I have to ask, what is the benefit in this. Even if the current home owners want to stay in the property for the next couple of years at some point aren’t they going to say “why the hell am I paying 400K for this house when its only worth 300K?”. At some point they will walk away anyway?!?
Sounds like good money after bad again to me.
Take Care Piggs…[/quote]
You’re right it is. First the banks have to agree to participate, not just the homeowner (who in all likelihood will be better off walking, particularly in CA).
Then there’s a really Marxist part of the bill where the Government gets a minimum 50% of the equity from your house when you sell:
• < 1 year 100% of equity goes to government/lenders
• < 2 years 90% of equity ” ”
• < 3 years 80% of equity ” ”
• <4 years 70% of equity ” ”
• <5 years 60% of equity ” ”
• >5 years 50% equity share
So who stands to benefit? The government, after spending OUR money on this, and the lender, who just has to take a hit up front.
This starts to look as much like retribution to the homeowner as it does a bailout.