[quote=Russell]”And the most important part of this is that the new mortgage isn’t recorded as a sale.”
I really think for the sake of home valuations it probably is a moot point. The forgiven amount probably doesn’t normally drop the loan total below already existing recent comps from market transactions.[/quote]
Maybe, maybe not. The fact is that the original sale (and the new valuations of homes in the area which were used for HELOCs and cash-out refis) was no more real than the tooth fairy.
If we’re going to go down this path of principal reductions, let’s at least make sure future valuations (for refis and sales) in the area reflect the real, affordable prices in the neighborhood.
