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Emergency Economic Stabilization Act of 2008 - House Votes “NO” But Debate Rages On
We mentioned (in jest) late last week that “On tap for next week: the world is coming to an end” and after today, I have to wonder.
Today, the House voted “no” to the Emergency Economic Stabilization Act of 2008 and the markets responded by promptly going in the tank and posting the largest-single-point-drop-in-one-day-in-history.
But wait.
According to Bloomberg, Secretary Paulson is working with Congress to salvage the “Bailout Bill” after the House rejected it.
Said Paulson:
“We need to work as quickly as possible; we need to get something done, we believe that our plan, and the plan that we developed with congressional leaders and worked so hard, is a plan that works. And we need a plan that works.”
Yep. That was well said.
WE NEED A PLAN THAT WORKS.
Now if only it was that cut-and-dry…
Stay tuned for more developments as they happen.
Emergency Economic Stabilization Act of 2008 - Draft
Love it or hate it, the “bail out bill” goes to a vote in the House on Monday and the Senate on Wednesday.
It is still in DRAFT form, but I think it is safe to expect some form of this bill to pass into law this week.
For all those of you who like reading the fine print of your tax forms, you can see a summary of the bill as well as the a full draft of the bill in it’s proposed form.
(Hat Tip Phoenix Real Estate Guy for making these easy to find…)
Just in case you needed to see it again — this is what a TRILLION dollars looks like in numerical form:
$1,000,000,000,000
Lower Taxes With McCain or Obama?
Great news for those of you who care about paying less in taxes, you can now calculate which Presidential Candidate will “make” you pay less in taxes: McCain or Obama.
A software company named Quantrix has created a site that allows you to enter your personal financial information such as how much income you have and what deductions you qualify for and it will tell you how much you will pay in taxes if Obama wins and how much you will pay in taxes if McCain wins.
So is it true that you will pay more in taxes if Obama wins the election?
Not necessarily.
And the software is built in such a way that you can enter in the “rich-guy-in-the-nice-house” information and find out just how much he will actually pay too!
Loan Modification Contact List
In the past, we have written about what you should do if you are having trouble making your mortgage payments. First, talk with your lender by yourself and try to get your loan modified. Second, contact a HUD-approved Housing Counseling Agency. Third, contact a loan modification company.
I just found a loan modification contact list where it looks like contact information is posted for most of the major lenders’ loss mitigation departments is posted.
Hat tip to Todd Carpenter at Lenderama for sharing!
FHA Hope For Homeowners Program
When the Housing and Economic Recovery Program of 2008 was passed in late July, we wrote about the Hope for Homeowners Program. Some of the highlights of the program include:
- The program is a voluntary program for lenders to participate in
- Lenders will reduce the amount of money that they are willing to accept to pay off your current mortgage (this has become known as a “short-refinance”)
- A new mortgage will be issued by the new lender based on your current homes value
- FHA will share in the appreciation of the home, not the lender who took the loss
- FHA will collect a 3% “exit fee” when you sell the home or refinance it
Are lenders happy with this program? Ummm…. It doesn’t look like it.
According to the Assistant Secretary for Housing at HUD Brian Montgomery:
“I think lenders will be enthusiastic about the program but they have other things they’d like to do before they do a principal write down”.
What are the signs that lenders are less-than-excited about the Hope for Homeowners program?
- There is no official list published of lenders who are participating in the program
- There is no standardized method of working with these lenders — so each scenario with each lender is handled on an individual basis
- There is growing sentiment among the lenders that any other loss mitigation method (loan modification or workout) is financially better for the current lender than the Hope for Homeowners program
Even Sheila Bair, who heads the Federal Deposit Insurance Corporation, praised the FHA program but said that few borrowers with IndyMac, the bank that the FDIC took over in July, would use it.
She said that her responsibility to maximize profits for the investors would probably limit the number of IndyMac borrowers who would take advantage of the Hope for Homeowners program.
Don’t be surprised if you are interested in participating in the Hope for Homeowners program and you end up getting a loan modification or loan workout from your lender.
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