The Large Banks Getting Another Deal

February 22, 2012


Just in passing - according to history, it's George Washington's real birth date. How would our First President have solved the continuing housing slump? Obviously too much has changed economically since the 1780s, but maybe he would have focused on a solution rather than on politics.


In the 21st century, the government's answer to the problem is to throw more billions at it. The settlement with the lenders that was announced this month is to give the large banks monies to be used to modify loans for homeowners who are in trouble due to loans that had increases in interest rates or loans that are greater than the present value of the home. Hopefully when the details of the deal are worked out, the banks will be required to use them to reduce loan interest rates or balances and be reimbursed for the loss. Perhaps this could speed up our short sale processes as well.


Those of us who have been in the real estate business for other down markets would love to go to a Congressional hearing and suggest ways to improve the short sale processes.