Commentary: An economic tale of boneless chickens and empty pots
Mass refis of underwater borrowers is a delusion not limited to the White House. New buyers for new loans must be found to pay off old ones: there is no method for automatic write-down of rate. The market cost to buy down a rate a mere 1 percent is about $60 billion per trillion, and there are at least $2 trillion in underwater loans out here.
We need adequate credit for buyers, not just to rearrange the existing lawn furniture. Buyers. Americans need faith in the value of their homes, mortgaged or not. Fail to assist prices to rise from catastrophic levels, or stay in this until doomsday.
Lou Barnes is a mortgage broker and nationally syndicated columnist based in Boulder, Colo. He can be reached at email@example.com.
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