BG, none of these programs “bailed out” lenders. There have been over a million permanent loan modifications to date, and not a single one of them resulted in the lenders being made whole. And none of the programs motivate the lenders to allow homeowners to stay in their homes without making payments. Indeed, to the contrary, if a homeowner has stopped making payments and a loan modification is being attempted, the motivation would be for the lender to get the agreement in place as quickly as possible.

With regards to your opinion on lender competence, we’ll have to agree to disagree. While it would seem the actual process is simple in non-judicial states like CA, that isn’t the way it works. Distressed assets are assigned to asset managers who are required to determine the value of collateral. That also shouldn’t be terribly time consuming in an ideal world. They could call up one of our friendly pig RE professionals and ask the question, and get an opinion of value. But instead they prepare a 15 page report. For each of the 200 or so distressed assets they’re assigned each week. They fall behind and never catch up.