Reporter's Notebook

Can Your Mortgage Wait?

Mark Hemstreet, owner of Shilo Inns, says it can – but the economy can’t.

Hemstreet created the eight-point America’s Econ Stimulus and Recovery Plan, the cornerstone of which proposes a one-year “mortgage holiday” – a national mortgage moratorium forbearance for all residential, commercial, industrial and farm loans.
It’s optional, and commercial and residential landlords who opt in could choose to cut their tenants’ rates by up to half.

According to the plan, which Hemstreet told me has earned attention from the U.S. Senate finance and banking committees, the government would pay an estimated 6 percent interest-only monthly payment on all existing mortgage debt to mortgage holders affected. And after the one-year time out, the regular monthly mortgage payments would resume as normal. But a 25-year mortgage would become a 26-year one.

The payoff? Hemstreet expects an immediate economic stimulus of all of the American families' and businesses' regular monthly mortgage payments, to be infused directly back into the economy. The hope is that the infusion of cash will help keep business stable and growing, provide more jobs and create more tax revenue.

And by not having to worry about hefty monthly mortgage payments, Hemstreet figures businesses will be freed to hire employees to get America working again, he said.

“My plan would immediately empower the American family and small businesses and it will pay for itself,” he said. “It puts money in the hands of the average American. The billions we’ve already spent bailing out Wall Street and AIG…was not necessarily money well spent. The money would be better spent on Main Street, not Wall Street.”

But what about the lenders? Many would receive a guaranteed interest stream from the feds, what he said is far better than the alternative of massive delinquencies, bankruptcies and foreclosures.

“The alternative – a prolonged depression – would be far more costly,” Hemstreet said.

Sounds simple. Could it work?

This is no doubt a brief introduction into the plan. More information is available at www.saveoureconomy.com.

-Megan Patrick-Vaughn can be reached at mpatrick@vbjusa.com