So, the basic process is 1) Borrow stops making payments. 2) Borrow goes into forbearance for 12 months just prior to foreclosure start. 3) Forbearance ends, borrower cannot make current. 4) FHA steps in to do loan modification. Essentially, they roll the forebeared balance into the loan, payoff the existing mortgage, and issue a new FHA-backed loan, without any income or payment ability qualifications. 5) Repeat the process again.

So, the government is making everyone whole.