Troubled Homeowners Looking For Relief May Have Found Some!

The news is filled with information about homeowners in dire financial situations struggling to keep their homes from foreclosure. Obama rolled out his Home Affordable Modification Program with little actual success. The idea was to help modify mortgages so that payments remained no more than 31% of total income. The restricitons of this program proved to be so tight that few homeowners could actually be approved for a modification.

Bank of America announced 6/3/10 that it was rolling out a relief program for roughly 45,000 of its most troubled borrowers that would reduce mortgage principal by as much as 30 percent. To be eligible, homeowners must have missed at least two monthly payments and owe 20 percent or more than their home is worth. Homes must have been originally financed by Countrywide Financial Corp. under specific lending programs.

The offer is a result of an agreement with state attorneys general that settles charges over high-risk loans made by Countrywide. The federal government will pay 18 percent of the forgiven principal.

In another agreement Bank of America will pay $108 million to settle charges that Countrywide Financial Corp., which it acquired two years ago, charged large and unfair fees to borrowers facing foreclosure. The settlement, which will refund money to about 200,000 borrowers, was announced Monday by the Federal Trade Commission. This equates to about $540 per household.