Monday, August 22, 2011

A call for help for homeowners

Today's editorial in the New York Times, "Homeowners Need Help", makes the very valid point that no economic recovery will occur unless and until there's a recovery of housing. The extent of the wreckage of the housing bust is staggering: 6 million homes have already been through foreclosure; 3.5 million more are in foreclosure now; and more than 14 million homeowners are underwater, half of them by more than 30%.

The Times says the Obama Administration needs better ideas and a more aggressive approach, that the measures tried thus far still make it more lucrative for banks to foreclose than to reduce principal balances. And reducing principal balances, or at least making it possible for those underwater to refinance, is what the Times advocates.

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