Tag Archives: Foreclosure Prevention

As the industry prepares to comply with the January implementation of new rules from the Consumer Financial Protection Bureau (CFPB), Fannie Mae and Freddie Mac updated their servicing guides to bring GSE standards in line with the new regulations. Among the guideline changes, servicers are prohibited from mentioning foreclosure earlier than 121 days into delinquency.

More than 11,000 homeowners have participated in Fannie Mae's post-modification counseling since 2011. Recognizing that many homeowners continue to struggle with their finances after receiving loan modifications, Fannie Mae developed the post-modification counseling program to take a holistic approach to individual finances and set borrowers on a sustainable path. Currently, there are 18 servicers that utilize the program.

Radian Guaranty Inc., the mortgage insurance subsidiary of Radian Group Inc., has entered into a master transaction agreement with Freddie Mac which the company says eliminates its claim exposure on 9,756 delinquent mortgage loans and 4,586 re-performing loans. The agreement involves a group of 25,760 first-lien mortgages held by Freddie Mac that were insured by Radian and were delinquent as of December 31, 2011. The agreement spells out future claim payments, loss mitigation activity, and insurance coverage of these loans.

America's Homeowner Alliance announced this week that it is officially open for membership. Launched by a team of industry veterans led by Phil Bracken and guided by an advisory board made up of representatives from the housing industry, prominent consumer groups, and fair housing organizations, America's Homeowner Alliance is the first nationally organized group dedicated to protecting and promoting sustainable homeownership for all segments of America.

Home prices have rebounded so rapidly that industry data show 8.3 million borrowers who've been underwater are on track to have enough equity to sell their home within the next 15 months--without resorting to a short sale. Metro markets that boast the highest percentage of homes with resurfacing equity include Omaha; Colorado Springs; Tulsa; Little Rock; and Raleigh, North Carolina.

Known as the Servicer Total Achievement and Rewards, or STAR, the program was created to establish servicing standards and acknowledge Fannie Mae servicers that stand out for their performance, customer service, and foreclosure prevention efforts, according to a release. Servicers recognized for the first half of 2013 in peer group one were Green Tree Servicing, Nationstar Mortgage, Ocwen Financial, PHH Mortgage, PNC Financial Services Group, Seterus, and Wells Fargo. In peer group two, Fannie Mae gave a nod to Fifth Third Bank and Regions Bank.

Freddie Mac is requiring servicers to offer a new modification to help borrowers in eligible disaster areas starting November 1, 2013. Dubbed the Capitalization and Extension Modification for Disaster Relief, the new option provides relief to borrowers by adding payments to the end of the loans to bring the account current. Fannie Mae also announced similar disaster relief policies in a recent servicing guide last week.

Although the pace of loan modification activity slowed from the first to the second quarter this year, foreclosure starts saw an even greater quarterly decline, according to data from HOPE NOW. In the second quarter, servicers provided 204,000 loan modifications to distressed borrowers, down by about 16 percent from the prior quarter. However, loan modifications were still up 13 percent from a year ago. Meanwhile, foreclosures starts were down 30 percent compared to the first quarter and down 38 percent from last year.

Newly initiated foreclosures are on the decline, reaching their lowest numbers since December 2005 in June, according to the latest Housing Scorecard from the Obama administration. Meanwhile, the administration continues to add to the tally of homeowners helped through its Making Home Affordable Program, bringing the total to more than 1.7 million as of June. Looking forward, the administration says it will focus on forming a new housing finance system.

As local governments consider the use of eminent domain to seize underwater mortgages, they may have to deal with the Federal Housing Finance Agency (FHFA) before moving forward with the plan. In a statement Thursday, FHFA stated it may ""initiate legal challenges"" to local or state actions that authorize the use of eminent domain to restructure mortgage contracts impacting Fannie Mae and Freddie Mac. Another action the GSEs' regulator might take is limit or stop business activity in jurisdictions that authorize the use of eminent domain to restructure mortgages.