Candidates’ Proposals to Rescue Homeowners Ridiculous in their Own Ways

“If you elect me as your President, I will just make all of this foreclosure mess go away. I will outlaw foreclosure and let everyone live in their homes for free. Better yet, we will just forgive all of that mortgage debt.”

What is the difference between the campaign promise above (admittedly ridiculous) and the ones that the candidates are promising?

This is a hot campaign topic. High gas prices, recession, etc. are not even a worthy component to this problem. Foreclosures are on the rise and every candidate is hoping to convince you that they are going to fix the problem.

The most ridiculous (besides my own campaign promise mentioned above) is from Senator Clinton.

Here is a look at her proposal (provided by the Dallas Morning News):

· Provide $30 billion for state and local governments to stem foreclosures with counseling, refinancing assistance and purchase of foreclosed properties.

It is estimated that 730,000 homes are already in a short sale or foreclosure situation. With almost 1 trillion estimated loans set to reset in the next year or so, $30 billion is nothing. You can counsel someone all day in a foreclosure. If the credit is bad and there is no equity in the home, the train has left the station and there is nothing anyone can do.

· Ask lenders to freeze interest rates on resetting mortgages for five years and halt foreclosures for 90 days.

Excuse me for a second as I gain my composure from laughing. Clinton needs to fire whoever said that was a good campaign promise. As an attorney, she should know better that you cannot just arbitrarily change a binding contract without enormous repercussions.

· Allow the FHA or another government agency to purchase mortgages and restructure them if the crisis worsens.

You cannot just let the Government pick up the bill for everything.

Barack Obama:

• Provide $10 billion to support victims of mortgage fraud and help homeowners modify loans.

At least Obama knows that this is a ridiculous campaign promise by just throwing a dog the bone with $10 billion.

• Offer a 10 percent universal mortgage credit to homeowners who don't itemize on taxes.

What???

Then there is Senator McCain:

· Expand the Federal Housing Administration to help 200,000 to 400,000 homeowners refinance into viable mortgages.

This is all we need – four more years of Bush politics. Don’t worry, the Government will just pick up the tab. We can just “print” our way out of this problem.

I realize that politics are politics and none of this is too surprising. I just wish that we had politicians that could offer a dose of reality, real solutions, and the appearance that they really do understand the problem.

Is there a fourth choice?

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