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As bankruptcy proceedings primarily help borrowers, it's not clear what punishing them would accomplish.
by rsj_hn 5y ago
As bankruptcy proceedings primarily help borrowers, it's not clear what punishing them would accomplish.
- dredmorbius 5y agoBankruptcy frees stranded assets. If tenants aren't paying rents, and landlords aren't paying mortgages, banks and real estate trusts have illiquid assets of difficult-to-assess (and likely low) value. With evictions, failures to assess risk ripple downwards, to tenants. Without evictions or bankruptcy closure, risk ripples upwards to creditors.