Foreclosure Help Isn’t Helping

"Servicers appear to have reached the ‘low hanging fruit’ of subprime loans facing interest rate resets, while not developing effective approaches to address the bulk of subprime loans which are in default before interest rate resets," the report said. "The mortgage industry’s failure to develop systematic approaches to prevent foreclosures has only spurred declines in property values and further increased expected losses on mortgage loan portfolios … We fear continued reactive approaches will lead to another wave of … preventable foreclosures."

This was as predictable as it is sad. You can't fool foreclosure with cosmetic loan mods or simply adding the shortfall back to a loan balance and resetting the "delinquent" switch -- real reductions in debt burden are needed.

And yes, some of these people need to go back to renting.