Mortgage relief fails to provide as much promised aid | South Salem NY Real Estate

While the five giant mortgage firms signed a landmark $25 billion mortgage settlement last year, the real relief did not fulfill most borrowers expectations. Just 20% of the aid dished out under the settlement covered forgiveness of first-mortgage principal. Per the Los Angeles Times:

“We all wish there had been more principal reduction, which is what is most helpful in keeping people in homes,” said Kevin Stein, associate director of the California Reinvestment Coalition, a 300-member alliance that lobbies on behalf of low-income and minority neighborhoods.

Still, Stein said, the program set a good precedent, demonstrating that debt forgiveness can benefit lenders and borrowers alike without causing a wave of intentional defaults, as critics had warned.

                    Source: LA Times

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