Banks letting some keep homes without paying mortgages

04/7/2008 | Bloomberg11

U.S. banks are so overwhelmed by the housing crisis they increasingly do nothing when homeowners stop paying their mortgages. Banks are reluctant to foreclose, in part because of the cost, said Peter Zalewski, owner of Condo Vultures Realty in Florida. Inaction by lenders is distorting the record foreclosure rate and delaying the worst of the housing decline, said Mark Zandi, chief economist at Moody's Economy.com.

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