2nd loan modifications and the OBAMA PLAN

Well today the news broke about President Obama ‘s new new stimulus plan, or as they put it his “expansion” to the foreclosure prevention program.  Previously the President and all the supporting cast lined up to explain how with $75 billion, the housing crisis could be solved.  Lenders would modify loans in mass and borrowers would finally get the relief they need.  Fast-forward a couple months and now we are seeing lenders continuing their reluctance with a few bright spot exceptions.
 
The “expansion” deals with second mortgages.  The lenders prompted by the first go round had a valid point.  “Why should we modify our loan, when the 2nd gets to sit back and collect their full payment, often at a higher interest rate.”  This argument won favor with Washington, and now the President is doing the following: Read more