Servicers completed 67,000 mortgage loan modifications in August, bringing the total for the year to 580,000, according to HOPE NOW, a voluntary private-sector alliance.
Loan modifications increased 8 percent in August when compared to the month prior, according to HOPE NOW; and year-to-date loan modifications outpace foreclosure sales by about 142,000.
The approximately 67,000 modifications completed by servicers in August include 48,000 proprietary modifications and 19,069 modifications completed through the government’s Home Affordable Modification Program (HAMP).
About 23,000 short sales also took place in August, HOPE NOW’s data shows.
“The bottom line is that there are more tools for consumers than ever before to handle mortgage challenges,” said Eric Selk, executive director at HOPE NOW, with the release of the alliance’s August data.
The majority of proprietary modifications completed in August came with fixed interest rates of at least five years and reduced monthly payments and principal, according
to HOPE NOW. These characteristics indicate “sustainability and affordability for homeowners,” the organization said in its report.
Eighty-eight percent of proprietary modifications featured fixed interest rates for at least five years, and 82 percent came with reduced principal and monthly payments. Additionally, 71 percent of proprietary mods in August lowered borrowers’ principal and interest payments by more than 10 percent.
While loan modifications increased over the month, foreclosure sales remained about the same at 59,000. Foreclosure starts decreased from 102,000 in July to 101,000 in August. At the same time, 60-plus-day delinquencies declined 2.5 percent to 2.18 million, according to HOPE NOW.
“HOPE NOW is pleased to report that since 2007, more than eight million permanent, non-foreclosure solutions have been completed by our members, on behalf of homeowners across the country,” Selk said.
Since 2007, the industry has completed 5.4 million proprietary modifications, and about 1.26 million homeowners have received modifications through HAMP since its debut in 2009, HOPE NOW reports. Also since 2009, the industry has completed about 1.36 million short sales.
HOPE NOW offers events throughout the country to help homeowners find foreclosure alternatives that suit their needs. A recent event drew nearly 900 homeowners in Maryland.
HOPE NOW, in conjunction with Making Home Affordable, will host two more events this year—one later this month in Philadelphia and another in November in Ft. Lauderdale, Florida. Another event aimed at active military and veterans and co-hosted by the Federal Reserve Bank of Richmond, will take place in Virginia Beach, Virginia, in November.
by Krista Franks Brock