About 133,000 homeowners received permanent loan modifications from mortgage servicers during the first quarter of this year – a decrease of about 3% compared to the approximately 137,000 modifications approved in the fourth quarter of 2013, HOPE NOW reports.
Of the 133,000 loan modifications approved in the first quarter, about 91,500 were proprietary loan modifications, while the remaining 41,363 were completed under the Home Affordable Modification Program (HAMP).
According to the voluntary, private-sector alliance of mortgage servicers, investors, mortgage insurers and nonprofit counselors, about 6.97 million permanent loan modifications have been approved since 2007. Of those, more than 5.6 million were proprietary programs, and 1,352,861 were completed under HAMP.
The nonprofit's data shows that there were about 217,000 foreclosure starts in the first quarter, compared to 264,000 during the fourth quarter of 2013 – a decline of close to 18%. Year over year, foreclosure starts were down about 46% compared to the first quarter of 2013, when about 400,000 were recorded.
Foreclosure sales also declined, with approximately 126,000 reported for the first quarter versus 131,000 reported for the fourth quarter of 2013 – a decline of almost 4%. On a year-over-year basis, foreclosure sales were down about 26%.
Approximately 34,000 short sales were completed in the first quarter compared to about 49,000 in the fourth quarter of 2013 – a decline of about 30%. On a year over year basis, short sales were down about 60%, as there were about 85,000 short sales recorded in the first quarter of 2013.
Also, total home sales were down 4% in the first quarter, compared to the fourth quarter, according to HOPE NOW.
Eric Selk, executive director for HOPE NOW, pointed out that there is a ‘direct parallel between the number of foreclosure starts and the number of loan mods, quarter over quarter and year over year.’
‘This means that the industry is steady in its effort to keep pace with market demand,’ he says in a release. ‘Sixty-day delinquencies are also slightly down, and we have seen this number decline month over month for over a year.’
‘We have also seen the attendance at our face-to-face community outreach events soften,’ Selk adds. ‘This is a direct result of the delinquency decline nationwide.’
Selk also points out that as more homeowners see improved equity in their property, due to rising prices, the need for short sales has declined.
‘We have seen a dramatic drop in those numbers in the first quarter of 2014 compared to the first quarter of last year,’ he says. ‘However, the steady number of short sales in the first quarter suggests that there are still some borrowers who prefer a graceful exit from the property as opposed to a retention option.’
Selk says face-to-face borrower outreach, co-sponsored by Making Home Affordable, continues to be a cornerstone of HOPE NOW's work.
This outreach is ‘supplemented by locally sponsored events and virtual, online events that allow homeowners to connect to servicers and counselors to find solutions from the comfort of their own home,’ he says.
‘Additionally, HOPE NOW has conducted community workshops with state and local leaders, with the goal of finding solutions tailored to the needs of specific communities,’ Selk adds. ‘The cumulative effort of borrower outreach, improved processes and better communication between parties has all contributed to positive results in the housing market.’
To read the full report, click here.