06 December, 2007

Here they come again! Our heroes!

The federal government must think we can't survive without them. I guess we have given them plenty of reasons to think that, but it becomes a self-fulfilling prophecy.

The more someone (or someones) come to the rescue, the more they become dependent on the help.

The latest example of the white knight that is the Federal government is the announcement that they are going to freeze the adjustable rates on all of those mortgages. Sounds like a good thing, but here is what is being missed.. If borrowers can't afford the rates where they are frozen (which by the way is among the lowest on record), how are they going to be able to afford the payments in 5 years, when the rates thaw?

I understand that one of the key indicators of the health of the economy is housing sales, but isn't this just another form of welfare?

If there hadn't been the pressure to relax the standards for loans, there wouldn't be the need to bail out those who didn't plan ahead enough to get a loan they would be able to afford.

I'll be the first to tell you that I am no Warren Buffet, but I was smart enough to not get a loan for the max I was approved for, and I got a fixed rate. The only time my payment will change is when my taxes go up to help pay for everyone else that needs the government to bail them out.

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