The FDIC is planning to roll out a limited test to determine if reducing the mortgage balances of borrowers who are substantially underwater will save them from foreclosure.
The test program would apply only to loans acquired from banks that failed and were seized by the FDIC, which is less than 1 percent of mortgages currently outstanding. It is estimated that 20 percent of borrowers (about 11 million homeowners) owe much more than their home is worth and if the program is successful there is hop that it will be extended to more home owners.
Check out the full article at the Post.
