Multi-family subprime borrowers should owe less
Multi-family property owners with subprime mortgages should receive a writedown of a proportion of the principal balance on their loan, argues a new paper from the Federal Reserve Bank of Atlanta.
The research finds that multi-family subprime borrowers are very likely to face foreclosure, ultimately resulting in a loss for the lender. It further finds that should these borrowers be forgiven part of their principal the probability of foreclosure would be a lot lower.
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