A draft compromise proposal indicates that borrowers who have been offered modifications consistent with the president’s Homeowner Affordability and Stability Plan or with a congressional program on refinancings would not be able to turn to courts to modify their mortgage. Under the proposal, judges would be able to reduce mortgage principal to a “fair market rate” and limit interest payments to a conventional rate plus a “reasonable” risk premium. Only loans made before 2009 and less than $729,750 would be eligible. Full article http://tinyurl.com/cetbpz

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