This term bugs the hell out of me.
Nearly everyone lost value (bubble value) in their homes in the housing boom-bust. But the people with the most equity in their homes lost REAL MONEY PAID, whereas people who had little to no equity lost nothing ... they lost future money that they haven’t paid yet (and could get out of paying if they sold or declared bankruptcy).
What’s more, a great number of ‘underwater’ mortgage holders took money out of their houses based on bubble values. Therefore they got REAL MONEY TO SPEND on other things but now want that same money back if they were ‘made whole’ by some government programs ... so they’d get to spend the same money twice!
Meanwhile poor shlubs who didn’t take equity out of their homes and either had them all or mostly paid off lost REAL MONEY ... yet no government programs are proposed to “make them whole” (not that there should be mind you, but if anyone should be “made whole” it should be people who lost REAL MONEY ACTUALLY PAID)
These programs to help ‘underwater’ mortgage holders are really only offered to help the lenders, not the borrowers. And to try to keep the housing bubble inflated or re-inflate it.
I tried to explain that to a friend who has a liberal streak running through her. Of course she is one of the ones way inderwater for those same reasons. She looked at me blankly and then told me more or less that I’m mean.