Study Suggests Writing Down Underwater Mortgages Will Fix Housing

Study Suggests Writing Down Underwater Mortgages Will Fix Housing

Center City – Read an interesting article on the RisMedia website.  The article summarize a new study called, “The Win/Win Solution: How Fixing the Housing Crisis Will Create One Million Jobs.”  Here’s the reader’s digest version:

• The study  suggests that writing down all underwater mortgages to market value would allow  1) the nation’s banks to pump $71 billion per year into the economy 2) create more than one million jobs annually and 3) save families $6,500 per year on mortgage payments.
• The plan, they argue, would lower homeowners’ mortgage payments by  more than $500 per month or $6,500 per year.
• Six billion dollars per month that is currently going to mortgage payments would instead go toward buying groceries, school supplies, and other household necessities.
• This stimulation in the economy would allow businesses to start hiring again and unemployment would decrease.
• In California, the plan would inject an annual stimulus of $20.5 billion and 300,000 jobs per year.
• In Ohio, $1.64 billion and  24,000 jobs.
• In Florida,  $12 billion and almost 180,000 jobs.

As a kicker they throw this in at the end:

“Last year, the nation’s top six banks paid out more than twice the cost of the plan ($71 billion per year) in bonuses and compensation alone ($146 billion in 2010), and currently, the nation’s banks are sitting on a historically high level of cash reserves—$1.64 trillion.”

I’m not an economist but I think everyone is ready to agree that the same old run of the mill politics in Washington isn’t getting it done anymore.  It’s time that everyone on either side of the isle get together and start making decisions that are in the best interest of this country – collectively.   When the banks needed to be bailed out the government stepped up, with taxpayer money, and helped them.  If this study is correct it sounds like it might be time for the big banks to pay it forward to the American people.

To search Philadelphia Real Estate listings for condos, homes and apartments click here.

Blog post compliments of CenterCityTeam’s Philadelphia Real Estate Blog

Frank L. DeFazio, Esquire
Prudential Fox & Roach Realtors – Society Hill
530 Walnut Street, Suite 260
Philadelphia, PA 19106
215.521.1623  Direct
610.636.4364  Cellular
888.308.1148  Fax
[email protected]
www.CenterCityTeam.com