[quote=harvey][quote=spdrun]The criteria are apparently the same (narrower than, but same group) as for existing forbearance. Not sure why Fannie/Freddie would want those homes on the market, unless it’s cheaper to have “owners” dump’em in 5 years than to foreclose.[/quote]
The math is simple: It’s cheaper to have owners keep them than to foreclose.
The principal is gone. Lenders cannot be made whole. For underwater properties foreclosure doesn’t recover anything, it is just more money lost due to transaction and legal costs.[/quote]I disagree. Foreclosure is not “more money lost” if the loan is non-performing. It’s cheaper for a lender to foreclose ASAP and turn around and get “something” for the property (sell it to a flipper for cash?) than to let their trustor(s) squat into oblivion, while letting the property go to waste and defaulting on their taxes and fire insurance premiums severely lowering the value of the collateral.
