The news folks wanted everyone to know this morning that because of all that crap that the mortgage companies and banks created.....if they messed around with your loan.....you get $2,000 now. Congressmen and news media folks were all happy about this deal. This twenty-five billion will be paid out by five banks.....and everyone's life so much better.
I sat there....looking over the $2k deal. Basically, you have to pay taxes on this, to both the state and federal folks. So you end up with $1400 at the end. It's nice to have $1,400.....but it really isn't going to fix your house troubles, your mortgage, or your happiness.
But here's the issue with the twenty-five billion. It doesn't come from some mystery pit in your backyard. The banks actually consider this profit money that they have to give away.....to make the President and the lawyers happy. So they need to make the money back up. You can anticipate....various fees and angles will be created for new homeowners over the next year.....to regain the twenty-five billion for the banks.
So in the end.....other than a great five-star press conference with the President.....there's really not much in this story.....except $1400 that you will spend on a new refrigerator, a new set of rims and tires for the pick-up, or a full-up week in Vegas with Wanda, your wife.
Oh, and all the new incentives and deals for banks to re-write your bank loan crap? Well....the question is....are we at the absolute bottom of the pit, or could dig a bit more and make this financial pit forty feet deeper....in which case....a re-write just gets you to round two of the mortgage issue. Just something to think about.
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