News

The Treasury's most recent Home Affordable Modification Program (HAMP) report shows ""extremely low conversion rates,"" with success just a 50/50 gamble, according to Moody's Investors Service. As of the end of April, servicers had converted almost 300,000 permanent modifications. However, they had also canceled 277,640 trial mods. Moody's says this represents approximately a 50 percent success rate. The report also shows 3,744 permanent modifications have been canceled.

Barclays said Friday that it has agreed to sell HomEq Servicing, its U.S. mortgage servicing business, to Ocwen. Ocwen will pay $1.3 billion ""in cash on completion,"" Barclays said. The transaction aligns the two companies with the highest modification conversion rates under the Home Affordable Modification Program (HAMP). The Treasury's latest HAMP progress report puts both Ocwen and HomEq at the top of the servicer list, having converted 83 percent of their HAMP trials to permanent status.

NeighborWorks America reports that 58 percent of homeowners who've received assistance through its foreclosure counseling program say the primary reason they are facing foreclosure is reduced or lost income. The nonprofit says it's time for mortgage servicers and investors to make meaningful accommodations for borrowers facing foreclosure -- or prepare for even more empty homes and devastated neighborhoods.

The percentage of past due loans held by the nation's largest mortgage financier has fallen. In its monthly summary report just released, Fannie Mae said the serious delinquency rate on single-family mortgages in its portfolio dropped to 5.47 percent in March, down 12 basis points from 5.59 percent in February. It's the first time the GSE's serious delinquency rate has declined since March 2007, when it was a mere 0.62 percent.

Scottsdale, Arizona-based Loan Resolution Corporation, a pre-foreclosure asset management firm, announced this week that Michelle Carothers has been named VP of foreclosure alternatives. Carothers will be responsible for driving Loan Resolution Corporation's performance related to the Home Affordable Foreclosure Alternatives (HAFA) program.

The foreclosure crisis in California has taken a toll on not only homeowners, but a large number of tenants in the state. According to a new study from a statewide organization, at least 37 percent of residential units in foreclosure in the Golden State last year were rentals, directly affecting over 200,000 tenants - most of whom were displaced.

The U.S. Department of the Treasury has sold 1.5 billion of the 7.7 billion shares of Citigroup common stock it holds. The government earned $6.2 billion from this first trade, and says it plans to continue selling off its stake in the bank ""in an orderly fashion."" A second trading plan for 1.5 billion more shares has already been pre-arranged and is expected to be completed by June 30.

Twenty months after the massive, multi-billion dollar federal bailouts designed to shore up the nation's largest banks, Weiss Ratings finds that Bank of America, Citibank, and thousands more are still vulnerable to financial difficulties or even possible failure. Weiss Ratings says major U.S. banks continue to be plagued by toxic assets and an inability to raise capital. As a result, the company has given 2,259 banks, controlling $5.8 trillion or 43.8 percent of the industry's total assets, a rating of D+ or lower, which translates to ""weak.""

New figures released by the U.S. Treasury indicate that the government's $700 billion Troubled Asset Relief Program (TARP) will wind up costing taxpayers $105.4 billion when all is said and done. That projection is $11.4 billion lower than previously estimated. The total expense of TARP can be directly attributed to the government's foreclosure prevention programs, as well as assistance provided to the auto industry and AIG. Programs that were designed to assist banking institutions will result in a net gain to the taxpayer.

Mortgage interest rates have fallen to their lowest level of the year. Economists say homebuyers have the financial turmoil in Europe to thank for that, as overseas investors have put their dollars instead towards what they see as safer U.S. Treasury securities, which are closely tied to rates for home loans. Freddie Mac puts the average rate for a 30-year fixed mortgage this week at 4.78 percent. Bankrate says 30-year fixed-rate home loans are averaging 4.92 percent at the nation's 10 largest banks.