990's do you?
You couldnt be that naive? The loans that are imploding were written between 2002 and 2007. These loans mainly consist of interest only loans that are "resetting" and those resets are too high for the home owner to afford.
Its really simple math Island, a three year interest only loan written in 2002 would reset in 2005, those people made money because they were ahead of the curve. A three year interest only loan written in 2005 is belly up now and foreclosed upon. What you are seeing today are the 5 year and 7 year interest only loans exploding in front of our faces. Like landmines, they were created after 2002 and before the bubble burst.
As these loans collapse, they are taking the whole market with them. You havent seen the last of foreclosures. We still have 10 year interest only and 15 interest only loans to mature and face resets, those will crush the housing market once again.
In all the cities that had housing booms, interest only loans made up the largest percentage.
For those that dont understand how an interest only loan reset works, ill explain.
You take out a 5 year interest only loan at 6% in 2004. You put no money down. The loan would then be written as a 80/20 loan with a first and second. In 2009, that loan will mature, and depending on the loan a large balloon payment (usually 15K) would be due in cash and the terms of the loan change to "PRIME" plus 2%. "Prime" is set at the time of the writing of the loan.
So, in 2009, you have to pay 15K in cash and on your first, the % goes to 8% and on the second (second is always 1.5% higher 7.5% plus 2%) and that makes the second 9.5%.
On a 400K home, the payment will jump from 3000 a month to over 5K a month.
This mathematical problem makes the problem serious when the homes value has dropped severely. People in this mess have NO OPTIONS. They could try and:
1) sell the home at a huge loss and pay the difference in cash
2) ask the lender to short sale the home
3) apply for a modification through the federal goverment
4) or re finance after paying the difference in cash between the new appraised value and balanced owed.
What this buyer CANT do is :
1) sell the home for what is owed.
2) refi the home for what is owed.
3) Have the interest rate changed.
Once buyers are in this mess, they simply walk away and leave the house and file for BK.
This is the reality of the BUSH Home Ownership society. Bush brags about the millions of homes sold after the introduction of his program to america and its those same millions that are foreclosing today.
There is no secret behind this. Its simple math.
Peace.
Tos,
