Bank of America has reported that it has completed nearly 285,000 mortgage modifications in 2010. The U.S. Department of the Treasury’s monthly servicer performance report for the December reporting period shows that Bank of America is the first servicer to surpass the 100,000 milestone in permanent modifications completed under the government’s Home Affordable Modification Program (HAMP).
“These results represent hope for these homeowners and recognize the tireless and meaningful efforts of our default servicing teams,” said Rebecca Mairone, default executive of Bank of America Home Loans. “As we move into 2011, Bank of America remains committed to providing home retention and foreclosure prevention solutions to as many homeowners as we can, and is poised to do so through ongoing growth in our staffing levels, continued improvements in processes and implementation of new programs.”
As part of its ongoing efforts and commitment to help homeowners through tough times, Bank of America nearly doubled staffing in the default servicing area in 2010. About 30,000 people are now dedicated to this area. Other steps taken during the past year included:
►Increasing face-to-face contact with homeowners experiencing financial difficulty, including opening customer assistances centers in hard hit communities and participating in nearly 600 housing rescue fairs across the country.
►Evolving programs to meet changing customer needs and responding with innovative solutions, including an industry-leading principal reduction program launched in March.
►Establishing a case management process for borrowers who have applied for a modification, with about 350,000 homeowners now assigned to a case manager.
►Addressing the potentially confusing “dual-track” process by which foreclosure procedures continue up to the point of sale while customers are in trial payment plans or being evaluated for permanent modifications.
►Developing a customer status checklist to provide greater clarity about the modification process.
►Engaging with community agencies to expand relocation assistance, credit counseling and other aid.
►Implementing new aspects of the government’s Making Home Affordable program, including second-lien modifications and streamlined short sale programs.
During the past year, Bank of America also conducted a voluntary review of its foreclosure processes in both judicial and non-judicial foreclosure states.
“While the reviews confirmed that the basis for foreclosure decisions has been accurate, we have implemented improvements that provide us even more confidence in our ability to deliver a quality, accurate process as we move forward,” said Mairone.
On the modification front, during the past three years of the economic crisis, Bank of America completed more than 775,000 mortgage modifications. More than 98,000 HAMP conversions were reported to the Treasury department last year, bringing the total since program inception in 2009 to nearly 102,000. Out of these permanent modifications, more than 90,200 remained active at the end of 2010.
The bank started about 147,000 HAMP trial modifications during the past year, while implementing a mid-year change in HAMP guidelines requiring full documentation and underwriting prior to the start of the trial period. December was the biggest month for trial starts since the change was implemented in April for trials starting in June, with about 11,000 new trial payment plans beginning. This provides a foundation for increased conversion activity entering 2011.
“Loan modifications will continue to be an important solution, and foreclosure remains an option of last resort,” Mairone said. “But given the realities of the recession and high unemployment, the bank has also dedicated resources to other foreclosure alternatives, including short sales and deeds-in-lieu.”
Through increased staffing, new technology and process improvements, Bank of America completed more than 95,000 short sales and deeds in lieu in 2010, more than twice the number in 2009.
For more information, visit www.bankofamerica.com.
