I have a problem with this idea because it punishes those who didn’t over buy. Interest rate freezes on ARMs is about as far as I think it should go. That should allow people to stay in their homes. I bought my place when prices were on the rise, not at the top, but close enough, but I bought knowing that I could afford it long term. If I knew I could have $100,000 in principal erased, I’d be in a much nicer house.
