U.S. mortgage servicers completed 101,000 permanent loan modifications for homeowners in January, down from 111,000 in December, but modifications continued to outpace foreclosure sales

Michelle Rivera

WASHINGTON , March 11, 2011 (press release) – HOPE NOW, the voluntary, private sector alliance of mortgage servicers, investors, mortgage insurers and non-profit counselors, released its January 2011 loan modification data, which shows that an estimated 101,000 homeowners received permanent, affordable loan modifications from mortgage servicers in the first month of the year.

The reported data for January shows that, for the month, mortgage servicers completed approximately 73,000 proprietary loan modifications for homeowners and 27,957 Home Affordable Modification Program (HAMP) modifications (as reported by US Treasury Department), for an estimated total of 101,000.

The number of permanent loan modifications was slightly down from December 2010 (111,000), but loan modifications still continue to outpace foreclosure sales nationwide. The 101,000 permanent loan modifications for the month compared to 73,000 foreclosure sales completed.

Here are some of the highlights of the January 2010 data:
• Total permanent loan modifications for the month were approximately 101,000, compared to 111,000 in December 2010.
• Loan modifications with reduced principal and interest payments accounted for approximately 81% (59,000) of all proprietary modifications.
• Fixed-rate modifications (initial fixed period of 5 years or more) accounted for 85% (62,000) of all proprietary modifications.
• Completed foreclosure sales for the month were approximately 73,000, compared with 58,000 in December 2010.
• 60+ days delinquencies for the month were 3.08 million, compared to 3.03 million in December 2010.

Faith Schwartz, Executive Director, issued this statement:

“HOPE NOW is encouraged by the fact that the trend of permanent loan modifications to completed foreclosure sales continues to be favorable. Over the past year, the industry has completed almost two million loan modifications for homeowners at risk of foreclosure.

The combination of government modifications and private modifications continues to make a meaningful difference in preserving homeownership and preventing foreclosures. As required by the current Making Home Affordable Program (HAMP), all modifications must be reviewed for HAMP eligibility prior to receiving a proprietary modification. Typically, many of these modifications are FNMA, Freddie Mac or FHA modifications.

Mortgage servicers and non-profits are working hard to streamline their processes and deliver decisions in a shorter time frame via web-based applications. A meaningful effort, such as the HOPE LoanPort® web portal, is being used by 14 mortgage servicers with over 700 users, and more than 2,100 non-profit counselors nationwide. More importantly, HOPE LoanPort® has eliminated lost paperwork and cut servicer decision times on applications to an average of 32 days.

Finally, HOPE NOW, along with key partners Making Home Affordable and NeighborWorks® America, continues to hold face to face outreach events in the hardest hit markets across the country. So far in 2011, events have been held in Las Vegas, Nevada and San Jose, California with an average attendance of 1,000 families. Events are also planned for Phoenix, Arizona in March and Boston, Massachusetts in April.

We congratulate the alliance members for all of their face to face borrower outreach efforts, which are occurring 24 hours a day, seven days a week, across the country.

HOPE NOW continues to work hard to improve the borrower experience by enhancing technology, streamlining decisions and making sure that all at-risk homeowners fully understand all of the options available to them in order to avoid foreclosure.”

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