HOPE NOW: Mortgage lending industry prevented nearly 240,000 foreclosures in DecemberMortgagePress.comHOPE NOW, foreclosures, workouts, loan modifications, Faith Schwartz
HOPE NOW, the private sector alliance of mortgage servicers,
counselors, and investors that has been working aggressively to
prevent foreclosures and keep homeowners in their homes, today
announced that its members and the larger mortgage lending industry
completed a record-high 239,000 foreclosure prevention workouts in
December 2008. This is the first time since HOPE NOW began to
compile data in July 2007 that the number of workouts exceeded
200,000 in 4 consecutive months and is the latest indication that
the mortgage lending industry is continuing to increase its
foreclosure prevention efforts.
The new monthly record number of workouts exceeds the previous
high set in October 2008 by more than five percent. The 671,000
workouts completed in the last quarter of 2008 were the most in any
three-month period since July 2007.
Including the December results, almost 2.3 million foreclosure
prevention workouts were completed by the mortgage lending industry
in 2008. Almost 3.2 million were completed between July 2007 and
December 31, 2008.
The December 2008 results also show that the mortgage lending
industry is continuing to shift its efforts to help homeowners from
repayment plans to loan modifications. For the first time since
July 2007, the number of loan modifications was more than half of
all workouts completed in a single month. The 122,000 modifications
completed in December 2008 are 19 percent higher than the previous
record set in October 2008. HOPE NOW expects that the increasing
reliance on loan modifications rather than payment plans will
continue as economic conditions warrant.
HOPE NOW defines workouts in its data as both modifications to
the terms of existing mortgages and repayment plans. Barring a life
event such as a job loss, death, or illness, repayment plans and
loan modifications are intended to enable a homeowner who has the
financial capacity to make monthly payments to remain in his or her
home as long as he or she wishes to do so.
According to Faith Schwartz, HOPE NOW's executive director, the
December results show that the industry is continuing to focus on
the pace of help for homeowners. "HOPE NOW members know they have
to keep doing more to keep up with the growing needs of homeowners
at risk of losing their homes," she said. "The December results
demonstrate that HOPE NOW members are moving aggressively to do
what's needed to avoid preventable foreclosures."
According to Steve Bartlett, president and CEO of The Financial
Services Roundtable, a HOPE NOW founding member, the December
results are a ray of good news for homeowners. "When coupled with
the report from the National Association of Realtors earlier this
week that existing home sales in December were higher than
expected, HOPE NOW's record-high number of foreclosure prevention
workouts should provide some optimism for homeowners about the
future."
The HOPE NOW December data also shows:
• 37 percent of homeowners with prime loans who received
workouts in December received modifications.
• 85 percent of homeowners with sub-prime loans who
received workouts in December received modifications.
• For the seventh consecutive month, the number of
foreclosure starts for prime loans exceeded those for
sub-prime.
• The number of foreclosures started in December increased
by 34,000 over the previous month. More than 75 percent of this
increase was in prime loans.
For more information, visit www.hopenow.com.
