Another option proposes limited assistance and government guarantees, in the form of borrower-paid fees or taxpayer-financed insurance, for most mortgages, in the event of a financial crisis like the subprime meltdown that began in 2008.
The terms under discussion would have 14 large banks pay a total of $3.75 billion in cash and the balance in other forms of borrower relief, the newspaper reported, citing people familiar with the matter.
"The sense of community matters," he says.Prosper takes this idea a step further, by allowing customers to form groups of borrowers with similar interests or backgrounds—similar to social networking sites such as MySpace.com or Friendster.
Making it harder for borrowers to pay their debts risks hurting future U.S. economic growth as over-indebted borrowers delay home and auto purchases, limit other forms of borrowing and reduce consumption.
They're not truly disintermediated either because the best platforms provide some form of intermediation (like scoring borrower quality).
Currently lawmakers in 30 states are working on some form of legislation to shelter borrowers from the promises they made.
These can be brought down with a more efficient model like Lending Club, with efficiencies that can be passed back in the form of lower rates for borrowers and higher returns for investors.
The White House has touted federal plans that allow borrowers to make payments based on their earnings as one form of relief designed to ease borrower distress.
Yet almost any act of monetary policy is a form of redistribution between savers and borrowers.Mr Weidmann hints he would rather buy private debt than government bonds.
Most of the so-called "National Mortgage Settlement" in 2012 with five large financial companies accused of dubious foreclosures and robosigning was paid not in fines, which can't be deducted from a company's tax bill, but rather in the form of lower monthly payments for borrowers with home mortgages.
The rebate should be passed on to borrowers in the form of lower rates.
