More Details On BofA Mortgage Reductions
Well, there's a bit more info on those mortgage reductions from Bank of America (BofA) in today's newspaper, so consider this to be a follow-up to the news flash I sent out yesterday.
Here's the latest ...
It appears that BofA is not reducing mortgage principal amounts out of the goodness of their hearts. The reductions are part of a settlement over alleged foreclosure abuses.
BofA and several other lenders agreed to a $25-billion settlement last February with 49 state attorneys general and some federal officials. Most of the settlement involves a reduction in loan amounts for the more than 1-million homes in the USA that are currently underwater. You probably remember all that business last winter about robo-signing, foreclosure irregularities and failure to verify documents. Well, this mortgage principal reduction is the result of that settlement with the various states.
Underwater homeowners will receive letters soon from BofA that invite them to fill out various financial forms to see if they qualify for a loan modification that will lead to a reduction in the principal balance on their mortgage. To qualify, homeowners must owe more than the value of the house, and be at least 60 days behind on their mortgage payment as of January 31st. Only mortgages that are owned by BofA will qualify. Mortgages owned by Freddie, Fannie or FHA will not qualify.
Hey, I'm sorry to have to bring this up, but what about all those BofA mortgage holders who are underwater on their mortgage but are not behind on their payments? You know, the people who are working two jobs so they can keep current on their mortgage payments and still buy such luxury items as food and gasoline.
Why should the people who don't pay their mortgage get up to a $100,000 direct mortgage reduction, while the hardworking guy who is doing his best to stay current doesn't qualify for this help? What about the young couple who had to buy using an FHA loan, or the senior citizen whose loan got sold to Fannie or Freddie and then bundled into some kind of triple-A rated "mortgage backed security" that is now owned by some rich capitalist in China or some investor in Russia? Why no break for these folks? They are having just as hard a time as the other guys.
This just doesn't seem to be completely fair to me, that's all I'm saying.
Here's the latest ...
It appears that BofA is not reducing mortgage principal amounts out of the goodness of their hearts. The reductions are part of a settlement over alleged foreclosure abuses.
BofA and several other lenders agreed to a $25-billion settlement last February with 49 state attorneys general and some federal officials. Most of the settlement involves a reduction in loan amounts for the more than 1-million homes in the USA that are currently underwater. You probably remember all that business last winter about robo-signing, foreclosure irregularities and failure to verify documents. Well, this mortgage principal reduction is the result of that settlement with the various states.
Underwater homeowners will receive letters soon from BofA that invite them to fill out various financial forms to see if they qualify for a loan modification that will lead to a reduction in the principal balance on their mortgage. To qualify, homeowners must owe more than the value of the house, and be at least 60 days behind on their mortgage payment as of January 31st. Only mortgages that are owned by BofA will qualify. Mortgages owned by Freddie, Fannie or FHA will not qualify.
Hey, I'm sorry to have to bring this up, but what about all those BofA mortgage holders who are underwater on their mortgage but are not behind on their payments? You know, the people who are working two jobs so they can keep current on their mortgage payments and still buy such luxury items as food and gasoline.
Why should the people who don't pay their mortgage get up to a $100,000 direct mortgage reduction, while the hardworking guy who is doing his best to stay current doesn't qualify for this help? What about the young couple who had to buy using an FHA loan, or the senior citizen whose loan got sold to Fannie or Freddie and then bundled into some kind of triple-A rated "mortgage backed security" that is now owned by some rich capitalist in China or some investor in Russia? Why no break for these folks? They are having just as hard a time as the other guys.
This just doesn't seem to be completely fair to me, that's all I'm saying.
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posted by Terry Ward at 5:40 AM
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