Agreed.
But, what do you do with the homes that people have put money into, have taken a loan out against - and have lost their jobs? Do these homes sit empty, and be allowed to rot? Many homeowners (I won't be so bold as to give a percentage) invest money into their home, add a hot tub, improve their workshop, paint the bedrooms, upgrade cabinettry. These 'improvements' consumed both time and money. This is time and money that is lost by the homeowner. It's not like the homeowner has zero investment in their home; and then intentionally had their company lay them off. What do you suggest? It's a lose/lose situation. Given bankrupcy laws - many people can simply declare bankrupcy; and either keep their home, or have the loan re-accessed to their current income level.
But, as you wisely pointed out - the cause of this whole mess is that Gov't appointed itself the task of 'wealth re-distribution'; and we are all reaping the benefits of this insane and unconstitutional abuse of power.
You asked what to do with homes on which people can no longer afford the mortgages, even through no fault of their own. This issue should be between the lending institution and the mortgage holder. If the lender wants to foreclose, they probably have that right, given the mortgage contract. If the lender wants to reassess, that’s also a possibility. If the lender wants the house to sit empty and rot, that’s their choice, too. Lots of bad things happen all the time to the most wonderful people on the planet. People get cancer and die. People start businesses and go bankrupt. People invest in, and improve, homes and lose their jobs and houses. The government has no right to take my money and a) give it to lenders, or b) give it to mortgagees.