Here’s a thought: let’s say this plan does work and every single one of the 10% of mortgages is reworked and all 5% of Americans behind in their payments stay in their home.
Then what?
Prices will still be too high, people waiting to buy will have to wait longer, people who bought during the bubble won’t be able to sell for several more years, lending will decrease, banks will lose business, and this temporary fix will have further eroded any sense of fiscal responsibility for both institutions and individuals alike.