Loan Modifications: Why Is Citigroup Optimistic About Future Loan Delinquencies

Loan modifications seem like a pretty simple concept. You can?t pay your mortgage so the government ?encourages? your mortgage provider to give you a break. The break can come in the form of lower interest rates, a longer tenure, deferring a part of your loan or even ?forgiving? a chunk of your loan (that doesn?t happen all that often). The key word of the above paragraph is ?seems?. The truth is not even close to simple. Banks are businesses and like all businesses, successful ones anyway, they need to know where they are going, what the future will look like in order to decide what decisions to make today. Investors and business analysts also want to know what the future of business looks like. Mortgage and securities analysts have a difficult job on their hands because the future is so