California Lenders Slow to Save Failing Mortgages

There’s been a lot of talking about it from lenders and government agencies, but there hasn’t been a lot of it going on. Moody’s Investors Services recently surveyed 16 mortgage servicers that accounted for 80 percent of the market for subprime loans made to borrowers with shaky credit histories. It found that most of those companies had only modified about one percent of loans with interest rates that reset in the first half of this year. The Mortgage Bankers Association said that the survey was flawed because it did not account for the other ways that borrowers were helped, including temporary reductions of monthly payments of dividing out delinquent amounts over future payments.

California based Countrywide Financial said that it has modified 20,000 loans which represents less than 5 percent of the more than 500,000 loans the lender states that were behind in payments as of last month. Countrywide also stated Tuesday that it will begin calling borrowers to offer refinancing or modifications on 16 billion dollars in loans with rates sent to adjust by the end of 2008.

Bank of America, a Charlotte North Carolina based bank, said that it had modified 3,200 mortgages representing $240 million during the first eight months of the year out of the estimated $377 billion in loans they service. They also stated they had a very low foreclosure number with only 192 homes as of September 30th.

Head on over to the Associated Press to read more about the California Lenders slow to Rescue Failing Mortgages.