that 25b settlement? More smoke and mirrors.

 Post script summary:  the Obama mortgage settlement will do nothing for the mortgage crisis.  It is campaign fodder and nothing more. 

For starters,  participating states (as of this writing, all 50 including Oklahoma, are involved) will split $5 billion. That amounts to 100 million dollars per state,  if evenly distributed.  This is earmarked for state mortgage relief programs,  but,  of course,  it will be put into the general fund of states such as California,  and used to pay off debt.  In other words, the first 5 billion  is little more than a bail-out for state governments.  

If you are one of some 750,000 who have already lost their homes to foreclosure,  this settlement will grant you as much as $2,000   --  yes,  I said "$2000"  -- in one of the most benign "relief" programs known to man.  You have lost your $300,000 home plus your down payment, closing costs,  and monthly payments before the foreclose and Obama has bought your vote for a pitiful $2,000 of someone else's money.  To make this more of an insult,  you may have to wait three or four years before getting any of this money.  Heck,  the details of the settlement have not been written as I write this post.  And,  after this bill is given its legal verbiage,  the terms of the agreement will be presented to a court of law for review and then, after that review,   you might get a few bucks . . . . . three years down the road.    

About the only really good thing coming from this bit of nonsense, is the fact that all of this money comes from a binding settlement against five of the nation'a biggest banks;  none of it comes from the taxpayer. The largest portion of this settlement ($17 billion) will go to principle reduction,  but it is not known how this will work or if it will make much of a difference to homeowners who have no jobs or are struggling to make their payments.  Understand,  that if you have missed any payments over the course of the six month period just prior to your application for assistance,  you are out of luck.  

Here are the five banks involved and their contact numbers.  You've got three years to make "the call, " no need to hurry.  

If your mortgage is connected to Fannie or Freddie (and 45% of all mortgages are, thus, connected),  you are not benefited by this program,  despite news reporting otherwise. 

Only those who lost their homes due to foreclosure during the years of 2008 through 2011, inclusively,  are potential benefactors.

Only those who are current on their mortgage payments qualify for any sort of principle reduction.  

And,  again,  "relief" is three years removed from today.  

Conclusion:  you should know that experts do not see this as the  "end all" for the mortgage crisis Obama brags about.  Taking three to four years to allocate this "rescue cash"  will have no serious effect on the housing industry,  apart from the recovery that the industry will be able to accomplish on its own.     

When you are drowning and need rescue,  three years is a little late.  Thank you,  very much,  Mr. "Smoke and Mirrors" Obama.  

National Mortgage Settlement/Midknight Review/ McClatchy News Service

Update: "Now the 'experts' have come forward to announce it will be at least eight years till [sic - 'til] housing recovers . . . . ."  Capital News

Update:  “By our estimates, housing vacancies will likely remain historically elevated until at least the latter part of the decade, restraining home-price appreciation over the same period,”    BizJournal