Mortgage principal reductions are becoming more common. The latest data shows that banks and lenders are forgiven, deferring or reducing the principal balance on about 15% of home mortgages, and they are writing off billions of dollars in principal. Studies show that reducing the balance on a mortgage may be the most effective solution to a housing crisis. Locate a list of mortgage loan principal reduction programs from banks.
At the end of the day, your mortgage loan is the single biggest financial decision you’re likely to make in your life. It’s important to take time to get it right, and that ultimately comes down to finding a lender who can do three things: offer competitive rates, offer great service and quickly process your loan. By keeping these areas in mind, you’re not only going to win as you go to buy your house — you're going to also save money and time.
If you choose a variable rate mortgage deal, then the amount of interest you pay can fluctuate over time. Mortgage rates often rise when the Bank of England raises the base rate, as borrowing costs become steeper for lenders, and these higher costs are passed on to homeowners. That’s why many homebuyers opt for fixed rates to provide peace of mind that their interest payments won’t change.
With this in mind, it’s important to do research before choosing a mortgage lender. You not only want to compare the rates but also the level of service each lender provides. When comparing rates, be sure to get the estimates on the same day as rates can change daily. When reviewing level of service, ask how quickly they can process your loan. Is the lender available to personally help you choose the right product and rate, or are you waiting on hold for “the next available representative”?  Do they make you jump through hoops just to get a rate quote?

Looking back at the flood of foreclosures since the housing crash, it’s clear that many borrowers didn't fully understand the terms of the mortgages they signed. According to one study, 35 percent of ARM borrowers did not know if there was a cap on how much their interest rate could rise [source: Pence]. This is why it’s essential to understand the terms of your mortgage, particularly the pitfalls of “nontraditional” loans.


With a fixed-rate mortgage, the interest rate will not change over the life of the loan. It's a good choice for someone who likes the certainty of knowing the mortgage payment will never go up. ARMs start with a lower interest rate for the first few years and adjust after a predetermined period (usually five years) based on the housing market. This type of loan can seem risky as interest rates have the potential to rise significantly, but there are caps in place to keep the rates from rising to astronomical levels.

Union Plus Mortgage Assistance provides interest-free loans and grants to help make mortgage payments when you're disabled, unemployed, furloughed, locked out or on strike.  If you qualify for the Mortgage Assistance loan benefit, you’ll also receive a one-time grant of $1,000 paid directly to you (Note: if you are applying due to a furlough the one-time grant is $300). The program has provided over $11.2 million in assistance to union members.


Bank of America Foreclosure Prevention - From January 2008 thru current, BOA has modified hundreds of thousands of mortgages. Some of those home loans were originally issued and held by Countrywide. Bank of America offers homeowners several foreclosure and mortgage assistance programs, including modifications, principal reduction, short sales, interest rate reductions and other resources. The lender also has opened help centers in many major cities, which provide homeowners with one on one counseling and free advice. Read more on all of the Bank of America foreclosure programs.
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