If I understand the proposals of the two candidates correctly:
- McCain wants to take some of the $700billion from the bailout and use it to buy out bad mortgages and renegotiate better terms for homeowners who entered into bad deals.
- Obama wants to require lenders to not foreclose for 90 days to allow folks to get back on their feet.
In McCain’s plan, although I’m not sure I agree with the concept of bailing out folks who make bad financial decisions (maybe they can cough up a few bucks to cover the college loans I have for 3 kids), at least we are not just moving the problem out 90 days,
In Obama’s plan, people will not get kicked to the curb until around Christmas or New Years. In the meantime, since these folks presumably can not make the payments, otherwise the lenders would not be moving to foreclose, then this just makes the problem worse since they will owe even more money after the 90 days. Lenders do not foreclose, from what I’ve seen, until they are out of options.. they don’t want the property, they want us to stay in the property and pay what we agreed to pay.
Neither plan seems great, but Obama’s seems to be more of an emotion play than a plan that will solve anything.
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