The U.S. Department of Treasury will be distributing an additional $3.3 billion in Troubled Asset Relief Program funds to Countrywide Home Loans Servicing as part of their decision to allocate additional funds to mortgage-servicing companies.
These extra funds will be provided to the previously Calabassas, California-based company in order to modify loans in the midst of the foreclosure catastrophe.
The payment will boost the already received fund to $5.2 billion from the Treasury Department.
In July 2008, Bank of America acquired Countrywide Financial Corp for $2.5 billion increasing its prestige by taking the reins from the former largest nationwide home lender and complementing its leading positions in credit-card and bank deposit lending.
BoA, in October, agreed to modify loans that could save 390,000 borrowers equating to as much as $8.4 billion, after Countrywide’s lending practices prompted investigations by California, Florida, and other state attorney general offices
On April 9, President Obama declared “good news” in the midst of an economic meltdown urging families to take advantage of the low interest rates.
“The main message we want to send is there are 7 to 9 million people across the country who right now could be taking advantage of lower mortgage rates.”
The revised loans, which encompass lowering the borrowers’ current payments, has increased the total amount for the plan by $3.1 billion to $18.3 billion from its originally dedicated amount of $15.2 billion.