This is why Fannie and Freddie mortgage initiatives won't work

This is why Fannie and Freddie mortgage initiatives won't work

MBA declarations are feel-good, but temporary

How far can lenders push the credit box?

Watt announcement helps, but risk keeps standards tight

Warren calls for GAO investigation of nonbank servicers

Asks GAO to review “unprecedented” growth of nonbank servicers
W S

Private mortgage modifications drop 20% in first quarter

/ Print / Reprints /
| Share More
/ Text Size+
Mortgage servicers completed 209,806 private modifications in the first quarter, down 19.7% from the previous period, according to data from the Hope Now alliance. Servicers, investors, insurers and nonprofit counselors from the industry make up the organization. Hope Now also tallied an additional 54,000 permanent workouts completed through the Home Affordable Modification Program in January and February, but the Treasury Department has not released data for March yet. The federal program averages between 20,000 and 30,000 completed permanent mods per month. If the average holds, servicers would have completed roughly 80,000 workouts in the quarter through the program. Private modifications have long outnumbered HAMP, pushing some in Congress to end the program, but Treasury officials have long said servicers used the program's guidelines to design their own initiatives. Of the private mods completed in the first quarter, roughly 81% included a reduction in principal or interest. Roughly half of the mods cut principal or interest payments by more than 10%. While private workouts did fall in the quarter, totals ended on an uptick. In March, servicers completed 77,000 modifications, an increase of 26% from the previous month. Foreclosure starts dropped in the first three months of 2011 as well to roughly 600,000, down 8% from the fourth quarter. But totals remained well above modifications. While the pause has been linked to increased scrutiny and corrections in the foreclosure process at these companies, the total amount of loans reported in delinquency dropped as well. Hope Now reported 2.7 million loans 60-days delinquent or worse, down roughly 10% from the previous quarter. "While it’s encouraging to see a continued decline in 60-day delinquency we realize many homeowners continue to be at risk of foreclosure, as evidenced by the increase in foreclosure sales in March," said Hope Now Executive Director Faith Schwartz. "Homeowners need the ongoing focus and support of loan servicers and non-profit housing counselors as they continue to move through the resolution process. This includes explaining all options, which may include a short sale or deed-in-lieu of foreclosure." Write to Jon Prior. Follow him on Twitter @JonAPrior.

Recent Articles by Jon Prior

Comments powered by Disqus