Bank of America efforts to assist underwater homeowners may offer individuals the option of either finding more affordability on their home loan when negative equity is a problem or through additional loss mitigation efforts, homeowners may be able to take advantage of programs which are available from servicers like Bank of America through plans from in-house initiatives and the Making Home Affordable Program.
Obviously, underwater home loans have become more problematic over the past months as property values continue to drop in some areas or remain stagnant after having plummeted months prior. While many servicers, Bank of America included, do participate in efforts to help homeowners find affordability in their home loan payment, there are still those who feel that when it comes to addressing underwater home loans, more affordability options need to be made available.
While Bank of America efforts like home loan modifications, refinancing, and loss mitigation efforts like short sales have been used by homeowners, there are still issues related to homeowners being unable to make their mortgage payment or being frustrated with the fact that they owe more on their home than their home is actually worth. Many homeowners with a variety of servicers have sought out assistance through either earned principal forgiveness programs or the Making Home Affordable Refinancing Program, but there are still problems related to the foreclosure prevention efforts and underwater home loan assistance plans.
Despite the fact that Bank of America reportedly offered nearly 50,000 loan modifications in the third quarter of 2010, there are still homeowners defaulting on their home loan or walking away when home loan assistance and affordability for their underwater mortgage is not available. While Fannie Mae and Freddie Mac homeowners, meaning those who have a mortgage that is owned or guaranteed by these financial institutions, do offer refinancing plans through the Home Affordable Refinance Program, more homeowners are looking for principal reductions and affordability, depending on their situation.
There are some homeowners who are able to meet their monthly mortgage payment despite being in a severe negative equity situation, servicers like Bank of America and others do still continue to see homeowners who are frustrated with their position and are considering simply walking away to be more of a viable option. Yet, homeowners who are struggling with their underwater home loan are still being advised to seek out programs like short sales, deed in lieu of foreclosure plans, or even a principal forgiveness program where they are available.
While there are some indications that homeowners who face foreclosure may be able to qualify for a short sale or deed in lieu of foreclosure plan more easily in 2011 thanks to changes in guidelines and reports that foreclosures may end up costing servicers more, there are both opportunities for homeowners who wish to save their home but need more affordability due to negative equity and those who simply can no longer afford their home and wish to be rid of a mortgage which is worth more than the value of the home to which it is attached.