CALABASAS, Calif.--(BUSINESS WIRE)--Bank of America has completed or approved more than $4.75 billion in principal reduction offers on first mortgages under terms of the National Mortgage Settlement in the five months since the settlement was approved by the court.
As of September 30, already 30,000 homeowners were approved for trial modifications or had made the required three monthly payments during the trial period and converted to permanent modifications under the principal reduction program.
The bank said progress to date puts the bank well on the way to meeting its total obligations within the first year of the three-year agreement. Early results are in line with expectations, including:
- Among borrowers who began their trial plan period more than three months ago, more than 85 percent successfully completed the process and qualified for a permanent modification.
- Monthly mortgage payments are dropping by an average of 35 percent for customers qualifying for the program.
- The average reduction in principal balance is more than $150,000 for customers qualifying for the program.
Within the first year of the program, Bank of America expects to have reached out to approximately 200,000 customers who are eligible to apply for a first lien principal reduction with letters requesting the limited documentation necessary to determine final eligibility.
To meet the terms of the national settlement, Bank of America has agreed to provide more than $7.6 billion in consumer relief through modifications of first and second liens and foreclosure avoidance solutions such as short sales. Under the agreement, banks will not receive full dollar-for-dollar credit for all of the assistance provided to customers, so this does not correlate directly to the $4.75 billion in first lien principal reductions provided so far. The government-appointed independent settlement monitor will make the crediting determinations.
Information on the settlement programs for Bank of America Home Loans customers is available at homeloanhelp.bankofamerica.com or by calling 1.877.488.7814.
Bank of America
Bank of America is one of the world's largest financial institutions, serving individual consumers, small- and middle-market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk management products and services. The company provides unmatched convenience in the United States, serving more than 55 million consumer and small business relationships with approximately 5,500 retail banking offices and approximately 16,300 ATMs and award-winning online banking with 30 million active users. Bank of America is among the world's leading wealth management companies and is a global leader in corporate and investment banking and trading across a broad range of asset classes, serving corporations, governments, institutions and individuals around the world. Bank of America offers industry-leading support to more than 3 million small business owners through a suite of innovative, easy-to-use online products and services. The company serves clients through operations in more than 40 countries. Bank of America Corporation stock (NYSE: BAC) is a component of the Dow Jones Industrial Average and is listed on the New York Stock Exchange.
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