B of A’s Mortgage Reduction Insanity

Bank of America has started sending letters to thousands of homeowners in the United States, offering to forgive a portion of the principal balance on their mortgages by an average of $150,000 each.

The reduction for qualifying homeowners could amount to monthly savings of up to 35 percent on mortgage payments, Bank of America said in a news release on Monday evening.  …

To be eligible for the principal reductions, however, homeowners will have to meet certain criteria, including: having a loan owned or serviced by Bank of America; owing more on the mortgage than their property is worth; and being at least 60 days behind on payments as of the end of January.

via NYTimes.com.

What craziness is this?  Just curious, what is B of A doing for all the folks who (a) bought a house they could afford, and (b) make all the payments on time even when times get tough.  Some folks have cancelled vacations, stopped eating out, shopping at cheaper grocery stores, walking instead of driving, and all sorts of other things.  What’s being done to help the responsible?

When you give something away to those who don’t deserve it the rest suffer by default.  We’ve been doing that for far too long in this country.  It’s one of the reasons we’re in the state we’re in.