BusinessFinanceReal EstateFinancial RegulationMortgage LawReal Estate FinanceLoan Portfolio ManagementLoan UnderwritingMortgage FinancingMortgage LendingMortgage ModificationMortgage-backed SecuritiesBarriersConstraintsLender ProtectionLoan Modification RemediesMortgage Borrower ProtectionsMortgage Lending ProtectionMortgage Loan ModificationSecond Lien Modification
We propose a new three-pronged plan to address the recent harmful flood offoreclosures.Our plan would address the major barriers that inhibit the ability of third-party servicers to modify mortgages the way portfolio lenders are now doing with greater success.The plan provides greater compensation for servicers to perform their duties, removes legal constraints that inhibit modification, and addresses critical second liens that often get in the way of effective mortgage modifications.Our plan has more modest costs than competing plans and is likely to be the most effective while still protecting the rights of investors in mortgage-backed securities.