Bank of America today unveiled a new loan program aimed at providing mortgage relief for active duty military customers behind on their payments.
The company’s new “Military Loan Modification Program” will provide immediate principal forgiveness on underwater mortgages to reduce the loan-to-value ratio to as low as 100 percent of current market value.
“Beginning April 1, 2011, Bank of America will also offer a 4 percent interest rate on mortgages for active duty military personnel while they are under Servicemembers Civil Relief Act (SCRA) protection,” the bank said in a release.
“This is lower than the 6 percent rate required by SCRA guidelines. The 4 percent rate will be applicable for the duration of the borrowers’ active duty and for 12 months after release.”
The program will initially target mortgages owned and serviced by Bank of America, but the company is also in talks with investors in other mortgages it services to expand benefits to those customers as well.
Bank of America has established a dedicated customer service unit for military customers that can be reached at 888-325-5357.