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UK mortgage holiday

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'Homeowners struggling to pay their mortgages were given a reprieve by Gordon Brown yesterday when he unveiled a plan to let people affected by the economic downturn take a two-year mortgage interest payment holiday.'
http://www.guardian.co.uk/politics/2008/dec/04/brown-mortgage-interest-break-repossessions

Strikes me as practical. Too late to implement in the USA?

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Originally posted by Bosse de Nage
'Homeowners struggling to pay their mortgages were given a reprieve by Gordon Brown yesterday when he unveiled a plan to let people affected by the economic downturn take a two-year mortgage interest payment holiday.'
http://www.guardian.co.uk/politics/2008/dec/04/brown-mortgage-interest-break-repossessions

Strikes me as practical. Too late to implement in the USA?
It's like trying to smother a fire with hay, the flames will disappear for a moment, but they'll be back, easy credit on imaginary money, and guvamints everywhere cranking up the money printing machine.

Rudd in Aus, was sitting on a big fat surplus (aka you've all been over taxed) handing out "free" thousands to first home buyers, luring people into debt for the rest of the price, guaranteeing some financial institutions which means they can't cock up no matter how much and to who they lend too with the added benefit there was a run on the institutions he didn't guarantee.

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Originally posted by Bosse de Nage
'Homeowners struggling to pay their mortgages were given a reprieve by Gordon Brown yesterday when he unveiled a plan to let people affected by the economic downturn take a two-year mortgage interest payment holiday.'
http://www.guardian.co.uk/politics/2008/dec/04/brown-mortgage-interest-break-repossessions

Strikes me as practical. Too late to implement in the USA?
For one, it is a massive discrimination against renters. What do they get? And why don't they deserve to get something?

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Originally posted by spruce112358
For one, it is a massive discrimination against renters. What do they get? And why don't they deserve to get something?
Let's deal with the primary issue first, please. Is this a good idea in principle or not?

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Originally posted by Wajoma
It's like trying to smother a fire with hay, the flames will disappear for a moment, but they'll be back, easy credit on imaginary money, and guvamints everywhere cranking up the money printing machine.
OK, that's a 'makes no difference' from Wajoma.

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Originally posted by Bosse de Nage
OK, that's a 'makes no difference' from Wajoma.
Ok that's a "yes it makes a difference by delaying things slightly and making them worse when they do happen."

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Originally posted by Wajoma
Ok that's a "yes it makes a difference by delaying things slightly and making them worse when they do happen."
Correction noted.

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Originally posted by Bosse de Nage
Let's deal with the primary issue first, please. Is this a good idea in principle or not?
I think the basic idea is not bad, in principle, but I have some doubts about the implementation.

Example:
The prime minister said the scheme would cover any household which suffered a redundancy or "significant loss of income". This would, for the first time, extend help to households where one family member loses their job and the other remains in work.

There might be situations where a couple can prevent repossession only if one is made redundant. I understand the need to help people who need the most, but maybe the criteria shouldn't be directly on employment status.

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Originally posted by Palynka
I think the basic idea is not bad, in principle, but I have some doubts about the implementation.
Yes ... perhaps a blanket holiday for all mortgagees would be best!

Will the interest be frozen too?

Jebus, I could do with one myself.

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Originally posted by Bosse de Nage
'Homeowners struggling to pay their mortgages were given a reprieve by Gordon Brown yesterday when he unveiled a plan to let people affected by the economic downturn take a two-year mortgage interest payment holiday.'
http://www.guardian.co.uk/politics/2008/dec/04/brown-mortgage-interest-break-repossessions

Strikes me as practical. Too late to implement in the USA?
I think the US Treasurey is going to unveil a program of 4.5% on a thirty year mortgage to get the housing market going.

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Mortgage holders have just been helped by another 1% interest rate cut.

Why should they be given payment holidays? If they cannot afford their repayments, though. Shouldn't have taken a massive mortgage they can't pay for.

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Originally posted by Bosse de Nage
'Homeowners struggling to pay their mortgages were given a reprieve by Gordon Brown yesterday when he unveiled a plan to let people affected by the economic downturn take a two-year mortgage interest payment holiday.'
http://www.guardian.co.uk/politics/2008/dec/04/brown-mortgage-interest-break-repossessions

Strikes me as practical. Too late to implement in the USA?
For a government to forcibly remove profit from a business contract between two private parties is, not practical. More like a disaster.

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It's an attempt to put off the property price crash until after the next election.

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Originally posted by Bosse de Nage
Let's deal with the primary issue first, please. Is this a good idea in principle or not?
I think you have to look at the fundamental issue first.

Does this make sense? You get a $200,000 mortage to be paid back over 20 years. With interest you will have paid approx $400,000 to the bank so the bank will make a $200,000 profit from you just by lending someone else's money to you.

This is highway robbery. Our banking system is not one designed to ensure the financial stability of a civilization. Instead, it has morphed into a system designed to generate maximum profit at minimal risk to the lender.

So, in this context, does anyone think reducing the amount of interest paid on a mortgage is a bad idea?

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Originally posted by Siskin
It's an attempt to put off the property price crash until after the next election.
Probably. If people lose their jobs, there should be social security to aid the transition to a new job, and people can always sell their house and move to a smaller rented house.