No one wants to see anyone on the street especially as the result of a foreclosure. The emotional toll cannot be measured. Homeowners want to save the investment, but if that is what the home comes down to, then it’s time for homeowners in foreclosure to move on.
The federal government was foolhardy to promote homeownership as a vehicl toward building wealth. We citizens were both foolhardy enough and unsophisticated enough to buy into that nonsense. All homeownership ever signified was the ability of someone with good credit and a job to go out and borrow money to purchase a nonperforming asset. The asset (and I use that term lightly when it comes to houses) is a no performer because it pays you no residuals and in the end you probably pay more, at least in nominal terms, than the house is worth.
Keeping people in their homes does not ignite the housing market. Getting houses through the foreclosure pipeline at the greatest speed possible is what’s best for a market of property buyers and property sellers. Bank of America should have pushed back against Congress, Fannie Mae, and Freddie Mac with that argument. If government really wants to make a market, it should be bringing buyers and sellers together, not keeping nonpaying consumers locked into a nonperforming asset.