The Real Story on Countrywide Home Loan Modification

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Countrywide, one of the nation"s largest housing lenders, became notorious due to its unethical lending policies and practices. Some of the main complaints about Countrywide have been due to poor communication among its staff, which often resulted in borrowers" hearing conflicting information every time they spoke with a different customer service representative. So complaints about Countrywide"s clerical errors and dispensing misleading information have been commonplace on message boards and the like.

  Bank   of  America  acquired Countrywide in July 2008. In October, the company announced a new set of policies intended to right the wrongs that many homeowners suffered as a result of its older ways of doing business. The bottom line is that the company wants to help more homeowners pay their mortgages and keep their homes.

Since a class action lawsuit was brought against Countrywide, the company, in conjunction with  Bank  of  America , has released a statement detailing their policy for helping struggling borrowers a consistent way with their home mortgage modification. Many of Countrywide"s borrowers have heard of this new set of policies, yet may not understand how the company has changed its ways, and more importantly, how to benefit from Countrywide home loan modification.

In the case of unreachable monthly payments, the new debt to income ratio is a simple 34%. Loans, once modified, will utilize a step-rate program to gradually bring the interest rate down to a manageable level. The stipulation is that only owner-occupied homes are eligible for this modification program.

There are a few different choices available via Countrywide"s new plan. HOPE for Homeowners, an FHA loan refinancing program, allows borrowers who were ineligible for traditional refinancing to take advantage of more open entry points. The motivation for HOPE was that so many borrowers had lost substantial home equity due to the housing market bust. The catch with HOPE is that if you sell your home, then at that point, the FHA gets a cut of any accrued equity. And if you are ineligible for HOPE, there are other loan modification plans available, including reductions in interest rate, and principal forbearance on the part of Countrywide.

If you are struggling to pay your Countrywide mortgage, then by all means look into for their loan modification program.  Bank  of  America  may well have improved the situation at Countrywide, in accordance with its 2008 news release. There is a solution to help homeowners modify their existing loans, and by applying, you will learn whether you qualify. Also, Countrywide is in the process of reviewing many of its mortgages and mailing letters to borrowers who are two months delinquent, or in danger of delinquency.

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Source by Lindsy Emery

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