BOSTON, May 31, 2016 /PRNewswire/ -- Bank of America is nearing the two-thirds mark in fulfilling its consumer-relief obligations under the bank's 2014 mortgage settlement with the U.S. Department of Justice and the attorneys general of six states, Professor Eric D. Green, independent Monitor of the settlement, announced today in his fifth report on the bank's progress.
Professor Green said that he had conditionally approved $294,987,938 worth of credit for consumer relief for the fourth quarter of 2015. The cumulative amount of conditionally-approved credit now totals $4,439,940,939, or 63% of the required $7 billion of credited consumer relief.
Of the $294,987,938 of requested credit that the bank submitted for the fourth quarter of 2015, more than $244 million, or 83%, was for modifications to an additional 5,172 loans. Nearly $46 million was for new loans extended to 4,496 low- and moderate-income first-time homebuyers, borrowers in Hardest Hit Areas, or borrowers who lost their homes to foreclosures or short sales. Another $4.76 million was for an additional subordinated loan to facilitate affordable housing.
"The consumer relief appears to be going to where the settling parties intended," Professor Green said. About 56% of the loan modifications to date are in Hardest Hit Areas, or neighborhoods defined by the U.S. Department of Housing and Urban Development as having suffered disproportionately from the mortgage crisis of 2008-09. The relief has been directed broadly, with loan modifications or new loans reaching every state and the District of Columbia – 47,117 census blocks in all. Of the more than 5,000 affordable rental housing units financed under the settlement so far, 68% are for Critical Needs Family Housing, another HUD designation.
"Most importantly, the data indicate that modifications for first lien principal reductions—the largest piece of intended consumer relief—are having their intended effect," Professor Green added. "The average principal reduction is 50.5%, the average loan-to-value ratio has been drastically reduced from 178% to 75%, the average interest rate has been more than cut in half from 5.42% to 2.11%, and critically, the average monthly payment has been reduced by $604 a month – nearly 38%. This directly and materially assists homeowners struggling to afford to stay in their homes."
At its current pace, Bank of America appears likely to fulfill its consumer-relief obligations well ahead of the August 2018 deadline, Professor Green said. "Although the consumer relief claimed by Bank of America for this quarter is relatively modest compared to other quarters," he said, "I am informed that Bank of America intends to submit substantial claims for credit in the coming quarters for additional modifications of homeowners' mortgages."
The full May 31 report and an easy-to-use interactive map are available at the Monitor's website at: http://bankofamerica.mortgagesettlementmonitor.com/. The website provides further details about the settlement, plus contact information for Bank of America, the DOJ, the attorneys general of the six participating states, HUD, Fannie Mae, Freddie Mac, the Financial Fraud Enforcement Task Force, and clinics for homeowners who want assistance but do not know where to get it or cannot afford it.
The Monitor's mailing address is: Monitor of the Bank of America Mortgage Settlement, P.O. Box 10134, Dublin, OH 43017-3134, and the e-mail address is email@example.com.
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/monitor--bank-of-america-still-on-track-in-providing-consumer-relief-under-2016-mortgage-settlement-300277138.html
SOURCE Monitor Eric D. Green