Bank of America (BAC) sent letters to Arizona homeowners who may qualify for mortgage assistance, including a principal writedown, under the Treasury Department‘s Hardest Hit Fund. In June 2010, the Obama administration released $1.5 billion in foreclosure prevention funding for states hardest hit by home price declines. BofA said Wednesday the write downs will go to homeowners experiencing financial hardship and owe considerably more on the mortgage than the property is worth. A spokesman for the Arizona Department of Housing told HousingWire about 40% of the 380 applications received so far are from BofA customers. “We are hoping to assist 8,000 households with these federal funds,” the spokesman said. BofA is also finalizing how it would participate in other principal reduction programs in Nevada and is in “advanced discussions” with the California Housing Finance Agency. “Bank of America remains committed to helping distressed borrowers remain in their homes through a variety of programs,” said Terry Laughlin, an executive vice president at BofA. Laughlin was recently put in charge of a new division within the bank that would handle how delinquent loans are treated in loss mitigation. A separate department will continue to service current and performing BofA mortgages. Along with principal write down, BofA is also involved with state housing agencies in California, North Carolina, South Carolina, Ohio, Oregon, Florida and Washington, D.C., to pilot unemployment assistance programs under HHF. These programs will offer qualified borrowers mortgage assistance for up to 36 months while they are unemployed. While these programs are targeted to low- and moderate-income homeowners, eligibility will also hinge on investor participation. “Since the Obama administration established the Hardest Hit Fund initiative one year ago, Bank of America has worked closely with both the Department of Treasury and state housing agencies to design and implement the program to provide interim payment assistance to unemployed borrowers, as well as funding for loan modification assistance to delinquent borrowers,” Laughlin said. “We are excited this program is coming to fruition.” Write to Jon Prior. Follow him on Twitter: @JonAPrior
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