Foreclosure completions were down by nearly one-fourth year-over-year in Q1 while foreclosure starts experienced an increase, according to data released by HOPE NOW, an industry-created alliance of mortgage servicers, investors, counselors, and other mortgage market participants.
Completed foreclosure sales totaled approximately 96,000 for Q1 2015, down from 126,000 in the same quarter a year earlier, according to HOPE NOW – a decline of approximately 24 percent. Foreclosure starts jumped by 3 percent year-over-year in Q1 (from 219,000 up to 225,000) and about 10 percent quarter-over-quarter (from 205,000 up to 225,000).
The industry completed approximately 444,000 non-foreclosure solutions in Q1 2015 compared with 96,000 foreclosure completions, meaning there was one foreclosure sale for every 4.625 non-foreclosure solutions, according to HOPE NOW. Non-foreclosure solutions include loan modifications, short sales, and deeds-in-lieu of foreclosure; approximately 116,000 of those solutions were permanent loan modifications. About 87,000 of those borrowers received proprietary loan modifications, while about 29,000 received modifications through the government's Home Affordable Modification Program (HAMP).
"The availability of a combination of long term and short term workout tools has allowed for mortgage servicers to consider the viability of all retention and liquidation options before a foreclosure sale becomes the only course of action," HOPE NOW said in their announcement.
While the total of non-foreclosure solutions in Q1 was virtually unchanged from Q4 2014, it represented about a 13 percent decline from Q1 2014 (509,000). For March, the industry completed 154,000 non-foreclosure solutions, up slightly from February's total of 147,000.
“Activity on mortgage solutions remained robust during the first quarter of the year," said Eric Selk, Executive Director of HOPE NOW. "Permanent loan mods continue to slightly outpace foreclosure sales and total non-foreclosure solutions remain at a steady pace. The industry has many tools at its disposal in offering customers the best possible outcome. HOPE NOW’s data has shown a consistent trend in the relationship between options offered and foreclosure sales. The good news in this trend is that these efforts point to a correcting market across the board. HOPE NOW’s members have made a special effort to engage borrowers in communities that still lag behind in their housing and economic recovery."
The number of seriously delinquent mortgages (those 60 or more days overdue) declined in Q1 2015 to 1.86 million, down 4 percent from the previous quarter (1.93 million) and 12 percent year-over-year (2.11 million).
HOPE NOW has announced that it will be hosting several nationwide outreach events to offer loss mitigation options to at-risk homeowners. They have already hosted face-to-face events in Oakland and San Bernardino, California, and have events planned in the next two months for Chicago (May 27), St. Louis (June 13), and Cleveland (July 11).
The number of non-foreclosure solutions offered by the industry since HOPE NOW began tracking the data in 2007 is 23.7 million, and 7.5 million of those solutions have been permanent loan modifications, according to HOPE NOW.