A Principal Reduction for 200,000 Bank of America's Homeowners

By
Real Estate Broker Owner with Aston Group - Orange County Real Estate 01451803

     Bank of America (B of A) is in a charitable mood and is supposedly sending out 200,000 certified mailed letters offering their borrowers a principal reduction to their mortgage.  And of course it is only given to struggling default homeowners in need of assistance.  So to the non-default homeowners that are struggling and in need of assistance your option may be the HARP version 2.0 program, which is another topic altogether.

     This B of A loan modification will not be a type of "robo signing" process loan leading to another $25 billion government settlement.  But rather it seems that B of A has had a push from Mr. State Attorneys General and the US Dept. of Justice giving a $11 billion bankroll to help out.  It has been reported that about 5.6 million US loans are delinquent or in the process of foreclosure, while B of A services about 20% of that.  To give you a head count number that's over 1 million US loans.  Which many of them are owned by Freddie Mac and Fannie Mae.

 

If given this golden goose of a letter you must have the following to be eligible:

  • 60 days late on their mortgage payment since Jan. 1st 2012
  • Must be able to pay the modified monthly payments (proof of documents will be needed)
  • Owe more than the home is worth, which is known as being "underwater" ($150,000 maximum principal reduction)
  • Your loan is owned by B of A or the private owner of your loan will allow you receive this loan modification

 

And the possible downfall if you have received this letter:

  • If you can't provide any income or the ability to pay for the modified payments - VOIDED
  • If you trashed the letter sent to you, then you're out of luck - VOIDED
  • Federal Housing Finance Agency (FHFA) has yet to agree to this loan modification - Possible VOID???
 

     Well, it seems that over 5,000 B of A's borrower have received aid prior to this letter and has spent $700 million of their principal reduction reserve.  But the spokes person from B of A reportedly said that they can handle if the total amount goes over their government allowance.  Over 8,000 letter have been sent and every week more will be sending out until all of the 200,000 letters are sent. A final bonus to this gift is that all of the 200,000 borrower's home have been put on a stop list on any type of foreclosure until their offer has been denied or unanswered.

 

 - Ann

(714) 588-7676

www.remaxann.com

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Topic:
ActiveRain Community
Location:
California
Tags:
bank of america 11 million
bank of america loan modification
bofa principal reduction
bank of america principal reduction

Comments 5 New Comment

Rainmaker
933,698
Bob & Leilani Souza
Placer County, CA: Foreclosures, Auctions, Rentals
Souza Realty - Roseville, Rocklin, Lincoln, Loomis, Granite Bay, Penryn, Newcastle, Auburn, Meadow Vista (California)

Ann, these letters are one reason for B of A mortgage holders to check ALL their mail...even the ones that may seem like junk mail! :)

Leilani

May 15, 2012 01:06 AM
Rainmaker
653,369
Patrick White
Put our 26 years experience and technolgy to work
Home Driven Realty, Inc

Good Morning Ann

Thanks for the post and B of A loan reduction information. Have a great day

May 15, 2012 01:10 AM
Rainer
80,397
Insurance Solutions
Insurance
Insurance Solutions Unlimited, LLC

Ann, That is great news for B of A customers, I am sure some of the other banks will follow along

May 15, 2012 01:17 AM
Rainmaker
568,777
Phil Leng
Phil Leng Team - Residential Real Estate Experts &
Keller Williams Eastside Market Center

Hi Ann,

Although the numbers of people helped will be relatively small, every little bit helps.

Phil

May 15, 2012 02:15 AM
Rainmaker
512,066
Michele Cadogan
917-861-861 - Brooklyn Real Estate Home Sales
Fillmore Real Estate

 

Seems like  an opportunity for a few more people to stay in their homes while avoiding  communities  of neighborhoods filled of vacant/boarded up homes, it maybe a good thing. 

May 15, 2012 08:56 AM
Rainmaker
655,127

Ann Urias

Save thousands when you List your home!
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