In another example of bank’s becoming cooperative in mortgage modifications for primary residences, an attorney colleague told me this week that one of his clients was offered a substantial principal reduction as part of a deal keep the client in his home.
The bank foreclosed, and the attorney defended the mortgage foreclosure on behalf of the client. The client’s home was over $100,000 under water. The case went through state court mediation. The client was seeking an interest and payment reduction.
The mortgage company representative said it was his company’s new policy to keep people in their homes and avoid foreclosure. The bank offered to mark the mortgage balance down to fair market value through a permanent mortgage balance reduction. The bank wrote off over $100,000 of mortgage debt as part of the homeowner’s payment reduction.
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