Citimortgage Measures To Help Foreclosure Victims

Posted on November 19, 2008
Filed Under Foreclosure Homes | 7 Comments

The fourth largest mortgage body in the country, CitiMortgage made announcements to take measures to help foreclosure victims. The plan has been drawn up following the example set by FDIC in dealing with IndyMac foreclosure problems. City assures that those mortgages that are at risk would be modified up to 40%. The principal would be reduced, the life term of the loan would be extended or the interest would be reduced. In some instances Citi would use a combination of all these options. For instance the loan might be extended to 40 years and the interest reduced to 1% for two years in order to allow time for the borrower to get back on rails. IndyMac under FDIC offers the rescue plans only for defaulters. But the Citi plan embraces all those who are at risk and facing problems like loss of income. Das said, “We will preemptively reach out to help at-risk homeowners before they become delinquent, which is critical to avoiding the loss of a home and protecting their credit score and future borrowing potential.” For implementation of the measure Citi will redirect a chunk of its employees into the sales department to give counseling and contact its customers about the measure. Citi also said that moratoriums would be extended on its mortgages that are floundering. The borrower has to be the occupant of the house – it being its primary residence. The borrower is expected to cooperate with Citi and have an income sufficient for making monthly payments towards repayment. Citi claims that it has already helped 370,000 of its borrowers to avoid foreclosure during the last two years. Das is confident that another 50,000 families will benefit from the new measure. Citi has about $200 billion in mortgages. The 500,000 house owners targeted by it for help owe about $50-55 billion in mortgages. The new measure however does not include about $600 billion worth of securitized loans that are owned by investors. For these Citi acts as loan servicer. The bank is currently talking with the investors as to how assistance can be provided to the house owners whose loan has been packaged, sliced and sold to outside investors. This problem of securitization is something faced by IndyMac also and till date remains unsolved. The note of alarm is that 80% of the sub-prime mortgages are securitized loans. Of these 75% loans had been given to borrowers without verifying their income. Unless investors come forward nothing can be done.

Search Repo Homes

• Arizona Repo Homes
• California Repo Homes
• Florida Repo Homes
• Georgia Repo Homes
• Michigan Repo Homes
• Ohio Repo Homes
• Texas Repo Homes
• Repo Homes In Other States

Popularity: 23% [?]

Related Tags

• citimortgage foreclosure

• government helping foreclosure victims

• CITI MORTGAGE REPOS

• foreclosure citimortgage

• Citimortgage foreclosures

• cant get loan on repo home

• seo forum

Comments