The Santelli Screed Hits Wrong Target on Mortgage Bailout
Joan Walsh, editor-in-chief of Salon.com blogs about the media coverage of "Class Warfare" in response to the 2010 Federal Budget and American Recovery and Reinvestment Act
Monday, March 2, 2009
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Interesting article by Baker. Aren't homeowners still getting some kind of bailout, even if the money is going to banks first? After all, they get to stay in their houses that they bought even though they couldn't afford it.
ReplyDeleteI'm sure you'll "explain" this to me later.
Yes. The homeowners are getting some kind of bailout; however, this bailout comes in a form that is mutually beneficial to both the bank and the homeowner. The banks benefit from this to a much better degree than the homeowner.
ReplyDeleteFor example, a homeowner may exchange a lower monthly payment and lower interest rate in exchange for a longer payment term (say 40 years instead of 30). The homeowner would end up paying more interest than they would have originally.