Bank Of America Agrees To Arizona Mortgage Loan Modification Program

A lot of Arizona homeowners struggling with their payments on mortgages being unable to afford them. Though, a new negotiation with the Bank of America, the nation’s biggest lender, can help them as it was recently announced that the bank will start offering loan modifications. This proposal will be held under the program of foreclosure prevention in Arizona that is financed by the federal funds. In fact, the state provides funds to repay up to $50,000 of a mortgage if the bank forgives the same amount of money. It means that the borrowers qualifying for this program will be able reduce the sum they owe up to $100,000.

Arizona Homeowners Can Modify Home Loans

Actually, Bank of America has occurred to be the first major lenders who have signed on to the program. Besides, the plan is funded from the Hardest Hit Housing Program of the Treasury Department by $268 million. However, only one Arizona homeowner managed to get a loan modification via program for now, though, the applications were accepted by the state Housing Department since September. The director of the Housing Department Michael Trailor expressed his optimistic views as for the agreement that can help to spur a lot of loan modifications.

Bank Of America Takes The First Steps

Although, it is still unclear how many borrowers will ultimately get their mortgage loan modification. The loans of some homeowners who provide payments to the B of A are actually held by Fannie Mae and Freddie Mac, which are governmental-owned companies. The problem is that these agencies didn’t agree to the principal-reduction mortgage loan modification plan. Thus, the agreement can apply only to cash advance loans owned by the Bank of America. Besides, Rick Simon, the bank spokesman, stated that Arizona homeowners who qualify for the loan modification will receive a mailing notice from the B of A this week.

Requirements To Qualify For Program

In order to get eligible for the mortgage loan modification program in Arizona, the borrowers of the Bank of America should be able to show that their income was reduced through illness, unemployment, divorce, underemployment or death. However, they still need to owe at least 20% more than their house is worth and to have some income. By the way, the borrowers who obtained the second mortgage that hasn’t been used to purchase a house won’t qualify.