I love how careful government officials are in using their words when talking about the foreclosure crisis. But any well trained ear can cut through the fluff and find the real meat and potatoes of what is being actually said.
Take for instance the video below of Sheila Bair of the FDIC on CNN.
In the interview, Bair is asked what she feels the Obama Administration will need to do to stem the tide of foreclosures and the first thing she says is to provide financial incentives to mortgage servicers to perform loan modifications. She went on and said the there are no economic incentives for servicers and many foreclosures are happening that do not need to because of this reason.
One of the agendas on her plan is to offer these fat cats a $1,000 government carrot per loan modification.
I agree with Bair on the fact that there has to be money involved in enticing mortgage servicers to actually help homeowners effectively and efficiently. However, it also confirms my long standing view that mortgage servicers are uncooperative because its costs them to perform a loan modification as opposed to just letting the borrower go to foreclosure and with million of loans going bad, the costs add up.
Maybe this explains why they can’t even receive a fax, email or voice mail. It’s not in the budget.
So, what we have are literally millions of homeowners that are unnecessarily being foreclosed on and it looks like $1,000 government kick back may solve the problem.
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