WARNING: comes with shenanigans.

“Fannie Mae takes a delinquent mortgage loan and replaces the delinquent part with an unsecured loan in order to circumvent the buybacks and mark-to-market consequences.”

A loss mitigation tool (heh, I like that) that will defer the pain!

(I wonder if this ‘unsecured’ debt is going to be at credit card rates?)

The big sloppy Bernanke blowjob today is destined to be too little, too late. $200 billion ain’t nuthin’, when you’re staring at trillions- yes you read that correctly- of bad paper.

Sure the street was ecstatic, but given their herding instincts, it’ll take similar actions on a regular basis (twice to thrice weekly IME) to continually postpone fear. Once a few smart sheep figure it out, it’s over, and the fed will be forced to UP their game. I have no doubts Bernanke has the balls to devalue the dollar and take it all the way to zero as long as he gets to be right in his little academic experiment. Go Ben! Give it the old college try!

Of course, because foreclosure process takes so long, this is a way of extracting more money from the house-poor, just as banks do with potential short sales- taking forever to decide until they inevitably say no, by which time a prospective buyer has walked, and said bank has bagged a few more payments from homedebtor.

As you might expect of someone who hasn’t gone through the foreclosure process before, or isn’t up to snuff via the blogosphere, they would NOT realize they could live rent free as long as it takes- in some cases that’s as long- or longer- than a year. Hey, if you make a deal with the bank to to take care of the property, it might even pay relocation fees.

But wadda I know I’m just a numpty.

“Your actions speak so loudly that I can’t hear what you’re saying.” -Ralph Waldo Emerson


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