This news just coming out -- in its continuing effort to "fix" the mortgage "problem" - two senators are planning to introduce a bill today that would give first lien holders a "veto" option if a borrower was trying to get second mortgage. This bill appears to apply specifically if the two loans together would bring the total owed to more than 80% of the value of the property.

It would also create another data base, of all the second (and other junior) mortgages, and track how they are performing.

This is supposed to help in the "wind down" of Fannie Mae and Freddie Mac - moving to a private secondary market program.

The real question is, how many lenders will be agreeable to a second mortgage on property they have a first on, when "private MBS issuers would be required to take a 10% first-loss position on the pools of single-family loans"? Could this spell the end of second mortgages as we know them -- should this become law?