Now onto the Hope for Home Ownership Bill: One blogger eloquently(?) called this bill the HO-HO bill. I guess you can get that with your Twinkie Tax break?? It was funny because the way that this provision of HR3221 was written is fairly laughable. I have attached a copy of the complete Analysis in this link.
To be clear:
Franklin American WILL NOT BE PARTICIPATING in this program.
It's too risky a product for a banker like us to play with and their are even issues within the Bill that don't create near the amount of Guarantee a traditional FHA loan would.
Now, you're asking, is this something I'll be able to provide my clients with for Origination purposes? Sure, likely through a Flagstar, Wells or similar type of bank. The question you have to ask yourself is:
IS a good loan to pursue and should you to try and write some of this business?
Question 1. Is it a good loan? Sure, if the borrower can still afford the drastically reduced balance at the new interest rates and monthly MI Rate (1.50% annualized!!).
Question 2. Do you try to attract this business for origination purposes?
-Short Answer: NO
-Long Answer: Double NO
Here's why:
Can't have a second note after closing
must have 90% of the new value based on appraisal ordered by you for the new transaction
Must qualify based on traditional FHA Guidelines (31/43-mostly)
a Few other highlights:

• Participation by the lender and the homeowner is voluntary.         
• Borrower  (as of  March 1, 2008) has total housing expense ratio greater than 31% and possibly higher  at the Board's discretion.
• Borrower certifies they have not defaulted "intentionally" and has provided accurate income/expense information.
• Borrower must have reasonable ability to make mortgage payments using criteria established by the Board.
• Lender must document borrower's income via two most recent tax returns.
• Lender must do criminal background check on borrower (no mortgage-related fraud last 10 yrs).
• Equity is shared in a sliding scale formula w/ HUD keeping 100% if home is sold or refinanced in first year.  Over next five years, HUD's share declines 10% each year and levels off at 50% for the life of the loan.

Sound complicated? You bet it is! Remember when FHA Secure came out. Everyone thought, awesome! a program for the benefit of defaulting borrowers. And then you read the details. Myriad is putting it kindly.
This program is ultimately going to be most efficiently handled through the in-house customer retention division of the servicers of these existing notes.
As Brokers our access to this program will be extremely limited and it will take countless hours to negotiate, in the name of our borrowers, a better position for them financially.
Is the $300BB if our Tax Dollars actually going to be used up in the 2.25-3 years that it's available? Maybe. It depends on how many people that purchased/refinanced homes with Stated Income loans and 1-2% min pay Option arms are going to be able to call their existing lien holder and actually obtain the newly renegotiated lower balance. My guess is for the next 12-18 months very few. Then as criticism over the effectiveness of the program grows many will suddenly belly up but likely it will be an effort of too little too late.