Bank of America announced today that they will setting aside $6 billion to help cover their bad credit mortgage debt that is spiraling out of control. This is the latest bank in the United States to be hit by the bad credit mortgage crisis. The company is having issues with their customers defaulting on their loans, like many other banks. The news about their bad credit mortgage problem precipitated a 77% drop in BoA stock, a move which will not help the bank.Walter O’Haire, an analyst at financial research company Celent, said: “Credit quality deteriorated in several areas, most notably in regions that have experienced the most significant home price declines, which includes the former high-flying areas such as California, Arizona, and Florida. With the price of oil at all-time highs, a surge in food prices, foreclosures and defaults in many areas of the country, it is hard to imagine that US consumers’ financial health will be on an upswing in the near term.”Numerous banks in the United States have been experiencing the bad credit mortgage crisis. The government has bailed out some, while others have simply been forced to close their doors.
Related reading: Bad Credit Mortgages
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