I saw the loan mod papers as he asked my opinion before signing them. he absolutely can make it and will stay there forever. He has a tenant and his PITI net of the rent he recieves is about $1000. He is divorced and took out equity to buy the house. He was unemployed for a while. He went back and retrained in another industry and now has a very good job in stable field. He has been promoted twice in the last year since he started.

He had about 80K loan balance plus a year of missed payments forgiven and now owes about 450K which is about what its worth now. He absolutely will acquire equity and no repayment of the forgiven amounts will ever be required. I know this because I saw the loan mod papers. The 4.5% cap is for the duration of the loan also.

Stop with the blanket statements that are patently wrong. Every situation is unique and your stereotypical presentation of anything you write is always full of holes. You usually present one good possibility but its only one of numerous possibilities. the world is not as B&W as you make it out to be.