BofA has just announced that it will become the first mortgage servicing entity to agree to do loan modifications on various types of second lien paper. This will include regular second mortgages and home equity lines of credit. What makes this announcement particularly encouraging is that BofA is NOT conditioning its agreement on a homeowner having its first mortgage also with BofA. As long as the second lien in question is a BofA loan, the primary mortgage can be with any lender, even if it's someone other than BofA.
The reason that this is of major importance is that, according to the Treasury Department, roughly half of all homes with first mortgages in default also have a second lien. This could imperil the homeowner even if he were able to negotiate a loan mod for the first. BofA's action could lead the way to an improvement in the overall mortgage finance market where default situations exist.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment