What is the effect of eliminating foreclosures? I can think of: elimination of proper price discovery and the fact that you are keeping people in homes they can’t and will never be able to afford. the bad neighborhoods are a lost cause already and will be reinhabited at the right price and time. the good neighborhoods will include homes where people can’t afford to stay and thus the govt/banks are paying the difference. in the average neighborhoods, market price is indeterminable and many of should be moving to other neighborhoods and making way for those in the good neighborhoods who shouldn’t be in good neighborhoods. http://online.wsj.com/article/SB123454524404184109.html?mod=testMod they’ve had a freeze on from november - january and now have put another one on for about a month. why not just man up and say you’re going to keep one on indefinitely and stop realizing losses?
If I didn’t have to worry about my credit score I’d be defaulting like a mofo right now to arbitrage the bailout.
one of my colleagues called his bank and asked whether he could benefit from the bailout. he is an executive and makes good money with impeccable credit. the back looked at his credit, payment history etc and basically said to him, the only way we can help you is if you default on your mortgage.
Same here, if I didn’t care about credit score; I would fall behind and let some judge reduce my mortgage balance. What a deal!!