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Subprime Solution
Let people borrow against their 401(k) or other tax-sheltered savings plans penalty-free for two years. As long as they use the money to pay their mortgage or make a down payment on the house.
This increases capital available to buy a home and offsets the supply and demand imbalance that currently exists. It allows the lenders to get paid what they are owed without having to foreclose. Borrowers get to keep their homes without going further into debt or paying penalties. And it doesn't cots the government or taxpayers anythign.
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