21st Century Homestead Act

[Toucano]

Federal government buys the toxic assets of lending institutions, taking the toxic assets off their balance sheets.

Properties, now federal land, are distributed to families and individuals who need them on the condition that they will live in the home for 5 years. With a reduced housing expense, families and individuals will have more disposable income to pay down debt and make new purchases to stimulate growth. Maybe they'll buy a car from Detroit.

Any future sale of the property would be subject to a federal tax to recover the government's initial expense. Any remaining proceeds would be paid to the homesteader.

I still want my federal usury law, however.

[NightWatcher]

1. get your common sense out of here

that's not the way we work around here.

(nice plan)

[DJ13]

2. Theres no profit for the corporate owners of our country

You should be ashamed of thinking that way!

[Toucano]

3. So much for the old American Spirit.

I should have known that federal land is only for ranchers, mining companies, and corporations.

[annabanana]

4. Sounds like a winner to me. . . n/t

[Riverman]

5. Mr. President and the Congress: Do this Now! You will be Heroes

Benefits:
- Will turn around neighborhoods now suffering from the blighting and deteriorating effects of homes abandoned
- Will have new residents paying local property taxes that will help cities and counties to provide basic services such as police, fire, emergency assistance, and keep schools open
- Will attract new investment and sales as homes as prices are stabilized which will attract re-opening and opening locally supported businesses, thus more jobs and sales tax revenue and increased manufacturing to re-supply stores
- Will leave families, seniors and individuals with more money in their pockets to save, pay for quality food, education, medical care and maybe even buy some new products such as cars, furnishings.
- These effects will result in less demand for services from police, fire, emergency, and human services, as well as jails, courts, probation which will free up resources to address critical needs such as repair and expansion of infrastructure - roads, sewage and water treatment systems, schools, colleges, parks, libraries, etc.
- Reduce the state and federal deficits as more and more families living in these abandoned homes will be able to pay state and federal income taxes.
- Will re-store stability to the residential mortgage market as these homes eventually are converted to private market 30 year or longer, low fixed interest rate loans.

Negatives:
- Banks and vulture investors won't profit from the sale of these home initially.

[Toucano]

6. Bold new idea or blast from the past?

Your points are all excellent!

[ColbertWatcher]

7. I'd go for something like this. Good idea. k+r, n/t

[hootinholler]

8. One thing

There needs to be a mechanism to obtain funds for repairs. Many of the houses have been looted for the copper, etc.

-Hoot

[Toucano]

9. HUD already has a mechanism for dealing with that type of thing, I think.

Perhaps if the house isn't fit for habitation, the family could receive a zero-interest federal loan for repairs.

Or those families could receive a 1 year credit for sweat equity they perform and be able to sell it after four years instead of five.

Or if the home is in severe need of rehabilitation it would need to be flagged for demolition.

I don't know what percentage of foreclosed homes are not fit for habitation.

[Gregorian]

10. Damn, that's quite a nice idea there.

On face value it seems very good. It would give the base of this country a big foundation. I bet this would put us so far ahead of any other boost we could ever achieve.

[Toucano]

12. I am sure someone smarter could work out the details

but the principle has a lot of pluses.

[Thothmes]

11. Are the toxic assets you refer to actually

mortgages (ie property) or are they financial instruments/derivitives whose value is based on future mortgage payments. Big difference. If they are the actual mortgages, then you have the property. If they are mortgage backed financial paper, all you have is paper.