I have long maintained that the housing recovery is premised upon the distress inventory clearing out. The distress in foreclosures and short sales is not helped by lenders unwilling to either re-finance or modify loans of qualifying homeowners.  If the homeowner can prove income, why shouldn’t the lender re-structure the loan to accommodate a monthly payment that works? It’s a win-win. If my neighbor’s loan was an adjustable rate and re-sets from 5% to 10%, and the payment becomes a tidal wave of debt, a foreclosure might begin. Ultimately, my home’s value will decrease as a result of that neighbor’s distress. President Obama, in his State of The Union speech a few weeks back, said, “I’m sending this Congress a plan that gives every responsible homeowner the chance to save about $3,000 a year on their mortgage, by refinancing at historically low interest rates. No red tape.”  Clearly, the devil is in the details. A huge impediment to refinancing is the lender’s appraisal. . In the scenario President Obama outlined, appraisals can =not= have any role in the refinancing process other than a place mark in the file. It can not determine value. If the lender  needs to restructure or modify an existing loan to reduce the  interest rate or extend the years…if they can create a more stable housing environment and avoid millions and billions in write offs and losses….then that would be the recovery we have been pushing for. A 30-year fixed rate mortgage under 4% is available today. Why not get started?