Those who locked in low mortgage rates are trapped in their current homes, as they can't afford to move and pay interest rates that are 50% to 100% higher than the low rates they secured years ago.
Well, yeah. For some of us, the whole purpose of locking in low mortgage rates was to move into a home that would be the last one we ever occupied. I'm still trying to figure out who is in the receiving end of the financial disaster (for them) that my mortgage has created -- paying 3% on a 30-year fixed-rate mortgage while inflation rates have exceeded that almost since the day I closed on the home.
The “bag-holder” that owns the long term 3% mortgage are large entities who are convinced they will be bailed out by .gov if they fail—since they are “too big to fail”.
They pulled it off thanks to the Uniparty in 2008.
They may not get so much joy this time.
You have an interesting point. If the lenders are silent, perhaps something is going on.
We have seen how taxpayer money has flowed to specific causes through entities like USAID. This has explained, at least to me, news outlets that don’t care about ratings or viewership, among other things.
Corporations have seemed giddy in embracing DIE. You mention embracing being underwater on a loan.
Something does not smell right.
Whomever owns the note is getting a low return on their money. It’s still better than a default.