You know it’s a recession when YOU lose your job.
A non-blogging friend of mine asked me to publish this letter that he wrote to his Representative in Congress. His letter (edited for privacy) speaks for itself:
Thank you for your ongoing interest in the matters of the people. My reason for writing you today is because of the economy and the struggling middle class of which I am a part.
My wife and I earn an income at the the middle class level and have two children in college. Our income level disqualifies us for financial aid other than loans, which makes paying for school very challenging. In addition, we were unfortunate enough to purchase an overvalued house at a peak in the real estate market and presently owe more than the house is worth.
Clearly, we are struggling financially despite living a frugal lifestyle. We burn wood, ride public transportation, and clip coupons to save money. If one of us loses our job, we will certainly lose our home. To help avoid this possibility, we are seeking to refinance our mortgage at a lower interest rate, which will free up some money for our budget.
We are not asking our lender for more money, we are not doing it to consolidate debt, nor are we seeking a handout. Rather, we are just trying to lower payments and strengthen our financial position. However, our residence will likely not appraise well given the state of the market, and refinance charges are a major obstacle. Thus, we will probably not be able to take advantage of lower interest rates to save money.
I ask you to work with our new President to establish programs to assist people like us, the silent, financially distressed middle class. Lenders must be made to write low interest loans and allow the rewriting of present loans at lower rates no matter what the value of the present properties. By doing so, money will be freed up to prevent possible foreclosures and help the economy in general.
I would welcome the opportunity to speak with you in person at any time if you wish. I believe that if you took a look at our present situation and the situation of many people like us, that you would see that we clearly need your assistance. My telephone number is xxx-xxx-xxxx and I may be reached any time.
Great post Erik. I have a number of friends in this position who want nothing more than the ability to refinance at a better rate. Most of the time when this topic comes up the argument against is that we are giving people a hand out and asking the banks to assume the risk for the over valued house.
But the banks already have that risk, so all we’re really asking is for the banks to switch to a lower interest rate which is now available to them.
It seems only fair that if we’re going to use our tax dollars to bail out the banks they could make the lower rates available to us.
Please thank your friend for sharing! And thanks for taking the time to post.
Just a small correction . . .
When the economy is poor and your neighbor has no job – – that is a recession. When YOU have no job – that is a depression. Given the short attention span of the public, this statement really is quite accurate. Reminds me of the citation from WWII – They came for the Catholics and I did not speak up because I wasn’t Catholic. They came for the Trade Unionists, but I did not speak up because I wasn’t a trade unionist . . . and there was no one left to speak when they came for me . . . <> I applaud your efforts to raise awareness.