{"id":150,"date":"2012-05-17T23:10:10","date_gmt":"2012-05-17T23:10:10","guid":{"rendered":"http:\/\/www.fremont-bankruptcy-attorney.com\/blog\/?p=150"},"modified":"2020-03-12T07:18:26","modified_gmt":"2020-03-12T07:18:26","slug":"mortgage-principal-reductions-and-bank-of-america","status":"publish","type":"post","link":"https:\/\/www.fremont-bankruptcy-attorney.com\/blog\/2012\/mortgage-principal-reductions-and-bank-of-america\/","title":{"rendered":"Mortgage Principal Reductions and Bank of America"},"content":{"rendered":"

By Ryan C. Wood<\/a><\/p>\n

Bank of America has indicated they will be mailing out letters to their borrowers that would offer a principal reduction of up to $150,000 for 200,000 borrowers.\u00a0 This is part of the $25 billion settlement agreement reached between Bank of America and the state and federal agencies for robo-signed documents during the foreclosure process.\u00a0 Many lenders had processed the foreclosures without verifying documents.<\/p>\n

As part of a settlement agreement Bank of America will be sending out these letters to their borrowers, but the borrowers still have to prove they qualify for the principal reduction.\u00a0 In order to qualify you first have to respond to Bank of America\u2019s letter.\u00a0 A lot of borrowers have grown tired of questionable businesses sending them letters indicating they can help them modify their loans or reduce their principal balances.\u00a0 Borrowers may think that this is another scam, so they either ignore the letters or throw them away.\u00a0 However, if you do not open Bank of America\u2019s letter or respond to it you will not receive the principal reduction.\u00a0 Bank of America is sending these letters to borrowers by certified mail with the words \u201cIMPORTANT\u201d in red letter on the envelopes, so be on the lookout for these letters.\u00a0 Be sure the letter is actually from Bank of America and not another third party company.\u00a0 You may respond to the letter by providing Bank of America documentation of your income.\u00a0 Your current monthly mortgage payment must be 25% higher than your current gross monthly income, which you cannot afford to pay.\u00a0 If you can afford to pay, why would Bank of America give you a modification?<\/p>\n

Once you have received the letter, you have to meet other qualifications to have your principal balance reduced.\u00a0\u00a0 Your mortgage has to be more than 60 days late, your mortgage must be owned by Bank of America or serviced by Bank of America and owned by an investor that is agreeing to have the loan modified, and you have to owe more on the mortgage than what your home is worth.<\/p>\n

After it is determined that you do qualify for this program your monthly mortgage payment will be reduced to 25% of your gross income.<\/p>\n

Now, keep in mind, this program is for about 200,000 of Bank of America\u2019s borrowers. You may still need to find other options in keeping your home if you are not one of the 200,000 borrowers Bank of America has sent the letters to.\u00a0 The letters will be staggered so that Bank of America can handle the responses, so don\u2019t despair if you don\u2019t receive the letter immediately.\u00a0 The letters will be sent throughout the next several weeks and into the summer.\u00a0 I am sure many bankruptcy attorneys<\/a> will field phone calls regarding these letter.<\/p>\n

If you have a second mortgage on your home this program will not help with it.\u00a0 However, you may be eligible to have your junior mortgages stripped\/removed in a Chapter 13 reorganization.\u00a0 If you are not one of the 200,000 people who receive this letter from Bank of America you can still contact a bankruptcy lawyer<\/a> to see what your other options are to keep your home.<\/p>\n","protected":false},"excerpt":{"rendered":"

By Ryan C. Wood Bank of America has indicated they will be mailing out letters to their borrowers that would offer a principal reduction of up to $150,000 for 200,000 borrowers.\u00a0 This is part of the $25 billion settlement agreement reached between Bank of America and the state and federal agencies for robo-signed documents during […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[31],"tags":[],"_links":{"self":[{"href":"https:\/\/www.fremont-bankruptcy-attorney.com\/blog\/wp-json\/wp\/v2\/posts\/150"}],"collection":[{"href":"https:\/\/www.fremont-bankruptcy-attorney.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.fremont-bankruptcy-attorney.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.fremont-bankruptcy-attorney.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.fremont-bankruptcy-attorney.com\/blog\/wp-json\/wp\/v2\/comments?post=150"}],"version-history":[{"count":5,"href":"https:\/\/www.fremont-bankruptcy-attorney.com\/blog\/wp-json\/wp\/v2\/posts\/150\/revisions"}],"predecessor-version":[{"id":998,"href":"https:\/\/www.fremont-bankruptcy-attorney.com\/blog\/wp-json\/wp\/v2\/posts\/150\/revisions\/998"}],"wp:attachment":[{"href":"https:\/\/www.fremont-bankruptcy-attorney.com\/blog\/wp-json\/wp\/v2\/media?parent=150"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.fremont-bankruptcy-attorney.com\/blog\/wp-json\/wp\/v2\/categories?post=150"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.fremont-bankruptcy-attorney.com\/blog\/wp-json\/wp\/v2\/tags?post=150"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}