Obama Administration Reports on Loan Modifications and Foreclosures in January

300px-Obama_cabinet_meetingAccording to the recent Housing Scoreboard published by the Obama Administration, for the month of January, 14,500 homeowners received permanent mortgage modifications through the Home Affordable Modification Program (HAMP), however, 53,100 homeowners got foreclosed on.

Meanwhile, 14,500 homeowners started trial loan modifications via HAMP, and 72,500 homes began the foreclosure process.

Private sector modifications continue to outperform HAMP. HOPE Now reported 62,200 mortgage modifications completed in January vs. only 14,500 completed via HAMP.

In January, the Federal Housing Administration (FHA) completed 39,200 loss mitigation actions (Short Sale), and the Home Affordable Refinance Program (HARP) completed 81,600 refinances.

Altogether, HOPE Now, FHA and HAMP have provided more than 6.1 million mortgage assistance actions which include loan modifications and Short Sales since April 2009, while just over 3 million foreclosures have taken place.

“Making Home Affordable has directly helped more than one million homeowners avoid foreclosure and indirectly helped millions more by promoting critical changes in the way the mortgage industry assists struggling homeowners,” said Tim Massad, assistant secretary for financial stability at the Treasury.

Since its initiation, HAMP has provided more than 1.1 million homeowners with loan modifications. These homeowners save an average $545 on their monthly mortgage payments.

About 87 percent of homeowners who enter the program receive a permanent modification, and about 94 percent of those are current on their modified loan after six months.

While HAMP claims fewer modifications than the private sector, the administration reports modifications through HAMP “continue to exhibit lower delinquency and re-default rates than industry modifications as reported by the Office of the Comptroller of the Currency.”

“The housing market has clearly bottomed out nationally and is turning a corner with new home construction increasing to a level not seen since June 2008 and home prices showing strong gains,” said Kurt Usowski, deputy assistant secretary for economic affairs at HUD.

For those who don’t qualify for loan modifications, FHA which included Freddie Mac and Fannie Mae continues to improve on its Loss Mitigation (aka Short Sale) procedures to prevent homeowners from facing foreclosure.  FHA also works feverishly with major servicers (BoA, Wells Fargo, Chase, Citi, HSBC, Goldman Sachs, etc) to allow the servicer more decision making ability to expedite the Short Sale transactions.

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