Thursday, April 1, 2010

Private Sector Mortgage Modifications Outnumber HAMP 2 to 1

HOPE NOW reported twice as many homeowners received a modification from the private sector than from servicers participating under the government-led Home Affordable Modification Program (HAMP).

In February, 95,586 homeowners received a modification from the HOPE NOW alliance of mortgage servicers, investors, insurers and non-profit counselors. HAMP modifications went to 52,905 borrowers in the same month for a total of 148,000 modifications.

The US Treasury Department launched HAMP in March 2009 to provide incentives to servicers for the modification of loans on the verge of foreclosure. After a year of the program, servicers provided more than 170,000 permanent modifications.

Roughly 78% of the HOPE NOW modifications completed in February received a reduction of principal and interest.

“Our data shows that mortgage servicers are continuing a strong effort on proprietary and HAMP modifications in the first two months of 2010,” said Faith Schwartz, executive director of HOPE NOW, an alliance of agents, servicers and investors in the mortgage industry.

In order to boost HAMP performance, the Treasury released guidelines that encourage principal write-downs.

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