A $25 billion settlement might be on the way to give relief to homeowners underwater in bad mortgages. The settlement would force big lenders like Citigroup, Bank of America, JP Mortgage Chase, Wells Fargo, and Ally Financial to beginning work on terms to begin work on helping homeowners get out of bad situations.
This comes after the widespread failure of the governments Home Affordable Modification Program (HAMP) which was supposed to stop home foreclosures on Americans. The settlement, if reached would end abusive foreclosures by lenders and require a more complex and detailed process that hopefully would favor the homeowner.
Also the plan would allow lenders to decrease the amount of principal a borrower owes by varying degrees. Yet another aspect would some lenders the tools to deal with homeowners who have second and third mortgages on their properties.
The settlement would be paid to each of the 50 states in cash and could save each homeowner as much as $1800 as long as they could prove they were the victim of some type of abuse by a lender. The deal sound fairly complex and it’s hard to tell who’s onboard but, the deadline for the parties involved is today. So we’ll see. I don’t think this thing is strait forward enough to provide a simple solution for those who are struggling.