Saturday, July 21, 2012

This could kill the big banks

...and a good thing, too.

Matt Taibbi reports on a proposed scheme for local authorities to compulsorily purchase negative-equity homes at current market value - realising big losses for the lenders - and then let the homeowners take out smaller, 100% LTV replacement loans.

Could the good guys win?


James Higham said...

They can propose it all they like but the banks are on an agenda and nothing's to get in the way of that. The new financial system depends on it.

Weekend Yachtsman said...

The banks have a legal charge on the property which can only be discharged by paying the debt.

If such things can be set aside on the whim of a local authority official, it's going to be impossible for anyone to get a mortgage in future.