J.P. Morgan To Halt Foreclosures As It Expands Mortgage Modification Program

October 31, 2008 6:23 p.m. EST

New York, NY (AHN) - JP Morgan & Chase Co said it will not put any homes into foreclosure over the next 90 days while it expands it mortgage modification program to 400,000 homeowners.

The bank is aiming to work with customers on $70 billion of its loans in order to help borrowers stay in their homes. The plan will offer several options ranging from reducing rates to extending terms and possibly replacing a product altogether if necessary.

"We think it's the right thing to help as many people who want to stay in their homes," said Charlie Scharf, chief executive of retail financial services, according to the Associated Press.

JP Morgan has already adjusted mortgages for 250,000 customers worth roughly $40 billion since early 2007.

The company will operate the program through its 24 regional counseling centers. 300 loan counselors along with 150 employees to review mortgages are being added in order to make sure homeowners are offered modification options before facing foreclosure. The bank estimates the program will last two years.

Homeowners who have loans through Washington Mutual, which JP Morgan recently acquired, will also be eligible for the program.

JP Morgan said it plans to donate 500 homes to community and non-profit organizations as part of the program.