Consider this headline from CNNMoney: Lower loan payments = fewer redefaults for homeowners

I'm not sure which is scarier. Is it that this incredibly obvious fact is being reported as news or that the federal government actually spent money researching and presenting the data to confirm that it's true.But here's the data. "Only" 18.7% of borrowers who had their loans modified in the second quarter were in delinquency three months later, according to a report from the Office of Thrift Supervision and the Comptroller of the Currency. Among borrowers who got modifications in the first quarter, 30.7% were delinquent three months later.

Regulators attribute the declining delinquency rate to efforts to lower payments under modification plans. In the second quarter, 78.3% of loan modifications resulted in lower monthly payments, compared with just 53.% in the first -- which seems like a reasonable explanation for the declining delinquency rate: lower payments are, in fact, easier to make.

Still though, an 18.7% failure rate within the first three months is hardly spectacular, even if it is a significant improvement -- especially when you consider the tremendous amount of bureaucratic skulduggery that borrowers have to work through to get modifications. According to the same report, nearly 40% of homeowners who had their payments cut by 20% or more last year were delinquent again within a year.

The latest data from the government also shows that just 24% of borrowers eligible for modifications are getting them -- and those are probably the more solvent among the delinquent borrowers.

What will happen to default rates once lenders start to dig deeper into the troubled borrower pool?