Sunday, February 22, 2009
A bonanza of bad ideas
So not only are those who were prudent about how much house they could afford and kept their mortgage payments current going to have their taxes go to subsidize those who got into trouble and are facing foreclosure,Obama wants bankruptcy judges to be able to alter unilaterally the terms of mortgages. At least that change would require an act of Congress; it's not something our imperial president can do by decree. This Register editorial offers a brief explanation of why that is likely to lead to increased interest rates and higher down payments,which will disproportionately have a negative effect on first-time homebuyers, especially those with moderate or low incomes. For a more detailed explanation, check here. Ah, the joys of unintended (probably, economic ignorance runs rampant on Capitol Hill) consequences.