RUSH: We’ll start in Collinsville, Connecticut, with Melissa. I’m glad you waited, and welcome to the program.
CALLER: Thank you, Rush, it’s such a pleasure to talk to you so thanks for taking my call.
RUSH: You bet.
CALLER: I had to call in about this whole foreclosure matter because this is my business. I own what is called a loss mitigation company and my company negotiates short sales for homeowners who are in some stage of foreclosure —
RUSH: Okay, hang on just a second, whoa, whoa, whoa, whoa. I need you to slow down a little bit so I can hear you. And I want you to explain for people that don’t know, when you negotiate a short sale for homeowners who are in some state of foreclosure, what does that mean? You mean you’re negotiating a sale where the price is less than what they paid for it?
CALLER: Exactly, yep, a homeowner who owes more on a mortgage or mortgages, because often time these days there’s more than one on the property. And they can’t sell their house (unintelligible) to pay off the loans, and I go in and negotiate with their banks for how that loss is gonna be handled. So just in general numbers, let’s say that they have a hundred thousand dollars in loans on their property, they can only sell the house for $80,000, so my job is to go in and negotiate with the bank for that $20,000 difference to either write it off, take the loss, let it go, or come up with some kind of an equitable arrangement with the homeowner to repay that difference.
RUSH: How often does that happen, that last option? How often is there a negotiation where the homeowner will pay something toward the difference?
CALLER: Well, more and more these days. I mean I should say that I’ve been in this business for almost a decade now, so I’ve seen a lot of changes in the housing market and I’ve seen a lot of changes in the economy. I see a large shift in the attitude of my clients, the homeowners, and what their level of responsibility should be here.
RUSH: Whoa, whoa, whoa. Tell us what that is. What is the shift?
CALLER: I have to tell you that over the past couple of years — and I don’t think it’s a coincidence that it has been ushered in with Obama being elected — I have a lot of clients these days that really feel that they should have no responsibility towards their mortgage.
RUSH: I was afraid you were going to say that. I somehow knew you were gonna say that. It all fits with this mode of dependency that we’ve been talking about today.
RUSH: The sense of entitlement.
CALLER: It is a big sense of entitlement. I get the classic, “The bank is getting a bailout, where is my bailout? The banks are making money, I should be let go of my mortgage,” and I get the classic, “I was tricked into buying this house. I was tricked by the loan officer –“
RUSH: Wait a sec.
CALLER: I get that more and more.
RUSH: Have you ever asked them what that means, they were tricked into buying house?
CALLER: I do and I have to be very careful, because obviously I’m a conservative so I’ve learned as a business owner not to get into political discussions with my clients, but I do have to ask them, “You go to a closing, you sit down at an attorney’s office or a title company. You sign documents to purchase a house. You do it front of a notary public. Are you not reading what you’re signing?”
RUSH: That’s not what I mean. I’m talking about before they even get the closing, like I was once tricked into buying a house with bad advice. I was told it would be the best investment I ever made. And it was just friends of mine. They said, “You’re throwing money away renting. You’ve got to go buy a house.” So I applied and got a loan, you know, mortgage and so forth. Turns out I couldn’t end up affording it. I had to get out of it. The bank didn’t trick me. I qualified, barely. I got tricked by conventional wisdom, by well-meaning friends. But what Obama’s talking about is that somebody’s minding their own business and a banker comes along and says, “You know what, you need to buy a house. I’m here to make you a loan, and even though you can’t afford it, don’t worry, you’re never gonna have to pay it,” and then they find out they are gonna get bills. That’s what Obama is trying to claim happened here. Do you know anybody who was minding their own business, had no desire to buy a house, and got tricked into buying one?
CALLER: Never. I’ve never — I’ve done personally over a thousand of these short sales in my career, and I’ve never seen somebody held a gunpoint, arm twisted behind their backs and forced to buy a house.
RUSH: Right. Now, closing, you know, the terms of the deal, all kinds of chicanery can happen there.
RUSH: And that might qualify as trickery. But Obama is trying to say that people who have no business being given loans were given loans. They were tricked, and I just have never heard anybody that I know who had a mortgage say they were tricked into applying for one, getting one, buying a house or whatever.
CALLER: I think the really sad thing, too, is that that attitude and people listen to the media, they listen to the radio, they read the newspaper, and now I have clients who are just your average, run-of-the-mill middle class hardworking homeowner that are adopting these strategies. They’re asking for, you know, “Where’s my bailout?” They’re telling me that, you know, “Chase Bank made a profit last quarter so therefore they should eat the loss on my loan.” They’re grabbing little sound bites and adopting this attitude, and I find it really sad because it really has just jumped exponentially in the past couple of years.
RUSH: Well, I’m sure you’re right and I’m not surprised. When people who are paying their mortgages, and at the time of the subprime mortgage crisis, by the way, despite the tenor of reporting and the crisis attached to it, the vast majority, well over 92 or 93% of the people were paying their mortgages, and then those people began to learn that there was this whole program out there for people who couldn’t pay their mortgages, who were given mortgages, who were put in these houses all because it was affordable housing and they learned later it was called the subprime mortgage crisis or what have you.
The people who have been paying are now the ones saying, “Wait a second here, I’m the one paying. I’m the one meeting my responsibilities. I’m the one following through on my commitment. The people out there who aren’t, I gotta pay for them, too? And I have to still keep paying for mine?” So I can understand the thinking of some people who might want to rebel, “Well, look, if these people aren’t gonna pay, why should I? Why are they protected? Why are they privileged? Why are they special, just because they have less money than I do? Why do they not have to pay for their house? I’m just not gonna pay anymore. Make ’em come take the house away.”