No, you are right. However, it is the right thing to do by the investors.
The investors will be losing enough. There is no reason to increase their losses by trying to save some idiot who overpaid for a house.
If modifying a loan results in a greater loss to the investors than a foreclosure, why in the world should they not foreclose?
It was never about “keeping people in their homes.” It was always about saving the banking system.
Just think about it…there were far more people who were “worthy” of a bail-out during the pre-bubble days. You know, the family that bought a house well within their level of affordability, but then mom or dad got cancer, and lost a job. THAT is someone I’d much rather save than the idiot FBs who never intended to pay back their loans unless the housing market paid it for them, via appreciation.
A non-recourse loan/foreclosure is a GIFT to these borrowers, as they really could have the lenders chase them for life, or until bankruptcy. They got to live in a house for free, in many cases, and then walk away after stealing hundreds of thousands of dollars from the lender/bank. Why should we feel sorry for them?
