Frank Louis
If you are here "illegally," Not a Problem: Buy a house, and you'll get a visa
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By Frank Louis
October 26, 2011

There are 2 new government "housing" programs ramping up this month. Neither, however, considers people who invested actual money in the housing market and lost actual money as a result of the fraud. No, these programs don't do anything but kick these Americans in the butt!

First, there is the new government program to "fast track foreigners," whom we are told, make up a large (as much as 40%) percentage of home purchases in South Florida, Southern California, Arizona and other hard-hit markets, into buying real estate that should, by all rights, be owned by Americans! You know, people who bought it at the 2005 prices and are now bankrupt? Yeah, those people. Now, two Senators, Sen. Schumer (D., N.Y.) and Sen. Lee (R., Utah) are seeing to it that this trend will not only continue but also become an increasing phenomenon. Sorry senators, some of us were born and raised in Florida and Arizona, we want it back!

Than is right, according to articles in the Wall Street Journal, CNBC's "Realty Check, and others, our government is figuring out even more ways to give the country away. They are offering visas to aliens who invest in real estate. Yes, it seem that if you are here illegally, just buy a house at today's bargain basement prices and you are in! The media talking heads think it is just grand! For now, the legislation stipulates that these new "homeowners" could not receive any US government benefits... for now that is. Just wait! Surely they might miss a payment, qualify for some modification program due to their "minority status," and... well you know where this is heading. Surely someone will decide it is unfair or "racist" to expect down payments for these "immigrants." It is another "foot in the door" that should be closed. Did you know that according to Wikipedia, the Latino populations of Georgia, North and South Carolina, and Arkansas increased between 300 and 400 per cent from 1990 to 2000? I wonder ...

Another question I have for this genius program. What happens in a few more years when the people of Florida or Arizona or the other states where this "wave of foreign investors" is happening wake up one morning, look around and say; "Hey, we are not even Americans, why is this even America?" "Bye, bye Florida, bye, bye Arizona." Can you say "secession?" "Sharia Law?" It can and will happen folks. Mark my words. Thanks Chuck, thanks Mr. Lee. The other program, "HARP," (isn't that what people used to call it when someone was making life difficult for them... "Being harped on?"). Anyway, This program, while it is set to "help" over a million people, is already being reported as "helping" people who have not even asked for help or even want it. I have heard reports of people being contacted by their banks out of the blue with a reduction. People who are having no problems with their mortgages and didn't even ask for any reduction. Who knows! I guess these are safe bets the administration can point to as successful modifications. Here is my take on the "HARP" plan as it is designed. I will use two hypothetical people in my example as I have done before to demonstrate my point.

So, two people bought a $200,000 property in 2005. Properties grossly overvalued by events in the fraudulent housing market. Person "A" has saved for years, is close to retiring, perhaps takes out a home equity loan on his primary residence, and makes an "investment" in his family's future, puts 30% down and has a mortgage for $140,000. The bank's approver professional appraisers validate the value and the realtor sure believes it is a great deal based on other documented "values." Person "B" on the other hand, takes out a no doc, no money down, no income verification loan for the full amount. Additionally, as person "B" has $10,000 in credit card debt, they get the loan for $210,000 with "cash back at closing." Credit cards paid off.

In the time since the purchases were made, let's just say the values have dropped 30% in this area. So, now the $200,000 property is now worth only $140,000 (a devaluation of $60,000 in just a few years). Well, wouldn't you know it... person "A" is not upside down in value of the property to the loan amount. Additionally, as this was not a "primary residence" in many instances, person "A" need not apply for any modification program and is out his $60,000 down payment as well. However, person "B" is underwater big time and gets the full service treatment. Who lost money in this scenario? Who has been robbed?

This is "wealth redistribution" at its best folks and no one is discussing it. Even government figures estimate the loss in net worth of Americans at $5.5 trillion. Hey, that could severely put a dent in our national debt!

Recently, I had a conversation with a gentleman who is well read in the real estate crisis and discussed my thoughts with him. I brought up the issue of "straw buyers" and other fraud that occurred. His reply was that it was not on that grand of a scale and that the real problem was a result of selling derivatives and the leverage. While I agree with him on this point to an extent, the point I believe he was totally missing is that the two elements go hand in hand. Mortgage backed securities needed mortgages to be created. How best to create mortgages and a hot housing market than to ... well, "just create them?" If anyone thinks for one minute that these fraudulent real estate sales did not affect the "comps" that real estate "values" are based on, I have a bridge to sell them. A big one.

He had also never thought about people who actually made down payments. Nope, not one word of thought ever in any of the articles I have read regarding US Citizens who have been raked over the economic coals by the housing fraud collapsing the country. No word about people who often invested more in down payments than the properties are now worth. That's right, just give it all away: sorry, but I do not think so.

Funny thing, no presidential candidates are touching this issue at all. I wonder why. Why don't you ask?

This was a nation based on Biblical principals. The founders referred to Scripture for the wisdom required to found the greatest nation ever formed (despite what the "Occupy Wall Street Protesters" think). Ezekiel 7:2-4 reads: "The end is coming on the four corners of the land. Now the end is upon you, and I will send My anger against you; I will judge you according to your ways and bring all your abominations upon you. For My eye will have no pity on you, nor will I spare you, but I will bring your ways upon you, and your abominations will be among you; then you will know that I am the LORD!'" The chapter continues and goes on to say in verse 13 that "Indeed, the seller will not regain what he sold..." I am curious if either Schumer of Lee has read these passages lately? The Founders surely did.

© Frank Louis

 

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Frank Louis

Frank Louis is a print and on-air commentator who offers opinions and solutions on and for the economy, social issues, and the future of this nation. In the Old Testament, Nehemiah 4: 14 instructs us to fight for our houses; something we need to be doing now. Our future generations depend on it!... (more)

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