Mortgage servicing firms ramped up proprietary loan modifications by an impressive 41% in the third quarter while foreclosure and short sales jumped by much less, according to new figures released by the Hope Now alliance.
Hope Now figures published late Monday show that mortgage firms completed 186,060 proprietary loan modifications in 3Q compared to 131,556 the prior quarter.
Servicers also completed another 33,300 loan restructurings under the federal government’s HAMP program.
Overall, foreclosure sale transactions rose 7% to 198,000 units in the third quarter while short sales increased 3% to 110,150 units. (The comparisons are to 2Q.)
In total, loan modifications and short sales exceeded foreclosures, indicating that servicers have a “strong focus” on foreclosure prevention solutions, said Hope Now executive director Faith Schwartz.
“It cannot be stated enough that mortgage servicers have more tools than ever before, via proprietary and government programs, to offer the most viable and realistic options for at-risk homeowners,” Schwartz said.
The Hope Now report also shows that foreclosure starts declined 4% from the second quarter to 504,000 actions in the third quarter. Foreclosure starts are down 16% from a year ago.