Delinquencies on home loans within Fannie Mae and Freddie Mac’s portfolios continue to climb, according to a report issued this week by the two companies’ conservator, the Federal Housing Finance Agency (FHFA).

Of the more than 30 million mortgages serviced through the GSEs, 2.2 million were in default as of the end of August. That figure represents 7.33 percent of Fannie and Freddie’s combined portfolios, and a jump of 6.6 percent compared to the previous month.

FHFA noted though that homeowners enlisting in the federal government’s Home Affordable Modification Program (HAMP) are classified as “delinquent” until they successfully complete the 90-day trial period.

The number of the GSEs’ borrowers who are 60 or more days behind on their mortgage payments has increased approximately 61 percent year-to-date to 1.5 million, or 4.89 percent of their outstanding home loans. Seriously delinquent homeowners – classified as those who are already in the process of foreclosure, have filed for bankruptcy, or are three or more payments delinquent – represented 3.92 percent of the two companies’ portfolios as of the end of August.

Just as delinquencies persist in heading steadily upward, FHFA’s monthly status report indicated that servicers of Fannie Mae and Freddie Mac loans are modifying fewer mortgages under the Obama administration’s foreclosure prevention program. The two government-backed mortgage financiers reported 80,000 new modification trials in the month of October, compared to 84,000 in September.

Despite the slower pace for federal HAMP modifications, FHFA says the GSEs’ home retention actions show growth, which signifies that they are offering other anti-foreclosure options to borrowers who do not qualify for the administration’s program, such as traditional loan modifications, repayment plans, and Fannie’s HomeSaver Advance program.

Still, the GSEs’ foreclosure starts in August increased 11 percent compared with July to nearly 94,700, FHFA reported. But at the same time, completed foreclosure and third-party sales declined 13 percent from 25,000 in July to 21,800 in August.
Separately, both “Fannie Mae”:http://www.fanniemae.com/ir/pdf/monthly/2009/103109.pdf and “Freddie Mac”:http://freddiemac.com/investors/volsum/pdf/1009mvs.pdf published their monthly financial summaries this week. Fannie’s gross mortgage portfolio declined at a compound annualized rate of 27.8 percent in October, while Freddie’s total portfolio increased at an annualized rate of 0.7 percent.
The two companies reported continued increases in their home loan delinquency rates. Fannie’s single-family, serious delinquency rate rose 27 basis points in September to 4.72 percent. Freddie’s single-family delinquency rate for October jumped 21 basis points to 3.54 percent of its portfolio.