Quote:
Originally Posted by safari
I don't agree with the above. In most cases banks lose money on foreclosures, so it's not in their interest to give loans to people who are likely to default. The way banks protect themselves is by giving higher interest rates on mortgages to the people with lower credit scores because they have a higher chance to default on their payments.
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yep, foreclosures are always sold at below market value, so banks do have to write off some of the loan in many cases.