[nwatson]

Many have and will continue to have their homes foreclosed during this recession, and they will have "bad credit" for a long time. If/when the economy turns around in a few years, any bank that decides to not fund these same peoples' mortgages the next time they shop for a house will miss out on a huge piece of the market. The banks won't stick to this policy. They'll follow the credit card companies who are very eager to issue new cards to those who just finished their bankruptcy proceedings.