Citi Joins in Effort to Streamline Modifications

Citi has joined other lenders in offering streamlined workouts to home loan borrowers who are at risk of default. Over the next six months, Citi says it will pre-emptively reach out to 500,000 homeowners whose loans Citi owns and who are not currently in default but are at risk of foreclosure. Citi estimates the effort will result in $20 billion of loan workouts, and the company said the effort is focused primarily on borrowers in areas facing "extreme economic distress." In addition, Citi said it will extend its foreclosure moratorium against homeowners when Citi owns the mortgage loan on a principal residence. Citi said it is working with investors to expand the program to home loans that are serviced by Citi but not owned by the banking giant. Citi said that since the beginning of 2007, it has already helped 370,000 borrowers whose loans it services avoid foreclosure through loss mitigation and workouts.