The U.S. Department of Housing & Urban Development (HUD) and the U.S. Department of the Treasury have released the November edition of the Obama Administration's Housing Scorecard— a comprehensive report on the nation’s housing market. Data continue to show signs that the housing market is strengthening—as home values continue to rise and home sales remained strong in October.
“The Obama Administration’s efforts to speed housing recovery are showing continued progress as the scorecard indicators highlight market momentum not seen since before the housing crisis—six consecutive months of rising home prices have bolstered homeowners equity, which is now $1.5 trillion higher than in April 2009,” said HUD Acting Assistant Secretary for Policy Development and Research Erika Poethig. “But with so many households still struggling to make ends meet, we have important work ahead. That is why we are asking Congress to approve the President’s refinancing proposal so that more homeowners can receive assistance.”
Included in this month’s Making Home Affordable Program Report are detailed assessments from the third quarter of 2012for the largest mortgage servicers participating in the program with results. The Servicer Assessments—first introduced in June 2011 and published quarterly – have set a new standard for disclosure around servicer efforts to assist struggling homeowners.
“The Administration remains focused on continuing to improve standards for the mortgage industry to help families avoid foreclosure,” said Treasury Assistant Secretary for Financial Stability Tim Massad. “We continue to push the industry to provide better service to homeowners while expanding the range of solutions available to families facing mortgage concerns.”
Since the inception of the Making Home Affordable Program, Treasury has required participating servicers to take specific actions to improve their processes through ongoing program reviews. The quarterly Servicer Assessments summarize performance on metrics in three categories of program implementation: identifying and contacting homeowners; homeowner evaluation and assistance; and program reporting, management and governance. Results for the third quarter of 2012 show that servicers are focusing attention on areas identified in previous program reviews and, as a result, are demonstrating continued improvement in program implementation:
►Servicers are more effectively evaluating homeowners under program eligibility criteria as seen in the “second look disagree” category, which reflects the rate at which Treasury’s program reviews disagree with the servicers’ decision to find a homeowner ineligible for assistance. In the third quarter, the average second look disagree percentage for the top servicers remained below one percent.
►Mortgage servicers continue to accurately calculate homeowner income, which is used to determine a homeowner’s eligibility and modified payment amount under the program. In the third quarter, the average income calculation error rate for the top servicers was below three percent, and two servicers had zero percent error rates.
►For the third quarter of 2012, two servicers were found to need only minor improvement on the areas reviewed for program performance, while seven servicers were found to need moderate improvement. Although servicer performance in a particular compliance category can fluctuate from quarter to quarter, in general, servicers continue to show continued overall improvement in program implementation. All servicers, however, will need to continue to demonstrate progress in any areas identified in follow-up program reviews.
The November Housing Scorecard features key data on the health of the housing market and the impact of the Administration’s foreclosure prevention programs, including:
►The Administration's foreclosure programs are providing relief for millions of homeowners as we continue to recover from an unprecedented housing crisis. More than 1.3 million homeowner assistance actions have taken place through the Making Home Affordable Program, while the Federal Housing Administration (FHA) has offered more than 1.5 million loss mitigation and early delinquency interventions. The Administration's programs continue to encourage improved standards and processes in the industry, with HOPE Now lenders offering families and individuals more than 3.2 million proprietary mortgage modifications through September.
►HAMP continues to offer homeowners affordable and sustainable assistance to avoid foreclosure. As of October, more than 1.1 million homeowners have received a permanent modification through the Home Affordable Modification Program (HAMP), saving approximately $542 on their mortgage payments each month, and an estimated $16.2 billion to date. In October, 74 percent of homeowners with eligible non-GSE mortgages benefitted from principal reduction with their HAMP modification. Eighty-seven percent of homeowners entering the program in the last two years have received a permanent modification.