I must say he nails this one:
I understand that from the 30,000 feet level most policymakers view these things from, having homes worth less than their mortgages is a real problem. People can abandon their mortgages, which breeds contagion etc, etc. But I really don’t understand why it’s such an unbearable crisis for responsible homeowners themselves. Maybe it is in some cases, but it seems to me that having your home worth, say, $500K when your mortgage is for $600K is certainly undersirable but not necessarily disastrous. If you bought during a housing boom, you shouldn’t be stunned and crestfallen if the value of your home temporarily sinks for a while — that is unless you’re a house-flipper, in which case my sympathies are significantly reduced anyway. Most people buy their homes and expect to hold on to them for a while. I don’t sell my stocks every time they go down. A dip in the value of your home now, isn’t a dip for all time. So, long as you can pay your mortgage, I don’t really see why you would walk away. And, even if you are the kind of person who abandons his obligations, I have to presume that walking away from your mortgage has real costs to your credit rating (and, hopefully, your self-esteem). Indeed, if abandoning your mortgage doesn’t nuke your credit score, what good are credit scores in the first place?
It would be nice if more (any?) Republicans in Congress agreed with this.