The capitalist reason of why over 6 million modifications were already issued was to avoid the investors potential financial loss in the event of a foreclosure by GIVING the negative equity homeowner a financial incentive to remain a negative equity homeowner when it was financially beneficial to the negative equity homeowner to default instead, NOT BECAUSE THE HOMEOWNER HAS A FINANCIAL HARDSHIP.
The Negative Equity Streamlined Uniform Modification System accomplishes this capitalist goal legally and fairly without principal reductions or favoritism toward any particular group of negative equity homeowners with its rules and guidelines. None of the programs existing or coming into play can match or even attest to this claim, Helping Homeowners, Responsible Homeowners, HAMP, etc...they all favor a particular subsection of the group for the financial benefit of Wall Street violating the most basic principle of the law, equality. The law clearly states that "a consistent and similar financial incentive must be given to all similarly situated parties", yet according to the HAMP guidelines the banks have been given the right to exclude the majority of similarly situated parties from receiving a consistent and similar financial incentive based on unrelated social economic factors such as the homeowners income WHICH HAS NO BEARING, STANDING OR MATHEMATICAL INFLUENCE on whether there is a positive net present value to the investor or homeowner destroying the principles of capitalism and violating numerous laws.
The Negative Equity Streamlined Uniform Modification System proposal is the equal entitlement of every homeowner to modify their current outstanding mortgage to an uniform interest rate of 3.0% fixed for a 30 year self amortizing mortgage term with the automatic added benefit of a matched equity principal paydown option based on the positive result TO the four requirements of the Negative Equity Streamlined Uniform Modification System without regard to the homeowners income or mortgage status:
1- owner occupied (primary residence)
2- one to four family home, condo or co-op
3- purchased/owned for 24 months prior to modification date
4- have negative equity established by a combined loan to value of 97% or greater with the exception that homeowners with a combined loan to value of 80% or greater, are also eligible if reasonable evidence is submitted/obtained that the homeowner's portion of the equity paid or down payment paid was lost due to the declining market value, not from purchasing under the market value.
There are no principal reductions but a sliding scale matched equity paydown option given for the first 10 years based on a pre-arranged loan to value percentage chart:.
Tier 1- For loan to values of up to 115%, there is no match equity pay down option available, the under the market reduced interest rate is the only financial incentive offered
Tier 2- For loan to values of 115.01% to 129.99%, it is a dollar for dollar matched equity pay down
Tier 3- For loan to values of 130.00% to 144.99%, for every dollar the homeowner pays the investor will match $2.00
Tier 4- For loan to values above 145.00%, the investor matches $2.00 for every dollar the homeowner pays and the interest rate offered is one half of an interest rate lower to further incentivized the homeowner.
The "tier" is based on the property's value at time of application, regardless of the future anticipated decrease in values. Once accepted, it does not change the principles of capitalism, which are profits and losses but now there is a shared financial loss between the two parties involved.
Based on the recent settlement of the Attorney Generals and the recent OCC settlement and HUD settlement , I have to remind certain parties that the creation of the "NESUM" System is a capitalist proposal, it is not for the financial industry or the government to take my ideas and apply them without my permission or paying me, see the copyright statement on the bottom of the rules page. Using parts of the system will not correct the housing industry and will continue to delay recovery for years, the entire system must be used.