With foreclosures on the rise and market instability increasing, The Federal Reserve Chairman, Ben Bernanke urged lenders Tuesday to help distressed owners by lowering mortgage amounts. He warned that foreclosures and late house payments are likely to rise a while longer, even with the efforts of industry and the government to curb a recession. Many lenders have increased their loss-mitigation options and grown more willing to work with owners in threat of default.
One suggestion from Bernanke was to actually reduce the amount of the loan, providing some instant equity to values that have decreased in the last couple of years.
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