Thanks to Dan Fitzpatrick of The Wall Street Journal for his August 3, 2011, article, page C3 “Bank of America in Loan-Foregiveness Talks”.
As many of you probably know there has been heated litigation concerning mortgage foreclosures in the past several years. Clever foreclosure defense attorneys have been raising arguments like lack of standing and pointing out that lenders are not the appropriate owners of mortgages. Since banks have often been careless in there recording and transfer of mortgage notes when selling them they have been getting heat from debtors and government organizations indicating that policies need to change. One such policy is the notary requirement. This requirement varies state by state but the idea is that the bank must have documents relating to the transfer of sale properly notarized before they could be sold or transferred to other banks. As you can guess, these requirements have not been properly adhered to.
In a panic, Bank of America is trying to save face in this mess. When Bank of America acquired the mortgage lender Countrywide Financial many of the mortgages acquired in that deal were already tainted and further tainted by the deal. Now Bank of America is offering to reduce the amounts owed by some if its borrowers in exchange for a release from legal claims debtors have against Bank of America.
What does that mean for Bank of America mortgage customers?
Possible opportunities to negotiate with Bank of America and lower the principal on their mortgage.
Hopefully, Bank of America will also give debtors more opportunities to save their houses when facing foreclosure.