Reply #47: I'm not defending mortgage banks

[Maven]

or the egregiously irresponsible way they AND the investment banks have behaved.

But it doesn't help homeowners who are losing their homes to say, "Don't worry--they'll make smarter investments next time!"

Your solution is to ask mortgage banks to pay the redemption price (principal and unpaid interest--remember, the mortgages are securitized) on the existing bonds, out of their own pockets, and then do what--provide new loans to the homeowners at better rates and take a loss on the interest they already paid? Not gonna happen. Meanwhile, homes are foreclosed upon.

Like I said, the "legal shield" doesn't save mortgage companies any money, and it doesn't shield them from lawsuits by the homeowners themselves. It just gives them some breathing room to work with mortgagors to avoid foreclosure. A pyrrhic victory is too costly when people's homes are on the line.