Modifications are still a crucial part of the government's strategy to deal with the real estate meltdown (credit crisis news). To further the cause of more modifications, which has gone slower than most people would've liked, at least one politician, Barney Frank of Mass., is calling on the CEOs of Citigroup (C), Wells Fargo (WFC), Bank of America (BAC) and JPMorgan Chase (JPM) to take losses on second mortgages. This would be a necessary step "to allow modifications of the first mortgages to be made," reports Reuters.

Holders of second mortgages, which proliferated before the bubble burst, want to collect at least something from the debtor. If they do not mark the loan as a loss on their books, the first lien holders are unwilling to negotiate. At the same time, there is movement underway to allow more modifications of second mortgages. 

For more:
- here's the Reuters article

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