Dave W

Citi's Flip-Flop on Mortgage Cramdowns: A Really Bad Idea

Forget the Cram Down. Foprget who did what to create the problem. Concentrate on the solution.

Modify all loans issued since January 01, 2000, into 20 year, Zero interest loans. The resulting principal only payments will: 1. lower the house payment and rapidly reduce the mortgage balance for the underwater homeowner. 2. provide capital to the lender to lend at today's rates and underwriting guidelines. 3. stabilize the housing market and stop foreclosures and short sales. 4. put all homeowners and investors in a positive equity position within 5 to 7 years, not 15 to 20. 5. increase tax revenue to State and Federal governments without increasing taxes. 6. provide a monthly economic stimulus to the household from the reduced house payment, without government intervention, bailout or increase in taxes. Much better than a one time check.

Not my idea but the proposition of The American People's Fix, check them out at americanpeoplesfix.com. An alliance of homeowners and investors with a viable solution to the housing market meltdown.