U.S.-based firm pays borrowers to pay their mortgage
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07/02/2010 8:00:00 AM
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Lately some borrowers in the U.S. have been considering walking away from their mortgage, even if they have a means to pay it.
Some say it's a rational decision when you owe more on your mortgage than the home is now worth.
New Jersey-based Loan Value Group LLC has come up with an incentive to keep those payments coming, however. In a press release today, the company says it is launching the Responsible Home Owner Reward program where it will pay a cash reward to borrowers if they agree to keep paying their mortgage.
That amount they will pay varies on income, negative equity, geography and other risk factors.
"RH Reward is the only program of its kind in the mortgage industry, and its structure and incentive-based design are unique," says Loan Value Group CEO Howard Hubler. "There is no cost to the borrower whatsoever, yet the homeowner receives the full benefit of the reward."
He says it is "by far" cheaper and simpler than any other loss mitigation strategy.
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Monica on
10 Feb 2010 02:03 PM
I think that Americans need to take some responsibility for their actions. They borrowed the money so they owe the money. It doesn't matter if the home isn't worth more than they owe. They signed a contract and need to stick with it.
The Responsible Home Owner Reward program is ridiculous. I pay my mortgage every month and don't get a reward....I owe the money to my bank...I signed a contract with my bank....
There needs to be more consequences in the States for walking a way from your mortgage. It seems so easy to do...