Homeowners with Bank of America are still looking for assistance through the home loan modification program. Homeowners that are struggling with an underwater mortgage are obviously in a troubling situation and these underwater mortgages have caused many to grow frustrated and simply walk away from their home.
Principal reductions, which are being asked for by homeowners, are not widely popular among lenders, but there are other programs available that may benefit homeowners who are suffering from an underwater mortgage.
The Home Affordable Refinance Program, for instance, is one of those programs that has made it possible for homeowners to refinance their home loan even when their mortgage is underwater. Some banks, however, say that they will use principal reductions but many feel that these principal reductions are not something that should be used in the majority of cases.
Homeowners are asking for principal reductions simply because of the drastic decrease in value of their home that they have seen over the last few months. Banks have stated there or some cases in which they will use principal reductions, but many lenders feel that it’s unfair to offer principal reductions just because a home’s value has dropped.
Yet, homeowners feel that the amount which many homes have decreased in value shows that homes where overpriced and these homeowners feel that a principal reduction is deserved. Some lenders like Bank of America may offer more principal reductions but other lenders feel that the only time principal reductions are warranted is when a homeowner has seen a reduction in home value and is in an area where they are unlikely to regain value.
While principal reductions are being asked for by many homeowners, again, many lenders are going to use alternate programs like the Home Affordable Refinance Program or the Making Home Affordable Program.
Homeowners that are struggling with there mortgage are being advised to contact their lender about the best options available in dealing with an underwater mortgage.