Bank of America to wipe out thousands of second lien mortgages

by Tara Steele in Mortgage, News - October 1, 2012  

Bank of America is in the process of sending out thousands of second lien mortgage forgiveness letters as part of this year's massive mortgage servicer settlement.

Bank of America’s big move

As part of what Bank of America calls their “ongoing efforts to help customers in need of mortgage assistance,” roughly 150,000 letters are currently being sent to pre-qualified homeowners that offers to automatically extinguish the full, unpaid balance of their second lien mortgages. Bank of America said in a statement, “The intention of the program is to place homeowners in an improved financial situation by reducing their monthly debt obligations and, potentially, help them create equity in their property.”
This big move is part of the terms of $25 billion mortgage servicing settlement reached this spring after years of investigation of the nation’s largest mortgage servicers in a joint effort between federal, state, and local entities.

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Bank of America's big move