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This is HUGE!

Have you seen what Citi has done?

http://money.cnn.com/2009/01/09/news/companies/citigroup_legislation/index.htm

Citi is certainly a leader with this announcement. I asked the very thing of WAMU only a few days ago and was told absolutely not - too much room for fraud (fraud as it pertains, she explained, is people that didn't want to continue to pay on mortgages that exceeded the value of the properties)

Bankruptcy judges have long had this right to reduce a note for just about anything other than primary residences....now, well the potential is limitless.

What gets me is that this is a VOLUNTARY action by Citi. I take back all the bad stuff I've always spouted about Citi. Well, almost.

This will be interesting. Imagine the flood of homeowners rushing to file bankruptcy now. Wow.

Posted by Wendy Smith on 01/09/2009 02:02 PM

Comments (7)

foreclosure, default, short sale, loan modification, bankruptcy, bail out

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7 Comments on This is HUGE!

JAN

The market was happy with this yesterday, and it expects the major players to follow ... Also, Fannie extended its "holding off on the big F" till the end of the month to help add time to potential modifications as well.

You're right. This is huge. It will be interesting to see how many people take advantage of this opportunity.

Take care.

It think it may only slow the number of foreclosures temporarily. Filing a bankruptcy does not mean you will escape foreclosure. I think they also need to take into account that it may very well compound the problems we're already facing. Motivating people to file bankruptcy and wipe out debt is going to force a lot more credit companies into financial troubles.

Hi Wendy,

Wow....This is major news!

Don't forget me if you learn of anyone moving to "The OC!"

Michael

(949) 753-7900

Excellent info. Thanks for the heads up!

Nice Job Citi!

This is big news.

Thanks for the info!

"Todays problems are yestderdays solutions"....or is it "Todays solutions are tomorrows problems"? Either way, I think there have some very hasty decisions made by lawmakers and we haven't even had a chance to let things cool down enough yet.

Without a little more time to digest the possibilities here, I'll have to wait to comment further - aside from saying that these decision makers need to let the dust settle a bit. To underscore my point, even Lawrence Yun and NAHB are waffling.

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