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Bank of America has agreed to provide mortgage relief, including partial loan forgiveness, to more than 200,000 borrowers.
The agreement is part of the $25 billion national mortgage settlement with five of the nation's biggest lenders that was announced last month and is expected to be filed today in federal court.
A spokesman for the bank says the lender's program goes beyond the settlement's requirements.
The program applies only to mortgages owned by Bank of America or certain Countrywide-originated mortgage loans that are owned by private investors and serviced by the bank, says spokesman Dan Frahm.
"We will actively contact more than 200,000 borrowers potentially eligible for the program, defer foreclosure sales for those borrowers until solicitation is complete and may forgive principal down to the current value of the eligible borrower’s home," Frahm says.
Here are the basic requirements to participate in the program:
- Borrowers must have been 60 or more days delinquent on Jan. 31, 2012.
- Monthly mortgage payments must be more than 25 percent of the borrower's monthly before-tax income.
- The house must be worth less than the balance on the mortgage.
- The first-lien mortgage loan needs to be owned by Bank of America or serviced for others who have given the bank permission to reduce principal if necessary on troubled loans.
Loans owned, insured or guaranteed by Fannie Mae, Freddie Mac, the Federal Housing Administration and Veterans Affairs loans are not eligible for the program.
Bank of America customers seeking more information on the program may call (877) 488-7814.
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Do you think there is any possibility that other banks besides bank of america will be doing mortgage reduction?
They dangle the carot in your face of the consumer who has been a reliable customer for years and paid on time and more, only to be told you have to be in stress of losing everything to get this type of bail out. What about bailing out the consumer who makes you profitable. Hell never mind about a reduction, why not give the ones who do the right thing and pay on time and give them the option to refinance to a better rate even with an upside down morgage.
Jason, makes no sense that BOA would actually use this to help their paying customers. I would come close to qualifying if only I would stop paying them. I assume it's the spin they're using when really it helps them from putting more REO on their books. It keeps non paying customers in their homes with the chance to move on while paying customers are still stuck in the mud. Hopefully their execs hit their bonuses this year.
Jason, this list was provided to me by the bank's spokesman. I think the idea is to help people who can't afford their mortgage payments and have fallen behind.
PMS, the settlement was signed and filed in federal court Monday.
I JUST CALLED THE PHONE NUMBER LISTED IN THE ARTICLE FOR BofA-877 488-7814 TO ASK IF DEUTSCHE BANK-A FANCY WAY OF SAYING BofA AS AN INVESTOR THAT BofA SUPPOSEDLY SERVICES MY LOAN FOR, WILL NOW PARTICIPATE IN A PRINCIPLE WRITE DOWN. I GOT A WHOLE LOT OF DEFLECTION, DANCING, ETC., THAT WHEN PINNED DOWN CAME DOWN TO THIS: '1. THE ACTUAL TERMS OF HOW PRINCIPLE WRITE DOWNS WILL OCCUR HAVE NOT BEEN DEVELOPED AND THEY WON'T BE FOR SOME TIME AS THE SETTLEMENT IS NOT FINALIZED YET SO NO BANKS, INCLUDING US-[BofA] ARE DOING ANY YET" ...UH, HUH, BEEN HERE HEARD THIS EXACT DEFLECTION BEFORE IN 2008 TO PRESENT AND REMINDED THE PERSON WHO ANSWERED THE LINE THAT THIS IS THE EXACT SAME KIND OF DANCE MAINTAINED/PERFECTED POST THE CA A.G. SETTLEMENT WITH COUNTRYWIDE/BofA OCT. 2008 THAT INCLUDED 13 ATTORNEY'S GENERAL OFFICES IN WHICH THE SETTLEMENT SAID PRINCIPLE WRITE DOWNS WERE TO BE IMPLEMENTED IN SOME 400,000 CA-COUNTRYWIDE ORIGINATED NEGATIVE AMORTIZATION LOANS AND YET VIRTUALLY NONE HAS BEEN DONE TO DATE BECAUSE.... BofA HAS CONTINUED TO USE ONE OF TWO DEFLECTIONS: 1. THE TERMS FOR IMPLEMENTING PRINCIPLE WRITE DOWNS NEED TO BE FORMULATED/HAVE NOT YET BEEN ESTABLISHED OR 2. THE INVESTOR ON "YOUR LOAN" REFUSES TO ALLOW IT ...WHICH INCLUDES VIRTUALLY EVERY LOAN AND WAS IN FACT AN ALLOWABLE EXCUSE IN THE SETTLEMENT AGREEMENT FOR NOT IMPLEMENTING PRINCIPLE WRITE DOWNS, E.G., IF THE "INVESTOR" REFUSED TO ALLOW IT. ...GUESS, WHAT, PER BofA, VIRTUALLY NO INVESTOR WOULD ALLOW IT. ...SHOCKING ISN'T IT!
"Borrowers must have been 60 or more days delinquent on Jan. 31, 2012."
why is this a basic requirement? this is the first time i have heard of something like this being mentioned.