I have pretty much been against any type of bailout for the reasons listed above. Those that chose to gamble on a variable rate & lost shouldn't now go crying to the government while I have sat with a conservative rate unwilling to put my home at risk. You gambled and you lost......... oh well.
I do have a slightly different opinion on a person who bought a new house on a balloon payment plan full well knowing that their job was secure and as soon as (insert scenario here ...maybe kid gets out of college or student loan is paid off) they could handle the higher payment in 5 or 7 years. Now their balloon comes due, they have the same steady income, all is well except........... their home is no longer valued at what it was 5-7 years ago and they can't refinance for what they owe on the home. IMO, that is a shame & not the fault of the home owner. Rare case but one that deserves some sympathy.