$300 Billion in Exotic Mortgages Now Available

The reasons for the H4H failure are simple - banks do not want to participate because they have to write first mortgage principal balances down too much and waive second mortgage liens. Getting a bank to waive principal is next to impossible as you know. That is the primary reason that every foreclosure prevention plan brought forth has failed thus far. Additionally, borrowers simply don’t qualify without exotic-type loan programs.

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Once again the government is changing the rules to bailout the banks - see underlined sentences in bold below. This program does waive principal which I condone, but with high housing debt-to-income ratios, 40-year terms, and near 100% LTV’s allowed, borrowers are better off renting. When the value of their homes drop another 25-50% in the next two years, they will walk away and rent anyway.