IMO, the something for nothing mentality of today's politicians is perpetuating and not improving anything. They, with their big banking political contributors, wiped out depression era banking restrictions designed to prevent just this situation, created an environment that enabled anyone to get a home loan (democrats) while they turned a blind eye to fraud (republicans). So the same corrupt fools put new laws into place that protects the corrupt status quo, and puts enough distance between them and the problem so that the people who perpetrated the problem avoid the consequences. This is the crux of the problem... avoiding the consequences.
No, the problem wont be solved with this latest round of mortgage relief because the government won't cut the proverbial gordian knot and dump the inventory. They will create some rehashed plan that protects the interests of big money investors while kicking the real solutions to someone down the road with a backbone and the courage to take the hit and just dump the inventory. Letting the non-speculators who have cash buyup the inventory for pennies on the dollar and do with it as THEY please and not how WASHINGTON wants them to.
Whether it works or it doesn't, it's an important step if they are talking about anything related to housing and home finance. A year ago, both Washington and Wall St. had conveniently separated the housing economy from the general economy as if there could be a broad recovery while housing languished. Now, at least, they are recognizing that we cannot have a recovery without a robust housing market, and they are beginning to see the light that we will not have a jobs recovery until the housing market is healthy.
For those of us in this industry who have known these things above to be true all along, we have to be optimistic. Up until this point, we have withstood regulation after harmful regulation (HVCC, GFE2010, Dodd-Frank, etc.) and if necessary, we will keep doing what we must. But let's all hope this will be a small step in the right direction.
Broker / Owner
Windermere Walnut Creek