Comments on: Is Bank of America headed towards principal reductions?

By: JC

JC — Fri, 03 Apr 2009 12:38:16 +0000

I have a loan with Bank of America. A stated stated loan made by their Private Banking division. No documentation at all!!. The note is written in such a way the wording allows the note holder to determine Libor if none is available from London. Who knows who the note holder is at this juncture.,. I need the legal department to talk with me. I am diligently calling and writing every day to get to the top level of management to discuss every paragraph of the loan language. This is a boiling pot ready to explode. Not late on any payments, Interest only at 6.625 excellent credit when loan taken out ,now in the toilet. 100K was down payment. I want a “cram down” on the loan balance? Any suggestions

By: Cheryl

Cheryl — Tue, 13 Jan 2009 04:13:10 +0000

I have a fraudulent mortgage loan with Bank of America. It was supposed to be a Fannie Mae reduction loan and after I closed found out I do not have a Fannie Mae loan. I filed aa lawsuit and BOA quit taking my payments at the bank trying to foreclosure so I have to pay my attorney the payments to send to BOA I learned that Banks not only sell the foreclosed houses for 50% of value, but they also file a Title Insurance Claim that the homeowner paid for and Lender receives a check for the loan balance. That is a big incentive.

By: James Freeman

James Freeman — Sun, 09 Nov 2008 17:32:10 +0000

I have 5 homes all maxed out with 10 mortgages, all balances on the second mortgages are greater than the value of the homes after a sale including selling costs. I can rent all 5 to cover the first mortgages including all other monthly costs at a break even, four already are rented. Additionally, all first mortgages are fixed rate 30 year low interest rate loans that average six percent. So if B of A/Countrywide would elimanate the second mortgages, I would catch up all first mortgages all currently four months (seconds behind 5 months) behind with money I have been saving from the rents collected. Then none of these properties will go up for sale that is further pushing late as well as on time paying home owners out of thier houses from rapidly falling prices or making them want to leave. I am sure such relief will be followed by certain terms, such as not being allowed to sell for 5 years or more. I was surprised to read the bailout package and there was no talk of help for homeowners, funny that wallstreet was fully informed of the help they are getting, but mainstreet has to hear it word of mouth or through internet searches.

By: Is there such a thing as a lender.... - Home Loan Forum - Loan Safe

Is there such a thing as a lender.... - Home Loan Forum - Loan Safe — Thu, 15 May 2008 04:21:45 +0000

[...] the only thing to really stop the foreclosures Here is the link and a portion of the article. Is Bank of America headed towards principal reductions? Reader Paul (big hat tip to him) pulled a key comment out of the B of A press release issued [...]

By: KayeThomas

KayeThomas — Sat, 03 May 2008 14:04:00 +0000

I see a number of problems with the whole idea but two really pop up.. first if this becomes the “norm” I would suspect we will see the demise of the 30 year note. No one will want to make any loan of that length with the possibility of losing 10-20% of the principle without a huge increase in rates.

Secondly the government is penalizing those who are financially responsible. I expect the backlash to really heat up from owners/buyers who are prudent.

By: Jill

Jill — Sat, 03 May 2008 12:35:12 +0000

Certainly someone must be approaching McGee to pin him down on what he has said? A call to journalists!

By: LibertyNewsprint

LibertyNewsprint — Fri, 02 May 2008 18:41:09 +0000

I think the best way forward for everyone is for the Government to subsidize
low interest fixed rate SHORTAGE loans. This is the most responsible way
to help out those who find themselves unable to pay a way out of thier homes
with viable options that do not hurt the economy an present a "Moral" Hazard.

A Solution to stop the bleeding in the Housing Industry-
Government Subsidized Short Loans.

For those who bought home in the past 5 years or have an adjustable loan that will reset sometime in the next 5 years.

In order to stop the precipitous decline in the housing industry government needs to provide subsidized "Short" loans for the difference between what a homeowner can sell there house for and the amount the homeowner actually owes. This loan will provide rates the homeowner could receive on a regular home equity loan for up to $100,000

This will allow homeowners to reevaluate their financial positions to more fiscally sound situations if necessary. As it stands now homeowners with good credit have no other choice than to wait until home values increase before they can have the freedom to seek other housing accommodations.

How would this work:

Homeowner A house's current value is $200,000 he owes $250,000.

His payments are about to reset from 4.8% to 7.0%

That?s a payment of $1467 to $1664 and he can't afford it.

Homeowner A sells the house for $200K

Now He Has Options:

Option A:

He gets a loan from the government for $70K at 7% that?s $465 a month.

He finds a smaller place for sale at $150,000 puts 20% down from the government loan.

He gets a mortgage for $130,000 at 6.5% and pays $839 a month.

Now Homeowner A is paying $1,304 a month on a mortgage the will not reset. That?s a saving of $163 a month in the mortgage payments.

Option B:

Continue to pay off the government loan of $50K and find a place to rent.

That?s $333 a month plus rent he can afford to rent an apartment for $1,134

The Benefits of Government Subsidized ?Short? loan?
This will allow homeowners to pay back the shortfall without damaging their credit.
Also, by stabilizing hundreds of thousands of homeowners the economy will benefit.
As it stands now homeowners have few viable options that only will exasperate the decline in the overall economy.
Stop the decline of housing prices
Extend more help to a greater amount of homeowners.
Keeps the homeowner from transferring debt to government and lenders.

By: drumfast00

drumfast00 — Fri, 02 May 2008 17:58:47 +0000

For sure. Its hard to accept its becoming a have and a have not world. The whole damn thing needs to be re arranged. Starting from its source. What source is that? I sure wish I knew. haha.

By: morganb

morganb — Fri, 02 May 2008 17:55:04 +0000

I agree – I don't think it should be centered on the privileged few, I
just don't understand why those that can actually pay their mortgage
(especially if they've put money down, used fully-documented income,
etc.) are penalized vs. those that lied about their income and
over-stretched expecting their home to go up. I just want any actions
to be as equitable as possible.

By: drumfast00

drumfast00 — Fri, 02 May 2008 17:52:52 +0000

Not everyone has the opportunity to maintain a healthy mortgage. People are worse off, than when they started their current mortgages. This downward hinge is obviously effecting millions. You cant put the blame on higher cost of living to the homeowners who, now, cant keep up with previously do-able payments. I agree that giving a handout to deliquents is unfair to those keeping up. Yet, is it fun to watch the rest of your neighbors suffer, as you grill your steak to its regular perfection? I'm sure the smell is very potent to the neighbors sitting in the driveway managing the yard sale of things they dont really want to rid of. Think about it, the future of all of us, doesn't always have to revolve around the privaleged few. (sorry for the spelling)