Sorry andy but that is not the case. His principal was temporarily written down by about 40K and the loan amount is the current value of his home. If he ever sells the bank will recover its money (based upon what I beleive the terms are thus far). I dont hink he will ever move or at least not in the next 10 years. His divorce was not funded by anyone other than him as the equity was and for the most part still is there. The bank is avoiding a loss and his interest rate is being subsidized but no where near $200K. Part of the process he went through involves the bank making a NPV calculation. If it was better to liquidate they would have done that but the asset is more valuable to them and hence tax payers by keeping this one on the books. There are all sorts of assistance programs in theis country and this is one. I’m sorry you feel like you are on the wrong side of this but trust me, you would not trade places with him if given the chance.
