I don’t know about you, but this one sticks in my craw (and I’m not even sure what that means).
Forgive Debt and Save the Housing Market
The evidence is growing: Mortgage-debt forgiveness is good for borrowers and lenders alike.
The editors at Bloomberg View have long argued that mere reductions in interest payments won’t do much to mitigate the biggest threat to the housing market: millions of borrowers who owe more on their mortgages than their homes are worth, and are hence prime candidates for foreclosure. The best way to prevent a flood of distressed properties from hitting the market is to forgive large parts of the loan balances. The strategy restores borrowers’ equity, giving them a reason to maintain the homes. Lenders gain by avoiding costly foreclosure proceedings, which tend to leave them holding properties worth only pennies on the dollar.
The above is from an opinion piece on Bloomberg.com
Let me see if I have this right. Just because your house is worth less than you owe, you are a prime candidate for foreclosure presumably because you will just walk away. And, if your lender just gives you a break you’ll have a reason to maintain the home. Am I the only one in America who is bothered by this line of thinking? What does this say about our collective integrity and sense of responsibility?
How do people who work hard, pay their bills and mortgages year after year feel about all this?
QUINNSCOMMENTARY 
Let the free market decide what is best. The lenders in this case should be the arbiters of what is in their own best interest. If a lender feels it is in their interest to forgive debt, then there is nothing stopping them. If a lender is mandated to take a loss through principal forgiveness, this will have a negative effect on rates for all new borrowers because a new risk has been introduced to the mortgage market. The more that politicians meddle with the free market for their own purposes, the more problems they create.
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I know that in some instances it is important to forgive people on their mortgages. My worry is the complacency that is starting to grow in the country. This administration is doing all it can do destroy the fabric that built this country. Most people do not see this because they are getting 99 weeks unemployment or food stamps, and now some are falsifying their health for disability insurance. Soon there will be no one working that can pay taxes, then we are all done as a people. Is that what we want, a Monarchy run by a guy who couldn’t operate a cash register?
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First of all, there is not reason to forgive anyone on their mortgage. It is an obligation they signed on for and are obligated for. The flood of debt forgiveness must be born by someone and guess who that will be. This country has turned into a give away program and is dangerous to our future. The key is to eliminate the red tape in forclosures and allow the banks to get the home on the market as quick as possible to minimize their financial loss. Stop these give away programs by the democrates and OBAMA.
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It used to be understood that risk and reward were two different things. The thinking behind loan forgiveness seems to be, You took a risk, You must be rewarded.
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