The fed pumping $1.5T was only to try and save the stock mart by creating artificial demand. This does not solve the problem. The market is acting irrationally.
Not of the $1.5T goes to home owners.
The bill house has passed is something more around the general population. This is when you have freezing on mortgages.
I believe 30 yr mortgages should carry with it 48 months ofwaving payment withou penalty or interest to cover medical emergency, unemployment, and disasters like this.
I know the market is acting irrationally, and I know the money doesn't flow through to homeowners. Here is what I was saying in more detail.
Because there is fractional reserve lending, banks are permitted to lend to corporations, simple business, and individuals, money for which the borrower doesn't have full collateral. If, for example, a corporation offers as collateral shares of it's stock which the company still holds, and the value of that company's stock drops, the lending institution is permitted to ask (actually is required by the Fed) to reduce the line of credit and collect payment to bring the line of credit back in line with fractional reserve lending laws. My understanding is the Fed put the $1.5 trillion up as "American Banking collateral", and told the big banks they can't reduce those lines of credit (analogous to a bank or S&L calling a mortgage), it's covered by this $1.5 trillion.
Re: your last paragraph, without thinking too deeply, a mandatory "waiver" period would be reflected in higher interest rate, or higher down-payment requirements, or both. A 48 month period seems excessive (business cycle recoveries are vastly shorter, disabilities are generally commuted to Social Security after 12 months) and ripe for abuse. It won't be free, regardless of the terms.
Edit: plus, I thought you can negotiate with mortgage lenders in those cases.
