Bank Of America Loan Modification

What you can expect

Bloomberg.com reported that Bank of America was 1 of the worst performers amongst the biggest U.S. banks in modifying loans for struggling home-owners. As of August 5, 2009 they had only modified 4% of eligible loans;
http://www.bloomberg.com/apps/news?pid=20601208&sid=aaiRx.lyFD4I


Don't expect much if any assistance from them. They have improved their mortgage modification eligibility review process, but they lack on execution.

They took $45billion in TARP funds (the government asset relief funds that is designated for banks to use to assist home-owners to remain home-owners without the bank taking large losses) but it doesn't appear that they have used these funds to build an efficient modification department.

They have signed up under the Home Affordable Mortgage Program to provide relief to those home-owners that are struggling and have a Fannie Mae or Freddie Mac mortgage. But in fact, they are substituting the rules (see the Home Affordable Mortgage Program page on this website) by adding that they will not reduce the mortgage payment if it ends up being less than 50% of the original mortgage payment. This is absolutely not a rule under the Home Affordable Mortgage program. This program states that if the home-owner qualifies, the mortgage payment would be reduced to 31% of their monthly gross income (including property taxes, home-owner insurance, association dues if applicable and repayment of escrow advances). It does not limit the reduction of the mortgage payment to any more than 50%. Unfortunately, if you receive this response, what really can you do about it?

Modification request instructions can be found at: http://www.bankofamerica.com/loansandhomes/financial-difficulty/

The instructions look very inviting, but don't be fooled. In fact, if you consider the fact that Bank of America recently testified to our Senate that they are confused about which borrower qualifies for a modification and that the paperwork may be the problem as they are confused about what to review and obtain, well then that should be enough for you to understand what you can expect from them. Especially, when they thus far have only modified 4% of eligible borrowers.

We give Bank of America a poor rating and strongly urge you to seek professional representation in order to ensure that your rights are protected and to afford you the very best chance to obtain a mortgage modification.