Homeowners with Bank of America may be able to get a mortgage principal reduction on their underwater mortgage thanks to new programs from the Obama Administration that are extensions of the home loan modification program. More and more homeowners are suffering from an underwater mortgage and declining home values are becoming a problem for homeowners and the housing market alike.
Owing more on a home than it’s worth is obviously a frustrating situation, despite the fact that principal reductions aren’t that popular with all lenders or with homeowners who have seen little or no drop in their home’s value.
However, some homeowners have seen a substantial drop in their home’s value and feel that with such a dip in their home’s price they must have been sold a home at an inflated cost so they feel justified in asking lenders, like Bank of America, for a principal reduction on their mortgage.
It is this principal reduction program that is hoped to keep homeowners from walking away from their underwater mortgage, stabilize the housing market somewhat, and ease the strain the many homeowners are feeling from owing more on their home than it’s actually worth.