[quote=scaredycat]but how does giving money to underwater homeowners help?[/quote]
You know, i really havent seen any of this. When homes are underwater and lenders make modifications, that isn’t giving money to underwater homeowners, they’re still underwater. And for the most part, the underwater part isn’t the homeowners loss, it’s the lender’s loss. Modifications, and government aid in facilitating those modifications are rarely, if ever, the equivilent of “giving money to underwater homeowners”. It’s either lender’s acknowledging their own losses that already existed, or the government stepping in to help underwater lenders.
Certainly there are lifestyle advantages to homeowners, but that’s significantly different than true economic benefit. If a homeowner is $100,000 underwater and their loan is permanently modified to zero equity, they still got nothing.
Of the recent government programs, there hasn’t been a single one that hasn’t been 100 times more advantageous to lenders than it has been to borrowers.
