The number of homeowners obtaining mortgage loan modifications
has dropped by nearly one-third over the past year, falling faster
than the decline in mortgage delinquencies and
Just over 207,000 mortgage borrowers obtained loan modifications
in the first quarter of the year, a 31 percent decline from the
more than 298,000 who received them in the first quarter of 2011.
During the same period, the rate of new foreclosure starts and
60-day mortgage delinquencies fell by 8.1 percent and 7.2 percent,
The figures were reported today by the Hope Now Alliance, an
initiative of the mortgage industry and U.S. government to address
the foreclosure crisis.
About 30 percent of all loan modifications were done through the
federal Home Affordable Modification Program (HAMP), essentially
unchanged from one year ago. The rest were proprietary
modifications conducted by lenders following their own private
guidelines rather than those of HAMP.
A significantly higher share of borrowers getting proprietary
modifications saw their principal and interest payments reduced
compared to one year ago. Seventy-two percent of private
modifications reduced the borrower's monthly payments by at least
10 percent, compared to 57 percent in the first quarter of
One of the differences between HAMP modifications and
proprietary modifications is that under HAMP, a borrower's monthly
payments must be reduced, while private modifications may
restructure a mortgage in ways that do not always reduce a
borrower' payments and sometimes increase them.
The report said there were a total of 545,000 foreclosures begun
in the first three months of 2012, down from 591,000 in the first
quarter of 2011. Sixty-day delinquencies averaged 2.64 million in
the first quarter of 2012, down from 2.86 million one year