BOA reducing mortgages by 100k?

According to a recent AFP article:

Bank of America has reached a side agreement with US authorities that could reduce the mortgages of some 200,000 borrowers….Bank of America borrowers are expected to receive reductions averaging more than $100,000…

The Tennessean reports that:

Underwater homeowners are eligible if they have a loan serviced by Bank of America and were at least 60 days delinquent on their mortgages as of Jan. 31.

Only loans owned by Bank of America or private investors are eligible, and those include mortgages originated by Countrywide Financial Corp. The Calabasas, Calif.-based subprime lender was acquired by Bank of America in 2008.

Loans are not eligible if they are owned or backed by Fannie Mae, Freddie Mac, the Federal Housing Administration or the Department of Veterans Affairs, Simon said.

Bank of America estimated that 200,000 homeowners will be eligible, though it does not anticipate that all of them will take part in the program.

The bank will begin reaching out to homeowners next month. It has three years to complete the principal reductions, but the settlement offers incentives for them to be completed within a year of the settlement’s completion, so Simon anticipated the process would move “fairly quickly.”

Bank of America mortgage customers can call 877-488-7814 to see if they’re eligible and to get more information.

This is very interesting!

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