Industry NewsMortgage

BofA expands Countrywide loan mods

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Bank of America will offer "earned principal forgiveness" to about 45,000 severely underwater homeowners who purchased homes with subprime and adjustable-rate mortgages offered by Countywide Financial Corp. and its subsidiaries. After acquiring Countrywide in 2008, Bank of America launched an $8.4 billion loan modification program to settle charges by state attorneys general that Countrywide engaged in unfair and deceptive lending practices during the housing boom (see story). Since its launch, Bank of America says the National Homeownership Retention Program (NHRP) has provided more than 175,000 loan modifications that are expected to save borrowers more than $7.2 billion over the life of those loans. Bank of America announced today that it's expanding the program, because many homeowners who owe considerably more on their mortgages than their homes are worth are reluctant to accept loan modifications that address only the amount of their monthly pa...