July 10, 2012 (Shirley Allen)

Proprietary loan modifications increased by five percent in May while foreclosure starts saw a jump of almost fifteen percent during the month according to HOPE NOW, the voluntary, private sector alliance of mortgage servicers, investors, mortgage insurers and non-profit counselors.

Using a three month rolling average, a total of 45,127 homeowners received permanent, proprietary loan modifications in May, up 5.0 percent from the 42,962 loan modifications in April.

Of the proprietary loan modifications completed in May, 81 percent (36,756) included reduced monthly principal and interest payments, with 73 percent (32,795) receiving a reduction of more than 10 percent. In addition, 90 percent (40,803) of the loan modifications received fixed interest rate loans of five years or more.

Loan modifications under the federal government’s HAMP program increased from April to May with government agencies completing 17,590 loan modifications in May compared to 15,167 in April.

Short sales also saw their numbers increase as a total of 38,273 short sales were completed in May compared to 34,643 in April.

Faith Schwartz, Executive Director of HOPE NOW, stated, “HOPE NOW, and its partners, continues to engage in aggressive borrower outreach, with an emphasis on streamlining processes through technology such as HOPE LoanPort®, better communication among stakeholders, education on borrower options and improving customer experience.”

Monthly foreclosure starts jumped during May following a slight decline in April. Foreclosure starts increased 14.9 percent from April to May, climbing from 177,259 to 203,590.

Completed foreclosure sales also increased, growing from 59,643 in April to 64,979 in May.

Mortgage delinquencies that were at least 60 days past due also felt the pain, increasing from 2.517 million loans in April to 2.527 million in May.

Tags: HOPE NOW, private sector alliance, mortgage servicers, loan modifications, fixed rate mortgages, delinquencies, proprietary modifications, foreclosure starts, foreclosure sales