Mortgage servicers completed 115,760 proprietary loan modifications in August, down 3.8% from the prior month, according to the Hope Now Alliance.
In addition, HOPE Now servicers completed 33,340 permanent modifications under the government's Home Affordable Modification Program in August, down 9% from July.
Hope Now servicers are required to evaluate struggling borrowers for the HAMP program first. If the mortgagor does not qualify, the servicer can offer the borrower a proprietary modification or another workout plan.
The report says 91% of the proprietary mods completed in August involved reductions in monthly mortgage payments.
The monthly Hope Now report also shows foreclosure starts totaled 245,015 in August, up 8% from July -- just as the foreclosure process got tied up in the robo-signing controversy.
Hope Now senior advisor Faith Schwartz said loan modifications occur before the foreclosure process starts and there shouldn't be any impact.
"I expect we will still see good numbers on workouts. This is all about avoiding foreclosure," she said.
