Saturday, March 27, 2010

Obama administration to cut loan balances of delinquent borrowers

Maybe I'll become a delinquent. Politicians cause the problem then seek praise for returning to the scene of the crime to offer aid.

Renae Merle and dina elboghdady of the Washington Post write:

"The administration's newest push also seek to more aggressively help borrowers who owe more on their mortgages than their properties are worth, by encouraging lenders to cut the loan balances of millions of these distressed homeowners and possibly refinance into loans backed by the Federal Housing Administration."
Full article here

another article from AP:
Gov't to unveil plan to shrink some home loans

update 2:

Imagine twin brothers, each with $180K of annual income. One rents, and the other has a $700,000 mortgage on a home that declined from $800,000 in value to $600,000 in value. Both brothers lose their jobs. Why should the renter pay higher taxes to subsidize his brother’s mortgage payments?
Read the whole thing here.

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