Homeowners with a Wells Fargo Mortgage are asking what options are available for those with an underwater mortgage or simply in need of some other form of a home loan modification. Wells Fargo is one of the lenders that have sided with the idea that widely used principal reductions are not a good option for underwater mortgages.
Other lenders like JP Morgan Chase have also said principal reductions are not a viable option for all underwater homeowners as allowing homeowners to simply change their principal amount just because their home lost value completely contradicts the intent of a mortgage contract, in which a homeowner agrees to pay a certain price on a home.
There are some cases, according to lenders that are opposed to extensive principal reductions, in which reductions on a mortgage principal should be used. Examples of this include homes that have seen a big drop in their value and are in an area where home values are unlikely to recoup much of that loss or homeowners that may have trouble paying their home loan payment because of an underwater mortgage.
While mortgage principal reductions are not a popular option among lenders there are programs that are in place to help homeowners that are having trouble with their mortgage payment. Homeowners in this situation are being advised to contact their lender for specific assistance options that may be available.