Mortgage relief plan can save banks billions
Bush expected to sign bill on refinancing
July 29 2008 - Congress’ plan to allow people to refinance into more affordable mortgages won’t just relieve thousands of homeowners - it’s also expected to save the banks that issued the loans billions of dollars.
Most banks will end up losing much less money handing mortgages over to the government than they would if the loans defaulted and the homes went into foreclosure. Plus, it will be up to the bank to decide whether to allow the homeowner to refinance.
“The banks should be thrilled with this,” said John Vogel, professor of real estate at Dartmouth College’s Tuck School of Business. “The banks have been pushing it; this is as good a deal as they were going to get.”