Tag Archives: Foreclosure Prevention

Mortgage servicers completed 56,000 permanent loan modifications through their own proprietary assistance programs during the month of July, according to figures released Wednesday by HOPE NOW. July's tally represents an 11 percent increase over the 50,000 proprietary mods reported in June. At the same time, foreclosure sales fell by 11 percent month-to-month and newly initiated foreclosure actions slipped 5 percent. HOPE NOW also found that the redefault rate for proprietary modifications is 20 percent.

HOPE LoanPort recently announced that the organization has now registered over 3,000 HUD-certified, nonprofit housing counselors in a little over a year of full operation. Counselors from more than 630 organizations in all 50 states, the District of Columbia, and Puerto Rico are now using the system to assist struggling homeowners. HOPE LoanPort is also upgrading its technology to comply with the Federal Housing Finance Agency's new guidelines for managing the GSEs' delinquent loans.

Twenty-one members of New York's congressional delegation sent a letter to Iowa Attorney General Tom Miller expressing concerns after he removed New York Attorney General Eric Schneiderman from the executive committee negotiating a settlement with several major servicers. The state's lawmakers say Miller's decision to oust Schneiderman ""sets a dangerous precedent"" for other attorneys general who, out of fear for what might happen, may choose silence over voicing their concerns with the proposed settlement.

Ginnie Mae has announced a new rule regarding buyouts of delinquent loans. Servicers may now buy out loans at the end of a successful trial payment plan, instead of waiting until a borrower has missed three payments. This new rule is in line with recently released Federal Housing Administration (FHA) guidelines requiring most loans to undergo a three- to four-month trial payment plan before a loan modification is made permanent. The new FHA guidelines go into effect October 1.

HUD is once again accepting applications for its Emergency Homeowners' Loan Program (EHLP), which provides assistance to borrowers at risk of losing their homes due to unemployment or underemployment. The new deadline for applications is September 15. The original deadline of July 22 was extended to July 27, but HUD announced Monday that it is reopening the application process because the agency believes it has enough resources to help more homeowners than have currently applied.

The default risk associated with newly originated mortgages continues to improve, according to the analysts at University Financial Associates (UFA). The company's default risk index for the third quarter indicates that with today's economic conditions, lenders and investors should expect defaults on new loans to be 32 percent higher than loans from the 1990s. That's down from an elevated risk of 41 percent during the first part of this year. UFA says at this rate, ""normalcy may not be far away"" for default and prepayment indicators.

Short sales are being used more frequently by homeowners, lenders, and investors to avert a foreclosure, and industry data released this week shows that these pre-foreclosure transactions are being pushed through at a faster pace. Freddie Mac says its short sales have risen from about 4 percent of completed workouts in 2000 to nearly 14 percent in 2010. The GSE warns that with the increase in short sale transactions comes an increase in fraud. It's become the top priority for Freddie Mac's fraud investigation unit.

Word on the street is the administration is sizing up a new program that would provide millions of homeowners with new, lower interest, lower payment mortgages. The initiative would allow borrowers with loans backed by Fannie Mae and Freddie Mac to refinance at today's rates, even if they are in negative equity or have bad marks on their credit. Two Columbia business professors say such a move would save homeowners an average of $350 a month and pump an extra $118 billion into the economy.

HOPE LoanPort has announced a partnership with the state of Maryland and GMAC Mortgage to deliver a direct-to-consumer foreclosure mediation portal. GMAC is funding development of the portal and will be the first mortgage servicer to use it. The portal, scheduled to go live in October 2011, will be the first statewide program in the nation to allow homeowners and servicers to exchange documents electronically prior to foreclosure mediation.

Iowa Attorney General Tom Miller has announced the removal of New York Attorney General Eric Schneiderman from an executive panel of state officials working with servicers on a settlement for alleged improper foreclosure practices. Miller, who is head of the committee, says the state of New York has actively worked to undermine the very same multi-state group it had been working very closely with over the previous nine months. He called Schneiderman's actions ""unacceptable.""