If banks would work with mortgage holders,

[cabinover]

wouldn't everyone come out better in the end? I'm talking about the folks that could afford a decent sized mortgage if the APR hadn't jumped at the end of an ARM?

Say a family is on the hook for $125K at 10% now. If they could afford a 7% note wouldn't the bank be foolish to turn their noses up at this offer and keep the mortgage above water?

Your thoughts, I'm not a financier, but I do fancy some things