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BofA Slammed Over 'Misleading' Mortgage Relief

As the entire mortgage system faces potential collapse
By Neal Colgrass,  Newser Staff
Posted Mar 28, 2020 3:30 PM CDT

(Newser) – Many homeowners are getting a break on mortgage payments these days, but the devil can be in the details. Connecticut resident Rosanne Stoddard tells CNBC she got quite a shock when she called Bank of America about her $2,200 monthly payments. They granted her a three-month pandemic waiver, she says, but the remaining amount would then be owed at once. That comes to $8,800, which Stoddard can't afford; she calls it "misleading to say the least." Others (like this Twitter user) say they've had similar BofA experiences. For its part, BofA says it can grant monthly deferrals on loans owned by the bank, but with loans owned by outside investors, the deferral is just three months—at which point the customer might have to pay up. For more:

  • Lenders are under pressure, too. What if they fail to keep feeding money into pension funds, hedge funds, and elsewhere when mortgage payments fall behind? "If Congress and regulators don't intervene—and fast—some mortgage servicers, banks, and lenders will have to dip into capital reserves that are insufficient to cover these payments over the long term," reports Curbed. "Some will have to shutdown entirely, at least temporarily."
  • Politico agrees, noting that Congress' $2 trillion package doesn't include mortgage relief. Now mortgage industry lobbyists are pressuring the Trump administration, and Treasury Secretary Steve Mnuchin says he plans to address the problem.
  • Meanwhile, how do people make mortgage payments? Business Insider's advice (beyond calling your lender) is to draw on home equity or try to refinance with a small company.
  • The Washington Post advises mortgage holders to visit aba.com and search "Industry Responds to the Coronavirus" to see what help is available. Or see what credit unions are offering at americascreditunions.org.
(Read more mortgage stories.)

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