Sorry About This--Another Mortgage Rant

I know--I'm beginning to sound like a broken record. But THIS is simply outrageous. Clinical psychologist and "life coach" Monica Banks Greene bought her Largo, MD house three years ago for $440K and it is now worth $390K. She'd like to refinance, but under the rules put forward by the Obama Administration in its effort to help our most protected class--homeowners--she hasn't enough equity in her home and she is too "upside down" to qualify for federally sponsored refinancing. Here's how the WaPost put it:

"That borrower, Monica Banks Greene, was ecstatic when she heard of the administration's effort to make refinancing possible for as many as 5 million households with little or no equity in their homes. The plan targets borrowers such as Greene who are on time with their payments yet cannot refinance because their home values have plummeted.

But Greene remains stuck in her old loan. Only borrowers who are no more than 5 percent underwater on their loans qualify for the program. Greene owes more than that. She bought her Largo house three years ago for $440,000. It's now worth about $390,000."

Here are Ms. Greene's words: "I make decent money. I have great credit, and yet I still can't qualify," said Greene, a clinical psychologist and life coach. "Now, I'm waiting again for a plan that works for people like me."

You want a plan, Ms. Greene? Here's one. Keep paying your mortgage on time out of your "decent" salary and shut the hell up. Oh, here's another plan--pay more each month toward your mortgage than is due and build equity--thereby getting yourself in a position in which a bank looks at you as a good risk (i.e. you've got skin in the game). Then, refinance. That she even considers it the government's job to create some kind of benefit for her bespeaks the deepening dependency state in which we find ourselves. That our government considers people like Ms. Greene (but who have more equity in their homes) worthy of help is also a travesty. Instead of worrying about how to help people refinance loans they freely entered into under terms they can presumably afford, we should be increasing the penalties--civil, criminal, and social--affixed to people who feel they can walk away from situations like Ms. Greene's. I want to be fair--she's not threatening to walk--but she represents an entire ideology that leads inescapably to that decision.