In other words, the hosts are appealing to the homeowner's sense of morality about walking away from the contract. Here is a snip from the post:
I can see that Felix signed a contract with a lender, but remember that the lender was writing negative-amortization interest-only mortgages and then turning around and selling them off to an investment bank to securitize, pocketing an up-front profit. Such lenders kept on making this trade until there was no more appetite for such loans any more, at which point they closed their
doors, keeping all their old profits and leaving the losses with the investment banks and the banks' clients.
So I don't think that Felix has any kind of moral obligation to the lender, nor to the sophisticated financial institutions which ended up buying the lenders' mortgages and who should have known exactly what they were doing.
Of course, this doesn't align with the Rick Santelli-ethos of CNBC. I guess it wasn't just business after all.
No comments:
Post a Comment