How Secrecy Could Wreck Geithner's Bank-Rescue Plan

All banks will fail because of deadbeat borrowers failing to honor loan contracts.

The Mortgage Forgiveness Debt Relief Act of 2007 removed the last incentive for borrowers to remain in “their” homes. This Bushtard law must be rewritten and retitled the Patriotic Mortgage Repayment Act of 2009. It should retroactively assess tax on any buyer that has defaulted in the last five years.

Patriotic Mortgage Repayment Act of 2009

If a borrower defaults on a mortgage and the market value of the collateral is insufficient to repay the money borrowed, the Treasury will recover 105% of the residual amount using IRS collection methods and interest schedules.

It should be trivial for the borrower to meet his obligation. After the foreclosure sale recovers 75% of the original loan, the payments on the remaining 25% loss should be well within the budget of even the biggest speculative flipper.

Such a law would prevent the general population from bailing out the speculators that purchased more house than they could reasonably afford. These wannabee flippers took grandma’s money out of the bank, now the bank has collapsed and the FDIC is having to pay off Grandmas. The least these deadbeats should do is repay 100% of grandmas’ money to the treasury plus 5% as a handling fee.

simple of TX 9:45AM March 24, 2009