Bank of America today announced the new “Military Loan Modification Program,” aimed at providing mortgage relief for active duty military customers behind on their payments and extending mortgage protections for servicemembers beyond active duty. The program takes effect April 1, 2011.
Key features of the new program are:
- An immediate principal forgiveness program for distressed military borrowers which can reduce the loan-to-value ratio to as low as 100 percent of current market value;
- A reduced four percent interest rate on mortgages for customers who are eligible for Servicemembers Civil Relief Act (SCRA) protection, which is lower than the 6 percent mandated under SCRA. The 4 percent rate will be applicable for the duration of the borrowers’ active duty and for 12 months after release;
- And a mortgage customer service unit dedicated to servicing military customers.
“Our new Military Loan Modification Program builds on our long-standing commitment to the United States military forces and will help address the heavy burden of financial matters at home that can weigh on those who are protecting our freedoms,” said Terry Laughlin, executive vice president for Bank of America. “Military men and women face extraordinary circumstances, and they make unique sacrifices for all of us. For these reasons, we want this combination of tools to address their needs and help them when they need it most."
The program will initially target mortgages owned and serviced by Bank of America, but the company is also in talks with investors in other mortgages it services to expand benefits to those customers as well.
Bank of America's customer service unit for military customers can be reached at 888-325-5357.
Tags: Bank of America, loan modification program, servicemembers, veterans, active duty, principal forgiveness, interest rate reduction, mortgage customer service
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