They hire men who are fond of looking up women's skirts and they give money to geniuses. Now the John D. and Catherine T. MacArthur Foundation is going to save Chicago homes.
Rather than set up counseling services years ago, back when Congress engaged in social engineering by abandoning sensible lending restrictions at Fannie Mae and Freddie Mac, the foundation is coming in after the damage has been done. For all those people who were unable to estimate their means, and thus lived beyond them, and for those who were duped by unscrupulous lenders, there will be grants.
Foreclosures are soaring in Chicago, and that is usually followed by abandoned houses which are boarded up, only to used for shooting galleries and other illegal activities. Better to give cash to various coalitions and support groups, who will then provide....counseling for those who are about to put on the street. Is this to avoid foreclosure the next time that the unfortunate lender takes out a mortgage?
A sizable chunk will be dropped into ShoreBank's coffers, where a fund is operating to help those with some means to get out from under a balloon mortgage and into something fixed. Perhaps they throw in a counseling session that explains what it means when you have a loan that comes due in five years, or that a variable rate means it changes from year to year, and not in a cheaper direction.
The foundation is giving a portion of the $68 million grant to lobbying efforts to encourage sensible practices.
20% down, twenty or thirty years term, at a set rate of interest, with a monthly payment not to exceed 30% of the borrower's salary. Simple, effective, proven over time...it shouldn't cost much to convince Congress that social engineering cripples the economy, and the old way is the safer alternative.
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