Bank of America Loan Modifications with Principal Reductions
The long awaited principal reduction loan modifcations are not - I repeat - are not merely a rumor, nor a pie in the sky, it can't happen to me kind of reality. I'm happy to say that one of my clients was amongst the first to receive a significant ($170,000) principal reduction offer on his B of A loan modification.
This particular client has been in loss mitigation for over two years. He has not made a single payment in two years, until today, when he made his first trial period modification payment. He has been turned down for B of A Modifications three times, and we were standing by, in case this modification attempt failed, ready to do a short sale. And the letter finally came.
So, it would seem that the tides are turning. The recovery process has been painfully slow, and many may say, "too little, too late" for the millions of Americans who have lost their homes already. And those people would be right. But we are here - how we got here is a lesson at best, but what we do going forward will determine both the length and scope of the final toll of this heinous financial crisis.
Today, I attended one of Bank of America's large-scale Short Sale Forums - mini-seminars currently being held across the country which outline their new short sale policies and procedures. We were given new tools and "insider access" for escalation of short sale issues (limited to forum participants only), and taken, step by step through the new programs, requirements and processes. The idea is to reduce the vast majority of short sales from 3-6 months down to 30 days from application to a pre-approved price and terms agreed to by the investor so that a "normal" sale can take place from that point forward. They have instituted some very good new policies and procedures. The system isn't perfect, and they will, undoubtedly, continue to make tweeks and changes as they go forward, but I do have to applaud B of A for taking a leadership role in their approach to improving the short sale process. This level of bank/agent communication...having real tools in place to handle the inevitable problems and find a path to resolution inherent in short sales has been a long time in the making, and we, as both agents and consumers are hoping to be seeing a little light at the end of the tunnel.
Let's all collectively hope that this new light isn't actually an oncoming train!