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I've written before that while trying to help a family member save thier house I found that principle reductions were not being offered. It seems that may have now changed.
I learned today that Chase is making major principle reductions. I know of one situation where the modification calls for wiping out the 2nd mortage of 80K altogether and reducing the 1st by 100K, In addition to that the interest rate is being lowered to 2% for 40 years. This is lowering the monthly payment from over 3700 to about 2500. Thats a pretty significant reduction if you ask me. From what I was told starting a few weeks ago Chase is now aggressively persuing this type of option.
While not a cure to all thats wrong with real estate this could be a huge step towards reducing foreclosures depending on how widely it's used.
On a side note real estate in Florida is moving at what appears to be a brisk pace. I must have seen 10 houses around me get sold with in the last 6-8 weeks.
This isn't a real estate is coming back post. I just thought the principle reduction was note worthy since a few months ago I was told that was not an option.
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