Other banks may follow Bank of America’s forgiveness move ponent gets added to the principal.
Barbara Desoer, president of Bank of america Home Loans
BaNk of amEriCa’S move last week to forgive a portion of expects to launch the program in May. said while the forgiveness helps homeowners in distress, it also
the principal in home loans that are “se- Bank of America said it would forgive only up to 30 per- helps lenders “by reducing the probability of a future default.”
verely underwater” could encourage other cent of the loan balance over three years, so long as the bor- The bank said it may consider interest-rate reductions in sub-
banks to follow suit to stem defaults, said rower is regular in making payments. It may extend that to five sequent moves to help achieve the government’s target to limit
James Silkensen, co-president of the New years after updating the home’s value, limiting forgiveness to mortgage repayments to 31 percent of household income while
Jersey Bankers Association, in Cranford. keep the loan-to-value at 100 percent. modifying subprime and some adjustable-rate mortgages.
Underwater loans are those in which The bank said it expects to offer principal reductions to- Silkensen said his group has no problem with banks volun-
the size of a mortgage is a fifth larger than taling $3 billion to about 45,000 customers. The forgiveness tarily offering such forgiveness programs, but it would “strongly
the home’s market value. The bank said it program is limited to those who borrowed from Countrywide oppose any legislation that would require that.” Banks should not
would consider forgiving the difference in James Silkensen financial, an aggressive lender Bank of America bought two be expected to absorb any risk in home values falling, he said.
such cases. To qualify, borrowers would have to demonstrate years ago. The bank said it also would modify loan balances for “Home prices go up, and home prices go down. A lot of people
hardship and be delinquent for at least 60 days. The bank said it borrowers with adjustable mortgages where the interest com- forgot that it is not a one-way street,” he added. - Shankar P.
Incentive program will “Implementation of the recom- across a grassy area to the riverbank.”
remain open for business
mendations within this report would
An anonymous tipster told
Hackensack Riverkeeper founder Bill
Deals around the state
change the way Sheehan that the hotel was polluting nPrivate equity firm Energy Capital Partners, in the Short Hills section of
The Business Employment Incen- the state of New the river, Taylor said. Sheehan for- Millburn, said it agreed to acquire three natural gas power plants from BG
tive Program will remain open to Jersey meets its warded the information to the crimi- Group for $450 million. The plants generate a combined 1,244 megawatts,
businesses interested in moving to affordable-hous- nal justice division, which launched and are located in Killingly, Conn., and in Orchard and Dighton, Mass.
or adding jobs in New Jersey, state ing obligation, an investigation. – Martin C. Daks
Treasury officials said last week. and produce a n Bridgewater’s Nistica, a supplier of optical modules for high-bandwidth
communications connections, said it closed on $6.5 million in series C fund-
While officials have said Gov.
Chris Christie’s budget proposal
and more realis- Raymond J. Lesniak
Christie signs series of ing. Investors include Battelle Ventures and Novitas Capital.
doesn’t include additional funds for tic, reasonable and sustainable meth- pension-reform bills
the program, they later announced od for delivering affordable housing,” n Curtiss-Wright Corp., in Parsippany, said it was awarded a $10.5 million con-
this will not affect the availability of Karrow wrote in the report. Gov. Chris Christie signed a package tract from Northrop Grumman Corp. to provide an upgraded radar signal pro-
the BEIP grants. Sen. Raymond J. Lesniak (D- of pension-reform bills on March 22, cessing solution for use in an Air Force surveillance program. – João-Pierre Ruth
Treasury spokesman Andrew Union) has sponsored legislation the same day
Pratt said that any business in- that would abolish COAH, but many both houses of
terested in applying for the grants of the details in his bill, S-1, differ the Legislature network, based in Hudson County,
Courtesy of the state of New Jersey
should continue to do so, and that from the recommendations in the completed work that distributed prescription pain
funds would be identified for suc- report. – Andrew Kitchenman on the bills. pills on the black market.
cessful applicants. The bills Since October, more than 32
Funding sources will include
money that becomes available
Hotel owner pleads include a num-
ber of reform
people — including doctors and
pharmacists — have been arrested
when previously approved grants guilt