Mortgage Principal Writedown Won’t Save Housing
And so it begins. Big gun lawmakers are making the move toward principal writedowns as the last resort to save the housing market. In a letter to the CEOs of Bank of America, Wells Fargo, JP Morgan Chase and Citigroup, House Financial Services Committee Chairman Barney Frank wrote, “To save homes on a large scale, we must move past temporary modifications in interest rates or terms and focus on permanent principal reductions that result in truly sustainable mortgages.”
