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The Lender's Calculus

Lenders have been flooded with pleas for help from homeowners during the foreclosure crisis. Policymakers often say it makes economic sense for a lender to modify the mortgages of distressed borrowers, lowering their monthly payments, because foreclosed homes yield even less money. In reality, lenders are modifying far fewer mortgages than expected.

 Lenders have been flooded with pleas for help from homeowners during the foreclosure crisis. Policymakers often say it makes economic sense for a lender to modify the mortgages of distressed borrowers, lowering their monthly payments, because foreclosed homes yield even less money. In reality, lenders are modifying far fewer mortgages than expected.

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Foreclosures Are Often In Lenders' Best Interest
Article | Government initiatives to stem the country's mounting foreclosures are hampered because banks and other lenders in many cases have more financial incentive to let borrowers lose their homes than to work out settlements, some economists have concluded.

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