Whats happening with defaulted mortgages??
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I received this information this morning and wanted to pass it off to you.
HAMP Program Not Working Out!!
The most recent report on the HAMP program has been released
and the results arent very pretty. HAMP is designed to bring loan payments in line with borrowers?The ability to pay by reducing interest
rates and/or modifying loan terms until the monthly payment reaches
31% of the borrowers documented income. One big issue, of
course, is that concept of documented income. Many of the loans
originated in the years preceding the real estate meltdown were
called liar loans because income documentation wasnst required.
Now, when the borrower needs a lower payment, documenting
sufficient income to qualify for a lower payment doesnt seem to
be happening.
Loan servicers are certainly putting lots of borrowers into trial
modifications with permanent modification coming after the
borrower has made at least three of the new lower payments
and all the documentation has been submitted and approved.
So how do we determine the success of the program? Some
numbers for you:
Bank of America has an estimated 1,018,192 eligible 60+ days
delinquent loans with 156,864 current trial modifications and 98
permanent modifications.
J.P. Morgan Chase has an estimated 448,815 eligible 60+ days
delinquent loans with 136,686 current trial modifications and 4,302
permanent modifications.
Wells Fargo has an estimated 334,949 eligible 60+ days delinquent
loans with 96,137 current trial modifications and 3,537 permanent
modifications.
The report lists a percentage of active and trial modifications as a
share of eligible loans which really isnt going to give any idea of how
many loans will be successfully modified. If we take permanent
modifications as a percentage of eligible loans Wells Fargo is
knocking them down at 1.06% for the program to date. Chase is
bringing them in at a rate of .96% with BofA producing a rate of .01%
***************************************************************
Fannie, Freddie Suspend Foreclosures
Mortgage finance companies Fannie Mae and Freddie Mac are
suspending foreclosures and evictions for about two weeks in a
temporary break for borrowers during the holiday season.
The suspension, announced Thursday by the government-controlled
companies, runs from Saturday through Jan. 3. “No family should
have to face the prospect of being evicted during the holiday season,”
Michael Williams, Fannie Mae’s chief executive, said in a statement.
Earlier Thursday, Citigroup Inc. announced a 30-day suspension of
foreclosures and evictions, affecting about 4,000 borrowers. Fannie
and Freddie did not estimate how many homeowners would get this
grace period.
Last winter, most major lenders suspended foreclosures while the
Obama administration developed its $75 billion loan modification
program. But foreclosures picked up again after those suspensions
lifted.
***************************************************************
Shrinking Pool Of Foreclosure Buyers?
The latest results of a periodic national survey by Trulia.com and
RealtyTrac show reduced appetite for foreclosure purchases, but
also more realistic expectations.
The November survey found 43 percent of the 2,203 adults surveyed
would be at least somewhat likely to consider buying a foreclosed
home in the future, compared with 55 percent of adults surveyed in
May.
Among all respondents, negative sentiment towards a foreclosure
purchase remained high at 81 percent, compared with 85 percent
in May. Top concerns included hidden costs, the riskiness of the
process, and fear that the home will lose value after it is purchased.
I received this information this morning and wanted to pass it off to you.
HAMP Program Not Working Out!!
The most recent report on the HAMP program has been released
and the results arent very pretty. HAMP is designed to bring loan payments in line with borrowers?The ability to pay by reducing interest
rates and/or modifying loan terms until the monthly payment reaches
31% of the borrowers documented income. One big issue, of
course, is that concept of documented income. Many of the loans
originated in the years preceding the real estate meltdown were
called liar loans because income documentation wasnst required.
Now, when the borrower needs a lower payment, documenting
sufficient income to qualify for a lower payment doesnt seem to
be happening.
Loan servicers are certainly putting lots of borrowers into trial
modifications with permanent modification coming after the
borrower has made at least three of the new lower payments
and all the documentation has been submitted and approved.
So how do we determine the success of the program? Some
numbers for you:
Bank of America has an estimated 1,018,192 eligible 60+ days
delinquent loans with 156,864 current trial modifications and 98
permanent modifications.
J.P. Morgan Chase has an estimated 448,815 eligible 60+ days
delinquent loans with 136,686 current trial modifications and 4,302
permanent modifications.
Wells Fargo has an estimated 334,949 eligible 60+ days delinquent
loans with 96,137 current trial modifications and 3,537 permanent
modifications.
The report lists a percentage of active and trial modifications as a
share of eligible loans which really isnt going to give any idea of how
many loans will be successfully modified. If we take permanent
modifications as a percentage of eligible loans Wells Fargo is
knocking them down at 1.06% for the program to date. Chase is
bringing them in at a rate of .96% with BofA producing a rate of .01%
***************************************************************
Fannie, Freddie Suspend Foreclosures
Mortgage finance companies Fannie Mae and Freddie Mac are
suspending foreclosures and evictions for about two weeks in a
temporary break for borrowers during the holiday season.
The suspension, announced Thursday by the government-controlled
companies, runs from Saturday through Jan. 3. “No family should
have to face the prospect of being evicted during the holiday season,”
Michael Williams, Fannie Mae’s chief executive, said in a statement.
Earlier Thursday, Citigroup Inc. announced a 30-day suspension of
foreclosures and evictions, affecting about 4,000 borrowers. Fannie
and Freddie did not estimate how many homeowners would get this
grace period.
Last winter, most major lenders suspended foreclosures while the
Obama administration developed its $75 billion loan modification
program. But foreclosures picked up again after those suspensions
lifted.
***************************************************************
Shrinking Pool Of Foreclosure Buyers?
The latest results of a periodic national survey by Trulia.com and
RealtyTrac show reduced appetite for foreclosure purchases, but
also more realistic expectations.
The November survey found 43 percent of the 2,203 adults surveyed
would be at least somewhat likely to consider buying a foreclosed
home in the future, compared with 55 percent of adults surveyed in
May.
Among all respondents, negative sentiment towards a foreclosure
purchase remained high at 81 percent, compared with 85 percent
in May. Top concerns included hidden costs, the riskiness of the
process, and fear that the home will lose value after it is purchased.
