Through the 2MP initiative, services of second mortgages have the option to modify the lien or to extinguish it -- which is an admission that the mortgagor is not likely to be repaid for the second mortgage, and they clear their interest in the property by filing a lien waiver.
The foreclosure crisis isn't an isolated problem faced only by those who lose their homes. It's a national problem, and one that impacts every man, woman, and child--even those who aren't in danger of losing their home.
Widespread reckless practices, not just related to the robo-signing scandal, caused the ongoing financial and foreclosure crisis, and these practices deserve careful consideration. There should be further, close investigations on this front.
It would take a law passed by Congress to create a right to rent for the people losing their home to foreclosure. However, President Obama could unilaterally act to require Fannie and Freddie to go this route.
We don't condemn bed-smokers to suffer the consequences of their risky behavior because the fire can spread. If we want to stop the spread of strategic defaults, principal writedowns are the most effective option.