HOPE NOW: Foreclosure Starts, Foreclosure Sales Near Pre-Crisis Levels

Posted by Patrick Barnard on February 02, 2016 No Comments
Categories : Mortgage Servicing

Mortgage servicers completed about 26,000 loan modifications in November – a decrease of 16% compared with about 30,000 in October and a decrease of 21% compared with about 33,000 in November 2014, according to estimates released by HOPE NOW, a voluntary, private-sector alliance of mortgage servicers, investors, mortgage insurers and nonprofit counselors.

Of the modifications completed in November, about 19,000 were completed through proprietary programs and 7,691 were completed through the federal government’s Home Affordable Modification Program.

Looking at other foreclosure alternatives, there were about 5,600 short sales in November – a decrease of 14% compared with 6,800 completed in October and a decrease of 35% compared with 8,600 in November 2014.

There were about 1,400 deeds-in-lieu completed in November, a decrease of 10% compared with 1,500 reached in October and a decrease of 26% compared with 1,900 in November 2014.

In total, all workout solutions, including loan modifications, short sales, deeds-in-lieu and workout plans, were approximately 99,000 for November. That compares to an estimated 24,500 foreclosure sales. This metric is important as it shows the breadth of solutions available to at-risk homeowners and that these homeowners are likely to receive an alternative solution to foreclosure.

It is interesting to note that nearly 40% of foreclosure-alternative solutions for families were repayment plans. This indicates most families are experiencing short-term hardships.

About 47,000 properties started the foreclosure process in November – a decrease of 17% compared with about 57,000 in October and a decrease of 22% compared with about 60,000 in November 2014.

There were about 24,000 foreclosure sales in November – a decrease of 14% compared with about 29,000 in October and a decrease of about 14% compared with 28,000 in November 2014.

About 1.65 million properties were seriously delinquent in November – basically unchanged compared with about 1.66 million in October but a decrease of 16% compared with 1.97 million in November 2014.

“As we turn our attention to 2016, our data continues to indicate recovery in the overall housing market,” says Eric Selk, executive director for HOPE NOW, in a statement. “Our November report shows that key trends remain consistent with previous reports. Specifically, foreclosure starts and foreclosure sales completed are at or near pre-crisis norms. Although fewer modifications are being reported, families are receiving assistance through foreclosure-alternative solutions, such as retention plans and formal repayment plans. This is reflective of an early intervention process that all servicers are employing. The goal is to keep families in their home and respond quickly when someone goes delinquent.

“Another key indicator of positive market stability is the decline in serious delinquency,” Selk adds. “HOPE NOW tracks those homeowners who are 60-plus days delinquent, and we have reported a steady total of about 1.65 million borrowers for the past five months. This is a far cry from the nearly 2 million borrowers who were seriously delinquent just 18 months ago. This is a true testament to the hard work of the HOPE NOW alliance and others, as well as the recent jobs report and economic recovery.”

To view the full report, click here.

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