Bank of America Home Loans has begun reaching out to customers who may be eligible for forgiveness of a portion of the principal balance on their mortgage under terms of a recent settlement among five major banks, 49 state attorneys general, and the federal government. The first letters in a targeted outreach to more than ... [Read More]
Bank of America Home Loans has begun reaching out to customers who may be eligible for forgiveness of a portion of the principal balance on their mortgage under terms of a recent settlement among five major banks, 49 state attorneys general, and the federal government.
The first letters in a targeted outreach to more than 200,000 potential candidates for this assistance are arriving in homes this week; most of the letters will be mailed by the third quarter of this year. The bank estimates average monthly savings of 30 percent on mortgage payments of customers who qualify for this program.
Bank of America began making principal reduction offers under the program guidelines in March, initially concentrating on homeowners who were already in the modification review process. So far under this early initiative, about 5,000 trial modification offers have been mailed, providing a potential total of more than $700 million in forgiven principal. Homeowners are required to make at least three timely payments before the modification can become permanent.
The wave of mailings beginning this week will reach a broader base of customers who may be eligible for this principal reduction program. The letters provide each homeowner with a description of the program and an invitation to provide financial information to begin the review process.
To be eligible for this program, a homeowner must meet certain criteria, including:
Owes more on the mortgage than the property is worth today.
Was at least 60 days behind on payments on January 31, 2012.
Has a contractual monthly payment for principal, interest, property taxes, hazard insurance, and any applicable homeowner association fees totaling more than 25 percent of gross household income.
Has a loan that is owned and serviced by Bank of America, or serviced for another investor that has given the bank delegated authority to do such modifications.
For further information on the settlement programs, Bank of America Home Loans customers may call (877) 488-7814.
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Borrowers considering inflating their income, even just a tad, checking the box to indicate they plan to live in the home when they’re not, or exaggerating their job description better think twice. Lenders are turning to websites and other tools to help nab fraudulent borrowers and perjurers looking to bilk lenders out of hundreds of ... [Read More]
Borrowers considering inflating their income, even just a tad, checking the box to indicate they plan to live in the home when they’re not, or exaggerating their job description better think twice. Lenders are turning to websites and other tools to help nab fraudulent borrowers and perjurers looking to bilk lenders out of hundreds of thousands of dollars.
Making sense of the story
During the height of the market, borrowers could get away with lying about their income, debt obligations, and the like to obtain financing. But not anymore. According to a representative from the Mortgage Bankers Association, there are “more fraud checks than ever, and it’s on every loan, not just a sample.”
More important, perhaps, the focus now is on preventing fraud rather than dealing with it after the fact.
Sometimes the fraud check is as simple as a quick call to the customer right before the loan is closed to verify information supplied on the loan application. Such a call to an otherwise unsuspecting borrower can sometimes uncover a lie perpetrated by a corrupt loan officer who’s in it for the commission – or more.
In other cases, lenders are using sophisticated databanks to spot fraudsters. One website, for example, provides salary data on various industry positions so the lender can determine if the borrower is overstating his income.
Another site provides historical wage data, and yet another checks the information supplied by self-employed borrowers, including whether the borrower’s company exists, who the principals are, the number of employees, and the annual revenue.
There are also sites that will tell lenders where there are judgments against the borrower or liens against other properties the borrower might own.
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The Consumer Financial Protection Bureau said Wednesday that it is considering a new set of rules that will focus on mortgage points and fees, the current complexity of which can make it difficult for home buyers to assess different loan offers. Read the full story [Read More]
The Consumer Financial Protection Bureau said Wednesday that it is considering a new set of rules that will focus on mortgage points and fees, the current complexity of which can make it difficult for home buyers to assess different loan offers.
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Changes to streamline the Home Affordable Refinance Program are helping some underwater homeowners get lower-interest loans. Those still-above-market rates, meanwhile, are boosting banks’ profits. Read the full story [Read More]
Changes to streamline the Home Affordable Refinance Program are helping some underwater homeowners get lower-interest loans. Those still-above-market rates, meanwhile, are boosting banks’ profits.
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