Foreclosure Folly

You have to love the compassion liberals have for those who find themselves in difficult straits.

As an example, take a look at this video report from CNBC regarding a Berkeley professor's plan to solve the foreclosure crisis. In a nutshell (no pun intended for those of you who knew me in my law school days), his plan calls for delinquent mortgage balances to be reduced to 85% of fair market value and their terms modified to a 4.5% interest, 30 year, fixed rate loan. Oh, yeah, and by the way, this starts right after that 6 month foreclosure moratorium that he also proposed.

I'm sure that sounds great to all those people who borrowed more than they could afford to pay, with loans having terms that they can't live with, and who are not making their monthly payments. It may not sound so good to those 95% of American homeowners who have been paying on time and who have loans with interest rates which exceed 4.5%.

I can't wait for the reaction of a guy who has been paying his bills, when he realizes that his neighbor, who was in default on his mortgage, is going to get a sweetheart deal (funded in part by his tax money) while his mortgage remains at a higher interest rate.

The logical reaction would be to stop paying your mortgage and wait for your "deal". I wonder if the liberals will still be compassionate if that happens?