Hey, Mr. President, How About A Holiday?

Let's give homeowners the option of not paying their mortgages for one full year

Warren Ballentine 

Warren Ballentine

Each year we celebrate many holidays in the country, from the Fourth of July to Christmas, and we also celebrate regional holidays as such as Sweetest Day and Juneteenth.  So, I ask you, Mr. President, why not create a new holiday?: The Mortgage Holiday.

Now many of you may be asking: What you are talking about Warren Ballentine?  Well, I am talking about a one year Mortgage Holiday where homeowners will not be required to pay their mortgage for one year! Do have your attention yet?

Here is how it would work:

1.    It would be optional. You only do it if you choose to.
2.    You cannot be more than three months behind on your mortgage.
3.    The interest on your loan will continue to accrue during the “holiday” year.

If a homeowner is paying a mortgage of $1,500 a month on a 30-year fixed at 7%, about $1,275 of that is going towards interest in the first half of that loan. Which means $225 is going against the principle—$225!!! The mortgage holiday puts an extra $18,000 in that homeowners pocket for that year—$18,000!

With the housing market and the economy in disarray this makes perfect sense. The banks will not lose a dime; in fact they will make more money over the course of the loan with the extra year of interest. Homeowners will be able to catch up on their bills and become credit worthy again, thanks to the extra monthly income they have. The economy will rebound more quickly with the extra cash and credit in the market.

So again I ask you, Mr. President: How about a holiday?

Warren Ballentine is a motivatonal speaker attorney, political activist, and host of The Warren Ballentine Show on radio.

ACROSS THE WEB
  • http://www.professorherm.com Hermann Mazard

    This is nothing but voodoo economics. The majority of mortgage loans in America are issued by a bank who pools them, repackages them and sells them as as securitized assets on the open market. Because the company who services a loan is rarely the holder of that loan, the concept of a payment holiday creates a liquidity shortfall for which investors would not be compensated. Breaking the circle of trust undermines the securitization market, scares away investors and reduces the pool of available assets that support the making of new loans.

    A forebearance (payment holiday) program exists in the secondary market for student loan, much to the dismay of investors. To combat investor flight, Sallie Mae temporarily suspended its forebearance program earlier this year and currently operates it with increased hurdle requirements.

    Instituting a similar program in the home mortgage market would have a devastating impact on liquidity that would eventually prolong our recession instead of accelerating its end.

  • Donovan

    With the housing market and the economy in disarray this makes perfect NON-sense. What’s next, let’s take a holiday from paying all the bills then and just live freely. Hell, I don’t like paying my taxes, can I get a 1 year moritorium from that too, althought the 16th Amendment of the U.S. Constitution says HELL TO THE NO!!!!?

  • Jiji

    “What you are talking about Warren Ballentine?”
    You missed a comma between “about ” and “Warren”.
    Also “principle” is different than “principal”.
    I bet you don’t know what the first one is!
    It is when you pay your dues on time, on principle.
    And you stop whinning to your homie (even if he is the Prez, by mistake).

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  • Mr. Fox News

    I love this idea I am not rich and its optional so those how are not hurting would most likely pay. In fact but the responses I see that many of you have no idea how this forbearance would help. The banks would in fact make more money, plus it would energize this economy.

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