Bank of America to Expunge 150,000 Second Liens
Borrowers with second liens owned and serviced by Bank of America may qualify to get their debt eliminated, HousingWire reported Oct. 1.
Bank of America sent letters to 150,000 pre-qualified homeowners who are eligible to have their second-lien mortgages completely eliminated. Those who received the letter will have the entire unpaid principal balance on second liens erased, unless the individual elects to opt out.
The program aims to ease the burden on borrowers who also are struggling with their first mortgages, and to help more homeowners create equity in their properties. Only Bank of America’s second liens meeting certain delinquency and property value guidelines are qualified for the program. Ownership of the first mortgage is irrelevant, HousingWire reported.
Bank of America noted that elimination of a second lien does not resolve issues with the first, including delinquency or foreclosure.
“The elimination of the second lien mortgage is completely separate from any actions being taken regarding the first mortgage,” the bank noted in a news release, HousingWire reported. “If the first mortgage is in foreclosure, those foreclosure activities may continue."