Countrywide/BOA refi question

[scramblingin2007]

Hello, I currently have a fixed countrywide mortg. @ 7%. I've had my mortgage for 5 yrs now, always paid on time. Now with all the news about countrywide and bank of america lowering interest rates for 400,000 clients I was wondering if I am one of the clients who can take advantage of this. My question is: Do you have to be in forclosure or default to get your interest rates lowered or can all clients get it lowered?

[ShanetheMortgageMan]

There isn't one set of guidelines that all lenders follow.  Each lender makes their own determination if they want to lower/modify someone's interest rate or loan.  Case in point, my mother-in-law was able to get her rate lowered and her ARM converted to a 30-year fixed rate, just by calling up her lender (WaMu) and asking.  A friend of mine in practically an identical situation tried with his lender and they said no.  But my neighbor, who was a few months behind on the mortgage, had his loan modified after working with his lenders loss mitigiation department for over a month.  The first step you should take is call up customer service and inquire about any rate/loan modification eligibility criteria that you must meet.

[Anonymous]

I don't think you are going to see alot of love from them on a fixed rate loan.  Most of the people getting the help are in ARMS that are jumping up in payments.  Their thought (and probably the correct one) is that if you have been able to afford the payment for the last 5 years and are not currently behind, then why would they drop th rate.  It can't hurt to ask, but to get any serious consideration you wouldprobably have to fall behind on your payment which is not worth the MAJOR hit to your credit score.  Also, I am curious if there will be astericks in the credit file of people requesting these adjustments down the road.  It would make sense and I think would be perfectly fair.  In the end, unless they are just doing a short term adjustment,  it is the same a settling a debt.  Good luck either way. 

[ShanetheMortgageMan]

mickie, the people who get loan modifications might get a 1099 for forgiven debt, but I don't think it'd be fair for people who get a loan modification to have that held against them.  In the example of my mother-in-law who got a free loan modification, she approached them for a refinance and instead they just modified her existing loan.  It wasn't like she didn't qualify for a new refinance, but the process of modifying an existing loan was easier.  Also, in the mortgage industry, new lenders aren't looking unfavorably at people who have had loan modifications in the past.

[Anonymous]

Thats great if that is the way it will work.  I would just be surprised if at least internally, these loans are not marked in some way.  If they are it is not far from them ending up on the credit report when new regulations end up in place after this mess washes over.  I don't agree or disagree with it personally, I just could not blame a bank for putiing a qulaifying remark on a loan that was not paid in full (particularly if it is a principle reduction)  I wish the guy above good luck for sure in getting a rate reduction, I just don't think getting a rate reduction on a loan that you are having no problem paying is a wise move just in case the above scenario does play out down the road.