Marshall & Ilsley Bank tried its first moratorium in December 2008. The bank's homeowner assistance program offered refinancing with reduced rates and term extensions.
Now moratoriums are once again the foreclosure prevention tool of choice for M&I Bank, which has given an additional three-month breathing space to distressed borrowers.
The Milwaukee bank said it has extended foreclosure moratoriums through September 30, 2010. The moratorium applies to all owner-occupied residential loans "for customers who agree to work in good faith to reach a successful repayment agreement."
The move reflects proposed Fannie Mae policy changes that encourage borrowers to work with lenders and servicers.
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Lenders that have initiated moratoriums should insure that they actually prevent foreclosures rather than just evictions subsequent to foreclosures.
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