Extraordinary suggestion from the Fed

Seems like Chairman Bernanke is urging banks to offer a deal to borrowers by forgiving part of their mortgages. Well, they're supposed to be borrowers who look like they will have trouble meeting hire interest rates or refinancing. But hey, I've got my troubles, haven't y'all. Seems to me it might be time for a "rent strike" like in the 'sixties only this time round it would be a mortgage strike.

March 4 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke, battling the worst housing recession in a quarter century, urged lenders to forgive portions of mortgages held by homeowners at risk of defaulting.

``Efforts by both government and private-sector entities to reduce unnecessary foreclosures are helping, but more can, and should, be done,'' Bernanke said in a speech to bankers in Orlando, Florida, today. ``Principal reductions that restore some equity for the homeowner may be a relatively more effective means of avoiding delinquency and foreclosure.''

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The Fed chief highlighted the threat posed by home values falling below mortgage balances, something Treasury Secretary Henry Paulson played down yesterday. Bernanke said the ``recent surge'' in delinquencies has been ``closely linked'' to the slide of home equity.

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Democrats in Congress have said relying on lenders to alter loan terms hasn't yielded enough progress and are pushing for a stronger government response.

Deeper Crisis

Bernanke warned today that the housing crisis may deepen.

``Delinquencies and foreclosures likely will continue to rise for a while longer,'' Bernanke said in the comments to the Independent Community Bankers of America. A surfeit of homes for sale indicates ``further declines in house prices are likely,'' he said.

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Once a person has made up their mind to walk away.....going going gone....go move in with Mom & Dad.

I've had a 30 year fixed mortgage thru the VA for 22 years now. People need to take care of their own back yard...nobody else should have to. Get ahold of yourselves!

Heard that people with $3 million homes are more and more "squatting," ie not paying their mortgages. Banks don't want to move on them because the costs will be high and they are too expensive to be saleable. Hah, hah, hah! When I was living in England in 1972-1973 it was the hippies who were the squatters and the single moms. Funny world.