GSEs Complete 117,000 Foreclosure Prevention Actions in 2Q13

Foreclosures recently have been falling throughout the country for an extended period of time, and the government-sponsored enterprises continue to do their part in assisting at-risk homeowners from losing their properties.

During the second quarter, both Fannie Mae and Freddie Mac completed 117,000 foreclosure prevention actions. This figure brings the total to more than 2.9 million borrowers who have been aided by either Fannie or Freddie in order to avoid being foreclosed upon by their mortgage lender since the enterprises were bought under conservatorship in September 2008.

Overall, the 2013 second quarter Federal Property Manger’s Report released by the Federal Housing Finance Agency revealed that approximately 2.4 million of these prevention actions have helped troubled borrowers save their homes, including more than 1.4 million permanent loan modifications.

The FHFA said that more than half of troubled homeowners who received permanent loan modifications in the second quarter had their monthly payments reduced by more than 30%. Additionally, one-third of the permanent loan modifications offered during this time period included principal forbearance.

As of June 30, 2013, the performance of modified loans remains strong, as about 11% of those that were revised in the third quarter of 2012 had missed two or more payments, the report stated.

Meanwhile, approximately 29,400 short sales and deeds-in-lieu were completed during the second quarter, which resulted in borrowers leaving their homes without going through the foreclosure process. This quarterly figure brought this nonforeclosure home forfeiture action total to more than 505,700 since the start of conservatorship.

Other positive news seen in the quarterly report is that the number of Fannie Mae and Freddie Mac delinquent loans dropped nationally in 2Q13 primarily due to a decline in the amount of loans that have not been paid in 60 or more days. According to the FHFA, the number of delinquent borrowers by at least 60-days declined 7% during the quarter to the lowest level since the regulator began overseeing the enterprises.

The enterprises’ serious delinquency rate fell to 2.8% at the end of the quarter compared with 7.6% for Federal Housing Administration loans, 3.9% for Veterans Affairs loans and 5.9% for all loans (industry average).

Also, the enterprises’ REO inventory continued to decline in the second quarter as property dispositions outpaced acquisitions. Property acquisitions dropped 7% during 2Q13, while dispositions decreased 2%.