The Boston Globe recently conducted and published a survey on the subject of mortgage bailouts. The survey is interesting because it demonstrates how ridiculous bailouts are given the current situation.

Good Intentions Do Not Guarantee Good Results

Eight states, including Massachusetts, Maryland, Ohio, and Pennsylvania, have pledged a collective $900 million towards the foreclosure crisis since the beginning of this year according to a Boston Globe report. The money was meant to help people refinance out of unaffordable loans, but things aren't working as well as planned.

A Globe survey found the raised cash has actually helped less than 100 people refinance.

The reason the bailouts aren't working is simple: many people are beyond help. The state programs aren't set up to provide distressed homeowners with money directly. (Thank goodness.) Homeowners that qualify for a refinance are sent to a recommended lender.

The lender sets up the refinance and then sells the loan to the state housing finance agency--this way it is the state taking the risk, not the lender.

The problem is that most applicants do not qualify for a refinance. A majority owe more on their home than it is worth and the rest have destroyed their credit by getting behind on their mortgage payments.

During the boom, an overwhelming number of people were given loans they didn't deserve for homes they couldn't afford. A lot of them lied about their income and their ability to repay the loan. Others were so reckless and irresponsible that they didn't take time to look over the paperwork they were signing.

Now that housing has taken a turn for the worse, the struggling homeowners are paying for their past mistakes. The thing is, this is not a tragedy. This is what happens when you live beyond your means.

There is no state program and no amount of money that can change that fact.