A friend just emailed me this article, which is basically more reading on the basic theme of foreclosure vs. short sale or loan modification. It includes some good quotes from Wall Street figures, who disparage the idea of a homeowner walking away from an underwater property, while those same Wall Street boys had a field day betting against the loans they were making to us.
Hypocrisy from Wall Street is nothing new, but the fact that as a nation we are spending billions of dollars trying to prop up a market that should be allowed to adjust naturally is something to concern us all. These billions of dollars are not going to homeowners, but back to the banks... and only to keep people in homes paying far more on a mortgage than the same home would cost to rent.
It's an easy sell to the public to help a homeowner avoid the stigma of foreclosure... but wouldn't it be a lot cheaper for the public to just not stigmatize those who were caught by the bubble? Let those overvalued homes go... to be bought by an aspiring homeowner at a far lower price after forclosure. We should thank those with the courage to walk away from bad debt - debt the banks that never should have issued in the first place.
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