In a blog post on Planet Money titled The Latest Loan Modification: Don’t Get Your Hopes Up NPR is reporting today that Bank of America has decided that it will be cheaper and easier to reduce principal rather than interest on “severely under water loans.” Oh. B of A is saying that this new strategy could apply to as many as 45,000 loans, including some of the “exotic time bombs” it inherited when it acquired Countrywide Home Loans last year.
I’m not sure this is really news. As Chris Mayer, the Milstein Professor of Real Estate at Columbia University’s business school is quoted as saying, “they’re just stating the obvious, which is that they’re not going to get paid back in full.” Professor Mayer goes on to editorialize.”There is no great solution,” Mayer is reported as saying. “We’re going to muddle along.”
In a blog post on Planet Money titled The Latest Loan Modification: Don’t Get Your Hopes Up NPR is reporting today that Bank of America has decided that it will be cheaper and easier to reduce principal rather than interest on “severely under water loans.” Oh. B of A is saying that this new strategy could apply to as many as 45,000 loans, including some of the “exotic time bombs” it inherited when it acquired Countrywide Home Loans last year.
I’m not sure this is really news. As Chris Mayer, the Milstein Professor of Real Estate at Columbia University’s business school is quoted as saying, ”they’re just stating the obvious, which is that they’re not going to get paid back in full.” Professor Mayer goes on to editorialize.”There is no great solution,” Mayer is reported as saying. ”We’re going to muddle along.”
Terrific.
