Shella Knows Best: How the Bailout Can Best Help People

Perhaps we can accomplish with the Bailout, that which would never otherwise be accomplished in current American history. Namely, a major investment in the affordable and accessible housing stock.

I present to you, Shella's 10-Point Bailout Plan, in the form of a letter to Barack Obama.

Dear Senator Obama:

I think I have an idea of how your administration can work the bailout to help needy Americans, while being honorable to the new taxpaying owners of defaulted mortgage loans:

1. American taxpayers purchase single-family and multi-family properties presently in default – and are issued a bond-like instrument for the value of their investment including some amount (yet to be defined) of interest per annum;

2. Purchase price to taxpayers is “short-sale” at current market value only (not including accrued and aggragatge missed payments, interest and fees, closing costs, points, property maintenance costs, etc.);

3. In exchange for being bailed out, institutions agree to accept and make a one-time write-off of the dollar amount (gap) between the gross mortgage default figure and the taxpayer short-sale amount. Then it's all rosey for wallstreet again.

4. The feds create a state-by-state portfolio of housing units including protectorates;

5. Each housing unit, at the time of purchase, is deed-restricted to be affordable and accessible housing in perpetuity;

6. Each state applies to the feds to become responsible for the disposition of the affordable and accessible housing according to their state housing plans, further providing a clear and concise oversight and reporting plan;

7. Each county applies to the state for the affordable and accessible units within the cities and unincorporated areas in accordance with their state-approved consolidated plans and housing elements;

8. Local nonprofit housers and housing authorities then apply to each county with a plan for the responsible and reasonable operation, repair, maintenance, and management of one or more housing units for the needy or underserved populations already-identified in their jurisdiction's approved housing element;

9. Local nonprofit housers and housing authorities agree to refinance the housing unit/s under their control at some point before a 15-year term, the then-current market rate being returned to the feds to pay the bonds presented to them by bearers having received same at the time of the bailout investment.

10. Financial institutions or other entities receiving taxpayer bailout accrue Community Reinvestment Act obligations, those credits may be used to perform accessibility modifications or other critical repairs and maintenance which may be necessary for the housing units taxpayers have been forced to invest in.