Wednesday, January 11, 2012

Loan Mods and Delinquencies Rise in November: HOPE NOW

The number of mortgage modifications completed during the month of November rose 5 percent from October, bringing the year-to-date total to about 969,000, according to HOPE NOW, a voluntary private sector alliance of mortgage industry participants.

Proprietary modifications continue to outpace modifications completed through the government’s Home Affordable Modification Program (HAMP). Of the nearly 84,000 modifications completed in November, 57,000 were proprietary while 26,877 were completed through HAMP.

Of the 5.13 million modifications that have been completed since 2007 when HOPE NOW began reporting data, 4.22 have been proprietary and a little more than 900,000 were completed through HAMP.

While completed modifications rose from October to November, 60-plus day delinquencies also increased. After reporting 2.65 million 60-plus day delinquencies in October, HOPE NOW reported 2.77 million in November.
Foreclosure starts, on the other hand, declined in November from 209,000 to 166,000.

Completed foreclosure sales rose from 64,000 in October to 71,000 in November.

About 68 percent of proprietary modifications completed in November reduced principal and interest payments for borrowers, and about 66 percent lowered principal and interest payments by at least 10 percent.

About 83 percent of proprietary modifications were fixed-rate modifications with an initial fixed period of at least five years.

“There are more alternatives to foreclosure than ever before for homeowners through federal programs, proprietary modifications, and state level initiatives such as Hardest Hit Funds,” said Faith Schwartz, executive director of HOPE Now.

“Mortgage servicers and non-profit, housing counselors are using all tools at their disposal to find options that fit each individual homeowner’s situation whenever possible,” Schwartz said.

According to Schwartz, the industry continues to emphasize “improving the customer experience through enhanced technology, single point of contact and leveraging all tools available to assist with foreclosure prevention, which in some cases includes graceful exits.”

HOPE NOW plans to host homeowner outreach events in several cities in the first quarter of 2011, including: Charlotte, North Carolina; Miami and Tampa, Florida; Las Vegas, Nevada; and Sacramento and Los Angeles, California.

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