Why Don’t Mortgage Companies Rework Payments?

Instead of foreclosing on all of those sub-prime loans, why don’t mortgage companies just refinance the sub-prime loans into fixed-rate mortgages and keep money coming in, instead of losing it?
You know, I really don’t care if it’s the banks fault for issuing mortgages they knew the borrowers couldn’t afford, or the borrower’s fault for taking out mortgages they knew they couldn’t pay. All I am asking is, doesn’t it make more sense for the Economy to work out terms that allow the borrowers to still make payments, rather than the banks losing all of that money, and the borrowers losing their homes?

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