February 09, 2012, 2:26 PM EST
By Hugh Son and Michael J. Moore
(Updates with Boxer’s comment in fourth paragraph.)
Feb. 9 (Bloomberg) — Bank of America Corp., the second- largest U.S. lender, was faulted by U.S. Senator Barbara Boxer for making borrowers wait as long as 90 days to apply for mortgage refinancing and was urged to speed up the process.
“Delays could prevent borrowers from taking advantage of today’s historically low interest rates and improvements recently made to the Home Affordable Refinance Program,” the California Democrat wrote in a letter today to Chief Executive Officer Brian T. Moynihan.
The lender began a reservation system last week that asks those who call during high-volume times if they wish to be contacted again in 60 to 90 days, according to two people who requested anonymity because the measure hasn’t been announced. President Barack Obama has said housing relief programs may aid the economy by lowering monthly payments for borrowers who are current on their payments.
“It is critical that Bank of America take the steps necessary to meet the increased demand for refinancing caused by changes in the HARP program so that responsible homeowners will not have to wait to refinance,” the senator wrote.
Rates for 30-year U.S. mortgages held at the lowest level on record, Freddie Mac said in a statement. The average rate for a 30-year fixed loan was unchanged in the week ended today at 3.87 percent, the lowest in records dating to 1971. The Federal Reserve said last month that economic conditions may warrant “exceptionally low levels” for interest rates through at least late 2014.
Bank of America is “working hard” to meet customer demand, a spokesman for the Charlotte, North Carolina-based lender said this week. Customers with a Bank of America checking account or those who apply at a branch aren’t subject to the delay, a person familiar with the matter said.
Wells Fargo & Co. and New York-based JPMorgan Chase & Co., the biggest U.S. mortgage lenders, said they aren’t stalling customers.
–Editors: Dan Kraut, Steve Dickson
To contact the reporter on this story: Hugh Son in New York at Hson2@bloomberg.net; Michael J. Moore in New York at mmoore55@bloomberg.net
To contact the editor responsible for this story: Dan Kraut at dkraut2@bloomberg.net
