Following Suit: Prevention Activities Decline

The number of foreclosure prevention activities completed by Fannie Mae and Freddie Mac rose to even higher levels, according to the FHFA’s July 2016 Foreclosure Prevention Report released Wednesday as the number of nationwide foreclosures has fallen on a year-over-year basis every month since November 2011.

In July of 2016, the GSEs completed 15,547 foreclosure prevention activities, over half of which (10,587) were loan modifications including HAMP permanent modifications. July’s total activities brought the total number of foreclosure prevention actions completed by the GSEs to 3,757,045 since the conservatorships began in September 2008.

Despite the total activities completed since that origination date, the number has been on the decline for a few years along with foreclosure volume. For example, in 2012, Fannie Mae and Freddie Mac completed a total of 940,974 foreclosure prevention actions between them. That number fell to 789,627 the next year and down to 561,312 for 2014. For 2015, the pace fell to 428,881 and through the past seven months of 2016, the number is 113,558.

In July the number of home retention actions recorded by the GSEs, which included loan modifications, repayment plans, and forbearance plans, totaled 13,442, down from 14,552 in June. The number of home forfeiture actions, which included short sales and deeds-in-lieu of foreclosure, was also down over the month in July from 2,323 to 2,105.

The number of permanent loan modifications also declined from June to July, from 11,342 to 10,587. The share of modifications with principal forbearance remained consistent from June to July at 20 percent. According to the report, improved house prices and a declining Home Affordable Modification Program (HAMP)-eligible population resulted in a drop in the share of modifications with extend-term only down to 45 percent of all modifications.

The number of foreclosure starts on GSE-backed residential mortgage loans decreased from 18,709 in June to 17,517 in July, and likewise, the number of third-party and foreclosure sales fell over the month in July from 7,904 to 7,108.

The combined serious delinquency rate (mortgage loans 90 days or more past due) on loans backed by the GSEs declined only slightly from June to July (1.23 percent down to 1.22 percent).

Click HERE to see the FHFA’s complete foreclosure prevention report for July.