reBlog from keepmyhouse.com: Loan Modification Blog | Keep My House | Mortgage Modifications

I found this fascinating quote today:

• In 2006: Family B took out an interest-only second mortgage with a balance of $60,000, an interest rate of 4.4%, and a term of 15 years.


• Today: Family B has $60,000 remaining on their interest-only second mortgage because none of the principal was paid down.


• Under the Second Lien Program: The interest rate on Family B’s interest-only second mortgage will be reduced to 2% for five years. This will reduce their annual interest payments by $1,440.


• After those five years, Family B’s mortgage payment will adjust back up and the mortgage will amortize over a term equal to the longer of (i) the remaining term of the family’s modified first mortgage (e.g. 27 years if the first mortgage had a 30 year term at origination and was three years old at the time of modification) or (ii) the originally scheduled amortization term of the second mortgage.

keepmyhouse.com, Loan Modification Blog | Keep My House | Mortgage Modifications

You should read the whole article.