Project Lifeline provides 30 day breather for loan mods
Loan servicers and lenders who handle about nine out of 10 subprime loans have agreed to participate in an initiative to help delinquent borrowers by putting foreclosure proceedings on hold for up to 30 days to evaluate alternatives. The Project Lifeline initiative, targeted at borrowers who are 90 days or more behind on their payments, was announced by six major lenders on Feb. 12 (see Inman News story).

 More loan servicers agree to put foreclosures on hold
Project Lifeline provides 30 day breather for loan mods
Inman News

Loan servicers and lenders who handle about nine out of 10 subprime loans have agreed to participate in an initiative to help delinquent borrowers by putting foreclosure proceedings on hold for up to 30 days to evaluate alternatives.

The Project Lifeline initiative, targeted at borrowers who are 90 days or more behind on their payments, was announced by six major lenders on Feb. 12 (see Inman News story).

Those lenders -- Bank of America, Citigroup, Countrywide Financial Corp., Chase, Washington Mutual and Wells Fargo -- say eligible borrowers will be offered workout plans that could lead to formal loan modifications for those who can make payments on new terms for three months.

The lenders are also members of the HOPE NOW coalition organized by the Treasury Department to speed up the process of modifying subprime adjustable-rate mortgage (ARM) loans before interest rate resets. While HOPE NOW members had been focused on modifying subprime ARM loans, Project Lifeline is targeted at nearly all loans, including prime, alt-A, and second-lien mortgages.

By March 31, the Project Lifeline initiative will include every member of the HOPE NOW coalition -- an additional 19 lenders and loan servicers, the coalition said today in a press release.

Project Lifeline participants are sending letters to seriously delinquent borrowers. Those who receive the letters must call their mortgage servicer within 10 days, agree to seek financial counseling, and provide updated financial information that can be used to draw up a workout plan.

A loan that is 90 days or more delinquent is eligible for Project Lifeline unless the borrower is in active bankruptcy, if a foreclosure sale date is less than 30 days away, or if the home is an investment property or vacant.

A list of participating HOPE NOW loan servicers is available from the Financial Services Roundtable. Information about the HOPE NOW and Project Lifeline programs is available online at www.hopenow.com or by phone at (888) 995-4673.