Step in Right Direction

Citi to Allow Jobless to Pay Less on Loans - WSJ.com:

"Under the program, Citigroup will temporarily lower mortgage payments to an average of $500 a month for certain borrowers who have recently lost their jobs and are at least 60 days behind on their mortgage payments. Borrowers will be allowed to make the lower payments for three months. Citigroup will waive interest and penalties during this period."

Nice move ... but how do they verify jobless-ness based on cut backs/layoffs/out of business and those from 'I quit"s ... you know?

that $500 a month could equal the loss of a lower income (lower as in lower of the incomes in a two income household - not lower as in socio-economic status) .... I know that when I was working it would have covered a 5 week month (after daycare I was taking in about $100/wk - and that was with my employee discount).

And it is really nice of them not to charge the interest -- BUT is 3 months going to be enough for these people? I mean they are basically saying that they have 3 months to find a new job -- what if there aren't any jobs to be had?

It also does not say if there is going to flags stuck on these people's credit reports either -- if there are then this will make it nearly impossible for them to refinance at a lower payment rate with lower interest to get it all in order .... it will also effect every other bill as well.

I mean, the credit card companies are already pushing up interest rates based on whether you pay your bills on time (including utilities, hint hint) ... I can imagine what they would do if you were behind on a mortgage.

Could you imagine your interest rates jumping from 14.5% to 29% ---- its been known to happen ---- does this make sense to you???

"Gee these people don't have enough money to live on, so lets take more of the money they don't have"

I think they need to stop this practice by the Credit Card companies more than going after the mortgage companies.

I think there needs to be a MAXIMUM interest allowed by FEDERAL law .... like around 20% .... this will keep the Credit Card companies from giving unsecured cards to people who they know are unlikely to be able to pay it back ...

like college students who will use the cards to buy books/clothes/food/etc and have to use their student loans to pay them off ... loans more than likely secured not by them but by their parents ... so they are afraid to got to their parents for help to pay the cards off.

As much as they have been bitching about the banking industry and mortgages -- you don't hear much about the highway robbery these people are getting away with ... I think its because when we think of credit cards we think of 'dead beats' simply not paying their bills.

And no -- at present I am not having any issues with credit cards ... nor mortgages ... so its not sour grapes. And the only people I know that have had issues with them are one's who were deadbeats ... so quorums there either.