GSEs See Rising Workout Volume

Loan workouts by Fannie Mae and Freddie Mac totaled over 99,000 in the third quarter, up from nearly 88,000 in the second quarter, but loan modifications make up only 13.6% of the workouts, according to a Federal Housing Finance Agency report. The report shows the mortgage giants modified 4,785 delinquent mortgages in September and initiated 30,183 repayment plans. However, the government sponsored enterprise regulator points out that Fannie "reinstated" nearly 27,300 loans in the third quarter as part of its HomeSaver Advance program. In April, Fannie servicers began offering delinquent borrowers advances of up to $15,000 to cover missed payments and allow the borrower to resume timely payments. Freddie does not offer HomeSaver Advances, which are unsecured loans with a 5% interest rate. The two GSEs had 678,500 mortgages that are 60 days or more past due as of Sept. 30 and reported nearly 41,000 foreclosure starts in September.