So by now everyone knows that there are hundreds of thousands of people who are facing foreclosure for any number of reasons.  Of course, this has become a hot topic on the campaign trail as we wind down to the Presidential Elections in November.

The current regime (The White House as well as the House and Senate) is weighing in with huge plans for stimulus, bailouts, and slate-cleaning.  With huge multi-billion dollar Bills in front of the House and Senate, you have to wonder how many homeowners $1B can help… then just multiply that by how ever many billions they ratify.  The latest package is supposed to help an estimated 400,000 people… that is all!

"So taxpayer dollars are being spent to just band-aid the issue" is what many people are thinking.

Now don’t take this as a ringing endorsement of a candidate - I have promised myself that I won’t reveal my stripes lest I offend someone … but just read on without focusing on the WHO and think more about the WHY.

Senator John McCain (R AZ - well, a Liberal R) has proposed something very interesting that I think should merit more discussion.  While others just want to fix the problems of those who are in trouble… Senator McCain, the Republican Nominee for President, has proposed that people need to QUALIFY for their newly fixed loans!

Amazing!!! Someone wants people to QUALIFY for a Loan!!  Who would have EVER thought of THAT!!?!??!  Not only that… Senator McCain would like people to RE-QUALIFY for their old loans!  Huh??  It isn’t as weird as you think.

You see… everyone that got a loan in the height of the market signed an IRS Form 4506-T for the lenders to actually pull the borrowers’ tax forms should they default on the loan.  Typically the form is only good for 6-12 months.  So if they got their loan in 2004-2006, it is too late for the Lenders to go back and say, "Hey!! You lied, you were making $25,000 not $250,000!!!"

Sen. McCain has thought of that… and he wants to make sure that people that receive government aid to straighten out their current financial mess are worthy of help.  Meaning - he wants to help the INNOCENT.  Sen. McCain has proposed that a borrower who seeks government aid monies to bail them out of this mess must prove that back when they got their original loan, that they qualified for it THEN.  He wants them to bring documentation!!

But wait… Countrywide, Greenpoint, and all the other big lenders said they didn’t NEED Documentation back then…so why should they need it now??  Because THEN they overstated income or assets or BOTH!

"Wait!! but the Loan Officer at the Bank told me it was ok!"…Did he encourage you to pay off your loan with future lottery winnings as well??

How could massive overstatements of income and assets NOT catch up with so many people??

The simple truth is that Sen. McCain is saying that no matter how bad you were conned or how ignorant you were to the process or how wrong the loan fit your financial needs… it was still and IS still partly the responsibility of the BORROWER to a) pay their bills and b) not just sign contracts without understanding them.

WHOA THERE MISTER!!!  What did I just say!?

The United States Legal system is based substantially upon CONTRACT LAW.  There are people who spend their whole lives nitpicking the minutiae of even the most simple contract.  They are called Lawyers - note LAW is in their title that they earned by spending inordinate amounts of time studying and memorizing Cases built on breaches of contracts.  When you signed that Note and the Mortgage Loan documents you were signing a contract and swearing that all the information YOU provided to the Lender via their Loan Officer was TRUE…

True… so if it wasn’t then it was FALSE??  If when you closed the loan and the title closer had you sign your loan application AGAIN for the 3rd or 4th time asked you to "Sign here if everything on this page is CORRECT" and it WAS NOT true… whose fault is that?

And that is what Senator McCain wants to prove before he helps borrowers.  I think you can infer my opinion about the matter at this point.

For More Information on Boynton Beach & Lake Worth Florida Real Estate and Mortgages, please contact

David Podgursky Broker Associate & Licensed Mortgage Broker Boca Executive Realty  & Boca Executive Mortgage 561-504-6949 cell DavidP@BocaExecutive.com Your Full Service Source for Residential and Commercial Real Estate and Mortgage Loans in Florida