Principle Reduction Modifications Are The Most Successful

I have said this time and time again and mentioned it in my posted yesterday.  “Borrowers who receive loan modifications that reduce loan balances and not simply interest rates are far less likely to re-default on their loans, according to a new study from the Federal Reserve Bank of New York.”

It took a “study” in order to figure this out.  “While modifications that reduce monthly payments are far more likely to succeed than those that don’t result in lower monthly payments, how that reduced monthly payment is achieved matters, too, according to the study.”  Really, you think?

http://blogs.wsj.com/developments/2010/01/04/ny-fed-most-successful-mortgage-modifications-reduce-borrowers-principal/