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Monday, Feb. 23, 2009 | 2:04 a.m.
An effective way to reduce monthly mortgage payments would be to amortize mortgages over a longer period — the length of time to be determined by the amount of payment reduction.
That way banks would make more money from interest and the homeowner would have the option of paying off the mortgage sooner or paying for the full term. At least the homeowner would be building some equity over time.
Those complaining that their adjustable rate rose to 10 percent don’t recall the late 1980s, when 8 percent was a good deal and 11 percent was not uncommon.
Bob Fuller-- You said"Those complaining that their adjustable rate rose to 10 percent don't recall the late 1980s, when 8 percent was a good deal and 11 percent was not uncommon."
That was then, this is now. The root problem in the current crisis is that income levels are not high enough generally speaking to support the payment obligations under these failing mortgages. For the housing market to recover in a healthy way income levels must begin increasing again, and we are not anywhere near that. That's why morgage relief in its various forms is needed, including the one that you have described in your letter.