Bush's Bank Bailout:
In a story incorrectly headlined Bush Outlines Aid for Mortgage Holdersm
, we read:
Bush's proposals unveiled Friday are designed to help combat those defaults. They would make it easier for borrowers now holding adjustable rate mortgages that are resetting to higher monthly payments to refinance those loans using the resources of the Federal Housing Administration.
Why not simply let the banks and lending entities change the resets? Lower the reset number or postpone the date. That would mean a less profit for the banks, and even some losses. Why can't that be allowed to happen?
> Why not simply let the banks and lending entities change the resets?
Why would the banks do that? What if they didn't want to?
Or do you mean force the banks to lower the reset interest rates?
You hear bankers whine and whine all the time about how they don't want to be in the real estate business and yet they aren't going to make it easy for anyone to refinance those ARMs once the poop starts hitting the fan. Bit of a paradox there, it seems to me, but maybe there's something I'm overlooking.
[Insert obligatory "It's A Wonderful Life" reference here.]
Yeah, we can only allow the free market to force people out of homes, not to force banks to lower their profit or lose money. Duh.