FireDogLake – Yesterday at a Senate Banking Committee hearing, Sen. Sherrod Brown said, “As long as we continue to have more than one million foreclosures a year, the foreclosure crisis must be our priority.” I think this has more resonance in the upper levels of government than we believe, at least on the political side. A continuing foreclosure crisis is debilitating to the economy, and every million kicked out of their homes is another million who resents the system and won’t vote for whoever was in power at the time. It’s a major political problem in addition to being a policy problem.

That’s the best I can say about a new proposal aimed at modifying up to 3 million mortgages in 6 months, as part of the global settlement with banks over foreclosure fraud. The President and federal regulators, led by the Justice Department, are managing this settlement, with the bank-friendly OCC on the sidelines. There’s much to be said about this story by the capable Shahien Nasiripour, but let’s get the broad overview first:

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