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-- latest attempt to calm the housing crisis here it is paying homeowners to walk away.
This allows homeowners to sell that profit is -- less than -- -- on the mortgage.
Given myself from found all my status Selig and fine if that's a law firm that specializes -- he joins us now.
Okay the government says we will pay you to do a Schultz that will give you 15100 -- get out the way move.
Let the bank take the loss you think this is a good thing.
In general I do think it's a good thing I think will help Stewart the market clearing process.
At the end of the day whether a bank for closes against that individual homeowner and then takes the property back into what is cool are we oh real -- Owned by the bank and sells it what -- a short sale is it's not going to make much of a difference except for some citizens and legal fees and cannot think.
If -- if you get a wave of these short sales people leaving selling for much less than the mortgage on the house.
Don't you flood the market with a ton of -- -- and that blood drive prices down even further that's what you mean by clearing the market.
I do what's the -- understand that I think I think really this.
Move by mr.
Obama is he is political copper -- other words what's happened this is home affordable modification program and was a failure a terrible -- to the modifications didn't -- So now recognizing he can't deny the market process he's he's getting behind.
What he was trying to stop before so to an extent we're gonna -- something I've always been saying.
By sticking your finger in the dike and stocking stopping the eventual flawed.
Who we can't deny it so this process must the -- so it's going to happen it is going to happen and what he's saying a thousand here fifteen Richard I was there.
I don't think it's significant that's why I say it's political cover.
I think that what's gonna happen now is the short sales can't be denied because the market is -- but it.
But it this could be significant in the -- at the end newspapers will you talk about principle modifications on Fannie Freddie books -- -- writing down assets.
There we're told -- by the administration giving out a thousand to each bank and 15100 per seller for relocation -- such suite 500 dollars and deal.
At that altogether not what foreclose on these properties look it's -- now almost zero.
There's no question that this administration thinks that the the solution to every problem -- the right track.
Taxpayer funds there's no question that's gonna happen and that's gonna happen I think -- won't this would happen without any federal at the -- but.
But the bottom mob got to get to this the bottom line is the taxpayers on the hook for probably at least another hundred billion dollars in -- way more than that way more way more with the loss yet because.
There's five and a half trillion dollars of loans.
That -- Freddie Fannie.
Now -- own or are responsible for many of -- to hit the mortgage loans in this country many of these loans are going to be the subject of these.
Of these short sales in addition there may be bailouts coming down the pike.
For the short sales in the private sector of the private banking sector OK so it's it's a lot of money.
You know real estate state after a second -- got to read an email that came in from the from we have it from Allen in -- manner in Massachusetts he's writing this about Detroit's possible plan.
Two -- 101000 homes and replaceable with farmland -- -- happily old gone.
-- standard of living comes from production not destruction.
-- down homes crushing cause another destructive ideas will only reduce our standard of living.
You're -- real estate guy what do you make of bulldozing 101000 homes and putting a farm in downtown Detroit.
I'll tell you how I I see these two stories as connected the short -- story and the Detroit demolition story.
Because what is happening in my opinion is that the free market is now.
Telling the regulators want to do.
The they have swapped roles in my opinion of free market is telling the regulators when the regulators have failed what has the -- Happened because the market won't be denied the mortgage modification program felt so we now and short sales.
The affordable housing program -- we now have nineteen million vacant homes so the market that is is command and these that's how I see it.
I think also to them two million dollars point you know there's a thing called creative destruction I mean you don't build it sometimes you -- tear things down right now we're in the process of tearing down the old Yankee Stadium.
Because they build the new Yankee Stadium when -- would ask you about though with respect to this program.
The banks are involved with their thinking that I think they're calling that some sort of elegant solution they don't want all of these thousands of -- when they get these homes they say that the people go -- -- -- this double -- The piping they're trying to figure out ways to keep people in at least another six month to let an exit gracefully.
How will this new plan impact there at this sort of program.
And I'll put -- this -- more homes on -- bench and they don't want.
Five seconds I think it's going to exacerbate the problem because people are going to see it as destruction waiting to happen.
All right thank you Stephen -- -- we appreciate your expertise in the.
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