A CNBC article reported that Bank of America (B of A) sent principle reduction offers by mail and was surprised that they have received such a low response.
I wasn't the least bit suprised. As a Realtor who handles short-sales, I know what happens when homeowners' become late on their mortgage payments. Lenders start the collection calls and, at the same time, inundate the homeowners' mailbox with past-due notices that clearly display the company logo on the envelope. Over time, financially distressed homeowners who don't have the funds to make the payments - regardless of the number of notices they receive - simply stop opening the envelopes.
Unless B of A clearly displayed their Principal Reduction Offer on the outside of the envelopes, it is no suprise that the response has been low. The majority of the mailed Principal Reduction Offers are likely unopened.
Contra Costa homeowners, if you are behind on your B of A mortgage payments, it's time to again start opening your B of A correspondence. You might be one of the 300,000 receiving a loan modification offer with a principal reduction.