[lbo-talk] CommonDreams 8/20/07: "Save subprime borrowers, not bloated bankers" by Dean Baker

Doug Henwood dhenwood at panix.com
Tue Aug 21 06:13:13 PDT 2007


On Aug 20, 2007, at 11:10 PM, Rick Kisséll wrote:


> Save Subprime Borrowers, Not Bloated Bankers
>
> by Dean Baker
>
> There is a simple and direct way in which the federal government can
> help out millions of moderate income families struggling to keep their
> homes. They can simply change the rules on foreclosure to allow
> moderate
> income homeowners the option to remain in their homes indefinitely as
> renters, paying the fair market rent.

It's not clear who collects the rent - the mortgage holder?

A more quasi-socialist variation on this: you could create a public entity that would buy the defaulted mortgage at a discount, collect the rent to help fund its operations, and eventually turn the house into some kind of limited equity property managed by the new entity. Occupants could sell the property back to the public entity at a price reflecting improvements plus inflation with no speculative component.

Doug



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