Countrywide Financial Corp, under pressure to help stem growing home loan defaults, says it will expand programs to help borrowers manage their mortgage payments regardless of the type of subprime loan they have or whether they have already fallen behind on payments.
Full details of the initiative, the result of a pact with the national community advocacy group, were to be disclosed yesterday.
Initial plans to disclose the deal were postponed last month after Calabasas-based Countrywide agreed to be acquired by Bank of America Corp for US$4.1 billion in stock.
Countrywide, the largest US mortgage lender and home loan servicer, has sought to address the growing number of defaults on its books by modifying loan terms, working out long-term repayment plans and other actions. It said last month it helped more than 81,000 borrowers keep their mortgage payments manageable last year.
The firm also was among the lenders who agreed to a Bush administration-proposed agreement to freeze rates on some subprime mortgages for five years.
Those efforts focused on borrowers with adjustable rate mortgages that were still being paid but set to adjust to higher monthly payments.
The latest initiative, brokered with the Association of Community Organizations for Reform Now (ACORN), calls for Countrywide to try to manage payment plans for borrowers that are already behind in payments, regardless of which type of subprime loan they have.
"Through this partnership, Countrywide and ACORN have agreed to a set of home retention standards to help borrowers who are in various situations of financial difficulty to establish suitable repayment plans or other solutions," Steve Bailey, Countrywide's senior managing director of loan administration, said in a prepared statement.
Some 6.96 percent of the 9 million loans in Countrywide's servicing portfolio were delinquent as of Dec. 31, up from 5.02 percent in December 2006.
About 1.04 percent of the mortgage loans, or 93,961, were pending foreclosure, up from 0.65 percent.
Under the latest plan, borrowers with subprime hybrid adjustable-rate mortgages, which typically were issued with a low "teaser" interest rate and then adjust higher after two or three years, could be offered the option of refinancing into a lower prime rate loan, or have their initial interest rate frozen for five years.
Homeowners with fixed-rate subprime loans who have fallen behind on payments could be offered short-term repayment plans, loan modifications or other adjustments, including having their interest rate frozen or adding their overdue balances to their principal loan amount.
Despite the efforts to modify loans for some borrowers, some consumer groups argue the mortgage industry has not done enough, noting many borrowers continue to fall behind on payments.
Maude Hurd, national president of ACORN, however, praised Countrywide's latest initiative.
"We hope others in the mortgage servicing industry will adopt similar practices," Hurd said.
‘LAGGING BEHIND’: The NATO secretary-general called on democratic allies to be ‘clear-eyed’ about Beijing’s military buildup, urging them to boost military spending NATO Secretary-General Mark Rutte mentioning China’s bullying of Taiwan and its ambition to reshape the global order has significance during a time when authoritarian states are continuously increasing their aggression, the Ministry of Foreign Affairs (MOFA) said yesterday. In a speech at the Carnegie Europe think tank in Brussels on Thursday, Rutte said Beijing is bullying Taiwan and would start to “nibble” at Taiwan if Russia benefits from a post-invasion peace deal with Ukraine. He called on democratic allies to boost defense investments and also urged NATO members to increase defense spending in the face of growing military threats from Russia
LEAP FORWARD: The new tanks are ‘decades more advanced than’ the army’s current fleet and would enable it to compete with China’s tanks, a source said A shipment of 38 US-made M1A2T Abrams tanks — part of a military procurement package from the US — arrived at the Port of Taipei early yesterday. The vehicles are the first batch of 108 tanks and other items that then-US president Donald Trump announced for Taiwan in 2019. The Ministry of National Defense at the time allocated NT$40.5 billion (US$1.25 billion) for the purchase. To accommodate the arrival of the tanks, the port suspended the use of all terminals and storage area machinery from 6pm last night until 7am this morning. The tanks are expected to be deployed at the army’s training
TECH CONFERENCE: Input from industry and academic experts can contribute to future policymaking across government agencies, President William Lai said Multifunctional service robots could be the next new area in which Taiwan could play a significant role, given its strengths in chip manufacturing and software design, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) chairman and chief executive C.C. Wei (魏哲家) said yesterday. “In the past two months, our customers shared a lot of their future plans with me. Artificial intelligence [AI] and AI applications were the most talked about subjects in our conversation,” Wei said in a speech at the National Science and Technology Conference in Taipei. TSMC, the world’s biggest contract chipmaker, counts Nvidia Corp, Advanced Micro Devices Inc, Apple Inc and
PEACEFUL RESOLUTION: A statement issued following a meeting between Australia and Britain reiterated support for Taiwan and opposition to change in the Taiwan Strait Canada should support the peaceful resolution of Taiwan’s destiny according to the will of Taiwanese, Canadian lawmakers said in a resolution marking the second anniversary of that nation’s Indo-Pacific strategy on Monday. The Canadian House of Commons committee on Canada-Chinese relations made the comment as part of 34 recommendations for the new edition of the strategy, adding that Ottawa should back Taiwan’s meaningful participation in international organizations. Canada’s Indo-Pacific Strategy, first published in October 2022, emphasized that the region’s security, trade, human rights, democracy and environmental protection would play a crucial role in shaping Canada’s future. The strategy called for Canada to deepen
RSS