That is exactly the problem if they ever want to eliminate or reduce the fraud. If the “homeowners” have no equity, the lenders (and their agents) should be the only parties controlling the sale/disposition of the property.
By allowing the “owners” and their agents to control the disposition/sale, the door is left open to fraud because the lenders are kept in the dark about all the details. They might not mind as long as the taxpayers are bailing them out, but I bet they would have changed the laws by now if they weren’t being bailed out.
