Because of the constituents streaming in our doors with the enormous stress connected with working on a modification...

I have serious concerns about that process.

Thank you for your leadership on Dodd-Frank, a huge effort to try to stabilize our financial sector.

We have made our new payment for over a year and are still receiving foreclosure notices.

I am very concerned about the legal issues getting resolved, in part because this poses a huge systemic risk to our banking system as a whole.

It is not certainly only shocking, but it is one example of how banks have mishandled both foreclosures and mortgage modification requests.

It is important to have national standards, but it is also important to have one regulatory agency that takes this on as its job with an eye to protecting consumers.

Thank you very much, Mr. Chair, and I will follow up on your questions related to the put-back with our folks, Mr. Edwards and Mr. Bisenius from Fannie and Freddie.

The current foreclosure crisis has been difficult and unprecedented, and we are far from done.

So often, we are coming into the story down the road when it has exploded.

I think it is important that you flagged it in your testimony and that we continue to pay attention to it in a Congressional oversight fashion.

The situation is that often when folks seek a modification, they are told by the servicer, you need to be delinquent before you start this.

I will just close with this comment, and that is that the perspective presented by major banks before this Committee was that they are suspending the dual track for loans that they carry, but they are being forced by Fannie and Freddie not…

Because of those existing agreements, what you are describing has little practical effect because Fannie and Freddie are telling those servicers to continue with the foreclosure process.

OK. So, ballpark, can you tell me between the two institutions or for your institution how many more repurchase--are we talking a billion dollars a month or are we talking about a billion dollars every 6 months?

So, Professor, in that case the financial incentives to pursue foreclosure are not offset by, if you will, defense of the reputation of the banking institution?

So that is a process you are actively pursuing? You are requesting those changes in the servicing contract?

I encourage every possible effort to try to make this modification track work better because it is an abysmal failure in terms of national policy right now and our economy and our families are going to--are suffering and will continue to…

Thank you for noting that.

If I can summarize what I just heard, you are not contesting her analysis of the financial incentives that certainly favor foreclosure, but that because the reputation of the bank is at stake, that balances that out.

That does not seem to be working in a way that we want it to.

So we have so many folks coming to our office in Oregon who over here are working with the servicer to modify their loan, but then they are getting foreclosure notices, phone calls, agents coming to their door.

I just want to put that forward.

I wish there was, in fact, a rule in place that said the foreclosure track will not be pursued until the modification is completed.

And that would not be because the number of folks falling into foreclosure action is declining, so to what do you attribute that?