Apparently the federal government is concerned that the current deflation and stagnation of housing prices is going to throw the entire economy into recession. The fear seems to be that consumers' confidence and spending will decline in response to fears that the prices of their homes are declining.
The Secretary of the Treasury and the Federal reserve are now encouraging major lenders to restructure mortgages rather than to foreclose. Supposedly ten of the largest have agreed. They are seeking an end to the dumping of cheap foreclosure properties on to the market in the hope that the market will right itself within the next 6 to 12 months.
They have also called for a complete overhaul of the mortgage industry. Hmmmm...could this mean that there will be some enforced accountability to RESPA?
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