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President Obama’s Senior Advisor, David Plouffe, sent out an email today explaining why loan modifications are “good” and not modifying loans is “bad.” I felt like Denzel Washington from “Philadelphia” saying “All right, Mr. Laird Plouffe, explain this to me like I’m a four-year-old, okay?” Well, here is Plouffe’s “Philadelphia” explanation to Americans. Prepare to be insulted. That presentation by President Obama’s housing adviser was … “Here you go, dimwits, let poppa tell you what to do.” And grossly misleading. How about talking to us like we are adults? Their motto should be “Cry Havoc! And let slip the dogs...

I know a divorced lady who is upside down in her mortgage. Her employer has also been cutting back her hours and she was late last month making her payment. She financed through a bank that sold her mortgage in the secondary market to Bank of America. Bank of America refuses to talk to her about renegotiating her loan. Other than walking away, does she have any options? Thanx.

Federal mortgage modification initiatives, targeting millions of borrowers, are intended to prevent foreclosures of underwater home mortgages. Those initiatives discourage principal reductions in favor of interest reductions, despite the possibility that the former would be a more durable foreclosure prevention tool. The programs also impose marginal income tax rates substantially in excess of 100 percent. Using the framework of optimal income taxation, this paper shows how alternative means-tested modification rules would simultaneously improve collections, efficiency, the number of foreclosures, and their total cost. As a result, lenders have an incentive to foreclose on borrowers deemed modification eligible by the federal...

At 8 a.m., homeowner Rodney Wynn was drowning under his $1,800-per-month, 13.4% interest rate mortgage. But by 5 p.m., he had found some relief: a 4.7% loan with a $970 monthly payment. Wynn, a program director for a youth home in North Carolina, is just one of a growing number of homeowners getting dream workouts on their mortgages. Some are even getting sweet 2% deals.

Full Committee Hearing The Private Sector and Government Response to the Mortgage Foreclosure Crisis 10 a.m., Tuesday, December 8, 2009, 2128 Rayburn House Office Building. The topic for the hearing is the private sector and government response to the Mortgage Foreclosure Crisis. Please address any of the following questions which you believe you are qualified to address: Assess the extent and effectiveness of the federal government’s programs and initiatives (including the Making Home Affordable Program) for addressing the mortgage default and foreclosure crisis and for creating more sustainable mortgage payments for at-risk homeowners. Assess the performance of private sector participants,...

Question: Do you think leverage requirements should be part of any financial regulatory reform in the United States, regardless of what happens to Basel II capital requirements? Sheila Bair: Although the intense public debate over Basel II seems like a thing of the distant past, I remain committed to the idea that leverage requirements are important for banks not just in the United States but around the world. By providing capital even when risk-based measures (erroneously, as it turned out) indicate minimal risk, the leverage ratio is a critical part of our overall approach to capital regulation. When we emerge...

WASHINGTON – The Obama administration's effort to persuade mortgage companies to lower payments for up to 4 million homeowners could fall short of its goal, according to congressional investigators. The Government Accountability office said Thursday the administration's projections that its loan modification plan could help 3 million to 4 million borrowers "may be overstated" because it's based on uncertain assumptions about the mortgage market and overall economic conditions. In March, the Obama administration launched a plan to give the lending industry up to $50 billion in financial incentives to modify mortgages for struggling borrowers. As of this week, 31 mortgage...

Some chit-chat at lunch today about something called the "Home Affordable Modification Program". Any FReeper mortgage brokers/Realtors know anything about this and care to weigh in?