mortgage principal reduction

Government Bars Fannie-Freddie from Reducing Principal

A federal regulator is standing by its decision to bar Fannie Mae and Freddie Mac from reducing principal for borrowers at risk of foreclosure, resisting pressure from the Obama administration. The Federal Housing Finance Agency announced the decision Tuesday after months of considering the option.

BofA to Start Reducing Mortgage Principal

Bank of America is giving some of its most troubled home loan borrowers relief from the threat of foreclosure. The largest mortgage servicer in the U.S. will forgive up to 30% of some customers' mortgage balances. The homeowners must have missed at least two months of mortgage payments and owe at least 20% more than their home is currently worth.