BofA $15.8 Billion Settlement: 164,000 Homeowners Receive Mortgage Relief

BofA $15.8 billion settlement

Bank of America (BofA) announced Wednesday that it has completed or approved a total of $15.8 billion in consumer relief for about 164,000 homeowners as of September 30 through programs established under the U.S. National Mortgage Settlement.

BofA said quarterly progress reports from all five banks involved in the agreement with federal and state governments will be filed Wednesday with participating state attorneys general and the federal program monitor.

BofA’s performance across all programs reflects significant gains during the third quarter, and the bank reinforced that it is on track to meeting its total financial obligations within the first year of the three-year agreement. Progress across consumer relief programs through September 30 includes:

First-Lien Principal Forgiveness - 30,000 customers were approved or had completed first-lien modifications providing $4.75 billion in principal reduction. Additionally, $230 million in pre-settlement forbearance has now been completely forgiven.

Home Equity Relief - Nearly 45,000 customers had received a qualifying modification or complete extinguishment of a home equity loan or line of credit, totaling $2.5 billion in relief.

Other Programs - More than 62,000 customers have completed qualifying short sales or deeds-in-lieu of foreclosure, providing a total of $7.4 billion in relief from unpaid principal balances on the loans. In addition, the bank provided an additional $617 million combined in enhanced relocation assistance and pre-settlement deficiency waivers.

Interest Rate Relief – In implementing the settlement programs, Bank of America’s priority was to establish traction with first-lien and home equity forgiveness programs to assist customers at greatest risk of foreclosure. With momentum now built in these programs, the bank is quickly ramping up activity on its interest rate reduction program for borrowers who are making on-time payments but have limited or no equity in their homes. As of October 31, 23,000 homeowners – more than half of the bank’s estimated eligible population - have been offered this assistance. The majority of this activity has occurred since the end of September and, as a result, will be reflected in completed rate reductions in future quarterly reports. Through September 30, approximately 1,000 rate reductions were completed, providing interest rate relief on loans representing nearly $250 million in unpaid balances.

BofA added that customers in all 50 states have received assistance from the settlement programs, with the largest numbers of customers benefiting to date residing in California, Florida, New York, New Jersey, Illinois, Maryland, Arizona and Nevada.