Next Tuesday the federal government and the mortgage industry will announce their plan to simplify the overall process for delinquent home loans held by Fannie Mae and Freddie Mac. By simplifying this process it's expected to allow for lenders to make changes on the delinquent loans by adding criteria to help expedite the process for loans that are behind by three months or more. This is all due in part to the fact that several of the major banks are trying to curb the mounting losses from unpaid home loans. At the end of June as many as 4 million homeowners were behind by one month on their mortgage payments while at the same time 500,000 homeowners had started foreclosing on their properties.
Last Monday Citigroup announced that it will be stopping foreclosures on homeowners who are currently living in their homes and have a good income with a chance to make changes to their mortgages by obtaining a lower interest rate. Furthermore, the bank also seeks to reach out to 500,000 homeowners confronted with falling behind on their payments in an effort to help them as well. This group of homeowners represents almost 1/3rd of all Citigroup's current mortgages. In addition to Citigroup helping their customers, JPMorgan Chase is stepping up too by working to modify a program that could help more than 400,000 of their customers. Now Bank of America has released a statement that starting on December 1st they are also going to help approximately 400,000 of their newly acquired customers from the Countrywide Financial Corporation buyout. Things are looking up.