In an effort to subvert the current Housing Crisis the Bush Administration is planning a bail out of home owners whose mortgage balances are greater than the value of their homes. Details are sketchy, but essentially the bank would reduce the principle balance of the mortgage, so that the home owner would no longer be in a negative equity situation.
It's unclear at this point whether this deal would extend to those who are negative as a result of using home equity to live the american dream, which for many has become a personal nightmare. It's also unclear whether only sub-prime mortgages will be targeted, or whether the bail out will extend to home owners who are negative as a result of short-sales and foreclosures in their neighborhoods.
One thing is clear, a consumer bail out of this magnitude is unprecedented, and we'll all be eager to see what happens.
It's unclear at this point whether this deal would extend to those who are negative as a result of using home equity to live the american dream, which for many has become a personal nightmare. It's also unclear whether only sub-prime mortgages will be targeted, or whether the bail out will extend to home owners who are negative as a result of short-sales and foreclosures in their neighborhoods.
One thing is clear, a consumer bail out of this magnitude is unprecedented, and we'll all be eager to see what happens.
Read the article here.
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