Here is a link that might be useful: modified loans aren't working
Gutting home values are not tipping people into foreclosure. If my primary home was worth one dollar I would still pay my frm every month just the same, I'm not going anywhere. After interviewing several couples who came to me trying to rent a house, each one of them had no idea what type of (variable rate) product they were getting.
Here we go again. Why modify a loan in a way that the person won't be able to pay anyway????? More good money after bad.
In addition, being underwater is irrelevant...unless one NEEDS to refinance. We were "underwater"
on our last house during the lat RE bust in '91...we just had to wait longer to sell in order to recoup our investment. It had zero bearing on our ability to pay our mortgage. So, instead of living in that house 5 years..we lived there for 13, and made a nice profit that enabled us to buy our current home.
Last but not least, the modifcations are not really modifications at all...they are just number shuffling..with the same result.
They need to come up with a TRUE modification......available to only those who did not over extend on their own part..
However, as lay offs continue, there will be more and more people who will have to default...as the availability of jobs shrinks daily...