July 12, 2011 (Shirley Allen)
The number of proprietary loan modifications declined slightly in May 2011 according to HOPE NOW, the voluntary, private sector alliance of mortgage servicers, investors, mortgage insurers and non-profit counselors. The organization reports that 53,000 homeowners received permanent, proprietary loan modifications in May compared to 57,000 in April, a reduction of 7 percent.
Of the proprietary loan modifications completed, 78 percent (41,000) included reduced monthly principal and interest payments, with 57 percent (30,000) receiving a reduction of more than 10 percent. In addition, 88 percent (47,000) received fixed interest rate loans of five years or more.
The number of loan modifications completed under the federal government’s Home Affordable Modification Program (HAMP) increased to 32,398 in May from 28,867 in April, an increase of 12 percent.
Total proprietary modifications and HAMP modifications for May were 85,000, slightly lower than April’s 86,000 modifications.
Proprietary loan modifications include Fannie Mae, Freddie Mac, Federal Housing Administration (FHA), US Department of Veterans Affairs (VA) and does not include loans modified under the Home Affordable Modification Program (HAMP).
Foreclosure starts were up in May as approximately 176,000 starts were recorded, compared to 163,000 in April, an increase of 8 percent. Completed foreclosure sales dropped from 73,000 in April to 68,000 in May, a decline of 7 percent.
Mortgage delinquencies that are at least 60 days past due increased slightly from 2.65 million properties in April to 2.67 million in May.
May’s data also shows that 80 percent of previous permanent proprietary loan modifications remained less than 90 days past due in the last year. This is the third month in row that 90 days past due loan performance has remained at that level.
Faith Schwartz, Executive Director of HOPE NOW, stated, “HOPE NOW’s monthly data report is designed to provide a comprehensive overview of mortgage market trends and industry efforts to help homeowners avoid foreclosure. While we have seen loan modifications flatten out in recent months, the overall numbers continue to illustrate the size and scope of what mortgage servicers, and their non-profit and government partners, have achieved on behalf of at-risk homeowners.”
Tags: HOPE NOW, private sector alliance, mortgage servicers, loan modifications, fixed rate mortgages, delinquencies, proprietary modifications, foreclosure starts, foreclosure sales