Citigroup is announcing a new program easing mortgage payments to an average of $500 a month for homeowners who have lost their jobs and fallen behind on their debts, reports the Wall Street Journal. Borrowers will be allowed to make the lower payments for 3 months and will pay no interest. The move comes days before the Obama administration is expected to introduce new guidelines for its loan modification program.
To qualify for the program, borrowers will need to show proof of unemployment and sign a form promising that they will seek a job and tell the bank if they find one. Only mortgages below $417,500 qualify for the program, and they must be both owned and serviced by CitiMortgage. The lender's CEO said that the federal government "had no role at all" in the new effort.