If you had the terrible misfortune to lose your home to foreclosure, you may very well find yourself branded as some sort of deadbeat.
Sadly, there are a lot of ignoramuses out there these days.
But given the global wreckage caused by the collapse of the housing bubble, blaming the average homeowner for winding up in a jam makes about as much sense as pointing fingers at typhoon victims.
A nonprofit called Boston Community Capital is now turning that ugly myth on its head, helping homeowners who are struggling to make their mortgage payments get back on a stable track.
The group's tactics are simple - BCC buys homes at foreclosure at current market prices and then sells them back to their old owners at what end up being a big discount.
Since launching its buyback program in 2009, the group has helped more than 400 families buy back their homes, with little if any repayment problems.
Here's part of an opinion piece that ran on Reuters by lyse Cherry, chief executive of Boston Community Capital. She argues the whole idea if moral hazard is now bankrupt when it comes to withholding help from foreclosure victims - simply look at the big bank bailouts.
First, defaulting on your mortgage and going through foreclosure is an uncertain and terrifying process that nobody would enter willingly. There is no guarantee, whatever program is in place, that you will emerge from it able to stay in your home...
Second, experience shows that these homeowners are not the irretrievable deadbeats that some creditors claim them to be. The entire U.S. economy was taken in by the housing bubble. At my organization, we have learned that our clients pay on time when given a loan payment that they can afford. Our borrowers have an excellent repayment record on their new, reduced-principal mortgages.
Finally, it makes no sense to sacrifice our entire economy in the name of a single ideological principal, which has hardly been enforced consistently over the last decade. When this same crisis threatened the livelihood of our largest financial institutions, moral hazard was put aside in the name of economic stability, and the government provided generous aid packages to help
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