Wells Fargo reported 52 percent net income. I wonder why?

Wells Fargo & Co. reported a 52 percent jump in net income as it reaped quick rewards from its acquisition of Wachovia Corp., but the San Francisco bank also boosted credit reserves in anticipation of mounting loan losses in the months ahead. Are you wonder why too. right? Well, 'Boy, we're glad we had this economic crisis?.

The company said Wednesday that first-quarter net income reached a record $3.05 billion (56 cents per share), in line with the preliminary results announced two weeks ago that sent the stock soaring and fueled a broader Wall Street rally. Wells Fargo earned nearly $2 billion in the year-ago period (60 cents per share), before it picked up its wobbling Charlotte, N.C., competitor on the cheap, for about $13 billion in late December.

Today our worst fear was realized.

Towards our leaders and institutions; they are naive beyond belief. Although being used, abused and oh so confused by their so-called leaders, big media and this one-sided economic system; they keep on chuging along still wanting to believe in the american dream they are sold every minute, every day. There's a Hope Program, no guidelines, no one has been aproved because there is no guidelines, No one, Zero, Nada; there is no hope, there is no help from Mortgages, Lenders, Goverment Agencies for a responsible homeowners. Ohhh yeah but they can used our taxpayer money to bail out big Corporations, Banks, Car dealerships without helping people for who has been used and abused?. Enough is enough.!!!!!

The real whiners are that 10% of happy few replutocrats and their 90% + of the whole shabang. They are the ones we are bailing out. They are the ones constantly lobbying & amp; begging for more deregulation & tax cuts. They are the welfare corporations slaughtering US's middle class and making them feel guilty about it too… But know who should be accountable for responsible homeowners losing their homes, their jobs, the increased foods prices, Gas prices and the SALARIES GOING DOWN? Anybody said me.........Many mental-health crisis and suicide hotlines are reporting a surge in calls from Americans feeling despair over financial losses.

The escalating pace of unemployment and foreclosures rising fears among some homeowners about keeping up with their mortgages are creating a range of emotional problems. People are seeing more drinking, domestic violence and marital problems linked to Economic crisis concerns ? as well as children trying to cope with extreme anxiety when their families are forced to move. They're depressed, anxious. It's affected marriages, relationships. Sixty-one percent in the West Coast identify housing costs, such as rent or mortgage payments, as significant sources of stress.

Then Yesterday around 8.30 am were a sad event all over the news: Los Angeles man kills wife, 5 children, himself.
It's hard to understand the suicide; I do not want to judge anybody because is not on my hands to do so but my Family prayers are for the all Lupoe Family.

At the bottom of the letter, Lupoe wrote,

They did nothing to the manager who stated such and did not attempt to assist us in the matter, knowing we have no job and five children under 8 years with no place to go. So here we are.

"Oh lord, my God, is there no hope for a widow's son?" Continue reading here: Source

Today's bible verse is" 14 The LORD upholds all who fall,
And raises up all who are bowed down.
15 The eyes of all look expectantly to You,
And You give them their food in due season.
16 You open Your hand
And satisfy the desire of every living thing.

17 The LORD is righteous in all His ways,
Gracious in all His works.
18 The LORD is near to all who call upon Him,
To all who call upon Him in truth.
19 He will fulfill the desire of those who fear Him;
He also will hear their cry and save them.
20 The LORD preserves all who love Him,
But all the wicked He will destroy.
21 My mouth shall speak the praise of the LORD,
And all flesh shall bless His holy name
Forever and ever."(Psalm 145 : 14 - 21

Lenders and Banks ignoring the responsible Homeowners.

Need help from your bank before you're forced to default? Good luck with that. Conventional wisdom may tell homeowners who can see financial trouble approaching to reach out for help as soon as possible. But most borrowers trying to follow that advice are finding they can't get their bankers to discuss the options — including loan modifications — until they've missed payments.
"It is extremely difficult for any consumer who is not delinquent to even find someone to talk with at their lender," says Michele Johnson. "The consumer who is really being proactive and trying to do the right thing faces challenges that are unexpected."
A harsh reality Marvin Webb, pastor of the Bethlehem Missionary Baptist Church in Richmond, Calif., called his bank nearly two months ago to say that although his credit is good and he's current in his payments, he can see financial trouble coming. "They said they were looking for a loan they could put me in, something good. But they never got back to me," Webb says.
He called back recently. "I told them what they told me, and they still didn't have anything to say. You know, they take your number and (say) 'We'll call you back.'"

Logic suggests banks should help struggling homeowners early, renegotiating loans to avoid even-more-costly foreclosure. Ben Windust, Wells Fargo senior vice president for customer and default operations, says, "We can always work with any borrower who is having any kind of financial difficulty," even before a loan is in default. But those who work with homeowners say that, mostly, that's not happening.

"One of the really unfortunate contradictions of this crisis is that it's only when people have ruined their credit that they can get even a response from their bank," says Adam Kruggel, director of the Contra Costa Interfaith Supporting Community Organization. Part of the problem is banks are overwhelmed by the flood of people who cannot make payments. And that leaves plenty of struggling but still-current borrowers "hanging on and sometimes they are making enormous sacrifices; in some cases they are draining their entire life savings" to keep up their mortgage payments, he says.

Sean Woods was one of them. At this time last year, he was a mortgage broker in Goodyear, Ariz., an expensive suburb of Phoenix. He was earning about $12,000 a month, he says, so payments of roughly $4,500 a month on two loans for his family's home in a golf-course community seemed manageable.
Then, in February, Woods received what turned out to be his last mortgage commission payment. Record home prices in the Phoenix area had encouraged overbuilding, so prices were falling and sales were slowing. "I saw the writing on the wall," he says.
In late spring, he called Washington Mutual to say that although he was current in his payments, he was struggling. He was running through savings and using credit-card cash advances to make his home payments.
He asked to talk to the bank's loss-mitigation department. Typically, when you punch your loan number into the bank's phone system, you are routed to the bank's customer service or collection department, depending on whether your payments are current or overdue.
A collections officer's job is to recoup past-due payments and set up repayment plans allowing a homeowner to make full, regular payments plus a portion of the delinquency in order to catch up. But negotiating a lower interest rate or reduction in the loan principal is usually beyond the authority of the collection department, says Azucena Valladolid, chief operating officer at Consumer Credit Counseling Service of Nevada and Utah.

Woods says he told his bank, "I'm making the payments, but it won't be long before trouble will be upon me, before I start missing payments."
Loss mitigation basically told me, 'This loan is performing. You haven't missed a payment.' Basically (they said), 'Call us when you start missing payments.'"

In July his check bounced and his mortgage went into default. He got financial counseling and the bank offered a tentative modification offer.By then, though, he'd begun to question the value of a bank modification. What was the sense in committing to a plan without an income to support it? Shouldn't he just focus on getting work?
The big picture Like the troubled loans they are meant to fix, modification plans can include complex loan features: interest-only periods that reset in a few years, gradually increasing payments, or complicated formulas for sharing appreciation or equity. Some simply stretch the loan over 40 years reducing the payment amounts but increasing the total loan cost.

Woods, sadder but wiser, is keeping his options open. "I'm one of those homeowners that's troubled but also accepts the responsibility for signing these documents and getting into this situation myself," he says.

Today, his $597,500 home is worth about $435,000. "I paid over $100,000 in just payments for this home in the last two years and my principal payment may have went down $5,000. At some point, either you concede to be insane or you wise up and say it's better to walk away from this thing than continue to put money down a black hole."

Banks are making relatively few modifications. In the third quarter of 2008, only about 40,000 loans were modified — a small proportion of the millions of loans said to be in trouble. And 58% of loans modified this year were back in default within eight months, according to the Office of Comptroller of the Currency.

Rod Dubitsky, a banking industry analyst at Credit Suisse, says there's no consistent program or standard to help people who are struggling financially but who are still current on their mortgages. He says the government should analyze data from banks on modification agreements to see which modification plans are really working, then create a national program with uniform standards.
"The sad thing," Dubitsky says, "is that the message a lot of struggling 'currents' are getting is, 'Come back to us when you're delinquent.' I've heard it said that some servicers will coach the borrower to become delinquent (in order to get help)."

An unexpected rescue That's the advice friends were giving Barbara Quinn of Asheville, N.C., after she got little help when she called Ocwen, the company collecting payments on her home mortgage. She says she reached out to the servicer before her interest rate reset and added $300 to her house payment but "got bounced around from one person to another and really didn't get to talk to anyone who could talk with me."
Friends were advising her to stop making payments in order to get the bank's attention. She couldn't stomach that idea. "I was saying, 'I don't want to be in default on my mortgage,'" she says. "I'm not the kind of person to miss a payment."
Also, it scared her. What if the strategy didn't work? "Then you're out on a limb," she figured. "I was wondering, at 75 years old, what am I going to do? Live in the street?".

Take action and be proactive. If you run into a wall, call your Congress member and senators. (Find contact information here; enter your ZIP code next to "Find Your Officials" at the upper right corner of the page.) Also, grassroots activist groups work through the PICO National Network to press local, state and federal officials to take homeowners' needs into account in addressing the mortgage crisis.

The economy sank because some people over-borrowed for houses they couldn't afford, and financial institutions over-borrowed for investments they badly misjudged. Lawmakers solution is to borrow $800 billion that it cannot afford. How will adding $800 billion to the national debt (which will also raise interest rates) solve a recession created by imprudent borrowing? And who will bail out the American taxpayer when the bill comes due?

No Help for Middle class Americans. Can we get help sooner than later?.

After a year of failed efforts, Congress and the new administration are considering more aggressive measures, including a possible change to bankruptcy law. Homeowner relief could come as part of a new economic stimulus plan, a revised financial system bailout program or as a standalone measure.

So far, progress remains painfully slow. More than 3 million homes have been lost to foreclosure since the housing bubble burst. Roughly one in 10 homeowners with mortgages are either in foreclosure or more than 30 days late in payments — the highest delinquency rate on record.

Without more aggressive measures, another 8 million to 10 million foreclosures are forecast over the next four years, according to Credit Suisse. That amounts to roughly one in six households with a mortgage

It is simply mind-boggling to me that (Congress and the White House) have moved so slowly to address this issue,” said John Taylor, president of the National Community Reinvestment Coalition, which has been lobbying for foreclosure relief.

Congress and the incoming administration are taking a multipronged approach to foreclosure relief.

"Accelerating foreclosures is obviously, in my view, the huge driving problem right now,” said Elizabeth Warren, a Harvard law professor appointed by Congress to chair a panel overseeing the financial bailout. "Until we think in a more comprehensive way, we can't create solutions that will really make a difference," she told Congress last month.

Many of solutions tried so far have been stymied by the legal morass created by the modern mortgage.

In past recessions, it was not uncommon for lenders to work out more affordable terms with borrowers who had fallen on hard times. Bankers often prefer to cut their losses by lowering monthly payments and stretching them out over a longer term rather than bearing the cost of foreclosure. But the complex system of financing the recent housing boom — which was based heavily on the pooling of mortgages that were then sold to thousands of investors — has hopelessly complicated a once fairly simple renegotiation between lender and homeowner.

Multiple classes of investors, each with different claims on the same mortgage, often have conflicting interests. Some will do better with a loan foreclosure while others would profit by keeping the loan performing. Some contracts setting up these pool pay loan “servicers” — the companies that manage mortgage payments to investors — more generous payments for loans in foreclosure and offer little financial incentive to undertake the more costly process of modifying terms.

“You have got to have the investor or their representatives come to the table motivated to do something,” said Taylor. “And that’s currently what we don’t have.”
To break the logjam, Congress is considering various proposals, including both "carrots" and "sticks."

One of the "carrots" is included in a proposed revision to the $700 billion bailout of the financial industry known as the Troubled Asset Relief Program, or TARP

Foreclosure Proposals:

Brankuptcy Law:

A deal between key Democrats and Citigroup opens the door for a measure first introduced a year ago that would allow bankruptcy judges to modify the terms of first mortgages on primary residences -- the only debt excluded from the bankruptcy process.
Under the latest proposal, borrowers must contact the mortgage lender 10 days prior to filing Chapter 13 to give the parties time to work out a modification. If no offer is made by the lender, the homeowner could file Chapter 13 and the judge could then treat as unsecured debt any amount of the mortgage that exceeds the newly appraised value of the home. The judge also could reduce the interest rate and extend the maturity of the loan.

This so-called "cramdown" provision is strenuously opposed by the lending industry, which argues that the risk that a loan will later be modified will increase the cost of borrowing.

FDIC PROGRAM:

Using Troubled Assets Relief Plan funds, the Treasury would pay mortgage servicers $1,000 for every modification they make under the program. Modifications must bring a borrower’s mortgage debt-to-income ratio to 31 percent.
Mortgage servicers start by reducing interest rates before extending the maturity to up to 40 years. If those steps do not work, the servicer defers principal. That means the borrower does not pay interest on part of the loan, though he must repay the full balance when he sells or refinances the house.

Hope Program:


Approved last summer under the Housing and Economic Recovery Act, the Hope for Homeowners program has $300 billion available to refinance troubled borrowers into FHA mortgages. Legislative restrictions on the program have made it largely ineffective.
Congress is expected to eliminate many of these restrictions as part of the TARP revision, which means lenders will absorb a smaller loss if they refinance a troubled borrower into an FHA mortgage.

GSE/FHA Loan Program:

The maximum limit for Freddie Mac, Fannie Mae and FHA loans dropped to $625,500 on Jan. 1. Many Democrats, including House Financial Services Chairman Barney Frank, support restoring the maximum loan size to the prior limit of $729,750.
This would help lower interest rates on these mortgages. FHA is becoming the program of choice for first-time buyers. Higher limits also put more homes in higher cost coastal cities into play for FHA.

Tax Incentives:

Spurred by the homebuilding industry, Democrats are working on tax strategies to help with the housing crisis. These include a tax credit available to all homebuyers, not just first-timers, of $7,500 -- and perhaps more.
The mortgage interest deduction may be extended to taxpayers who don't itemize. Tax incentives may also be provided to owners who rent out vacant properties.

Lower Mortgage Rates:

So far, the Federal Reserve has led the move to lower longer-term interest rates after targeting short-term rates as low as zero percent. Congress is looking at additional efforts to push mortgage rates as low as 2.99 percent.
These measures could include providing an explicit government guarantee on mortgages issued by Freddie Mac, Fannie Mae and federal home loan banks.

Are you tracing Corporate America Bailout?

No. Then just look at this link here and check for yourselves how corporate America will be Bailout and not Middle Class Americans, The people who running the economy, the peple who's always be blaming for, the people who's really suffering, The people who's paying taxes, If a business can't survive without taxpayer money they deserve to fail but Hundreds of banks and a handful of insurers and automakers have applied for funds from the Treasury Department as part of the $700 billion Troubled Asset Relief Program. The Treasury Department has transferred capital to the majority of these companies as Taxpayers expenses.

Where's accountability and responsability? Are we there yet?

If you owned the bank or Mortgage company money do you think they'd give you a break to pay an overdue bill or would they ask you to live the house and file for bankruptcy?
We need to Understand there is no such a hope, a help, a bail out for American Taxpayers, Citizens, workers, middle class americans. The sense of Hopelessness are at the tip of iceberg for Power, political purposes and Money. That's ashamed.

The sense of Hopelessness. The phenomenon and effects of the Mortgage crisis.

Many mental-health crisis and suicide hotlines are reporting a surge in calls from Americans feeling despair over financial losses.

It's unknown if the economic meltdown will lead to more suicides, says Lanny Berman, executive director of the Washington-based American Association of Suicidology. "Maybe the fact that so many are calling is a positive sign. They're seeking help."

Although suicides spiked during the Great Depression, they didn't increase in subsequent recessions, which lasted an average of 10 months, according to the suicidology group's website. The current recession is 13 months long and counting.

Concern centers on rising unemployment, Berman says, because the unemployed have two to four times the suicide rate of employed adults.

Also, there's a strong link between humiliating losses and committing suicide. "Losing your job, losing your home — these are such major losses," Berman says. Although the majority can cope, adults who already have mental health problems or lack supportive relationships are most vulnerable, he says.

Calls to the National Suicide Prevention Lifeline jumped 36% from 2007 to 2008, totaling 545,000 last year, says director John Draper. But callers were increasing before the economic collapse, and about half of the added calls in 2008 came from taking over a veterans' suicide line, Draper says.

He is worried because a lot of adults phoning a hotline with resources for those facing foreclosure (888-995-HOPE ) say they feel isolated, as if they're the only one facing this problem.

"This sense of aloneness is part of suicidal thinking," Draper says.

Among areas with suicide hotlines reporting increases in callers since the economy slid: Dallas; Pittsburgh; suburban San Francisco; Hyattsville, Md.; Georgia; Delaware; Detroit.

In Boston, more hotline callers with mental health problems mention job losses, evictions or fear that they'll lose their homes, says Roberta Hurtig, executive director at Samaritans Inc.

In Kalamazoo, Mich., and other locales, callers with mental illnesses such as bipolar disorder say loss of insurance and cutbacks in public health programs are preventing them from getting medications.

At the Gary, Ind., Crisis Center, suicidal callers with economic worries are increasing, and their depression is more severe, says Willie Perry, program coordinator for the hotline.

"There's more hopelessness. They don't see a way out," she says. "We try to help pull them up by the bootstraps, but the bootstraps are a lot lower than they used to be. The grim phenomenon is rearing its head: the suicide of homeowners who have lost their homes during the mortgage crisis is getting on the tip of the iceberg and nobody seems to care.


Police in Taunton, Mass., report today that Carlene Balderrama, 53, a wife and mother, shot herself to death Tuesday afternoon -- 90 minutes before her foreclosed home was scheduled to be sold at auction. Balderrama faxed a letter to her mortgage company at 2:30 p.m., saying that "By the time you foreclose on my house I'll be dead."

The mortgage company notified police, who found her body at 3:30 p.m. The auction had been scheduled to start at 5 p.m., when bidders showed up at the house and found it surrounded by police cruisers. But, unbeknownst to buyers and to Balderrama, the auction had been postponed by the time she grabbed her husband's high-powered rifle, [Police Chief]O'Berg said.".

This is a middle-class family, a husband working, the son is working," O'Berg said. But the housing crunch, he said, "is inflicting real pain on middle-class Americans

A little help but not enough. Streamline Modification Program.

Fannie Mae today said that the Streamlined Modification Program (SMP) announced by the Federal Housing Finance Agency (FHFA) in November is now available to Fannie Mae servicers and borrowers as an option to help prevent foreclosures. Fannie Mae on December 12, 2008, provided information and guidelines to its servicers regarding the implementation of the SMP.

The SMP is designed to be a streamlined process for modifying the loans of
a large number of borrowers who are delinquent in their mortgage payment and may be able to avoid a foreclosure through the program. As FHFA has indicated, SMP was intended to help set standards in the mortgage servicing industry for conducting loan modification programs on a large scale as a foreclosure prevention measure.

Fannie Mae has been working with FHFA and 27 lenders and servicers in the
HOPE NOW alliance to implement the SMP. Under the program, borrowers who meet
certain eligibility criteria and demonstrate financial hardship may be eligible for a loan modification that reduces their monthly principal and interest payment.
The streamlined process allows a borrower to sign a single document at the outset of the workout process that both establishes a new monthly payment during a three-month trial period, and sets forth the modification terms that will take effect if the borrower makes the new payments during the trial period. The program is available to borrowers who have missed at least three monthly payments on their existing mortgages.

"By bringing the collective efforts of FHFA, Treasury, HOPE NOW, Fannie
Mae, Freddie Mac and other mortgage industry participants together through the
SMP to confront the foreclosure challenge, we'll be able to help more families
across America stay in their homes," said Herb Allison, Fannie Mae president
and CEO. "Along with other recently announced initiatives by Fannie Mae to
reach and help financially troubled borrowers earlier, including our Early
Workout program, the SMP is a critical component of our company's foreclosure
prevention efforts. These efforts are helping more than 10,000 delinquent
borrowers every month get back on track."


Modification Options


Through the SMP, servicers may change the terms of a loan to reduce a
borrower's first lien monthly mortgage payment, including taxes, insurance and
homeowners association payments, to an amount equal to 38 percent of gross
monthly income. The changes in terms may include one or more of the following:

-- Adding the accrued interest, escrow advances and costs to the principal
balance of the loan, if allowed by state law;
-- Extending the length of the mortgage loan as appropriate;
-- Reducing the mortgage loan interest rate in increments of 0.125 percent
to an interest rate that is not less than 3 percent. If the new rate is
set below the market interest rate, after five years it will step up in
annual increments to either the original loan interest rate or the
market interest rate at the time of the modification, whichever is
lower;
-- Forbearing on a portion of the principal, which will require the
borrower to make a balloon payment when the loan matures, is paid off,
or is refinanced.


Eligibility


Highlights of the SMP's eligibility requirements communicated to servicers
include:

-- Conforming conventional and jumbo conforming mortgage loans originated
on or before January 1, 2008;
-- Borrowers who are at least three or more payments past due and are not
currently in bankruptcy;
-- Only one-unit, owner-occupied, primary residences; and
-- Current mark-to-market loan-to-value ratio of 90 percent or more.



Servicers will be sending modification solicitation letters beginning this
month to thousands of borrowers believed to be eligible for the program. It is
critical that eligible borrowers respond to these letters and reach out to
their servicers to determine if they can receive SMP assistance. Also,
borrowers who don't receive a letter are encouraged to contact their servicer
to see if they may be eligible for SMP help. Fannie Mae will be working with
servicers to monitor and improve implementation of the program as necessary.


Fannie Mae exists to expand affordable housing and bring global capital to
local communities in order to serve the U.S. housing market. Fannie Mae has a
federal charter and operates in America's secondary mortgage market to enhance
the liquidity of the mortgage market by providing funds to mortgage bankers
and other lenders so that they may lend to home buyers. In 2008, we mark our
70th year of service to America's housing market. Our job is to help those who
house America.

Hope: From the time it came out, it's been stuck in quicksand.

Once touted as a potential breakthrough to help solve the foreclosure crisis, the government's Hope for Homeowners program has failed to live up to its billing so far. And there are serious doubts it ever will.

Bankers don't like it. Consumers don't understand it. Government regulators don't trust it to solve the problem. a liquidity crisis is making its presence felt on a global level. The stability of the world economy demands liquidity, and the current economic climate is in particular need of renewed cash flow. But do we also require political intervention in order to solve the present mortgage crisis?

The entire world is shaken by the present liquidity crisis. In order to stop the global mortgage meltdown, a number of well known banks worldwide have come together to auction off huge amounts of dollars. A stable economy is inherently based on liquidity. What is indispensible now is a regular and uninterrupted cash flow. The point is, is political help a need of the hour for tackling this mortgage crisis?

Market analysts believe that government assistance may not be necessary to avoid the potential crash of the mortgage market. What is the meaning of Sub prime mortgage? It can be classified as a mortgage crisis caused by a worldwide reduction in liquidity. The United States mortgage market has suffered profoundly because of the current crisis. And as expected, this has resulted in global mortgage crisis.

In 2005, We witnessed the advent of sub prime mortgage crisis. This was followed by rising rates of interest as well as a moderate fall in the prices of real estate in 2006. A clear understanding of the present mortgage crisis requires you to fully comprehend the concept of 'foreclosure'. If a home owner, in reference to the present mortgage crisis, is unable to fulfill the terms and conditions as put down in the 'mortgage' agreement, a foreclosure becomes applicable.

What is the root of the present mortgage debacle? The sub prime mortgage crisis is a fallout of a number of factors. The unpredictability of real estate prices is currently a common phenomenon. The worldwide mortgage crisis probably takes it's roots from this particular phenomenon.

The increasing popularity of high-risk mortgage loans is also to blame for the tightening of liquidity. Millions of individuals indulge in mortgage fraud nowadays. Erroneous calculation of credit scores is a significant contributor to the current mortgage crisis as well. Rigid government policies are responsible for the sub prime mortgage catastrophe as well.

Plenty of economic experts think that the mortgage crisis has helped new buyers out. Because of dropping home prices, a greater number of investors have applied for low-interest mortgage loans.

The result: Federal housing officials have received fewer than 115 applications since the program took effect Oct. 1. Compare that to the more than 3 million homeowners currently in some form of foreclosure, according to the real-estate research firm RealtyTrac.

Other alternatives are already lining up to possibly supersede Hope for Homeowners, which offers to get people facing foreclosure into affordable, fixed-rate mortgages, insured by the Federal Housing Administration.

Two new initiatives were unveiled last week:

*A home-loan-guaranty program by the Federal Deposit Insurance Corp., aimed at providing refinancing to an estimated 2.2 million distressed homeowners.

*A loan-modification program by Fannie Mae and Freddie Mac that would fast-track applications for mortgage relief.

Neither requires lenders to take a write-down on the principal of the mortgage -- a major objection the banking industry has had with the rules of Hope for Homeowners.

Lenders are wary of the deal, especially when the mortgages are held by investors who don't want the potential value of their investments trimmed. Banks fear they will be targeted by investor lawsuits.
Basically, you're trying to get them to take a big haircut on the balance of the loan, but you have to get someone who has the authority to make that decision
There's really no teeth in this program that can make that happen."

There's also a catch for the homeowners: If they eventually sell their home, they'll be required to share half of any profits with the government.

Meanwhile, bankers are trying to sort out which approach to focus on, even as the government has already doled out the first 25 percent of the $700 billion banking rescue/bailout program.
But the rescue program has raised a number of open questions now about what would be best for both lenders and borrowers."

From the time it came out, it's been stuck in quicksand.