[quote=pri_dk][quote=sdrealtor]The loan is already secured by a property worth less than the loan amount and it would be the gubment’s doing to refi them into lower rates. [/quote]

The government would do the refis?

Let’s try an example:

The government would pay off a $500K loan (i.e. write a check to a bank for $500K to make the bank whole.)

Government is now holding a $500K loan on a $400K property. If homeowner decides to walk, the government loses up to $100K in the whole scenario.

If this home were in Temecula, the government would now be underwater $250K+
😉

Since the the government is likely already guaranteeing the original loan, this just really just takes us in a a big circle and doesn’t solve anything.

It doesn’t help the homeowners, and doesn’t help the government’s balance sheet. If it helps anyone it would be the banks, mortgage brokers, and real-estate hustlers who will inevitably find ways to defraud the whole scheme.

I like to hear creative idea as solutions to problems, but we aren’t going to find one here that won’t just result in a bigger mess.

The cleanest way our of this is what most Piggs have been advocating all along: Foreclose and put it back on the market, at market prices. Only sell/loan to those who can afford it.

If we rewrite the rules of the game now, it will only reward those who cheat.[/quote]

I am with you on these points, but the suggestion by the OP also included that the interest in arrears “more than 365 days” be rolled into the loan.

How is this boot licking idea not class based welfare? You help the rich bankers you help the realtors, and you help middle class people and up, who by all reasonable standards live in luxurious digs. Sounds like corruption/theft to me. Let the nations capacity for charity be used for more deserving people.