u235

Mortgages for people who lost their homes in the hurricanes have now come due after a 3 month grace period.

That's it in a nutshell.

Can you imagine owing tens of thousands of dollars on .... nothing? Or worse than nothing, a mess, debris, or toxic schmutz? Damn that sucks. Better yet, you have nothing to pay off the debt with - no job, no possessions, in fact you don't even have a home right now.

Put aside the emotional devastation of losing everything you own, and all artifacts of your youth, your ancestors, any physical legacy you might have inherited - Grandma's china, your Great Great Uncle's peg leg, whatever. Think on just the basic necessities of life, food, shelter, warmth, .... hope. With a multi-thousand dollar burden on your head, and no job to earn money to even support your family, much less pay this off what do you do?

Yes, the housing industry doesn't want to suffer a crash - with so much property destroyed and so many people without regular income they have to understand that just paying off this debt after 3 months of grace isn't very likely. Further they don't want the rotty destroyed property either. They want their money.

It's unlikely, given the fact that our government has shown that it cares more about big industry than individuals, that the administration will take steps to mitigate the situation. That is until it becomes a hot news item.

The more likely scenario is that the banks will realize that without customers they too won't survive and thus work for some compromise that enables both the lenders and borrowers to shoulder some of the loss. Or so I hope.

So what will it be for mortgage lenders this holiday season - Scrooge or no?