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More homeowners taking loan modifications, avoiding foreclosures

Mortgage servicers complete 400% more solutions than foreclosures

Past due house

The mortgage industry completed over 100,000 permanent modifications during the second quarter, according to HOPE NOW, the voluntary private sector alliance of mortgage servicers, investors, mortgage insurers and non-profit counselors.

During the first quarter, permanent loan modifications increased 16% from last quarter to 100,198. Of the 100,000 loan modifications, about 69,000 homeowners received proprietary loan modifications, or in-house loan modifications, and 31,684 homeowners received loan modifications completed under the Home Affordable Modification Program.

“The Q2-2016 data report confirms the continuous decline of serious delinquency rates across the country,” HOPE NOW Executive Director Eric Selk said. “With the lowest reported total to date (1.54 million), markets continue to make recovery from the housing crisis.”

“For those homeowners who still face struggles with affording their mortgage, there are a plethora of options available to them,” Selk said.

During the second quarter, mortgage servicers gave 335,000 homeowners non-foreclosure solutions. Aside from permanent modifications, other solutions included modifications, short sales repayment plans, deeds in lieu, other retention plans and liquidation plans.

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Fcls solutions

(Source: HOPE NOW)

Some homeowners didn’t qualify for long-term permanent loan modification, in which cases the mortgage servicers looked for a short term options that, in many cases, led to a permanent solution.

In fact, non-foreclosure solutions continue to outpace completed foreclosure sales by more than 400%. For every one foreclosure sale, mortgage servicers offered 4.14 solutions. The array of solutions that a servicer is able to provide to an at-risk homeowner allows for the homeowner to avoid a foreclosure sale in many circumstances.

Foreclosure starts decreased in July to the lowest level since May 2005, according to ATTOM Data Solutions, the new parent company of RealtyTrac.

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