More than 91 percent of borrowers nationwide who received mortgage loan modifications in the second quarter of 2014 had their monthly principal and interest payments reduced, while 56.1 percent of borrowers lowered their monthly payments by 20 percent or more, according to a report released earlier this week by the Office of the Comptroller of the Currency (OCC) regarding first-lien mortgages at large national and federal savings banks.
The OCC Mortgage Metrics Report, Second Quarter 2014 found that borrowers had their monthly mortgage payments reduced by an average of $252. The average payment reduction was slightly more ($269) for borrowers who received modifications made under the Home Affordable Modification Program (HAMP).
From January 1, 2008, to March 31, 2014, servicers implemented more than 3.5 million loan modifications, OCC reported. About 59 percent of those loan modifications, or 2.1 million, were active at the end of Q2 2014, according to OCC. The remaining 41 percent were no longer in the portfolios of their respective lenders due to having paid their mortgage in full, having been involuntarily liquidated (through lender actions such as foreclosure), or having transferred their loans to non-reporting institutions. OCC reported that about 69 percent of the nearly 2.1 million loan modifications that were active at the end of Q2 were performing, while 25 percent were delinquent and 6 percent were in the process of foreclosure.
In all, servicers implemented about three times more home retention actions during Q2 than home forfeiture actions. Home retention actions, including loan modifications, shorter-term payment plans, and trial period plans, totaled 208,150 for the quarter, which represented a 12.5 decline from Q1 and a 34.1 percent decrease from the same quarter in 2013. Home forfeiture actions, which include foreclosures, short sales, and deeds-in-lieu-of-foreclosures, totaled 64,790, according to OCC.
OCC reported that about 47 percent of nationwide mortgages were included in this portfolio, which totaled about 24.1 million loans with approximately $4.1 billion in principal balances.