Hope Now Impact in Foreclosure Prevention Grows
In April, mortgage servicers provided loan workouts to about 183,000 homeowners reaching "the highest monthly amount" since the program started in July 2007, according to Hope Now, an alliance of servicers, counselors and investors dedicated to preventing foreclosures.
The Hope Now April report indicates that on an industrywide basis during the month the number of workouts has continuously seen progressive growth. For example, in April it increased by 23,000 compared to March.
"Numbers clearly demonstrate that Hope Now is succeeding at helping homeowners avoid foreclosure and stay in their homes," said Hope Now executive director, Faith Swartz, upon the announcement. "The alliance will continue to do everything possible to reach and help as many as possible."
Since the initiation of Hope Now in 2007, the mortgage industry helped a total of about 1.6 million homeowners avoid foreclosure through loan modifications, repayment plans and other workout options.
In April, of the 183,000 at-risk-of-foreclosure borrowers, about 106,000 of those holding prime and subprime loans went through a repayment plan workout with their servicer, while another 77,000 opted for loan modifications. In the past three months alone, Hope Now said, it has connected 4,000 homeowners with their lenders or HUD-certified housing counselors, through various workshops in 11 cities in California, Georgia, Illinois, Ohio, Pennsylvania, Massachusetts, Minnesota, Wisconsin and Indiana. In addition, it is planning such workshops in other cities around the country.
The HOPE hotline operated by the Homeownership Preservation Foundation available 24 hours, seven days a week, the nonprofit said, on average receives up to 4,000 phone calls every day at no cost to borrowers. "This is far in excess of what the lending industry has ever had to field," Hope Now said.
Moreover, Hope Now has sent a total of 1.2 million letters to borrowers as part of its nationwide effort to reach out to homeowners at risk of default or foreclosure. As of now, Hope Now data show that 20% of the recipients of these letters have contacted their servicer to receive more information on their loan and consider their workout options. This response, Hope Now said, is 10 times higher, compared to 2% to 3% average response rate servicers usually receive for their letters to borrowers. "Foreclosure benefits no one - the borrower, community, lender and investor all lose," Ms. Schwartz said. "Hope Now has every incentive to help troubled homeowners hold on to their homes." The highest foreclosure risk, however, is associated with subprime adjustable-rate mortgages about to reset. (c) 2008 Mortgage Servicing News and SourceMedia, Inc. All Rights Reserved. http://www.mortgageservicingnews.com/ http://www.sourcemedia.com/