Loss Mitigation Efforts Are Still Alive and Well

The number of non-foreclosure solutions completed by mortgage servicers in February 2016 outpaced the total of foreclosure completions by a 3:1 ratio during the month, according to HOPE NOW, a private-sector alliance of servicers, investors, mortgage insurers, and non-profit counselors.

The industry completed approximately 97,000 non-foreclosure solutions (including loan modifications, short sales, deeds-in-lieu of foreclosure, and other workout plans) in February, compared to about 28,000 foreclosure sales during the month, according to HOPE NOW.

Those non-foreclosure solutions include 27,000 permanent loan modifications. About 19,000 of those were completed through proprietary programs and about 8,000 of them were completed through the government’s Home Affordable Modification Program (HAMP).

Since HOPE NOW began tracking the data in 2007, the industry has completed approximately 24.8 million non-foreclosure solutions; approximately 7.8 million of those have been permanent loan modifications.

“Non-foreclosure solutions outpaced foreclosure sales by more than a three to one margin in the month of February,” HOPE NOW Executive Director Eric Selk said. “This has been a fairly steady trend for the past year and illustrates the availability of various long term and short term solutions that benefit homeowners. From a historical perspective, this number marks consistent performance in customer assistance and solutions offered.”

“This has been a fairly steady trend for the past year and illustrates the availability of various long term and short term solutions that benefit homeowners.”

Eric Selk, Executive Director, HOPE NOW

Though many housing fundamentals have returned to their pre-crisis levels, or “recovered” nationwide, some pockets of the country are still struggling with large volumes of distressed homes. HOPE NOW has three more borrower outreach events planned in Florida for later in the year in order to allow homeowners facing foreclosure to connect face-to-face with their servicers and housing counselors.

“The volume of non-foreclosure solutions compared to the number of foreclosure sales illustrates the hard work that servicers continue to perform with borrowers who are struggling with their mortgage,” Selk said. “Solutions, including loan modifications, have remained consistent even though serious mortgage delinquencies fell to one of the lowest levels since HOPE NOW began tracking data. Our industry members comprehensively review all at-risk families for multiple options, when going through the loss mitigation process, and attempt to apply the most viable solution for each situation. Servicers continue utilize a multitude of programs and HAMP alternative products to assist homeowners. These solutions avoid foreclosures and we are pleased to see the number of proprietary modifications completed remain stable.”