[Diggers350] sharing mortgage fall-out

[ilyan]

Dont those who walk away from their mortgages still owe money to the 
building society and be liable to repay if they win the lottery or 
inherit?       Would they make a clean break with that debt if they went 
Bankrupt?

Ilyan

On 07/01/2011 18:27, james armstrong wrote:
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>   To The Editor, F T .
> 9th January 2011
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> Sharing the burden when mortgages breakdown.
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> “Banks’ senior bond holders should share the burden  of future losses in order to spare tax-payers..”
> is the novel idea  advanced by the
> European Commission.
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> (“Brussels to
> target bondholders” Jan 9th )
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> Why do we wait so long before  establishing a balance  between
> multi-£billion corporations and
> vulnerable individuals?
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>   Mortgage lenders  should share the burden  of  losses
> when houses are repossessed-  as they are
> in tens of thousands each year.
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> Mortgage lenders are capitalized in £billions. Individuals
> who fall behind on repayments are
> invariably already under severe financial stress and often have lost
> their employment.
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> Under the present arrangements just when they are most
> vulnerable, distressed families   are hit
> with  the further hammer blow of eviction.
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> Not only do they lose ownership of their greatest asset but
> are then evicted, their family life is jeopardized, contacts with  wider family, friends and neighbours are
> further strained or broken and often their childrens’ schooling is interrupted
> when they are forced to move house and find other accommodation.
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> It would be difficult to devise a more socially inept,
> inequitable  and damaging arrangement –
> multiple madness or worse  - corporate
> predation on individuals’` vulnerability.
> .
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> A condition of corporations being granted the  privilege of offering mortgages to persons aspiring
> to be owner occupiers, should be that in the event of independently assessed genuine
> inability to  keep up repayments, the
> lender and the  borrower should share the
> misfortune of the breakdown:  ownership
> should pass to the lender and the ex-owner retain occupancy  now as a protected tenant.
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> In many instances this would be beneficial to the lenders since
> repossessed property  is now often sold off
> at below market price.
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> James Armstrong                                                                  9 January 2011
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