From what I have read, loans and re-financing by the Banks are totally unavailable to the home-owners.
“Underwater” homes are being vacated all over the country - and the banks are now “OWNING” a very large percentage of realestate. Where is this leading?
As I understand it as long as these mortgages are on the books at the loan value the bank’s assets stay the same. But if the value is lowered through a deal or through a foreclosure then sold for less money the banks have to show a loss. That’s why they won’t negotiate.
I can’t say I totally blame people who are walking away. Businesses do it all the time. And why make payment for something that will never be paid for? The banks took just as big a risk as the buyer when they “bet” the homes would stay the same or go up in value. The opposite happened.
banks don’t care.
the bail out allows them to carry 15-20% defaults vs the previous model of only 3% defaults.
The forclosure mess will be all profit for the banks.