The real number of problem loans is...

The Case Shiller and First American Core Logic are understated by several million... They both draw their data from the recorded deed information and then use a general "guestimate" (thank you Paul Harvey) as to the current value in a manner that is very similar to what one might glean at www.zillow.com. And that one has no relationship to reality! Zillow reports only history… does not provide an accurate estimate of current value.

Problem... they have zero way of determining the current balance due on an Option ARM, with negative amortization. The ONLY number recorded is the original amount recorded. In order to accomplish this feat, one would need to know not just the opening balance, but also: 1) the entry rate, 2) date of recordation, 3)original minimum payment, 4) the payment history, 5) the term, 6) index, 7) margin 8) the historical data for the index from that date of funding, and 9) and then go about running the numbers for each of the millions of loans in the portfolio’s for every lender or thrift that made these loans… Once this is completed, a Broker Price Opinion (BPO) of the estimated value would be required...not happening…

There never was a secondary market for these loan products... none in MBS pools. Further, very few of these loans have are in default. As the ENTIRE loan portfolio's of Downey, WaMu and Wachovia, plus any other thrift that offered Option ARM's IS COMPRISED SOLEY OF THIS PRODUCT, you may wish to research the dollar amount their respective portfolio's... and you will be closer to the true number of problem loans...

Further... as, with the exception of Wachovia, all of those loans carry a maximum 10-15% negative accrual, you will then get a better handle of the number of additional (not previously included in the default data) loans that may go into default... AND the dollar amount of additional TARP funding that may be required to cover these losses... You will find that the Treasury indemnified US Bank, Chase and Wells Fargo from any loan losses as part of the (forced?) purchase of those banks...

My research indicates that the true number of problem and potentially problem loans to be closer to 25 million...

Another reason to offer immediate modification of the CURRENT LOAN BALANCE, every ARM loan; and every fixed loan more than 3% over the 10 tear Treasury bond into: a 50 year amortized. 5 year reset loan at 4%. With NO QUALIFYING. Loans already in default carry a forbearance agreement as part of the modification...

Further, in order to correct the lack of oversight from all of the previous laws...HERA, EESA and the new ARRA (love those acronym's) and any future act; require every lender, thrift, loan servicier, brokerage, insurance company or any other entity that owns any beneficial interest, either directly or indirectly, in any loan secured by 104 unite residential real estate, and has received any federal funds, either directly or indirectly be required to make the above offer of loan modification.

These loan modifications are to made without... without... any qualifying... my proposal will reduce the average mortgage payment by about 55% for these 25 million homeowners... we all gain by keeping them in the home; and thereby stabilizing the real estate market... the mortgage payment savings will, no doubt, go back into the economy through the purchase of good and services... my proposal will inject some $150 million (compounded)... for no less than the first 5 years of the loan modification or about $2.4 trillion... at "tad better" than what Mr. Obama is proposing... and $100 in true hard costs per loan, my proposal is as close to cost free as we will ever get!