IT'S A MADHOUSE!
New Rewards for not walking away.
When I read this, I was like, now this is beyond ridiculous unfortuanetly is another indication of how f**ked up things are.
Banks are not in the real estate business. Their infrastructure is not designed for that type of industry. They are in the lending business which is their core profit center. Unfortunately playing the landlord is becoming more of a cost center for the lending industry.
There is also another angle regarding these foreclosure prevention programs that seem to do more harm than good.
Top TARP Cop Warns: The Bubble Is Back
SIGTARP -- not a Bond villain but Barofsky's shorthand title -- sums up all the sundry spending in one handy place. The Federal Reserve has been buying mortgage-backed securities and other mortgage-related debt in enormous volume, projected to reach $1.2 trillion by the time the effort expires at the end of March. Treasury is spending hundreds of billions more to capitalize Fannie Mae and Freddie Mac, so the agencies can continue to finance home mortgages. Congress has extended the $8,000 tax credit for first-time homebuyers and added a $6,500 credit for existing owners buying new homes. And while Treasury's $75 billion Home Affordable Modification Program is designed to forestall foreclosure for homeowners, its direct (and intended) effect is to keep home prices high.
I have been hearing a lot of chatter from one individual who works in the finance industry who claims that the Obama administrationjust are artificially propping up housing prices as long as possible. That perspective is starting to gain more creedence.
What this means is that we haven't reached bottom at all. And this recession/depression is going go a lot longer than we actually thought.