Monday, May 17, 2010

Loan Modifications: Pressure from Obama

When I borrowed money to buy my house, of course I expected the lender to just forgive part of my debt. (Ok, maybe not – why should I?) Pressure is mounting on loan servicers and investors to reduce troubled homeowners' loan balances, but Fannie and Freddie do not lower the principal on the loans they back, instead opting for interest rate reductions and term extensions when modifying loans. There is continued press about F&F being under more and more pressure by the Obama Administration to do principal write downs. http://money.cnn.com/2010/05/14/news/economy/fannie_freddie_principal_reduction/

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