These could take the form of tax write-off provisions for mortgage write-downs and a tax exemption on the shared appreciation.
In 2010 Ocwen disrupted the industry with its Shared Appreciation Modification model, a creative solution for servicing loans that are underwater.
My New York University colleague, Andrew Caplin, has for some time been advocating the wider use of shared appreciation mortgages as a way of sharing risks between lenders and homeowners.
But the shared appreciation concept also offers a way to restructure existing loans so that they provide benefits for both lenders and households and allow households to de-leverage and repair their balance sheets.
In a shared appreciation restructuring, the lender would take a haircut on the outstanding loan and replace it with a combination of a new loan and a claim on the future appreciation of the collateral.
The shared appreciation feature gives the lender the right to the first, say, 40% of the appreciation of the collateral above the value of the debt over some specified future time period (say five or 10 years).
In areas with more severe house-price declines, it may be necessary for lenders to take a bigger haircut and offer smaller notional shared appreciation claims in order to restore homeowners to positive equity at lower house prices.
Feder favors a plan that would allow Fannie, Freddie and other banks to convert their underwater mortgages to shared-appreciation mortgages that would carry lower monthly payments and give banks and homeowners shared equity stakes in the homes' future appreciation.
Shared-appreciation loan modifications are an approach to principal reductions that Democrats, Republicans, and even a financial regulator could all learn to love.
There was no talk of money, or of deals, it was all about digging into characters for whom we all shared a profound reverence and appreciation.
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Although Europeans would be happier if the burden of the dollar's realignment were shared more evenly, Asian governments will continue to limit the appreciation in their currencies until China loosens its own peg against the dollar.
What began as a semi-improvised piano piece has grown into a full symphonic work, giving McPartland a vehicle with which to fully express her appreciation for Carson's vision, as well as their shared concern for the destiny of the natural world.
And even though many citizens shared conventional prejudices about African cultures, the substantial African-American population offered the potential for a radically different appreciation of African art.
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