Source: Ieva Augstums, Associated Press (USA Today)

Wachovia said it will quit offering a mortgage payment option that allows borrowers to pay less each month than the bank charges in interest.

The choice to pay less was one of the options of Wachovia’s (WB) controversial Pick-A-Payment mortgages, which offer customers four payment options each month. Wachovia told the Associated Press that it will no longer offer the less-than-full interest payment option on all new home loans.

Critics have said paying less than the amount of interest charged can lead to negative amortization. That means the borrower owes more than the value of their home, increasing the chance of foreclosure.

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