Posted by
CKHustler on Saturday, September 27, 2008 8:41:23 PM
So I was sitting around ideating the other day(jk, its from an IBM commercial) and came across this idea while talking with my dad.
Couple of assumptions/truths before I give out my priceless invention
1. Mortgage banks are the ones failing because people are not able to pay their mortgages. Pretty much a given.
2. Prices of houses are, and have been, falling. So people don't own enough of the house to sell it and that is killing the market.
My solution!!! And you may want to sit down folks!
Remove Property Taxes!!! TADA!!
I know where my parents live, they pay around 8k property taxes a year. In many places the property tax is higher than it should be since house prices have fallen. They never lowered property taxes! Remove the couple hundred each month that these folks have to pay to the almighty government, and let them use it for their house payment. Now this will also help house pricing as people would start to gain some equity in their homes as they pay for them. It would at least help stabilize the market, instead of a continuing free-fall.
Now, of course this alone will not solve this crisis. There are many things the government could do to help solve this. Cut taxes to start. Stop wasteful spending would also help us lower our debt and increase the worth of the dollar. But, when did the almighty government do anything that was good for the economy?
But, if we can get the American people to be able to pay their mortgages, then the banks will be taking in the necessary money. I also think that banks could be smarter and lower interest rates on existing loans. That would lower house payments and people would be able to pay, instead of leaving and the bank getting nothing. But hey, thats just me thinking out of the box right?