Have we forgotten to help the troubled homeowner
While the government printing presses have been working overtime pumping money at every financial institution in sight, it seems that the root cause of the problem, the troubled homeowner who is having difficulty paying their mortgage every month has been forgotten.
Now I'm not talking about the speculative investor who may have defrauded the lender or the borrower who may have lied in order to get a loan, rather, just the decent people who are in a little bit of a bind and are having trouble paying their mortgage every month.
Interestingly, I met with such a couple the other day to help them list their home for sale but unfortunately the proceeds from the sale wouldn't be enough to pay off their loan. They have called their lender to rework the terms of their loan but haven't been able to get past the customer service department. They weren't interested in a short sale (and I'm glad about that because that's just a waste of everyone's time).
But worst of all, they are only slightly underwater. They just need to get their payments down a little which is why they wanted to sell their home and buy something a little smaller at a better interest rate so they would more easily be able to make their monthly mortgage payment.
And people like them are in trouble and so far the government has forgotten what the root cause of the financial crisis is all about.
It's a shame.
WSJ Online has an article on Plans to Aid Borrowers Gain Steam.
Not good enough.
I tend to believe that letting market forces self correct is a better choice than intervention but since the government currently seems to think otherwise, something should be done to help the troubled homeowner.
Just my opinion. What's yours?