One thing which I noted in last night’s debate was John McCain speaking to the actual concerns of those affected in their personal lives by the financial crisis – those who have seen their home values collapse while keeping up their home payments. As a for-instance, there is me. My house has lost at least $175,000 in value, and perhaps more – in a real sense, by house is actually worthless because with so many foreclosures on the market, there will be no prospective buyer’s for my house as there are plenty of nicer houses to be had for even less than the supposed market value of my home. Essentially, every month I make a mortgage payment, I’m wasting my money – I am not building equity, and I long ago lost the $40,000 I put down on the house. In terms of logic, the best thing for me to do with this house would be to bag it – go buy a house at knock-down prices and once I close on that home, allow this one to fall into foreclosure.
I’d rather not do that.
But what to do? I contacted my lender and suggested a re-working of my loan payments – not any forgiveness of debt, but just an easement on the amount I had to pay each month so that I could hang on here while building up savings until the market comes back and I can either sell the house (and pay off the bank) or refinance it (and pay off the bank). No harm, no foul – the bank has one less foreclosure on their hands, I have my house without the shame of a defaulted loan, I’m building up savings and in 5 to 10 years I sell/refinance and clear things up with the bank which will not have lost a penny on me. The answer to this suggested course of action? Not just no, but heck no. The bank wasn’t interested…and so there I sat (and sit) tossing money down the black hole of a collapsed Las Vegas housing market, watching my tax dollars go to bail out Frank and Dodd’s buddies who created this whole mess and all the while wondering if anyone was ever going to take an interest in Americans in this fix. Finally, last night, someone did – and it was John McCain. And I wasn’t the only person who noticed:
ABC News’ Rick Klein: “[M]cCain is roaming the stage, playing to his strength. And comes out with a policy proposal to help people stay in their homes — a strong lead answer, to have a meaty response to that. McCain looks confident early.” (Rick Klein, “Live Debate Blog,” ABC News’ “Live Debate Blog,” blogs.abcnews.com, 10/7/08)
Details? Don’t have them – but we really won’t fix the mess until we figure out what to do with all those houses in New Jersey, California, New Mexico, Nevada and elsewhere around the nation which have lost more than 20% of their value. Until this is resolved, a huge chunk of the American public is entirely removed from the housing market unless they ditch their current homes, thus shoving even more foreclosures on the market to drive down prices even further and make home mortgage paper even more worthless than it is now. Whatever the plan is, it has to have a component of helping those Americans who are upside down but who have not defaulted – not even so much as one late payment. Those who can afford their homes, but who’s homes have suffered a massive loss of value, thus becoming a dead weight on the housing market and on the banks who are holding paper on houses worth half of the loan amount.
All of Obama’s finger pointing at Bush; all of Obama’s ignoring of his Party’s part in this debacle, all of his welfarist notions on how to move forward are so much worthless nonsense – they don’t address the problem which needs to be fixed in order to get things moving again. A lot of wealth has been lost, and some way has to be found to make the debt load of the people match the real value of the nation’s real estate – McCain has an idea, and is clearly thinking of regular folks; the hard working people who didn’t buy houses on speculation but who have none the less been caught in the Democrat-inspired collapse of the mortgage industry. In this alone – the perception to see where the real problem lies – we can see McCain’s manifest superiority over Obama as a prospective Chief Executive.
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