Government's Mortgage Rescue Plan a Failure

Grand Rapids, MI (PressExposure) February 17, 2011 -- Financial advisor Dennis Tubbergen has been watching the housing market and discussing this topic and many others in his online blog and in his monthly newsletter Moving Markets™. Tubbergen has been saying for months the housing market cannot dramatically improve until unemployment numbers become substantially better and the widespread, excessive debt in the U.S. is dealt with in an acceptable manner.

Tubbergen, who is CEO of USA Wealth Management LLC, a federally registered investment advisory company, also gives this gloomy prediction: The housing market is not likely to bottom until at least 2012.

The financial advisor, author and talk radio show host recently referred to a January 27, 2011 article from USA Today which states in part, "A mortgage modification program aimed at saving homeowners from foreclosure has failed because regulators are 'afraid to rein in or impose penalties on the mortgage services' whose record 'has been short of abysmal,' the program's watchdog told Congress on Wednesday (January 26, 2011)."

A bill was introduced January 25, 2011 to end the program, thus saving up to $30 billion in bailout funds that have not yet been spent.

Tubbergen had a few comments regarding the article.

"The program is a voluntary program, and banks have the discretion to use the program or not use the program," explains Tubbergen.

The article also quotes Neil Barofsky, the special inspector general for the government's bank bailouts, as saying Treasury needs to act quickly to respond to some of the (mostly Republican) statements calling for the dismantling of the Home Affordable Modification Program (HAMP). Also in the article, spokeswoman for the Center for Responsible Lending Kathleen Day thinks HAMP should be given a chance. Day does not blame the Treasury Department for the program's failures, but points a finger at the mortgage-servicing industry she claims 'can't distinguish between the foreclosures that are inevitable and those that are avoidable.'

"My guess is that Ms. Day may not have much banking experience," notes Tubbergen. "It seems to me that a bank only forecloses on a property when non-payment is assured. The last thing a bank wants in this environment is another property it has to try to sell - payments on a loan are far more preferable."

Tubbergen's bottom line here?

"Government intervention rarely works, in my opinion," concludes Tubbergen. "This is just another example. Were I in charge we'd scrap this program and reinstate 'mark to market' accounting."

Dennis Tubbergen has been in the financial industry for over 25 years and has his corporate offices in the USA Wealth Management Building in downtown Grand Rapids, Michigan. Tubbergen is CEO of USA Wealth Management, LLC and has an online blog that can be viewed at His weekly talk show The Everything Financial Radio Show is simulcast on two Michigan metro stations and also airs to over 600,000 financial advisors, with recent podcasts available at

The opinions expressed herein are those of the writer and not necessarily those of USA Wealth Management, LLC. This update may contain forward-looking statements, including, but not limited to, statements as to future events that involve various risks and uncertainties. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual events or results to differ materially from those that were forecasted. Therefore, no forecast should be construed as a guarantee. Prior to making any investment decision, individuals should consult a professional to determine the risks, costs, benefits and fees associated with a particular investment. Information obtained from third party resources is believed to be reliable but the accuracy cannot be guaranteed.

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Press Release Submitted On: February 17, 2011 at 11:34 am
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