May 10, 2012 (Shirley Allen)

Proprietary loan modifications increased slightly in March, but a decline in HAMP modifications left the total amount of completed modifications almost unchanged from the previous 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 46,494 homeowners received permanent, proprietary loan modifications in March, up 4.6 percent from the 44,459 loan modifications in February.

In the first quarter of 2012, a total of 146,818 proprietary loan modifications were completed, down 11.6 percent from the previous quarter and down 29.4 percent from the same quarter last year.

Of the proprietary loan modifications completed in March, 84 percent (39,063) included reduced monthly principal and interest payments, with 79 percent (36,527) receiving a reduction of more than 10 percent. In addition, 90 percent (41,639) of the loan modifications received fixed interest rate loans of five years or more.

Loan modifications under the federal government’s HAMP program declined from February to March with government agencies completing 19,940 loan modifications in March compared to 22,263 in February.

Faith Schwartz, Executive Director of HOPE NOW, stated, “We continue to be encouraged by the efforts of mortgage servicers, non-profit counselors and others to educate homeowners on their options and find viable solutions for home retention, or graceful exit in some cases. In cases where home retention is not an alternative, the focus shifts to community stabilization through improving the short sale process and deed in lieu process, focusing on issues associated with vacant homes and enhancing public/private partnerships to support the housing market. HOPE NOW continues to work with all stakeholders to find creative ways to assist at-risk homeowners. For 2012, we will continue our commitment to homeowners via enhanced regional outreach activities, streamlined processes and effective use of technology.”

Monthly foreclosure starts jumped by over 10,000 following a 16.6 percent decline in February. Foreclosure starts increased 6.2 percent from February to March, growing from 167,114 to 177,395.

Completed foreclosure sales continued to decline, falling from 69,268 in February to 65,824 in March. It was the third consecutive month that foreclosure sales outpaced loan modifications.

Mortgage delinquencies that were at least 60 days past due declined from 2.657 million loans in February to 2.536 million in March.

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