2012-01-27 — bizjournals.com
Bank of America has stopped originating cash-out home-refinance loans. The new policy went into effect last week. And the Charlotte, N.C.-based bank has suspended all mortgage refinancing activity that allows homeowners to convert equity in their homes to cash.
BofA spokesman Terry Francisco confirmed the policy when contacted by the Charlotte Business Journal, a sister publication of The Business Review. However, he says the change is only temporary. He says the bank has seen a "tremendous surge" in refi applications since a new federal policy took effect Jan. 17. That policy allows banks to refinance homes more than 125 percent underwater and still receive a government guarantee on the loan.
Francisco says the increased volume of applications stemming from that issue forced BofA to temporarily suspend cash-out refis so closing times for other loan types didn't suffer.
"We hope to reinstate them as soon as possible," he says.
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