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Monday, December 08, 2008

Resetting the Bowling Pins

From Bloomberg News:
Most U.S. mortgages modified in a voluntary effort to keep struggling borrowers in their homes and stem foreclosures fell back into delinquency within six months, the chief regulator of national banks said.

Almost 53 percent of borrowers whose loans were modified in the first quarter were more than 30 days overdue by the third quarter, John Dugan, head of the Treasury Department’s Office of the Comptroller of the Currency, said today at a housing conference in Washington.
Can't say I'm terribly surprised. In the old days, when your credit was no good the banks wouldn't lend you money. Nowadays, when your credit is no good the banks will keep lending you money until you pay it back. They call it "refinancing." I call it "punitive lending."

Thanks to For What it's Worth.

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