The Financial Bailout Fiasco

Short Definition:
Streamlined Modification Program is a change to the original mortgage terms. It may include
change to the product (an ARM to a fixed rate mortgage), interest rate, amortization term and maturity date, and/or unpaid principal balance. The change/s is made to create a more affordable payment for the borrower.
http://www.fhfa.gov/GetFile.aspx?FileID=169

Under the new program, mortgages on owner-occupied homes that are at least 90-days past due with a loan-to-value of 90% or more will be eligible for the streamlined modification. Homeowners who owe more on their home than it is worth will be eligible.
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If that qualification is required then the program is all about protecting Fanny / Freddy and not the home owner. If the owner only owes 50% of the value, foreclosing would be great for the lender but if the owner owes 90% the modification might keep the lender from being stuck with a home valued under the delinquent amount.

Highlights of the FHFA Streamlined Modification Program
Posted by The Tim at http://seattlebubble.com/blog/2008/11/11/highlights-of-the-fhfa-streamli...
To qualify, borrowers must:

* Have a loan owned or guaranteed by Fannie or Freddie.
* Owe 90% or more than the home is worth.
* Be 90 days or more behind on payments.
* Demonstrate financial hardship.
* Not have filed bankruptcy.
* Presently occupy the home.

Possible remedies under the plan include:

* Interest rate reduction.
* Loan term extended from 30 to 40 years.
* Deferred principal.