Consumers that are not eligible for mortgage refinance help are finding it difficult to avoid foreclosure. The result has been an increase in write downs for many banks and their bottom lines are starting to suffer. While experts are encouraging consumers to get mortgage refinance help if possible, few are able to get an approval if they do. The problem appears to be a catch 22 and few are certain if there is a way to solve the issue without introducing forced mortgage refinance help on banks, which would not go over with many of them that are struggling with bad portfolios filled with bad loans.
“It is good news that housing starts are at the low level where they are, and at some point people are going to come out of rental housing and move back into purchased housing.” said Bill Downe, the CEO of the Bank of Montreal. “The one big “blockage is the pending restructuring of government-sponsored mortgage lenders Fannie Mae and Freddie Mac. When they’re restructured, I think the U.S. housing market will become a much more orderly place.”
“Name the cookie jar, another writedown,” said Edward Jones analyst Craig Fehr.
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