8 Alpha-Zulu

Number of U.S. Homes With Negative Equity Is Stunning

it is too late for many; we should establish a treasury backed 40 year fixed interest amortization guaranty pool (or seed it with a similar pool of govt. funds) as a "work-out platform" to re-fi all of those that are about to enter the foreclosure arena. this would help the banks balance sheets immediately and would actually provide them with more aggregate interest over the longer mortgage term, it would substantially decrease the monthly cash flow payments that the borrower needs to cough up every month and could actually create an augmentary (perhaps temporary) longer term segment of the bond market wherein government backed mortgage paper was the credit support mechanism.

as it relates to moving forward, "there must be required fiduciary relationships" between lender, appraiser and mortgage originator to clean up the way loans are "stretched" to close same. The current standard operating procedure amongst them now provides each with a shield of exculpation that is nearly criminal and the risk to bond holders of this paper gets passed along buried under the rubber stamps of the Country-Wides of the world; thusly, the owners of those bonds have been duped. This complete vacuum of culpability between the aforementioned parties is why we are here today.
-8Alpha