A reverse ARM be helpful to solve the subprime mortgage problem?
The big problem seems to be the people defaulting on their mortgage loans, leading to foreclosures and bank losses. What if the banks offered to take 20% of the mortgage amount and put it in an interest-free accruring loan account, mortgage based on 80% Balance at high interest rate, allow the homeowner to make optional payments to pay 20% to take right to lower interest rates on the mortgage of 80%, would this be useful to keep these mortgages viable? Would this help to avoid a taxpayer bailout the financial system?
Sounds like a plan
Mortgage Zip Code Territory – Marty Saltzman
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