WASHINGTON — House Financial Services Committee Chairman Barney Frank (D-Mass.) has sent a letter to several of the nation's largest mortgage servicers urging them to “engage in an intense effort” to modify troubled mortgages.
Franks told the servicers to use the billion-dollar Bank of America settlement of predatory lending claims against subsidiary Countrywide Financial Corp. as a template for wide-scale loan modification. Franks said substantial interest rate reductions, reductions in principal and waivers of late fees prepayment penalties should be employed.
Franks wants immediate and specific action. He told the servicers to get back to the committee no later than Oct. 17.
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