Posts Tagged ‘short sales’

Recently, I was listening to a CNN report on short sales of homes.  Basically, the bank decides to take a payoff short of the current debt amount on a property.  The adjustment reflects the reality of the economy, job market, and housing crisis.  The federal government should consider a short sale program for student loans with the borrower buying the adjusted debt from himself and the fed eating the loss. 

For example, a student borrowed 20K but the interest has ballooned (forbearance and Income Contingent Repayment) 35K.  The fed eats 15K and the student get a short sale new loan of 20K with a low interest rate.  However, the student is not allow to get new debt (car, boat, house, kids) above the 20K amount until the student loan is repaid. Okay, this is not China so I can say kids.  

While the job market is down, people are staying in school to live off student loans but the mountain of debt is growing. Everyone I know has an advance degree that qualifies us to be unemployed.  Middle class is about an income amount; not your education level or the ability to discuss wine, jazz and global warming.  Hiatus…Sabbatical… Blank, please.  You are just plain old unemployed. You are writing a book.  You need to be concerned with your checkbook.    

Short sales


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