In the second quarter, Citi worked with approximately 108,000 borrowers to avoid potential foreclosures on mortgages with a total original value of more than $16 billion, the bank says. Citi, the fourth-largest servicer in the nation, released the numbers in its quarterly foreclosure prevention report.
The company notes that modifications decreased about 5% from the first quarter but that ‘total loss mitigation actions’ (e.g., home retention and non-retention actions) for borrowers serviced by Citi in the second quarter improved 29%. The decrease in modifications is the result of Citi's implementation of the Home Affordable Modification Program (HAMP), which requires borrowers to be placed in three-month trial periods before their modifications are made official.
Two percent of all loans serviced by Citi were in loss mitigation or foreclosure-completed status at the end of the quarter, but 90+ day delinquencies increased to 4.7% in Citi's servicing portfolio for first and second mortgages.
Additionally, Citi's foreclosures-in-process inventory for loans increased approximately 10% in the second quarter of 2009 as compared with the first quarter of 2009; however, foreclosures initiated decreased 14% over the same period.
Redefault rates for loans serviced by Citi did not exceed 29% for loans modified between the first quarter of 2008 and the first quarter of 2009. "These rates showed continued improvement for loans modified in the first quarter of 2009," Citi says.
The company also notes in its report that its loss mitigation staff increased by 1,400 employees since the beginning of the year, and that CitiMortgage has developed and implemented HAMP training for over 4,000 employees.