Loan Mod Totals Experience 42 Percent Year Over Year Drop
HOPE NOW has released its mortgage industry data for the first half of 2011, showing a significant decline in mortgage delinquencies from the same period in 2010. The inventory of 60-day-plus delinquencies is 2.7 million for the first six months of 2011, down from 3.7 million for the first half of 2010, representing a decline of 27 percent. Meanwhile, completed foreclosure sales for the first half of 2011 dropped 25 percent from the same period in 2010 (432,000 compared to 575,000). Foreclosure starts also declined by nine percent with 1.13 million for the first half of 2011, compared to 1.25 million for the same period in 2010. “There were one million less delinquent homeowners in the first half of 2011 than there were for the same time period last year," said Faith Schwartz, executive director of HOPE NOW. "The decrease in delinquencies combined with the drop in foreclosure starts and sales shows that more homeowners are getting assistance through the many options available to them." Permanent loan modifications for the first half of 2011 were approximately 558,000. This compares with 968,000 completed during the same period of 2010. While this represented a 42 percent decrease, the industry has completed 4.7 million total loan modifications for homeowners since HOPE NOW began reporting data in 2007. "Current loan modification efforts show a trend in sustainability and affordability, which is crucial to the long term health of the housing market," said Schwartz. "Homeowners have received 4.7 million permanent loan modifications versus 3.7 million foreclosure sales since 2007. In 2011, modifications exceed foreclosure sales by more than 126,000 year to date." Key data points for the first half of 2011 (Jan. 1– June 30), compared to the same period of 2010: Loan modifications ►Total loan modifications were approximately 558,000, down from 968,000—a decrease of 42 percent. Foreclosures ►Completed foreclosure sales were approximately 432,000, down from 575,000—a decrease of 25 percent. ►Foreclosure starts were 1.13 million, down from 1.25 million—a decrease of nine percent. Delinquencies ►60-plus-days delinquencies were 2.7 million, down from 3.7 million, a decrease of 27 percent. ►Loan mods completed under HAMP were 183,421, down from 331,083—a decrease of 45 percent. ►Proprietary modifications were approximately 375,000, down from 637,000—a decrease of 41 percent. Data on proprietary loan modification characteristics (January 2011–June 2011) ►Eighty percent are currently performing (less than 90 days past due). ►Loan modifications with reduced principal and interest payments accounted for approximately 81 percent (304,000) of all proprietary modifications. ►Loan modifications with reduced principal and interest payments by 10 percent or greater accounted for approximately 57 percent (212,000) of all proprietary modifications. ►Fixed-rate modifications (initial fixed period of five years or more) accounted for approximately 81 percent (303,000) of all proprietary modifications.