[LuvFreeRepublic]

Ok, this is food for thought. Thanks. Now what happens to those who already took a loss on their homes by selling it? Now if a bank is willing to do a like kind exchange, what is stopping the bank from adjusting the principal on the existing home loan for those who can afford to keep paying the mortgage? But again, you still have those who have already sold their home and suffered a loss. Seems to me any way you try and fix the mess it results in picking winners and losers.

[Freddd]

Digging in deeper is not the answer.

[Secret Agent Man]

I can’t say I have any real good solutions for people that are so upside-dwon in their current mortgages.

For those of you NOT in mortgages right now, I think the best advice is if you have enough money saved up now, to buy a depressed value house outright and not deal with a mortgage at all. For those not with enough money yet, save a year or two, or 3 or 4, and buy your house outright. You will save so much money in interest it’s not even funny, and you’ll never have to worry about interest rates.

[MrEdd]

ROFLMAO

[the invisib1e hand]

Does it make sense for Joe to sit there, stuck in a home that he can’t sell or refinance; making a payment every month on what he knows is a bad investment?

umm, pardon FReeping me, but whether it "makes sense" after the fact or not is quite irrelevant. Joe ought to meet his obligations. Since when was that optional? Just couldnt get past this part of the article; it's bound to be shot through with more foolish premises after a beginning like this.

[RKBA Democrat]

This is a very good idea, but it presents some challenges:

1. A lot of the banks that are servicing mortgages don’t own the underlying notes. They make more in fees if it forecloses. So sadly, their financial incentive is to let it burn.

2. A lot of financial institutions either don’t want to take a loss on their books or can’t.

3. You do get into the issue of moral hazard. The lenders do and should want folks to make good on their loan and the truth is, most folks try. They don’t want to make it easy to get out because they’re better off having the debtor stay put and continue to make the payments.

Where I see this being useful is in states where a mortgage is nonrecourse debt and where you have a financial institution that both has a large enough to have a significant inventory of REOs and is strong enough to take the hits.

[org.whodat]

ROFLOL, and how many joints did the guy smoke to make this all seem like it made sense? Because a frog will grow wings and fly before this turkey does.

[OldCorps]

btt

[familyop]

The current issue is trivial in comparison to what’s in store tomorrow.