File this under a WTF.
Anybody else getting the feeling of being overwhelmed by the amount of crap coming out of Washington D. C.?
Buried deep in the pages of the current Obama Mortgage Modification Plan is this information.
paragraph vi. Second Liens: While eligibly loan modifications will not require any participation by second lien holders, the program will include additional incentives to extinguish second liens on loans modified under the program in order to reduce the overall indebtedness of the borrower and improve loan performance. Servicers will be eligible to receive compensation when they contact second lien holders and extinguish valid junior liens. Servicers will be reimbursed for the release according to the specified schedule, and will also receive an extra $250 for obtaining a release of a valid second lien.
I have always believed that there is plenty of blame to go around on both sides of this fiasco and it is basically a waste of time looking backwards at the causes. However, when it comes to second liens ... short of medical problems .... the only reason these were taken out were to utilize ones equity as an ATM machine. This is bullshit!
Why stop here ... how about all other kinds of debt? Why not just pay the bills for that big SUV? Credit cards? Student loans? Where does the insanity end?