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Last week Bank of America, one of America’s largest home loan servicers after its acquisition of Countrywide Financial in 2008, entered into a settlement agreement with the federal Department of Housing and Urban Development.
Under the terms of the settlement, B of A will be released from reliability for failing to negotiate in good faith with a group of 57,000 homeowners with government-backed B of A loans attempting to avoid foreclosure. The bank will have to waive a minimum of $10 million in late payments, and will review each borrower’s file to establish eligibility for a loan modification, short sale, or other means of avoiding foreclosure.
"Our total costs for the program will be multiples of that,” said B of A spokesman Dan Frahm on the $10 million minimum payment forgiveness.
The bank will not, however, have to admit any wrongdoing or pay any fines or penalties to HUD. "We took the borrowers into account first," said HUD lawyer Helen Kanovsky.
B of A is taking additional steps to reach out to other distressed borrowers not covered by the settlement. Today through Sunday the bank has counselors set up downtown at the convention center from 8:30 a.m. through 6:00 p.m. to meet customers seeking help with mortgage problems. While they’re accepting walk-ins, the bank recommends customers pre-register here.
Last week Bank of America, one of America’s largest home loan servicers after its acquisition of Countrywide Financial in 2008, entered into a settlement agreement with the federal Department of Housing and Urban Development.
Under the terms of the settlement, B of A will be released from reliability for failing to negotiate in good faith with a group of 57,000 homeowners with government-backed B of A loans attempting to avoid foreclosure. The bank will have to waive a minimum of $10 million in late payments, and will review each borrower’s file to establish eligibility for a loan modification, short sale, or other means of avoiding foreclosure.
"Our total costs for the program will be multiples of that,” said B of A spokesman Dan Frahm on the $10 million minimum payment forgiveness.
The bank will not, however, have to admit any wrongdoing or pay any fines or penalties to HUD. "We took the borrowers into account first," said HUD lawyer Helen Kanovsky.
B of A is taking additional steps to reach out to other distressed borrowers not covered by the settlement. Today through Sunday the bank has counselors set up downtown at the convention center from 8:30 a.m. through 6:00 p.m. to meet customers seeking help with mortgage problems. While they’re accepting walk-ins, the bank recommends customers pre-register here.