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Private mortgage modifications outnumber HAMP 4 to 1 in September

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Mortgage servicers modified 119,585 loans through private programs in September, more than four times the 27,840 done through the Treasury's Home Affordable Modification Program, according to the Hope Now alliance. Hope Now is an alliance of mortgage servicers, counseling agencies and nonprofit counselors. The 147,425 modifications through both private programs and HAMP is a 1.1% dip from a month ago. "While HAMP has provided a road map for other solutions, and is still the first line of defense for a delinquent homeowner, if the borrower is not eligible for a HAMP modification, a proprietary modification is able to fill the gap and offer a viable and sustainable solution to avoid foreclosure, enabling the borrower to stay in their home," said Faith Schwartz, senior adviser for Hope Now. Hope Now reported more than 3.2 million loans in delinquency by 60 days or more. Foreclosure starts reached 249,609 in September, up 2% from the previous month. Completed foreclosure sales increased 17% to 119,688 in September. According to Hope Now, servicers have completed 1.4 million mortgage modifications in 2010, and more than half, 53%, reduced principal and interest payments by 10% or more. HAMP isn't the only program being outperformed by comparable private programs. The 312 short sales and deeds-in-lieu completed through the Home Affordable Foreclosure Alternatives program is well short of the 117,000 Equator said has been initiated on its platform, a sign, said some market participants, that servicers are moving those government short sales into their own programs. Write to Jon Prior.

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