Borrowers with second liens owned and serviced by Bank of America may qualify to get their subordinate debt extinguished entirely. The banking giant mailed 150,000 letters to pre-qualified homeowners who are eligible to have their Bank of America second-lien mortgages eliminated.
The program was designed to ease the pains of struggling borrowers who are also dealing with issues on first mortgages and to help more individuals create equity in their properties.
Unless the customer opts out of this automatic relief within thirty days of receiving the letter, the borrowers will have second liens on collateral property completely removed. Only second liens owned and serviced by BofA that meet certain delinquency and property value guidelines are qualified for the program. The offer will take care of the entire unpaid principal balance on second liens.
As long as the second lien is fully owned or serviced by Bank of America, second lien mortgages associated with a severly delinquent first lien mortgage also qualify. Ownership of the first lien mortgage does not matter as long as Bank of America has control of the subordinate lien.
Mailings to eligible customers began in July. Only customers who receive pre-qualified letters will be able to use the program today.
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