Third Party & Independents Archives

Democrats Screw the Poor Again

Once again, the Democrats controlling congress have put the screws to the poor in the United States. By passing into law the Housing and Economic Recovery Act of 2008 they have taken away one of the few avenues for poor and lower income families to acquire homes, requiring them to ‘give’ money to rich landlords instead of earning equity on a house that they would be buying themselves.

This act closes the door on non-profit organizations ‘gifting’ the down payment of a house to individuals who have good or fair credit but are unable to collect the required down payment necessary to buy a home. The FHA will no longer back any loans using this method, effectively shutting out any home loans to anyone who doesn’t have a credit rating of 720 or more. It is estimated that the housing market is going to boom over the next two months while people take advantage of the programs until they end with September, when afterwards home sales are expected to drop 50%.

And don’t let the Democrats fool you; this will do nothing to address the issues that are causing the high foreclosure rates and the failures of the lending institutions that we have seen over the past couple of years. This doesn’t address the instances of fraud, which was perpetrated by organizations that bought high-risk loans and then coupled them with low-risk loans to sell to unsuspecting investors. Nor will it address the use of adjustable rate mortgages by people who clearly did not have the income to handle the increase in mortgage payments that rising interest rates that caused the majority of foreclosures.

No, this blocks an avenue for all individuals who are scraping to get by, partly because of the oppressive taxes they have to pay on all goods that they purchase due to embedded taxation, and are unable to put together the down payment requirements that they will no longer be able to avoid paying, all the while ensuring that the government have even more say in who can and can't purchase a home if they are poor or low income families. Oh, and they will be giving one time tax credits to poor and low income families who do manage to get a home loan that has to be repaid over the first fifteen years of the loan. Provided they can hit their families up for the downpayment amount.

For millions of people, the American Dream of owning their own home has now come to an end. And the people who will benefit? Why, the rich of course. Their investments will be better; the unwashed masses now being cleaned from the threat of home ownership and placed squarely back to the dependant class, needing someone to rent their living quarters from. And all the while the people who are being put into this position will be told by the ones guilty of this act that they are their only protectors.

If anyone were curious how someone who worked for the Dukakis campaign and has never voted Republican could have left the Democratic Party behind as it turned into a morass of the same fear mongering and hate filled politics that the Republican Party has been guilty of in the past, this shining example is a good place to start.

And this is where Obama misses the boat by saying that the people are clinging to god and their guns because the government isn’t taking care of them. The reality is that people don’t want the government taking care of them, they want the government to start minding its own business again and letting them live their lives without the protection of Big Brother dictating how they spend their hard earned money. But I never expected a Democrat to get that, after all they see nothing onerous with the use of force to ensure everyone is more equal and taken care of. It just doesn’t enter into their view of the world that the real enemy is the one with the legal use of power against them, not the business man who can only try to convince them to give him their money, not take it at gunpoint.

Posted by Rhinehold at August 5, 2008 10:47 PM
Comments
Comment #257834

“Once again, the Democrats controlling congress have put the screws to the poor in the United States.”

From your link Rhinehold- “Patricia Garcia-Duarte, president and chief executive officer of the non-profit Neighborhood Housing Services of Phoenix, said it is really home builders, not the American people, who are reaping the benefits of seller-funded down-payment assistance.

She said the services of Nehemiah and AmeriDream need to go because they do nothing to promote responsible homeownership and exist primarily to help builders sell more homes.

Garcia-Duarte said her organization and many other government and non-profit agencies already offer “true” down-payment assistance, a far cry from the handouts buyers have been receiving through seller-funded programs.

For instance, Neighborhood Housing has strict payment-to-income standards and requires borrowers - the assistance eventually must be repaid - to attend borrower-counseling sessions and take financial-literacy and budgeting classes.

Garcia-Duarte said the down-payment assistance services her organization provides will not be affected by the ban, which focuses solely on the seller-funded variety.

Home builders using seller-funded programs artificially inflate home prices by as much as 6 percent before passing that money to buyers, she said.”

And from the NAR-“Seller-funded downpayment assistance programs – codifies existing FHA proposal to prohibit the use of downpayment assistance programs funded by those who have a financial interest in the sale; does not prohibit other assistance programs provided by nonprofits funded by other sources, churches, employers, or family members. This prohibition does not go into effect until October 1, 2008.”

http://www.realtor.org/gapublic.nsf/pages/hr_3221_key_provisions

So its the poor american corproate homebuilders who will suffer not the poor american people in reality Rhinehold. No wonder you are so up in arms over this law. To hear you rant its the Dems and only the Dems that are taking homeownership from the working poor and forcing them to rent from rich landlords only.

“If anyone were curious how someone who worked for the Dukakis campaign and has never voted Republican could have left the Democratic Party behind as it turned into a morass of the same fear mongering and hate filled politics that the Republican Party has been guilty of in the past, this shining example is a good place to start.”


Its funny you slam the Dems and Obama yet the law passed overwhelmingly with support from both parties. In the house it was 272 to 152 and only 17 Senators voted against it.

The real issue Rhinehold is why are you not more upset with this interference by the government into the free market. Why wasnt the Mortgage and housing industries allowed to crash completely without the taxpaying public being forced at the point of a gun to bail them out and stabilize the economy?


Posted by: j2t2 at August 6, 2008 1:01 AM
Comment #257835

What I want to know is why Rhinehold isn’t more upset at the fact that in 2003, when the attorneys general of ALL fifty states (blue AND red) sent a letter to the White House to tell Bush that legislation was needed to avert the looming subprime mortgage crisis, the Bush White House did worse than nothing: Bush used a civil war-era law to not only prevent any legislation against the banking industry, but also to negate any and all legislation the states had already passed to regulate the lenders.

The banking superintendents of all fifty states opposed and protested the Bush administration’s decision.

And we all see what happened.

So against whom should you vent your anger, Rhinehold? Against the Dems who you think are not fixing the problem like they should? Or against the guy who ignored the attorneys general and banking superintendents of ALL FIFTY STATES and caused the mess to begin with?

Posted by: Glenn Cessor at August 6, 2008 1:23 AM
Comment #257841

Rhinehold, your article’s opinions are baseless.

First, your opinions sound as if you believe the poor are entitled to home ownership regardless of their ability to save the down payment. This kind of thinking by GW Bush with his 2004 “Ownership Society” promises is what brought this economy to its knees and opened the flood gates to homeownership by 10’s of thousands of persons who in reality could not afford to own the homes they bought through a variety of financial and sales gimicks.

Democrats are closing those flood gates. And that is a good thing for both the poor and the economy in the long run. Since you are a free marketeer, I have to ask what is your beef with the marketplace and competition bringing sustainable and competitive rents into balance with a dropping housing valuation marketplace?

Do you no longer believe in the marketplace establishing stable and predictable competitive valuations for things like housing?

There is a plethora of criticism that can be legitimately laid at the Democrats of Congress’ feet. But, this ain’t one of them. They are preventing a good number of other poorer families from stepping into a home ownership foreclosure future.

If you really want to bleed for the poor, try suggesting policies to increase jobs and wages and quality education accessibility for them.

It is a terribly time to be poor in America. But, it is going to get considerably worse over time. I never shed a tear over having to move from a rental apartment. If I ever lost my home however, it would be a devastating blow to my, and my family’s lives. Policy should encourage home ownership which is sustainable and has a high probability of remaining sustainable.

Policy should encourage low cost construction and maintenance homes for poorer Americans. Not with tax dollars, but, with building code requirements and license conditions to be in the home construction business. Earth bermed housing is vastly cheaper to maintain, and in many areas of the country, construction costs would cheaper than conventional foundation housing.

So, why are Democrats at all levels of government so abjectly ignorant on this topic? Why aren’t they learning what resources are available in the marketplace to meet their constituent’s needs? The answer of course is, poor people don’t vote, so, don’t worry about them. Just build you election campaign around serving them, and then ignore their plight after elected until the next election cycle. The ignorance of our politicians on potential solutions to these kinds of problems is cavernous.

They think they are actually learning something to help the poor when they call the CEO’s of construction and mortgage industries in to their hearings, when in fact, they are learning nothing more than what those CEO’s want to increase their salaries and corporation’s profits.

Posted by: David R. Remer at August 6, 2008 4:10 AM
Comment #257842

Glenn, excellent question and points. GW Bush made the ‘ownership society’ his mission in 2004 and he got Greenspan to collude with him to keep interest rates way too low to facilitate this home ownership society of his. Facilitating greater home ownership in America is a noble goal, but, GW Bush and his dupe, Greenspan, were the absolutely WRONG people to trust with such a complex task, as this plethora of unintended consequences for all of America demonstrates.

And now I hear nearly half of Americans want to replace GW Bush with a near mirror image. Absolutely unbelievable. If America elects McCain, they will get just exactly what they deserve, as they have for electing GW Bush. There is justice and no higher power is required to administer it when it comes to incompetence by voters, congress, and/or a president.

Posted by: David R. Remer at August 6, 2008 4:20 AM
Comment #257845

Glenn Cessor and David,

Why do you make the assumption that I approve of anything that Bush has said or done now or in the past? Because I focus on something that the Democrats have done, that means I approve of the Republicans?

Just more of the same, can’t defend the actions so instead you deflect to the typical ridiculous position.

Posted by: Rhinehold at August 6, 2008 7:13 AM
Comment #257852
She said the services of Nehemiah and AmeriDream need to go because they do nothing to promote responsible homeownership and exist primarily to help builders sell more homes.

And that is one of the most ignorant statements I’ve ever heard. They do not promote NOR demote responsible homeownership. They just allow people who are without means be able to make a home purchase.

If someone is working and using all of their income to pay bills and rent, how are they supposed to save up the thousands of dollars they will need to make a downpayment?

Yes, more homes will sell, though more of them will be used homes and not new ones. But that is because we are allowing more poor and lower income individuals to purchase homes.

Are you suggesting we should be socking it to the new home buyers by keeping the poor and lower income people out of home ownership?

What seems to have been missing from my original article, and I apologize for this, is that this is a typical Democratic response to an issue. Instead of dealing with the issues, or the small segment of people abusing a loophole, etc, they want to block the use it in its entirety, it doesn’t matter who it affects.

The response to the ‘crisis’ is not to block home ownership en masse by poor and lower-income families but to educate and assist those who made bad decisions and leave the others who are not defaulting alone. If >90% of the people that this program helped are not in foreclosure, you are effectively blocking access for a large percentage of those who could use the program for the sake of protecting the small minority of users who are abusing it or having trouble.

And that is the common theme when it comes to Democratic answers to problems they encounter. Control behavior through force instead of assist individuals who need it.

Posted by: Rhinehold at August 6, 2008 10:08 AM
Comment #257854

I gotta play devil’s advocate here. My family and I just purchased our first home, and we used the Nehemiah program for our downpayment. We were in a situation where we had to move with little warning, and moving to a less expensive area and getting a $800/mo mortgage was more logical than staying in area and renting for $1000/mo or more. We had no time to save up multiple thousands of dollars for the downpayment, so Nehemiah was a godsend. That the government is clamping down so hard on such programs is sad, because others in my situation won’t have the same opportunity that I had.

On the other hand, part of the housing problem is indeed people biting off more than they could chew, though I blame the lenders more than the people. It does seem either duplicitous or schizophrenic that with one hand the government gives out what is basically an interest-free $7500 loan to those who have already bought their first home, but with the other they take away the financing that so many first time homebuyers need to make the purchase in the first place. Another example of the appearance of progress being more important that the progress itself?

No, this blocks an avenue for all individuals who are scraping to get by, partly because of the oppressive taxes they have to pay on all goods that they purchase due to embedded taxation,
C’mon Rhinehold, was this really necessary? Ya had to throw in that one little bit of Libertarian anti-taxation ranting and smudge what was one of your better posts. It’s okay to go off message now and then, it give one an air of spontaneity :-)

L

Posted by: leatherankh at August 6, 2008 10:20 AM
Comment #257855
C’mon Rhinehold, was this really necessary?

Of course not, but I couldn’t resist! Call me a slave to my philosphy.

BTW, it’s anti-income tax rant, user fees are correct to pay for services provided…

And thanks for your view, I too am in a similar situation, having to buy a new house from the estate of my late grandfather in a hurry. Had this program not been in place I would have been in a position to go to less sound means of financing to make the purchase.

Posted by: Rhinehold at August 6, 2008 10:25 AM
Comment #257857
And that is the common theme when it comes to Democratic answers to problems they encounter. Control behavior through force instead of assist individuals who need it.
And the Republican sink-or-swim response is so much better? Color me confused.

L

Posted by: leatherankh at August 6, 2008 10:27 AM
Comment #257860
Rhinehold, your article’s opinions are baseless.

Except that they aren’t. But let’s continue…

First, your opinions sound as if you believe the poor are entitled to home ownership regardless of their ability to save the down payment.

Entitled? I don’t think I would use that word. In fact, I don’t think many people are ‘entitled’ to very much. So you inject a straw man and now want to argue it?

This kind of thinking by GW Bush with his 2004 “Ownership Society” promises is what brought this economy to its knees and opened the flood gates to homeownership by 10’s of thousands of persons who in reality could not afford to own the homes they bought through a variety of financial and sales gimicks.

And the millions of people who used those same ‘financial and sales gimicks’ who are still in their homes and not relying on renting their home should be punished for the 10s of thousands who abused it or overreached?

Democrats are closing those flood gates.

Except that they aren’t.

And that is a good thing for both the poor and the economy in the long run.

Except it isn’t.

Since you are a free marketeer, I have to ask what is your beef with the marketplace and competition bringing sustainable and competitive rents into balance with a dropping housing valuation marketplace?

My beef is in changing a program to make it worse, not better. Non for profits were lending the downpayments, not large corporations, and was an example of private individuals helping out others without the government stepping in. But step in they did by removing the ability for the FHA to back loans that had the gifted downpayment in them, when it should not matter to the FHA where the individual got the money. It’s ok for them to get it from familty members but not a non-for profit? What sense does that make?

Do you no longer believe in the marketplace establishing stable and predictable competitive valuations for things like housing?

I do, but we don’t have that now and this doesn’t bring us closer to that, does it?

There is a plethora of criticism that can be legitimately laid at the Democrats of Congress’ feet. But, this ain’t one of them. They are preventing a good number of other poorer families from stepping into a home ownership foreclosure future.

Bull.

If you really want to bleed for the poor, try suggesting policies to increase jobs and wages and quality education accessibility for them.

I have and will continue to do so. Most of them will involve getting the government out of blocking private solutions, as they are doing now.

It is a terribly time to be poor in America.

Yeah, just horrible. It would be much better to be poor in Mexico or India than the US right now…

But, it is going to get considerably worse over time. I never shed a tear over having to move from a rental apartment. If I ever lost my home however, it would be a devastating blow to my, and my family’s lives. Policy should encourage home ownership which is sustainable and has a high probability of remaining sustainable.

So, over 95% is not ‘high probability’? I’m sorry David but this is just ridiculous. The overwhelming majority of those that took advantage of this program that the non for profits provided are still successfully in their homes. The ones that didn’t take out adjustable rates, that is. It is the small minority that are causing the problem, coupled with outright fraud by the subprime lenders in repackaging the risky loans.

Stopping this program will do *NOTHING* to prevent people from defaulting on their loans and will only succeed in blocking people who are in a position to make the payments (they are making rent payments already) from being able to own a home and build equity because they don’t have the extra funds to plonk down several months of salary.

Posted by: Rhinehold at August 6, 2008 10:47 AM
Comment #257861
And the Republican sink-or-swim response is so much better? Color me confused.

Republicans are tonks, not sure how they crept into the conversation…

But yes, allowing people to fail is the only way to ensure that they are free to succeed.

Posted by: Rhinehold at August 6, 2008 10:48 AM
Comment #257864

“And that is one of the most ignorant statements I’ve ever heard. They do not promote NOR demote responsible homeownership. They just allow people who are without means be able to make a home purchase.”

Yes perhaps it does Rhinehold but by raising the price of the house by up to 6%. Those that choose to but new homes still have the same resources available for the down payment as those that are buying older houses. Seems like competetion would be something a free market type would favor. I know its hard for your corporate homebuilder buddies to have to play on a level field but hey isnt that how it should be?

“If someone is working and using all of their income to pay bills and rent, how are they supposed to save up the thousands of dollars they will need to make a downpayment?”

Great time to address this Rhinehold where were you when the free market types were busting unions, off shoring and out sourcing? As we continue with the race to the bottom we can only ask ourselves this very question, and perhaps try to fix the real problem instead of crying foul because our corporate buddies aren’t getting an advantage in the market place.

“And that is the common theme when it comes to Democratic answers to problems they encounter. Control behavior through force instead of assist individuals who need it.”

Of course Rhinehold every law is forced at the point of a gun whether it be a Dem, Repub or Bipartisan law. Sorry the big corporations you defend in the name of the poor cant use the government as the force to sell their wares this time but you do realize that this law only pertains to FHA mortgages so the private sector still has the means to continue the seller assisted down payments thru non FHA mortgages.


Posted by: j2t2 at August 6, 2008 10:55 AM
Comment #257873

Lets say somebody transplants a bunch of fish to another lake to help it survive. Unless they keep them in some kind of tank or container where they can breath and survive, it’s kind of pointless, right?

Same thing with this. Maybe this down-payment thing is good for some. But for many, it might just run them into higher priced mortgage territory than they’re capable of paying for. Sure you got them a house, but they’re not going to be able to keep it for long, and what’s worse, it’s going to leave them worse off.

In the end, where the government helps, it should help to give sustainable improvements. Helping students pay for college with grants rather than loans is an example. I can personally attest to what a problem it is to pay them off. It’s not going to make me a more avid consumer, to say the least. I believe government can improve lives, but not everything it does or can do will serve that end, and we must keep an eye on it.

Posted by: Stephen Daugherty at August 6, 2008 11:25 AM
Comment #257878

Anyone that can afford rent these days can afford mortgage payments. The problem for a whole heap of folks has always been the down payment. What’s so wrong with benevolent organizations that gift down payments to folks that can’t come up with them?
Are the Democrats scared that home owners might not vote for them?
Why would anyone getting an FHA loan need a gifted down payment though? Most folks can come up with the $500 required by the FHA.

Posted by: Ron Brown at August 6, 2008 12:54 PM
Comment #257880

Ron Brown-
They can afford some mortgage payments. But if they don’t have to put up the down payment, they might be tempted to buy something at the edge of what they can afford, and that can become a problem. Down payments, I think, are a way of discouraging those who are on the margins of being able to afford something. When those people get into trouble, the payments can become impossible to maintain.

Posted by: Stephen Daugherty at August 6, 2008 1:09 PM
Comment #257887

“If someone is working and using all of their income to pay bills and rent, how are they supposed to save up the thousands of dollars they will need to make a downpayment? ”


Typically when you move from renting to owning, you spend more on a monthly basis in real estate. If you can’t save money in a rental situation how could you make a budget that works with a higher payment and bills?

In other words, your argument is chewbacca. It does not make sense.

Posted by: angrymob at August 6, 2008 2:05 PM
Comment #257893
Typically when you move from renting to owning, you spend more on a monthly basis in real estate.

Not really. For example, before I moved into my first house, my rent was 550 a month, my house mortgage was 423 a month. And that was at an 8.5 interest rate (which I still have).

So how does the cost of real estate go up again? Do some actual investigation… If you know your means and you stay within it, this option was the best opportunity you have.

Posted by: Rhinehold at August 6, 2008 2:38 PM
Comment #257895

A typical discussion going on here. Some are debating based on the intent of the original Constitution. Others are debating based on the contention that this is democracy as we have it today. Lash out or praise the big hand government that gives and takes away, making winners and losers of us all. That gives me the prerogative to state that we might all be wealthy if it weren’t for corporate subsidies. Or, we would all be driving bigger cars if we had more national laboratories to compete for defense dollars. Government has worked their magic to be all things to all people. Thus the politicians are rewarded 85% of the time with incumbency. Thus they are able to provide pork to Poland for specific museums or to fund all kinds of International ‘needs’. Here is a grassfire article from this morning’s email:

Did you know that your tax dollars helped construct a visitor’s
center that you can’t visit?

That’s right. Taxpayers forked over $200,000 worth of federal
transportation dollars to commemorate the birthplace of
President James Monroe, and it remains closed!

Before skipping town last week for a five week paid vacation—
compliments of U.S. taxpayers, the House passed a bill containing
more than 500 earmarks—like the one above, and then no doubt
patted each other on the back for a job well done.

Roy, this kind of arrogant, unaccountability from our supposed
leadership brings my blood to a boil. But nothing got me as worked
up as reading about the “Parking Garage to Nowhere.”

According to investigative reporter Sharyl Attkisson,
Rep. Paul Kajorski (D-11 PA), funneled more than
$3 million in taxpayer monies to build the Kanjorski Center.
Now built, the building has been sitting vacant since 2005,
with the city picking up the $15,000 a month tab.
If that’s not outrageous enough, Kanjorski is attempting to
siphon an additional $5.6 million for a parking garage
project for his vacant building.

When told federal aid can be applied to parking garages
that serve mass transit, the 12 term Congressman bristled
saying, “I don’t think the rule should have any attention
paid to it; because in Congress we have our own rules.”

Later in the same story, Kanjorski even refers to our money
as “free money.”

Billions wasted every year. Billions that could be directed toward helping new home buyers if you think of it that way. But then, we have to take care of the farmers, etc. etc. etc.

The government is near the end of their rope. Inflation through the roof, $65T of debt, stagnant wages for last ten years, people can’t afford health insurance or education for their children, financials collapsing around us, yada yada yada.

Government reform is needed. Subsidies have to go, Corporate Personhood and Money is Free Speech has to go. Goods have to be priced on a competitive market basis and not skewed by government intervention.

We can begin that reform by not voting for the status quo any longer. Pull the lever for Nader, Barr or a write-in but don’t reward the duopoly any longer.

Posted by: Roy Ellis at August 6, 2008 2:46 PM
Comment #257896

Stephen

many people who can afford thier monthly rent, could also afford a comparable house payment, but can’t come up with a down payment because they live at thier means. why should it matter where that down payment comes from ? many people buy homes that are at the edge of the envelope for them. if thier income is verifiable then they have a right to buy what ever they qualify for. taking away gifted down payments from otherwise qualified buyers is asinine. i bought my first home with a down payment from my family. i’ve never missed a payment in 16 years. according to your logic, i’de have never been able to buy the home, even though i was quite capable of making the payments. where the down comes from is irrelevant, and the dems have really screwed this one up.

Posted by: dbs at August 6, 2008 2:48 PM
Comment #257897

Small consideration is that many rentals cover part of the utility fees, too…..which is total homeowner responsibility. We get used to having water, garbage, sewer paid and of course, we don’t pay property taxes. First-time home ownership is often a big eye-opener.

Posted by: janedoe at August 6, 2008 2:51 PM
Comment #257899
why should it matter where that down payment comes from ?

That is one of the odd issues with this bill. It eliminates the downpayment from coming from a non-for profit organization (which would include any charity) but it is ok to get the downpayment from a famliy member…?

It is confusing.

Posted by: Rhinehold at August 6, 2008 2:58 PM
Comment #257900
First-time home ownership is often a big eye-opener.

Yeah, that’s true. Best to just keep from owning homes then instead of educating them to understanding what is part of home ownership and the costs involved and how to calcuate a budget and how to manage their money properly. After all, with rent you just pay a person a single portion of your check and everything else is taken care of you.

You know, just like the Democratic platform, take care of you instead of expecting you to stand on your own two feet.

Posted by: Rhinehold at August 6, 2008 3:00 PM
Comment #257901

“What’s so wrong with benevolent organizations that gift down payments to folks that can’t come up with them?”
“That is one of the odd issues with this bill. It eliminates the downpayment from coming from a non-for profit organization (which would include any charity) but it is ok to get the downpayment from a famliy member…?”

Guys am I missing something here?
The HERA08 doesnt prohibit charities and non profits from supplying a down payment just the sellers. Again from the NAR-“Seller-funded downpayment assistance programs – codifies existing FHA proposal to prohibit the use of downpayment assistance programs funded by those who have a financial interest in the sale; does not prohibit other assistance programs provided by nonprofits funded by other sources, churches, employers, or family members. This prohibition does not go into effect until October 1, 2008.”

http://www.realtor.org/gapublic.nsf/pages/hr_3221_key_provisions

Posted by: j2t2 at August 6, 2008 3:19 PM
Comment #257902

Great attitude Rhinehold !

Posted by: janedoe at August 6, 2008 3:25 PM
Comment #257903

“It is confusing.”

not actually, if you think about it. after all which is more efficient at helping people, and does not require the gov’t to run it ? which is the most inefficient way to help people, and requires the gov’t to run it, and take the cost from the tax payers at gunpoint ? now ask yourself, why the dems would be against private charities providing down payments to poorer home buyers ? enough said.

Posted by: dbs at August 6, 2008 3:27 PM
Comment #257928

“why the dems would be against private charities providing down payments to poorer home buyers ?”

Good God guys are we totally incapable of looking at the facts or what? Once more very slowly… the act does not prohibit private charities from providing down payments for FHA mortgages. So to answer your question the Dems are not against it if you are giving them the total credit for this bill.

Posted by: j2t2 at August 6, 2008 6:26 PM
Comment #257952

No, j2t2, you are missing the ponit.

The non-for profits simply get the initial loan back, with enough interest to keep the operation afloat. Because they receive this money back to pay for their operation they will no longer be allowed to operate.

So the majority of these non for profits will be out of operation in two months.

Other organizations who never expect to have anything other than the original payment or less come back to them will survive, but they are much fewer because they take their money for operation from charities (or tax breaks/credits that taxpayers pay for).

It’s the typical Democrat solution. Screw the poor while putting more power in the hands of government. I can understand why Democrats are so overwhelmingly for this ‘assistance’.

Posted by: Rhinehold at August 7, 2008 12:43 AM
Comment #257953
Great attitude Rhinehold

Yeah, I hit the Democratic philosophy on the head, didn’t I.

Posted by: Rhinehold at August 7, 2008 12:45 AM
Comment #257955

Rhinehold, you are obviously unfamiliar with renting total costs and homeowner total costs. The costs of maintaining a home, including local taxes, insurance, entire maintenance from ground to roof, and energy costs, are all expenses that are higher owning a home, especially if larger than an apartment, than renting.

Therefore, if the mortgage payments and rental payments are roughly equal, and the family is barely making the rent payments, they WILL DEFINITELY NOT be able to afford to remain in their home if they didn’t have the extra income to save for a down payment.

It is exploitation of the poor for builder’s and mortgage trader profits, pure and simple. You don’t seem to grasp the math of the situation where poor folks can’t save for the down payment. It means they can’t afford to maintain a home either.

Rather than set them up for foreclosure and dumping the mortgage for the escape road to another place for lack of ability to make the payments, let’s focus on improving their wages, their financial understanding, and educational path to better wages, instead.

Posted by: David R. Remer at August 7, 2008 2:55 AM
Comment #257965

Rhinehold let me make sure I understand what you are saying. A family member, a not for profit company, a charitable organization and/or a benevolent benefactor will cease to exist in a few months because seller financed down payments have been prohibited in HERA08. Even though those mentioned are not affected by this prohibition.

Again from the link in your article “Garcia-Duarte said the down-payment assistance services her organization provides will not be affected by the ban, which focuses solely on the seller-funded variety.”

I know this is an attack on the Dems but shouldnt you have something of substance to attack them on. Lets face it, the homebuilders will have to compete with product and price to sell their wares. Thats the rub here, a level playing field for the individual and the big corporate homebuilders. True free market competetion, not the unusual favor the big corporation as we have seen the past 30 years. Perhaps the title of your article should have been “Dems screw poor big homebuilders”

Posted by: j2t2 at August 7, 2008 9:58 AM
Comment #257975

j2t2,

*sigh*

The non-for profit organizations, that were receiving some money back from the downpayment gift to pay for their operating expenses, will not be allowed to function any further. That is where the statement you keep trying to portray as fact falls flat on reality.

Garcia-Duarte’s organization will remain, because they give a true gift, but they get money for their operating expenses from other areas. Family members and other charities will exist also.

However, the MAJORITY of organizations and money used for the benefit of poor and low income homebuyers, will be blocked.

And to what end? The organizaitons being blocked will be non for profits, so they were not out to ‘fleece the poor’, just recoupe their operating expenses, and it will make NO difference in preventing people from being foreclosed upon or not, other than blocking home ownership for everyone who would have needed to use those programs to buy a home, regardless of their situation, debt/income ratio, creditworthiness, etc.

What benifit is being derived by blocking these organizations from doing what they have been doing?

You keep saying that this is ‘helping the homebuilder’ but you (and the person you reference) gets it completely wrong. Do the homebuilders get more home sales? Yes, potentially, though how many of these homes are starter homes that are already built?

The real benificiaries (and now those damaged) by the program’s existence were the poor and lower income homeowners. The home builders will be able to alter their businesses, lay off staff (the other side effect that Dems don’t care much about, the loss of lots of middle class jobs) and keep on going. The potential homeowners are going to have to not buy, keep renting, and keep LANDLORDS rich, all the while just throwing their money away and having nothing when retirement comes so they have to keep relying upon the government and SS. Yay!

Well, unless you belong to a rich or middle class family you can hit up for a loan or belong to a church. Poor athiests are just screwed. :(

And, if they do get the downpayment from other sources, like family and charities, WHY does that help prevent foreclosures again? Please explain that to me j2t2… The government (Democrats) have written a law that blocks a specific thing from occuring, where do they get their authority AND how does it help fix any problem?

BTW, I want to give you an example. I am purchasing a home. My grandfather passed away and I am buying it from the living trust. There is no corporate homebuilder, etc. The only people getting the money from the sale are the family and mortgage lender. I am going to be using this program because I do not have the downpayment for issues that aren’t really relevant, suffice to say I can afford the mortgage.

I have to close by the end of September or I am going to be unable to purchase the home with no money down.

Good Job, Dems.

Posted by: Rhinehold at August 7, 2008 12:30 PM
Comment #257983

“The non-for profit organizations, that were receiving some money back from the downpayment gift to pay for their operating expenses, will not be allowed to function any further. That is where the statement you keep trying to portray as fact falls flat on reality.”

Rhinehold Im not trying to portray anything Im simply going to the link in your post and the national association of realtors for factual information. Both concur that prohibiting seller funded down payments doesnt affect the non profits, family etal.

“Garcia-Duarte’s organization will remain, because they give a true gift, but they get money for their operating expenses from other areas. Family members and other charities will exist also.

However, the MAJORITY of organizations and money used for the benefit of poor and low income homebuyers, will be blocked.”

Again according to the NAR only seller funded down payments are prohibited. Are you sure the ones you think may be affected are “non profit organizations”? It seems the 2 mentioned in your link may be affected because the were in essence fronts for the big homebuilders and not real non profit organizations.

“The real benificiaries (and now those damaged) by the program’s existence were the poor and lower income homeowners. The home builders will be able to alter their businesses, lay off staff (the other side effect that Dems don’t care much about, the loss of lots of middle class jobs) and keep on going.”

Well thats already happened my friend, with the real estate bust and the backlog of new houses already on the market the trades have been laid off. The problem they have is selling the houses. But hey as long as we can take a swipe at the Dems what the heck, lets not let facts get in the way.

“The potential homeowners are going to have to not buy, keep renting, and keep LANDLORDS rich, all the while just throwing their money away and having nothing when retirement comes so they have to keep relying upon the government and SS. Yay!”

The potential homeowners can still go to the real non profits, family etc. for loans just like before.

“Well, unless you belong to a rich or middle class family you can hit up for a loan or belong to a church. Poor athiests are just screwed. :(“

Perhaps the athiests should form an alliance to give other athiests the benefits of belonging to a church. As a legitimate non profit organization it is still a viable source for down payment money.

“And, if they do get the downpayment from other sources, like family and charities, WHY does that help prevent foreclosures again? Please explain that to me j2t2…

Maybe it doesnt help to prevent foreclosures Rhinehold however if you would read what Ms. Garcia-Duarte has to say then it seems they help people that get the down payment money to budget etc. Whether that works or not I dont know but as a free market type I must ask where was your outrage with outsourcing, offshoring and busting unions for the benefit of corporate profits? IMHO thats why we are where we are in real estate today wages havent kept up with inflated housing prices.

The government (Democrats) have written a law that blocks a specific thing from occuring, where do they get their authority AND how does it help fix any problem?”

Their authority comes from we the people Rhinehold the same as they would have with any law they pass. How does it help, well for one thing the added 6% the homebuilders inflated the prices of the house by to have seller assisted down payments will help lower the payments.

“BTW, I want to give you an example. I am purchasing a home. My grandfather passed away and I am buying it from the living trust. There is no corporate homebuilder, etc. The only people getting the money from the sale are the family and mortgage lender. I am going to be using this program because I do not have the downpayment for issues that aren’t really relevant, suffice to say I can afford the mortgage.”

Using the living trust as a method of getting a down payment seems like a good thing in your particular situation Rhinehold. Are they raising the price of the house by 6% in order for you to get this down payment?
BTW are you a poor and/or low income first time home buyer or are you just using the poor for your own benefit in this blaming the Dems discussion?
In general Rhinehold its my observation that real estate loans are very hard to get right now. The Lady that just bought my house in Reno put 45% down to get her’s. Thats the way it goes after the abuses we have just seen in the lending and housing markets. To blame the Dems for 1 little section of the recently passed law just doesnt seem right. If we as taxpayers are propping up the housing market due to the excesses of the free market then Im surprised its not a much tougher law. Myself I would have preferred to have the bottom drop out of the market so a few years from now I could buy at 20% of what I would pay today, but then here they go and prop it up. Seems that the poor would have benifitted from much cheaper housing prices a few years down the road more so than a down payment on an inflated selling price today.


Posted by: j2t2 at August 7, 2008 1:29 PM
Comment #258067

Stephen Daugherty
Even coming up with the down payment on their own a whole heap of folks buy more expensive homes than they can really afford. They’re counting on future pay raises that may or may not come through. If they get the raises they might be OK. But of they don’t get them they’re in trouble.
One of my daughters recently bought a home. They crunched the numbers and decided that by using his Army pension check to make the payments they could easily afford payments on a $54,000 home, which is a pretty decent house around here. The real estate agent tried to get them to buy a 68,000 house. When they told her they couldn’t afford the payments she told them that she could get them financed based on future pay raises on their jobs, and cost of living increases on his pension, and that these would cover the extra amount of the payment. They didn’t fall for it. But a whole heap of folks seem to.
What a lot of folks don’t seem to take into consideration is, even if the pay raises do come through, and they are the amounts counted on, that the cost of living can also go up and take a big cut out of the raises. This will put them behind the 8 ball in a hurry.
I just don’t see where gifting down payments causes folks to by homes they can’t afford.

Posted by: Ron Brown at August 8, 2008 1:50 PM
Comment #258081

I have nothing against credit, but paying twice what something is worth is something that always irked me.

I’ve only ever borrowed from friends, usually at no interest, and likewise lent to them, realizing things happen and it might end up being a gift.

I built my own house on a pay as you go basis. I always buy used cars.

But in this new world, if you get sick….you end up owing a fortune, if uninsured. Something is very wrong with this economy, IMHO. Maybe it’s a new Constitutional right to get a loan…..

Posted by: googlumpugus at August 8, 2008 3:39 PM
Comment #258118

It can’t be a right if it requires someone else to provide something for you, because that would violate their rights…

It’s a truth the progressives seem to want to ignore.

Posted by: Rhinehold at August 8, 2008 9:39 PM
Comment #258123
The costs of maintaining a home, including local taxes, insurance, entire maintenance from ground to roof, and energy costs, are all expenses that are higher owning a home, especially if larger than an apartment, than renting.

There can be some truth to that, but in my experience, those who keep renting for years (or decades) are usually locked into some very uncompromising patterns when it comes to their lifestyles and the choice of WHERE they are choosing to live. Patterns which reflect very poor long term economic planning and that demonstrate the typical American desire for instant gratification and living lifestyles beyond their means.

Many young individuals (or couples) insist on living in neighborhoods where they could never afford to buy—where buying would involve taking out prohibitively expensive mortgages. Think of how many people are paying 2+ grand a month to rent small one-bedroom apartments in places like NYC, San Francisco, or Boston. The typical argument that they have “jobs which require” them to be there usually doesn’t hold water (if your job delivers a salary that requires you to rent for thirty years, then you need to think about either changing jobs or moving to a different city with lower housing costs).

Fact is that if you’re willing to buy a modest house in a modest neighborhood and SAVE and sacrifice until you can afford something more, most people really could swing it. Not everybody, maybe, but a lot more than are currently even making the effort.

Posted by: Loyal Opposition at August 8, 2008 11:18 PM
Comment #258159


L.O.: Your modest house in a modest neighborhood is the right senario for people to follow. However, if the majority of Americans followed that plan, our economy would be a shadow of what it is.

Our economy is primarilly based on the hedonistic mass consumption of goods and services. The capitalist mantra is you deserve it all and you deserve it now. It is hounded into us on a daily basis. Instant gratification should be the moto on our money.

Posted by: jlw at August 9, 2008 1:47 PM
Comment #258163

JLW, an inflated housing market riding a bubble of massive debt is not good for the economy at all—not good for lenders, home-owners or anyone.

The rental market might suffer some if more people owned. But one thing that would happen is that rents would have to come down as greater percentages of people moved into their own homes, making rent cheaper, which in turn could allow even more people who want to buy to save for down payments. Owners of rentals would also be more motivated to sell, freeing up additional housing and bringing housing prices down across the board. Lenders would in turn would less reason to offer gimmicky and dangerous loans (dangerous to them as well as the borrowers) in an artificially inflated housing market. As greater numbers of people held equity in the places where they’re living, the economy could move across the boards towards a dependence on tangible assets rather than massive debt (debt both foreign and domestic—i.e. to China).

No, I say that the current economy is a shadow of it would COULD be if we moved more towards an ownership society rather than a borrow-and-spend one.

Posted by: Loyal Opposition at August 9, 2008 3:47 PM
Comment #258183

Rhinehold,

We have to leave screwing the poor up to the Republicans and Third Parties. Democrats may end up hurting the poor in ineffective attempts to help them, and there may be some who are self centered enough to help themselves first…but, my party does not SCREW the poor.

Posted by: Marysdude at August 10, 2008 10:35 AM
Comment #258198

Marysdude
There’s none so blind as those with partisan blinders on.
Fact is BOTH major parties screw the poor.

Posted by: Ron Brown at August 10, 2008 5:56 PM
Comment #258216

Rinehold,

I was being sarcastic. I don’t know how denying a poor risk a loan is screwing someone.

Funny thing is, I’m a poor risk to banks because I never borrow from them.

The calculus for risk is screwed up.

Posted by: googlumpugus at August 11, 2008 7:09 AM
Comment #258244

Democrats may end up hurting the poor in ineffective attempts to help them, and there may be some who are self centered enough to help themselves first…but, my party does not SCREW the poor.

In other words, it’s ok to be incompetent. As long as you WANT to help them, it doesn’t matter if you hurt them in the process. If being a party member leads to thinking like yours, Marysdude, I will never join one.

Posted by: DTP at August 11, 2008 12:48 PM
Comment #258265

“In other words, it’s ok to be incompetent.”

Ok? heck its great, if your up a repub up for relection as POTUS and have proven your incompetence.

seriously DTP, I dont think this prohibition has hurt the poor it seems to have hurt the real estate investor and the middle class much more judging from this thread.

Posted by: j2t2 at August 11, 2008 2:56 PM
Comment #258305

Now why is anyone here griping out the economy? After all, “Reagan proved deficits don’t matter” - that’s what our Vice President said, and what he says should be good enough for any red-blooded American, right?

What is not commonly known is the reply the current president gave when he heard what Cheney said: “What, me worry?”

Posted by: Glenn Contrarian at August 12, 2008 2:57 AM
Comment #258456

LCOL Hubert -

Ah, Georgia - an honest-to-goodness paying client of McCain’s top adviser! We gotta go help ‘em out! Two war fronts isn’t enough, we need a third one too! And this time we’ll be against the nuclear-armed varsity!

So what would you have us do, LCOL? Considering the state of our military, economy, and world reputation, what CAN we do? And if we CAN do something, SHOULD we?

Remember the USS Scorpion? The American sub that sank in 1969? There’s a lot of evidence strongly pointing to it being sunk by a Soviet torpedo…but the government kept it quiet. If the public had known right away that the Soviets had torpedoed one of our subs, what would have happened? Remember the ending of ‘Dr. Strangelove’?

But the government kept it quiet, and we did NOT have a thermonuclear exchange, and millions of lives were NOT ended. The decision to NOT avenge the murders of our submariners on our submarine was the RIGHT decision.

Sure, you might call this cowardice on the scale of Neville Chamberlain…but then Hitler didn’t have nukes capable of reaching all our major cities within less than half an hour.

If you want economic sanctions, fine. If you want to render humanitarian aid, fine. If you want to pound a shoe on the lectern at the U.N., fine. But keep our military out of Georgia.

Posted by: Glenn Contrarian at August 13, 2008 6:33 PM
Comment #258460

LCOL -

You said, “But like myself, terrorists are hearing Obama and his idealist world that will bring terrorist in our borders.”

My posts don’t normally contain this much sarcasm…but this time I think the occasion calls for it.

Hm. Last I recall, 9/11 was on BUSH’s watch, and he WAS SO VIGILANT. “The confidential President’s Daily Brief (PDB) for August 6, 2001 contained a two-page section entitled “Bin Ladin Determined to Strike in US,” and refers to possible hijacking attempts by Osama bin Laden disciples and the existence of about 70 FBI investigations into alleged al-Qaeda cells operating within the United States.”

And what did he do?

You can see the scanned document itself at:
http://www.thesmokinggun.com/archive/0409041pdb1.html

Yeah, us Democrats sure don’t like to keep our borders secure -

“Democrats tried to double the number of containers at ports and airports checked for weapons of mass destruction. It cost $1 billion. It would have been paid for by asking the 200,000 millionaires in America to cut their tax cut by $5,000. Almost all 200,000 of us would like to have done that, to spend $5,000 to make all 300 million Americans safer. The measure failed because the White House and the Republican leadership in the House opposed it. They thought our $5,000 was more important.”
Source: Speech to the Democratic National Convention Jul 29, 2004

And Fox News has Obama pinned just right - they’ve confused him with Osama bin Laden here:
http://thinkprogress.org/2008/07/24/foxs-kilmeade-confuses-bin-laden-and-obama-twice-in-five-seconds/

and here:
http://dailydoubt.blogspot.com/2008/07/fox-news-identifies-osama-bin-laden-as.html

and here:
http://latimesblogs.latimes.com/washington/2008/05/shocking-fox-ne.html

and here:
http://technorati.com/posts/qRshGxPVJ7Hd1r12Y0LKrShzcFf0YqFWPGr0O9TD8dg%3D

(an NBC employee did the same…but unlike the Fox employees, he was reprimanded (perhaps the Fox employees got promotions - hey, the truth doesn’t matter, right?))

Yep, and ol’ Obama will be more of the same - that Koran-totin’ Muslim even voted against invading Iraq, even though we KNEW they had those WMD’s pointed right at everybody and they was arming and providing support and training bases for al-Qaeda, too!

Yep, he’s gonna let those ter’ists in and then he’s a-gonna send the Man to come confiscate all our guns, too!

Posted by: Glenn Contrarian at August 13, 2008 6:58 PM
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