BofA Embraces 2nd Mortgage Mods, and Polishes Image

Relief for homeowners groaning under the weight of burdensome second mortgages is about to come from an unlikely source: Bank of America, which has been one of the most reluctant of the big lenders to modify first mortgages.

After the Obama administration accelerated its efforts to persuade big banks to modify terms on second mortgages, Bank of America stepped up with the first signed agreement to do so on Jan. 26. The irony is that, before now, BofA modified fewer mortgages on a permanent basis under the federal government's Home Affordable Modification Program (HAMP) than nearly any other big lender: just 3,183, through last December, with another 9,178 modifications awaiting the final sign-off from borrowers.

But times are a-changing--and fast.