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View Diary: Is This What It Must Come To To Stop the Banksters? (14 comments)

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  •  I don't think it works that way (3+ / 0-)
    Recommended by:
    Odysseus, johnny wurster, jpmassar

    The bank is credited for whatever they eventually sell the property for, and the former homeowner's debt is reduced by that amount (plus fees).

    This is just like how it is in many US states now: the owner is responsible for the whole mortgage.

    What is not the same is that mortgage debt is like student loan debt here: non-dischargeable in bankruptcy. So there is no legal escape for former owners who find that they owe 200k euros.

    The banks make some silly self serving arguments about how this state of affairs keeps strategic defaults under control, but I call BS. Both parties should share in the risks involved in a loan.

    (-5.50,-6.67): Left Libertarian
    Leadership doesn't mean taking a straw poll and then just throwing up your hands. -Jyrinx

    by Sparhawk on Tue Nov 13, 2012 at 09:16:17 AM PST

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