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Originally Posted by Preacher Dave
My brother and I have been kicking around a solution. Most banks receive their money at about 1/4 of a percent. They then turn arond and loan it to us at 4 to 7 percent interest rates for car loans, mortgages, etc.
We were thinking that if ever mortgage was refinanced at 1 to 2 percent lower than they are currently at it would put a lot of money into the homeowners hands to do more with than what they currently have. Some of the numbers that we came up with were 2 to 4 hundred dollars per month depending on the amount of the mortgage.
Everyone is focusing on the big companies, and yes it would be catastrophic for them to go under. The government bailed out the banks, insurance co., and mortgage lenders, but cannot bail out the big three. This seems weird to me. We gave the banks 300 billion and did not worry about where their money was going. From reports that I have heard that money is not getting lended like they thought that it would.
The money from an interest rate refinance on everyones' home would make a huge impact on everyone. With more money every month it allows people to spend more and have a lasting effect on the economy.
My brother and I are not financial experts. Just some ideas that we came up with. I am sure that there will be plenty of questions. show me what might work better.
Preacher Dave
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Great idea in theory, but not gonna happen. Most people who need your refinance idea are under water on their homes value right now because of overinflating values and too much easy credit, and therefore no bank will touch them.