[ClearCase_guy]

Lenders would be asked to reduce monthly payments to 38 percent of the borrower's income

1) Back in the good old days, I think banks wouldn't give mortgages in the first place if the payment would be more than 32% of income.
2) I'm assuming these sub-prime mortgages are all fixed rate, otherwise, the reduction in payments to a fixed percentage of income doesn't seem to make sense.
3) If I lose my job and have no income, does that mean my mortgage payments are 38% of zero?

[Joan Kerrey]

3) If I lose my job and have no income, does that mean my mortgage payments are 38% of zero?
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Makes perfect sense to me. This way those unfortunate victims of swindlers will be compensated. Government will pay them to stay in their homes. This extra money will then stimulate the economy in general. Assuming a $3,000 per month payment does that mean that those affected will receive $1,140 per month from Freddie or Fanny. That should right the wrongs these homeowners experienced. /s

[RipSawyer]

I don’t know the bank rules for the sixties but back then people used to tell me that only a fool would have a house payment that was more than one week’s income.