BofA offers cramdowns with a twisted arm
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Do you think BofA’s cramdown offers are likely to extend beyond 200,000 to greater numbers of underwater California homeowners?
- No (70%, 52 Votes)
- Yes (30%, 22 Votes)
Total Voters: 74
Bank of America (BofA) has begun offering principal reduction (cramdowns) to homeowners in compliance with the $25 billion settlement reached with state attorneys general this year.
BofA plans to mail cramdown offers to over 200,000 homeowners nationally. The estimated average reduction is $150,000 per homeowner, saving each candidate roughly 35% on their monthly mortgage payments.
A member of BofA’s executive management team hailed cramdowns as beneficial to homeowners, mortgage investors and entire communities. Cramdowns are also a boon to lenders such as BofA since they transform an unprofitable foreclosure into a long-term performing loan, he said.
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About The Author
Sarah Cantino
is lead editor for the Landlords, Tenants and Property Management and Real Estate Property Management books.
Another Excellent article by First Tuesday! Thank you!
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i love it…a self administered cramdown. if it originates with the “cramee” is a cramdown? sounds more like an elective and self help E-Z homemade amputation!
let’s remember that the brainiacs at BofA bought that steaming pile we called Countrywide…and C/Wide was/is the real source of their loan problems. those of us in the trade remember how hard it has always been to get BofA to fund a loan.
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unfortunately, the B of A program only applies to thier own portfolio products. If you have an FHA loan you get nothing.
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