.why not take the value of the appraised value of homes as of let's say, yesterdays date. Now make the banks write down the loan(mortgage) to the current value.
However this deal is available only to Primary residence. 2nd homes, vacation homes, investment homes are not available to this formula.
The banks must take the hit for this since they are ultimately the cause.
No mortgages are granted until the commitee gives final approval usuually just a quick 24 hours before a closing on a home takes place.
THEN if you can not pay, you lose the home and the bank gets it back. Fair is fair and I think that is what Americans that played the game right want.
Those of you with Home equity lines that used your home value as an ATM are shit out of luck. Living beyond your means can not go rewarded.
OK, flame away.
Boston Globe..snip
Tangle of loans feeds foreclosure crisis
Borrowers can't tell where to turn for change in terms
By Robert Gavin Globe Staff / July 31, 2007
Each month, Stephen and Kim Martinelli sent their mortgage payment to Chase Home Finance, and when they fell behind, it was Chase that launched foreclosure proceedings, with an auction of their Lawrence home scheduled for later this week.
The Martinellis, squeezed by the cost of caring for a disabled son and carrying an adjustable-rate mortgage that boosted their monthly payments by $900 over the past year, pleaded with Chase for a break: for a new payment plan, a lower, more affordable rate, or a delay in the foreclosure, due to hardship.
Chase's answer: "No."
What the Martinellis did not know was that Chase was not calling the shots. Chase merely services the loan, acting as bill collector and administrator.
The mortgage was held by an unknown investor, whom Chase declined to identify and who refused to modify the terms of the Martinellis' loan.
They are among thousands of delinquent borrowers caught in the maze of modern mortgage financing as they desperately try to save their homes. Unlike in the last real estate bust, when local banks and credit unions wrote nearly 80 percent of mortgages in Massachusetts, most home loans issued today pass through a nationwide chain of brokers, lenders, service companies, Wall Street firms, and investors. That makes tracing ownership difficult, if not impossible....snip
sw
How are you going to differentiate between these types of mortgages? This plan rewards people who bought way more house than they could afford and sticks it to people who live within their means.
Why don’t they just raffle the properties off to the citizens of the US? Limit the tickets sold to the note minus the insured portion (MI) and this way we would all get something for the money they took from us...the chance at winning a house for $5. The banks take a little hit for writing bad loans, the Mortgage Insurance companies take a little hit for insuring bad loans and some people in the USA may wake up owning an apartment complex in phoenix or a townhouse on the bay. If we need more cash, let the Euros and Asians in on the action as well.