Bailing Out the Banks 0
In pursuit of commisions, they chose to make bad loans. Now let someone else pay for them:
Here’s how it works. As we know, millions of families are facing foreclosure on their homes because they have mortgages that they can’t afford and live in homes that are worth less than the amount on their mortgages. This is a situation where the banks would ordinarily take a huge hit since they have no hope of recouping anywhere near the amount owed on the mortgages when the homes go through the foreclosure process.
But politicians can’t resist a bank in distress. They want the government to step in and either guarantee or directly issue new mortgages to these homeowners. When these new mortgages are issued to pay off most or all of the prior mortgages, they will be giving the banks far more money than they can reasonably hope to get if the houses had gone through the foreclosure process.
