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April 14, 2024 - Stew Peters Show
59:14
The FedsTo Own Private Property of Vets?
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If I were to tell you that the VA is seemingly going to be buying up properties that are defaulted on by veterans in the foreclosure pipeline, what would you think about that?
For us, it seems to be quite a problem, maybe.
The VA slash the federal government could quite possibly own personal property, own personal real estate in this country.
Well, today's conversation is centered around this new program that we've learned about recently.
So please stick with us.
Don't go away.
We start now.
Hey, everybody.
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Okay, so I'm going to preface this whole conversation by telling you that real estate and finances and all that stuff is like reading Egyptian hieroglyphics to me.
And I'm thankful that we have a person like Jason who understands it better than I do because I think it's important.
These things are important to talk about and to get out to the general public.
So without further ado, let's bring in Megamind, Jason.
How you doing, buddy?
Good and you.
I'm doing good.
And hey man, like I don't mean, I'm not goofing on you, but like with some of this stuff, compared to how I see it and understand, you are a mega mind.
Because you see it differently and you're able to explain it.
And also, able to explain it in a way that people like me can understand a little better.
So, talk to us a little bit about what you learned.
I Full disclosure, folks, it had Jason a little fired up, so I know it's going to be good.
Tell us what's up, brother.
- I'm a little fearful about how fired up I might get, but you know, I had an interesting conversation with a friend of ours about maybe four or five months ago about this exact topic.
And coming from a place where we dealt with foreclosure often, I didn't understand how they could put the mechanism in place to change a lot of the things that they did during COVID.
Certainly, you know, how do you restructure loans?
How do you change existing parameters?
Because once you sign a mortgage, it's a contract, right?
They can't be altered.
It's not like you have to have a new contract.
And new contracts have to involve new rules.
That means it's today's rules.
So if money costs more from the Fed, that's how it works.
And so, you know, we even joked about, well, maybe this is the way that the camel sneaks his way into the tent, is government will start buying securities.
They'll start buying mortgages.
And we kind of laughed it off, but then we talked about it in hyperbole.
Well, here we sit.
A few days after the announcement on April 10th.
And I want to make sure that I'm reading this.
You're going to see me glancing off to the side here as we go.
They're calling it a last resort program for tens of thousands of veterans in danger of losing their homes because of post-pandemic mortgage problems.
So, they announced this on Wednesday, here we sit, and they're talking about specifically defaulted loans that are currently in the system with other mortgage providers because Not everybody knows but a VA-backed loan doesn't mean that it's backed by the physical VA. It means that the VA has money earmarked that they can specifically drive towards backing a VA-backed mortgage through another servicer.
So you may, and most veterans that have a VA loan, obviously you know, but if you have a mortgage at Wells Fargo, it can be a VA loan and it's backed by the VA. And so the underwriting criteria, the strenuous standard that they hold borrowers to is changed based upon the VA's desired outcome with how many people get loans, right?
Maybe they can make their debt to income a little bit lower.
They can make certain costs and parameters to entering into that contract and or agreement lower.
You've had a VA loan, right?
Yes, sir.
I have one right now.
As do I. And your FICO score.
You're not going to see these great strides once you get above 630 to 650.
You're not going to be greatly diminished.
The barrier to get into the loan is going to be similar, but You're going to have very little differentiation between a 650 and a 750 credit score.
And I know 750 isn't perfect, obviously, 850 is.
But the difference between a 650 credit score and a 750 credit score is substantial in a creditor's eyes.
And so the VA has already set up a system that makes the barrier of home ownership lower.
It's not easy by any stretch, but it's easier than other programs.
And so the giggle was that here these programs already exist, and now here comes the VA coming up with an idea.
And again, I hope this thing works out well, but I'm going to discuss what I think some of the pitfalls may be.
The Veteran Affairs Servicing Purchase Program, with the acronym VASP, which will launch in May, will allow the department to purchase defaulted VA loans from outside mortgage servicers.
So now, I'm not gonna say directly that this is the first time, but this is the first time, to my knowledge, that our government will own paper to physical assets That the citizens of that government are paying for.
It's an FHA loan.
It's a back loan.
It's a product.
It's an inside-outside.
This is a first.
These are the things that you hear about in other countries where you think, you know, like China, the Bank of China.
They finance so many things within their system and their economy.
They do this kind of thing.
They kind of control not only the banks, but they control the government.
And that's a lot of control.
I'm not saying that that's what this is, but this is what they're doing is they're physically buying up.
I've always said in other conversations that if they're going to do something, I think what they should do is definitely use a third party, another servicer, just like they are currently doing, and giving yourself a little bit of space in between the situation and reality, right?
So, instead of loaning direct from the government to the citizens, you have to use a servicer.
This is the first time that I'm seeing it where you actually have direct.
Well, but here's my question.
Why does this thing even make sense?
Like, it doesn't make sense to me.
It seems like it doesn't make a whole lot of good sense to you.
No.
So, like, what's the play?
Why would we come up with this?
Because I knew, I shouldn't say I knew, but it was my thought during the scamdemic, they want to call it, when all of these places came out and they were like, hey, there's a lot going on right now.
If you can't pay, no problem.
Just skip it.
And people went apeshit, man.
They loved it.
I don't got to pay my bills.
And so, for example, retail store owners were loving that because people weren't paying their mortgages.
They didn't have to.
They were spending the money elsewhere.
And so, I guess I don't understand why this is even a thing anymore.
Well, number one, that shouldn't have happened.
And there were plenty of financial heads out there talking, saying, don't do it.
Now, at all costs, if you've got to skip your vacations or sell something to get there, make your loan payments.
Like, that is...
Any fiduciary, anybody who lives in the world of finance is never going to tell you.
Now, notice who told you not to pay your loans, right?
You know, it wasn't, you know, Wells Fargo said, we're going to adopt this forbearance program and you don't have to pay.
Well, nobody ever really talked about how you're going to recover out of it, like from the get-go.
And that's the difficult thing is if you're going to, if you're just going to arbitrarily say, you know what, you don't have to pay these loans, but you don't own them.
They were in no position to do so.
Yeah, man.
But here's what they were told, and correct me if I'm wrong.
The word on the street was, well, you just add those payments to the end of your loan.
So if you had, let's just say for conversation, say you had 12 months.
Okay, well if you skip four, then you just have 18 months left.
You'll just pay four extra months on the back end.
Which to a lot of people seemed to make sense.
My red flag went up because my thought was, there isn't an effing bank on this planet that's going to say, hey, you know, you owe me money and it's okay, just keep it for now.
Well, and maybe that works over the life cycle of a 20 year, say you have 20 years left on your note, okay, it makes sense out on the back end, you're in a smart position.
But guess what?
The bank is still paying for that money that you have out.
There are incurred costs that are there.
Again, when you sign a contract, you've got a maturity date.
That isn't something you can't just go in.
It's not like a PT test where, oh, I think I thought I had 74 pushups and not 63.
And then you just quick change it and then initial it, right?
No!
This is a mortgage and the bank is obviously still on the hook for the money.
You know what I mean?
They still have to make their pay.
They still have to have their staff.
Now they have to create a whole new likely, and again, I can't verify this because I wasn't in a bank during this time.
But I'm assuming they had to create other systems to start tracking those loans that were in this weird deferral account of people that were in forbearance or had hardships.
There were already mechanisms in place for hardship modifications and all these other pieces.
No reason that anybody needed to be put into this position, but you really didn't need what caused this proposition to occur either.
So again, just a series of follies brings you forward.
And I think this underscores kind of that...
What was that phrase during COVID? Is the cure worth the...
Wait, and I don't know.
I don't know.
I'm biting it up here.
I can't figure this one out.
The phrase I used during COVID all the time was, this is bullshit.
That was my phrase.
The cure can't be worse than the cause, right?
I think that's what it was, right?
So if you're going to do all these things, like that can't be worse than just riding through.
And this was another cure versus cause.
You know, you're going to say people can't go to work, they can't do this, they can't go to their places of worship, they can't do all these other things.
And so kind of as a, I don't want to call it a reward, but kind of a deferral from the norm.
Okay, you don't have to pay those bills.
Well, Number one, they legally, I would assume, didn't have much of a leg to stand on, but when you're the government and you back that many loans, no bank who needs to do business with the government is not going to do it.
You're going to abide by what they say, and then you're going to have to work out these creative solutions to, what do you do?
We know home ownership cycles are a lot shorter than they used to be.
Our grandparents lived and died in the same house.
Their entire adult life.
And our parents maybe had the starter house, the second house, and the retirement house.
Well, not retirement house, but their last house, maybe three.
And so the life cycle of loans is much less, and so I think the hope was, man, people are gonna start selling off their assets, and when they sell those off, they'll clean up at the closing, and we won't have to deal with much of it.
Well, funny story, veterans don't sell houses all that often.
Right.
That one's pretty interesting.
And so what I see in this whole thing...
Hold on, hold on, hold on.
You can't just skate past that.
What do you mean?
Veterans tend to have their loans longer and stay in houses longer than traditional borrowers.
Really?
Mm-hmm.
Why might that be?
I have no idea.
I just remember seeing that information floating out there years ago.
I used to always ask, like, the difference between, you know, what were the rates, and we've looked at it, you know, default on VA loans versus, you know, the traditional marketplace, and we saw there's a little ripple, but it turned out to be a lot more of a ripple, just based upon the instability of the client.
You know, so, but the overall Term of the loan that was being paid on was always a little bit higher.
So it just meant that they'd stay in houses longer.
I don't know about you, but I'm pretty reluctant to change.
So once I make the decision, I'm going to get in there and I'm going to stay.
And if I need something, I'll fix it.
I'll add it.
I'll build it.
I'll do something.
So again, I'm sure there's some social trait on the backdrop that causes this, but traditionally speaking, VA loans go longer in between changeovers.
And not that that's not a big deal, but I think that was the hope.
I think when economists were looking at it, they were like, ah, you know, if the spike in real estate keeps doing what it's doing, people are going to jump back on that bandwagon of, you know, selling their home and buying their next bigger home or something different or whatever.
And so if you were able to inspire a lot of selling of homes, then the banks would be given the opportunity to clear them up at the closing.
And be like, hey, by the way, remember that 18 grand from two years ago?
Yeah, we're gonna clean that up now.
And then you can take the rest of your money.
And everybody, thumbs up, happy.
Glad we all survived together.
You got paid, you were made whole.
I got my payments, I'm whole, and I'm gonna drive forward.
Pleasure doing business with you.
But now, this vast program wants to go in at a time where anyone who goes to get a loan understands now what Fed Prime rate is and they know that that affects the market and what you're actually going to have to pay to service that money, right?
The Fed is running 5.25 to 5.5, depending upon the cycle, and don't quote me on that one, but I'm pretty sure I'm right.
Banks only make that small difference in between.
So if you're paying 6.5% and the bank is paying 5.5%, realize that the bank is only making that 1%, and that comes down to everything that they have to do to procure and keep your loan in good standing, accepting all of your payments, processing all of your paperwork, staying compliant with your paperwork, ensuring that you, you know, If you're not using your mortgage to pay your taxes and to escrow your other costs, making sure that you're in good standing there.
So as a team, because when you have a bank or a partnership with a financial institution, it's a partnership.
Regardless of how you want to see it, that's what it is.
But they have diligence standards that they need to maintain.
And so there's a great cost there for a bank to track paper and deal with all that stuff.
And so that slim margin at 1%, and you think about this, the borrowers in the VAS program will be guaranteed a fixed 2.5% interest rate for the remainder of their loans.
Now for veterans that are in that pipeline, that are in that position where they would qualify for this, that is pretty amazing.
It's a great rate.
I do not want to talk about that as a bad deal.
That is extraordinary.
Obviously, things happen to get people into that position, and that's unfortunate.
But again, now we're carving out another thing where a specific group is going to get something that nobody else gets.
Well, here's my question.
Why wouldn't we just...
Why wouldn't we just give veterans 2.5% then?
To be able to potentially greatly diminish the amount of veterans who end up in this foreclosure pipeline?
You shouldn't have...
I mean, this is...
We're all so short-sighted in mortgage rates.
We live through...
The last 10 years have been...
Pretty amazing.
You know, to see things as low and two and a quarter.
I remember seeing like high ones, like one and seven eighths.
That's free money.
You know, be honest about it.
I mean, inflation is going to run at 3% and your note is less than two.
I mean, that's just, that's Kiyosaki principles for, you know, healthy debt.
You know, anytime you can do that, just rock it.
But there's 2.5%.
They're going to own the paper.
They're going to charge 2.5%.
The government, and God love them for all their great ideas, has never been known as a great actuary.
Like, is the bank going to build, or excuse me, is the government basically going to build a bank out of bankers to oversee all this, to work through this program, to maintain compliance?
Well, there's been a lot of talk about this One World Bank.
Well, and again, could this be?
This is the first step.
If you can do this, and you can charge 2.5%, but I don't understand.
How can you give a borrower 2.5% at the same time when you're charging a lender 5.5% for that money?
Yeah, that's a great question.
That's odd.
It's difficult.
But if you're going to say that 2.5%, come up with something that makes more sense or something that maybe is a little...
It's a little...
I don't know.
I hate to...
It's more fair long haul to all than it is...
For a very select group.
And so like you were saying, maybe just say all veteran loan or all VA loans are gonna stay at 2.5%, which that would be awesome.
Like I'd be the first one in line again, let's go.
But again, you wouldn't need to, or if you're gonna do it at 2.5%, still make the banks do the third party process on this.
You know, what's gonna happen now?
All of a sudden, the government's gonna be in the foreclosure business.
They're gonna be in the pipeline business.
They're gonna be in the clean up all the paper business.
You know, because some of these homes are eventually gonna default.
You know, they'll follow their own death of borrower, so on and so forth.
There's a lot of things that can happen that can get you there.
And if you think it's difficult to work with, you know, somebody else, let's work with an upstart Government agency that now is gonna be doing something that they've never done before.
And God willing, they hired the right people to roll this thing out.
You know, maybe a couple of execs from some of the big banks are gonna be over there overseeing it.
But still, it's just, it's so fraught with opportunities for problems.
Well, the question is, whose zerts are getting greased on this deal, right?
Because you just brought up a lot of things That they're going to need to do that the government, but more importantly, the VA, doesn't do.
And so if you're saying that the VA is going to start owning physical property until the loan is paid off...
Well, that's pretty scary because they've...
Look it, man.
All these places, some of them still don't have it right.
I think I used Quicken Loans or Rocket Mortgage or something like that eight years ago, and it was a complete nightmare.
And these guys talk about how they do, well, we do 10,000 loans every five hours.
We do 20,000 a day.
Well, it was a horrible, horrible experience.
But once you're in it, you can just back out, but you've already done enough work.
You want to see it through.
I don't know, man.
I think that my intuition, which maybe isn't very strong all the time, but sometimes I feel like it's pretty on point every now and then.
There's a deeper picture here.
For sure.
Wouldn't you think?
There's some kind of shenanigans happening.
They're shadoodling all over this thing.
Yeah.
It's not too good to be true, but it's too good to be real.
If that makes sense.
Yes.
I mean, you can't do it.
And then, you know, the further that you read into the article and go through all these pieces, it's this continuation of things that we want to see.
And of course, we want veterans to get, you know, if you're in a bad spot, dude, I want those people to be taken care of.
Right.
That is a huge focus, and God love them for doing something.
But it sure seems like a short-sighted decision to go in and jump this.
But of course, then you have to back it up with facts.
And so, I think it was the Under Secretary who said that the estimate that this new program will produce about $1.5 billion in savings over the next decade by avoiding costs for housing vouchers, federal loan defaults, and other complicated issues Related to veterans' homelessness.
Huh?
There it is.
Well, now you're using every tactic under the sun to give this thing credibility.
Well, they just told you, though, bro.
They just told you what the shenanigans is.
Right.
They're trying to free up money to the tune of billions of dollars, it sounds like.
Of VA money.
Well, for what?
What do we need to do?
I mean, and don't get me wrong.
We discuss it all the time on this show.
We discuss it on Disgruntled over on YouTube.
We discuss it all the time.
That there's something happening.
Somebody's pockets are getting lined.
Somebody's business is going to take off and be a generational wealth builder.
Whatever it is.
We need to free up billions of dollars.
Okay, well, are we going to then use that to take care of VA employees so that they can give veterans a good experience at the VA and the best quality of care possible?
Are we going to Are we going to make sure that these veterans who are in this foreclosure pipeline, are they going to be safe as long as they agree to participate?
I mean, we talk all the time about all these things that the VA is wasting money on or not paying for at all.
Because they say there's no money.
So now they're looking to make billions of dollars off this deal.
Not make, I'm sorry.
Save billions of dollars on this deal.
But for what?
And that's the whole thing.
I mean, I just ran my calculator across 40,000 homes at a $200,000 average.
And I almost want to do it again because it didn't seem right.
It was 40,000 homes.
Yeah, it's only if it's a $200,000 average, which again, that's why the omission of statistics to be able to proof it out to see what's actually there is shocking.
Well, let's just say at a $200,000 average at 40,000 homes, that's an $8 billion investment that the government is going to make in those 40,000 veterans houses.
I'm just using a malarkey average.
$8 billion.
0.025.
There's something happening, dude.
Well, there's something happening.
They got plans.
I did 2.5, right?
Yeah, so the 2.5% interest on that is $200 million.
Let me ask you this.
$200 million.
Do you think we could make a dent in veteran homelessness with 200 million bucks?
I think you could make a dent in veteran homelessness with a million dollars.
Right.
Do you think that we could get veterans all over this country home modifications to help them live a better life with more independence and the ability to move around their space easier with 400 million dollars?
Right.
I mean, there's probably 20 examples of what we could do with this money.
So my question to the VA would be, if you are going to get into the business of potentially owning my property, should disaster strike my life or my family and I somehow default on my home, the money that you save or make off of that, Because you're going to save me by this vast program.
What next?
And I hate to be the guy to like overlook what's right in front of us, which is this program to try to save veterans that are in this situation.
But every time we just take things for face value, and I shouldn't say every time, but most times, we take these things for face value.
We then a month, two months, three months, four months down the road, find out that there's some other shenanigans happening and veterans are just getting augured out.
Bent over the car and augured out every time.
Didn't we fight for a long time about getting rid of the company store?
You know, when you worked in the coal mines, and then you lived in a coal mine owned home, and you went to a coal mine owned grocery store.
Yeah.
We've worked pretty hard to get away from it.
That was the idea of government backed loans.
It meant they were the guarantor.
And so there would be certain guidelines that citizens would have to meet to meet or exceed the threshold to use the programs.
And by programs, I mean loans, in case anybody isn't familiar with that phraseology in that context.
But all loans that are out, they're programs.
They come and go.
The criteria change from time to time.
And so you'll notice like a lot of the loan programs that we used to have, you no longer have.
You know, there's certain things that still exist, but for things that we had readily available 20 years ago, now you have to go to a savings loan, a traditional bank that still offers in-house products because the government backing on certain things that used to be everyday staples are gone.
You know, and so you're diminishing the pool of opportunities and ways that people can get loans.
And this one just On its face, saving veterans is great, but I just say at that point, just spend the $8 billion.
If we can send $60 billion every couple of months over to Ukraine.
Yeah, dude.
Just spend the $8 billion.
Quit collecting.
Just get out of the business.
Don't hire a bunch of people.
Pay off these notes.
Be like Oprah Winfrey.
Everybody gets a house that's in the program.
And just be done with it.
You know, because it's kind of funny money anyway.
It's all nonsense.
But, you know, they're not banks.
We can't have our government in banking.
That is a misstep.
I think it is a tragically short-sighted idea.
As good as this could possibly be for veterans, there has to be an easier way.
Because you already know they're making the payment on the note, right?
Like, if you had a $200,000 loan with, you know, ABC Bank, and the VA's going to buy it up, they're getting whatever that number is.
So the money's been spent.
I mean, I don't know where the VA gets it in their coffer, or what kind of expenditure, or how this even gets frameworked on the backside to get funded.
That's probably a whole nother conversation.
I don't even want to know.
Like, my life is too short to know even half the things we already know.
So the funny money comes in and it can go do its thing.
The big exchange already happened.
You're not gonna run this profitably.
We know that.
It's likely gonna ulcer a bunch of money at the same time.
And we know it's gonna pull in some money.
I mean, if you maintain that balance, there'd be $200 million coming back into the coffers.
But $200 million doesn't buy you a lot when it comes to employees at the federal government.
Oversee these things.
But I'll tell you what $200 million would buy a lot of.
If the federal government were to allow me the opportunity to receive $200 million as a grant or something like that to do something like for veteran homelessness.
Give me $200 million and I'll find the people That have the energy and the passion to fight this thing the way it needs to be fought.
And 200 million bucks will do a lot.
I don't know that it'll completely wipe it off the map from the country.
No.
But we'll make one hell of a dent in it.
And then the next time we'll come and ask you for another 200 million and we'll do it again.
But the fact of the matter is that there's all this money changing hands and floating around from agency to agency to agency and then gets paid out to somebody's brother-in-law who's a contractor or whatever the case may be.
But the frustrating part about it, Jason, is that nothing ever changes.
We get all these fancy words and these big, beautiful productions about what's going to happen.
And we got, oh, we were just awarded X amount of money to do X, Y, and Z. But what happened to X, Y, and Z? Did we cut them off the back of the alphabet?
Because you never see X, Y, and Z once it's talked about.
And the money's given out.
What happens to all this stuff?
I don't know, man.
Like I said in the beginning, all of this kind of is like reading Chinese to me, right?
I don't comprehend it well.
But what I do understand is that the VA stands to bankroll a lot of money with this program.
On the face of helping veterans who are about to lose their homes.
So on the surface, that's great.
That's awesome.
Give these folks the opportunity to keep their stuff.
But the question then becomes, if it's $8 billion that you stand to make off this, off interest alone, what are we doing with it?
And my last question before the break is, do we have a right as taxpayers to bitch about what happens to that $8 billion?
Because is it tax money?
No, it's not tax money.
It's interest payments.
Or it's interest made on the payments that were made.
You know what I mean?
So like, I don't know, man.
I think it's a slippery slope.
But I think that we should...
Do you have anything to add before we take a break, bro?
No?
All right.
So chew on that for like 13 seconds and we'll be right back.
Don't go away.
Hey folks, welcome back here to the last half of the show.
I think what we should do here is transition the conversation.
Jason and I talked offline about where to go next and I agree with him that we should have a discussion about what this looks like moving forward.
You know, like, is there questions about who may qualify?
Is there questions about, you know, I'm sure that there's going to be some kind of stringent guidelines that need to be followed in order to take part in this program, right?
Yep.
Yeah, sorry.
I was reading it while you were speaking, and I can't do both.
I love you, man.
The program is going to ensure that a veteran that goes into default, there's an additional affordable payment option that will work in a higher interest rate environment so they can keep their home.
Makes sense.
So you're trying to keep the cost of homeownership down.
But the new program will only be available or open to veterans who have defaulted on their mortgages and not others who've renegotiated higher, costlier new mortgages over the last year.
Those individuals will not be able to opt into the lower rate VASP loan program.
So, let's just say you're in a position where you could renegotiate your note to make up the default and kind of create the new mortgage on your existing house.
Which is, you know, yeah, sometimes it sucks, but you make decisions and you have to deal with the consequences.
And a lot of people, I think, probably did that, right?
They worked it out.
Their bank created some type of program for them to be able to use.
So this is specifically talking...
They've clearly already identified who these people are.
Because last fall, the government came out and basically asked lenders to...
To continue this forbearance on foreclosure for VA loans for this specific reason.
So, I mean, you might have some of these loans inside of this program that have, you know, four years of non-payment performance.
Whoa, four years?
Well, it could be.
You know, when did the forbearance go into place?
I was in 20.
Yeah, you're right.
As earlier, I mean, as last fall, they were asking them, Not to do it.
But when the program ended in 22, thousands of veterans found they owed large payments on their homes, forcing some into default and other into unfavorable new loans.
An NPR investigation in 2023 uncovered.
So there were families that were hurt by those gaps.
And so the VA last fall called on all mortgage companies to delay additional foreclosures until May of 24 while they set up this new program.
Okay, okay.
Hold on a second.
Okay, so, okay, well, give these guys a break while we set up this program.
Okay.
And maybe the banks did that.
But the banks aren't taking, they're not going to, maybe they did, but it's an absolute surprise to me if any bank in this country is going to just not take a payment for four years.
Or three years or two years for that matter.
Not to mention, like, what happens to the, not the insurance payment, but the interest that's paid and your escrow for, you know, insurance and all that stuff.
Right.
All of that just keeps stacking up on top of each other.
And so...
Like, these mortgages and these payments that are due gotta be just humongous.
Well, they could be monstrous.
And then you could include all the fees that they can charge on top of that.
So, maybe the, you know, let's just say the principal, if it was a $1,500 payment that covered everything in escrow, it doesn't seem like much, but it's $18,000 at the end of one year.
So, $18,000 is a heck of a bite to take, you know, if you're struggling to make your payment.
So, you know, sadly, you know, the tough thing would have been at that time to look at it, go into the bank and be like, you know, and banks were willing to do it on these hardship modifications.
You know, you'd be able to walk in and be like, yeah, I did a lot of bad last year, you know, as far as our relationship.
I hurt you.
Can we take that 18,000, roll it in?
What's today's current rate?
Lock this thing together and kind of go forward fresh.
And I'm assuming a lot of people were able to do that.
Like a refinance type thing.
Well, yeah, you're gonna completely refinance your home.
It's a new mortgage, okay?
It's a new contract.
It's new terms.
And so, you know, likely those things happened.
But you are talking about ones where, I mean, as late as fall of 23, asking Mortgage company, well not mortgage companies, but banks, servicers of paper, please don't keep going down the foreclosure route for these folks.
Hold them.
Continually bear that burden because there are costs.
If somebody isn't paying, and this is what I was talking about before, like how much money it takes to make sure that all these things are in good standing, you need to make sure if you're not escrowing for their insurance, that you're getting copies of their insurance, that you're noted as the payee for loss.
It's like a bank.
If I made a loan to you on a Harley, I would want to know that you have enough insurance to cover to pay me back should you wreck your Harley completely.
So banks have to make sure.
So that costs money to have employees that verify, that go and do those pieces.
And then you have employees that have to look at the tax record.
Are the quarterly or bi-yearly taxes being paid?
If they're not being paid, you have to fund those because, again, that's another problem.
And so you're authorized to be able to do those things with some leeway, but when you spend that money, now it comes back and you should be compensated thusly for it.
So let's just say if you made absolutely no payments on that, Let's just call it that same $1,500.
So you're at $18,000 there.
Fourth protection insurance is gonna be more difficult than a regular insurance policy for a homeowner because you don't really know the condition or standard of the home.
And so maybe you have to pay $4,000 for that insurance policy for the year.
Now we're up to $22,000.
Let's just say that the taxes didn't get paid.
And there was no plan for the taxes to be paid.
It's a $200,000 asset, and we'll just call it roughly a point and a half per.
That's another $3,000.
So now I've already crept that initial $18,000 to $25,000?
Yeah.
One year!
You know, that's what those costs look like.
If you were already supposed to be paying in on them, that was part of your thing, and then you weren't paying in on those, and somebody else had to pay them, they compounded.
And so the problem gets worse and worse with time.
And so when this whole thing was happening, I'm just sitting here watching going, wow, here comes the train wreck.
And again, it was the media, the newscasters that were telling you, yeah, the mortgage fork, this is better for you.
You didn't go to any place that was a true financial, either a newspaper, a periodical of some sort, or even interweb based.
And nobody was making those same recommendations.
You know, they were telling you, it's probably a better idea to make those payments if possible.
I can't believe that people would believe that this is a thing.
It blows my mind, man, to be quite honest with you, that anybody as a homeowner can go two, three, four years and think it's cool to just miss a payment.
At some point, you've got to get uncomfortable with this situation and ask questions, you would think.
A little personal accountability probably would have helped out.
And again, now, okay, put on the tinfoil, right?
But I bet they're all driving new cars and they got cool shoes and shit like that, you know?
Could be, but I think a lot of those cases are probably difficult, right?
It's either...
I don't know.
I want to see the happier, normal side of life.
I don't want to be that way.
Don't let me drag you down, bro.
Not gonna.
But I will do this.
Putting on the foil, not Hanson's reference to hockey, but the hat.
If the VA is tracking 40,000 that are in this condition, how many other federal notes are out there that look like this?
How many FHA, RDA? Tons.
You know, the Fannie and the Freddie, you know, those are, I just consider those FHA, but, you know, between the other federal programs that are out there, if this is what the VA's got, what do they have?
Yeah, I mean, because...
It wasn't just veterans who were told, don't pay your bill.
No, no, but this is the one small sample that we get to see, that we get to pay attention to, that they talk about, and so that's that whole camel inside of the tent thing, right?
So we get to see it here first, folks.
This is where they do it.
This is how it rolls out.
They've got the complex mechanisms in place to do all these things.
My hope is that they would just be doing this to help out some veterans, but I think there's probably people in similar situations across the board.
And the sad thing is, the longer that this went on, it put people in a worse and worse position.
Right.
Every month.
There should have been a conversation over the past three years that, hey, you had that one-year mulligan.
This should have been on every news station.
Be like, all right, it's time to reevaluate.
And if you really want to stay here, this is what you have to do.
Go in.
Rates were still in, you know, rates were still historically low.
You know, you can basically get that hardship modification or a mulligan.
You know, they can look past that because ultimately the Fed tells you how underwriting needs to look.
And so they can kind of just say, oh, just don't pay attention to this.
Cut this out.
We're going to go forward.
We're going to pretend like that didn't happen.
Or it's time to sell your house and it sucks.
You don't want to be forced into that position, but you could have sold your home.
You probably, at that time, made some windfalls, depending upon how long you owned the home, and moved into another home.
And again, they could look past that 12-month mulligan phase.
They could have very simply done that and just said, no, that doesn't count.
You know, unless there were other contributing factors, but if it was just this one thing, this as an underwriter, you can overlook and then draw that loan forward and give people a chance to do it.
But that's, you know, I always say it like when I was at the bank, bad news is great in real time, but bad news with a time delay fuse.
Is often irrecoverable.
Yeah, man.
You know, tell me something really sucks today or it's going to be difficult and do this.
Well, we can make that decision and drive forward.
But if you keep trying to put in this effort and energy on the same piece of shit that's just never going to work, and you spend thousands of dollars to figure out that it's just not going to work, you know, it's like listening to Paul Harvey.
You know, it's so obvious it shouldn't require elaboration.
Yeah.
Yeah, and to me, it seems like it's one of these, like you said, a delayed fuse.
It's like signing up to go down into the man-made submarine to see the Titanic in four years from now, knowing that it's going to implode and you're going to die.
Yeah, well, I'm going to do it anyway.
To me, it's madness.
Yeah, that whole thing was mad.
That was fraught with so much peril that the fact that it was even spoke out of someone's mouth is shocking.
Well, and I think that you're a thousand percent right, bro.
I think that this is just a litmus test for the rest of the country.
And how dare they?
These people that sit up on these high perches in these ivory towers, and people like to say, well, they sit up on these ivory towers.
Okay, so these folks sitting up on this ivory tower, they know damn well that this is not going to end well for people who are struggling financially, who maybe can't find employment that's good enough to live on.
And then we talk about things like We just talked about it on Disgruntled, about how people have to...
They're sick of getting their asses kicked and robbed in the subway in New York and, God forbid, pushed in front of a train by some hoodlums.
So they decide to drive into the city to go to work just to find out they've got to pay to drive over the bridge.
A convenience fee.
These people know that Americans are struggling.
And yet they still do it.
And then this whole time, bro, this whole time that this has been going on, for the last four years, they've been throwing at us all this other smoke and mirrors, cloak and dagger bullshit.
We're going to focus on people that hate their dicks, and we're going to focus on critical race theory and BLM, and you know, that guy grabbed my boob about 35 years ago, so I want $150 trillion from the world because someone grabbed my boob.
It's just all so stupid, and this is the stuff that is put out to the world on our mainstream media platforms.
But nobody's talking about this.
Not only just for veterans.
Like for me, this goes a step beyond just for veterans.
This is Americans as a whole.
And it seems like they knew it was going to happen.
They knew it was coming.
Well, they can't afford it now.
They'll be able to afford it in four years.
Bullshit!
You knew exactly what was going to happen.
The American government, in my opinion, in this situation, Jason, has preyed upon the lower to middle class people.
Because they know if you don't have to pay your shit, they're going to spend their money elsewhere.
And don't worry, we'll give you a solution on the back end.
Let's get through the pandemic and let's get through this and let's get through that.
And oh, weird.
240 days or 241 days or something like that until the election.
So 240 days before we elect a new president, all of a sudden we have this magic pill to save veterans who didn't pay their mortgage because we told them not to.
Only to find out that what's really going to happen is they're probably going to lose their homes anyway.
But yet in the process, the VA is going to bankroll billions of effing dollars.
With no idea.
Well, they have an idea.
We don't have an idea.
No information about what's going to be done with it.
Yeah.
It's unbelievable, man.
My gears have been ground.
Right.
Well, and every time that we hear about things, it's like in these glittery superlatives.
You know, it's...
It's fart factory nonsense.
It doesn't matter.
The days of reporting actual facts seem to be in the past.
We live in a world now where they tell me that we have 3.5% inflation.
I forgot how much my beef jerky cost last year.
I'm just so stupid.
I just don't know.
I don't know how we quit producing oil domestically and magically my oil got more expensive, but that's because of some other factors.
But we're gonna use that same tactic on other countries.
We wanna punish them, we're gonna make sure that we shut off their ability to get oil.
Okay, well, you did that to us.
That crushed our pocketbooks.
You've done things, your spending is so out of control that inflation and trying to buy back the reserve dollar is something that nobody can even figure out what that's gonna look like.
They keep saying soft landing, hard landing, crash landing.
Hey, you know what?
This one is pretty simple to figure out.
It's gonna be epic.
It's gonna be horrendous.
And we're in the midst of the worst possible time.
When you look at real data, What people lived through in the Depression.
How far their dollar went.
What it took to live the median lifestyle.
It's worse now than it was then.
The difference is they changed the definitions.
That's why you can't define what a woman is.
These are the same people that can't define what inflation is.
So I'm going to take fuel, healthcare costs, and groceries off the list.
And that's what we're going to define inflation.
What?
The cost of fucking post-it notes?
That's like the one thing.
Oh, they've only gone up 3.5%.
And then furthermore, that meat puppet.
That meat puppet we have sitting in the Oval Office has the balls to go on world television and say, oh yeah, but you know, we're doing great economically.
Inflation is down, people are happy, they got more money in their bank accounts than they ever have.
I don't know what bank account you're looking at, Mr.
President.
My bank account sure as hell doesn't.
My wife's sure as hell doesn't.
Our kids' bank accounts sure as hell don't have any more money than when Donald Trump was in office.
And this isn't an ad for Donald Trump.
This is an ad for getting your ass out.
Because nothing that was good before you came into office is still good.
It's all went to shit.
So how dare you?
How dare you get up and stumble your ass to a podium or a lector and itch your face like an alien or an AI robot and tell everybody, tell the American people that they have more money and they're doing better financially?
Every time I see that on TV, Jason, I wish that people would take out their cellular telephonic devices and film their reaction to his words.
Because I'm guessing that 98% of them are going, I don't know what bank account you're looking at, but mine sucks.
Right?
It's foolish.
And they say, well, you don't understand basic economics.
Well, hold on.
We understand it very well.
We have modest incomes, most of us.
Well, I know I do.
And when we have ripples in our grocery bills, I see those that day.
I deal with those the rest of that week until payday.
Don't tell me I don't understand how the economy works.
When I used to be able to go and fill up one of my trucks for $56 and it's now 120, 125 bucks, I know the difference.
I'm not that stupid.
I don't have any money left.
I can't.
And now with all this other nonsense going on, Insurers don't even want to be in certain areas.
My homeowner's insurance policies are going through the roof.
At the same time, my local taxes are going through the roof.
There is not a place where I'm not ulcering money comparative to a very short period of time ago.
And so, when they start to show us again this VA idea of how you're going to help somebody, good God!
How honestly...
Amazing was the phrase that Ronald Reagan spoke.
The most dangerous words to ever be spoken is, don't worry, the government is here to help.
How true is that?
Think about everything that we've watched the past three and a half years.
Every time they step in to help, it hurts.
Every time they step in to help, it costs more.
Every time they try to eliminate a problem, it creates 30 more.
You just have to quit.
Well, I'm going to tell you what.
I'm going to take that as your closing thoughts because we're running low on time and you did an excellent job.
My closing thought is this.
You had just mentioned, Jason, that somebody had said, well, you just don't understand basic economics.
You're right.
I've never taken an economics class.
I've never taken an advanced economics class.
I've never worked in a bank or in a financial institution of any sort or done any kind of finance work.
But I'll tell you what I do understand.
I understand the app on my phone that shows me how much money I have.
That's all the economics I need to understand.
Four years ago, when I was filling up my truck for $30 cheaper, I understood that.
When I went to buy milk for my kids, because they like to eat whole boxes of cereal at one time, I understood how much more cheap the milk was then than it is now.
I can see that things are a lot more expensive.
And I can see how it affects my bank account.
And to be quite honest with you, full disclosure, I made more money last year than I did the year prior.
And I still have less.
So, you can go right to hell with your, you don't understand economics.
Understand these nuts.
I know what I got, and I know how I spend my money, and I know how I have it set up.
My family is set up a certain way, and we do not deviate from the plan.
I understand that.
Folks, thank you for joining us this week.
And I apologize for the nuts comment, but I was...
Man, it just gets me heated.
I don't understand why they think we're all so stupid and why they can just take advantage.
Well, they can do it because we allow it.
We talk big game, but we don't do much else.
But anyway, thank you, Jason, for your time today.
We love having you.
We'll see you next week.
Take care of yourselves.
Take care of each other.
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