If it is important to help homeowners stay in their home, why not require banks to sit down with people who are in danger of being foreclosed upon, and renegotiate the loan so that it is affordable to them, by lowering the interest rate and extending the term. If the house is still unaffordable, then reality may require either steps to make it affordable, maybe an additional low interest loan from the feds would be in order; and maybe it will continue to be unaffordable, at which time the bank might become the property owner, and and contract with the owner to become the renter in a rent to buy arrangement.
The other banking crimes that should be addressed are interest rates and penalties on credit cards. There are some who buy things on credit that they cannot and need not afford. Maybe a penalty is in order, but not necessarily an interest rate hike. The whole point of credit cards is to keep people buying, not to drive them into the poor house which is counterproductive.
Credit card interest should be capped at between 12 and 15 percent (my arbitrary numbers, so I don't sound like I am too anti-bank). The interest should be able to be calculated easily over a period of time, and statements from the credit card companies should reflect not just the minimum payment due, but the advantage of paying off completely or in larger installments. Same as cash options should become a rule rather than an exception.
So these are my two "what ifs" for the feds to consider. Neither would cost much to them. People would be happy and the economy would have the cash needed to carry on.
- Keep people in their homes by renegotiating mortgages.
- Cut interest rates and penalties on credit cards.
No comments:
Post a Comment