This is a Feature, Not a Bug

At Salon, David Dayen observes that it, "Turns out much-hyped settlement still allows banks to steal homes,' even after the much hyped mortgage settlement.

This is not an oversight.  The Obama administration has aggressively allowed banks to cheat customers an investors since day one.

Basically, they see this as a way of making sure that the banks appear solvent.

See my writings on HAMP. Here is one quote:

Warren asked Geithner repeatedly about HAMP. After several evasions, Geithner said about the banks, “We estimate that they can handle ten million foreclosures, over time… this program will help foam the runway for them.”

By "them", he means the banks.

By foaming the runway, he means that it allows them to delay writing down bad loans, and continue to extract payments and fees by cheating the public.

The suggestion that this is anything but deliberate policy is simply naive.