ArnoldCountry

Prime Mortgage Trouble Could Accelerate Bank Failures [Housing Tracker]

To this comment I say: "I absolutely do believe that there will be more principal reductions," Michael Gross, Bank of America

B.S. They will do it here and there so they can so they did it but truth is, they cannot afford the losses. If 50% of the loans made since 2005 have lost 20% of their value (more than that is likely) and then they right that off in a refiance, these guys will collapse. More important, unless they are a portfolio lender, the secondary market with its complex traunches used for the securities will never buy into that kind of loss in which some investors will be 100% under water by the thought. More important, people forget the disparate impact of helping a few by writing down their loan balances and then the rest who were not so fortunate. The lawsuits are coming over these kinds of issues.