According to an article in the Los Angeles Times, the only loans currently that are being considered are those that were originated by Countrywide Financial, which was acquired by Bank of America in 2008.
The only loans that will qualify for the principal reduction are those owned by Bank of America or private investors. These also include mortgages originated by Countrywide Financial which Bank of America acquired in 2008. Loans owned by Freddie Mac, Fannie Mae or FHA will not be eligible. The projections are that 200 households will benefit from this program.
Check Here to see if your mortgage qualifies for this program.
Is there an upside for Bank of America to offer this program – I would say so. They own $3.25 billion in penalties from the foreclosure settlement which could be reduced for instituting the principal reduction program.