I wish I had been able to pay all of my debts, but I have absolutely no guilt whatsoever for filing BK and not paying it back. All of the fees and interests are set to cover expected loses. In the good years when much fewer people defaulted they made more money. Now more people are defaulting and they are making less. It was a business decision on their part to make these loans at the interest rates that they did. It is obvious now that they made bad decisions just like we did.
I have a simple solution to the whole mess going forward. We could replace all of the existing regulations on lending with one simple rule: The banks/lenders can only repo/foreclose on the collateral that was put up on the loan. There would be no recourse against the borrower other than taking the collateral and affecting his or her credit score. No deficiencies would be considered and judements would not be allowed.
What would happen, would be that banks would require significant collateral to make any loan, you would have to have a downpayment on all loans.
Credit scores would become much more important. Bank would do much more due diligence before making a loan. Any taints would require larger downpayments or prevent you from borrowing. Unsecured credit cards would be significantly reduced.
But we would not have the economic mess we have now. The economy would grow much slower, but it would be much more stable.
I have a simple solution to the whole mess going forward. We could replace all of the existing regulations on lending with one simple rule: The banks/lenders can only repo/foreclose on the collateral that was put up on the loan. There would be no recourse against the borrower other than taking the collateral and affecting his or her credit score. No deficiencies would be considered and judements would not be allowed.
What would happen, would be that banks would require significant collateral to make any loan, you would have to have a downpayment on all loans.
Credit scores would become much more important. Bank would do much more due diligence before making a loan. Any taints would require larger downpayments or prevent you from borrowing. Unsecured credit cards would be significantly reduced.
But we would not have the economic mess we have now. The economy would grow much slower, but it would be much more stable.
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