Principal Reduction, when a bank forgives a portion of the principal amount of a mortgage, is the most revolutionary development in Loss Mitigation history. Principal Reduction represents an effective solution for countless homeowners who's home value is "underwater", meaning the value of the home is less than the amount of the mortgage note, by helping them get back on track with their mortgage, bring their monthly payments down to a managable level and most importantly, stay in their home.
Principal Reduction workouts are being utilized with increasingly popularity. It is often the banks last resort when attempting to avoid foreclosing on a propety, but they are becoming more willing to agree to a principal reduction agreement as the housing crisis continues to deepen. |
