Bank Of America Federal Home Loan Modification Plan–Homeowners Seek Options From Alternative Modifications

Bank of America has seen a rising number of home loan modifications made through the federal Making Home Affordable Program throughout 2010. Increases in the number of permanent home loan modifications has brought relief to numerous homeowners who were facing the loss of their home from foreclosure without some form of intervention and assistance. However, recent reports which have analyzed the federal home loan modification program and have concluded that the program has not reached as many homeowners as was originally hoped.

It’s for this reason that some homeowners feel they may have a better option at turning to alternative modifications from servicers like Bank of America. There are indications that in-house modification programs are helping more homeowners than the Making Home Affordable Program, and this is said to be due to a variety of reasons. There are some homeowners who have thrown criticism at numerous financial institutions participating in the modification program accusing these banks of losing paperwork, stalling modification programs, and generally they have said that banks stand to profit more so from foreclosures than modifications.

While there were problems with the modification program early, incentives have been given to financial institutions to modify mortgages, which many thought would bring a rejuvenation to the federal modification program, but there are still many critics who feel that the performance of the program overall has been lackluster.

However, financial institutions like Bank of America may be able to offer homeowners more modification opportunities through in-house modifications, known as proprietary modifications, as these types of mortgage assistance plans are made directly between servicer and homeowner. While there have been reports that problems were seen in the proprietary modifications as well, more homeowners are seeing success when it comes to finding permanent modification assistance with these alternative modification plans.

Many feel that homeowners who work directly with their servicer to achieve a modification may stand a better chance as universal guidelines, like those set forth by the Making Home Affordable Program, are not in place and servicers may be able to tailor different modification plans to fit a particular homeowner’s situation. Again, these alternative modifications which are made from servicers like Bank of America and many other financial institutions are not a guarantee but have been used by homeowners who were either unable to obtain a federal modification or who may have been in a position where a traditional modification was unhelpful.

Yet, housing counselors have prompted homeowners to speak with their servicer and weigh all of their mortgage assistance options, because no matter if a homeowner is able to provide affordability within a federal modification plan or a servicer’s home loan modification program, addressing mortgage difficulties early is vital so that a homeowner can simply find the foreclosure prevention they need to avoid the loss of their home.