Fix Congress's Housing Fix

Mr. Zuckerman...Please read:

Mr. Zuckerman:

Would you be kind enough to follow-up on the previous commentator's idea about requiring the banks to have an "Absolute Auction Within 120 Days."

It really is an excellent idea because currently the banks can carry their foreclosed property on their books at full value indefinitely. So the banks have no incentive to sell the properties. Rather, the vacant properties attract blight and mold, further declining in value and destroying our tax base and housing stock.

This is what the banks are doing now...destroying our housing stock. They only care about money, not communities.

Please forward this idea to Sen. Dodd and Rep Frank. It would assign punishment appropriately and not involve the taxpayer.

Otherwise in one year we will be reading about hundreds of billions of dollars of housing stock that the banking industry let rot. Ane we will be mired in a deep depression.

Solution no one else has proposed

The banks are permitted to carry nonperforming properties on their balance sheets for way too long. If the mortgage mess is truly a national emergency, before we engage the taxpayers to bail out the players, let's try this: Require banks to submit nonperforming properties to absolute public auction within 120 days of the first missed payment. An ABSOLUTE auction, note -- not a reserve auction -- at which the bank would NOT be allowed to bid on its own behalf.

This would mean that if the highest bid comes in at $28,000 on a $600,000 house -- so be it. The property is nonetheless sold to the highest bidder. The property is now off the bank's books, it has a new owner who can be held liable for property maintenance and taxes, sparing the neighborhood blight, and the original owner, who was not bright enough to foresee the consequences of his poor real estate decision, is on the street with a huge tax bill for the difference between his mortgage amount and the sum realized by the bank at the auction.

Appropriate punishment for the original homeowner AND for the bank who exercised such poor underwriting standards that they made the loan in the first place.

This would also have the result of lighting a fire under the butts of lenders who currently take forever to approve short sales. Knowing that if a short sale offer was not approved and completed within that 120 day window -- that the property would be headed to absolute auction -- the banks would break their legs hurrying to assemble a staff who could review and approve this type of sale pronto.

The banks would take huge losses under this proposal, but they have already and will continue to take huge losses even if nothing is done. This would at least clean out inventory and hasten the return to normalcy of the entire RE market. And no taxpayer funds would be required!

Why not me?

Why should I pay for this. Should I simply walk down to my financial lender and say,"well everyone else is doing it". Is there no consequence for our own actions? Or will the liberal congress forgive stupidity? "Oh, is dat what a amortized mogatage be"? WTF? Do you still get arrested for murder, speeding,public disturbance, ect. ? You are telling me all you have to say is ,"I just was too damn stupid to realize the consequence of being an IDOT! That is it ? Well , I am an IDOT. Why should I not just devalue my home? And let me start over. The industry that prey on stupid people should devalue their companies. But, to hell with that , the dem congress is gonna take care of that. WTF, is a VIP anyway? Apparently , a Chairman of the Banking Committee. I know I am dumb, but, if I can see through this ? We are screwed.Dodd should resign as chair! Not going to happen. If , I had my way he should give his senate seat up. After all he does not understand what it means to be a congressman. He works for the people . Not his best interest.