Posted on Monday, January 18, 2010
The December 2009 Servicer Performance Report for Making Home Affordable show us some interesting things.
• At this point about 89% of eligible mortgage debt is covered by HAMP participating servicers. During Q4 2009 servicers agreeing to participate rose from 63 to 102. Another 2300 lenders service FNMA or Freddie owned or insured loans, making them automatically eligible to participate. This should mean that non-participation is no longer an obstacle.
• During Q4 2009 active trial and perm mods rose by 75% from Q3. More than 46,000 offer for perm mods have been sent. As of December 1,164,507 trial mods had been offered and 902,620 trial mods had been started since the program began. This should mean we have a large enough sampling to see if the program works.
Other stats of interest;
• Borrowers in active trial mods have saved over $1.5 billion.
• Loss of income is the primary hardship (51.8%). Excessive obligation is second (11.2%). Unemployment is only 5.6% and illness 2.7%.
• 100% of perm mods are for rate reductions. 43.2% involve a term extension and 26.6% a forbearance.
• Of perm mods, borrowers rations before average 45/72.2 and after 31/55.5
• There’s a wide range in terms of how good of a job lenders and servicers are doing. At one end, CitiMortgage has 47% of its eligible loans in trial mods. At the other end, Wachovia has only 3%.
• In California there have been 158,935 trial mods and 13,353 perm mods. In North Dakota the numbers are only 190 and 15, further highlighting the need for geographic driven, property type driven and price range driven solutions.
Perhaps most telling is that of 3,356,844 eligible, 1,164,507 trial mods offered, 902,620 trial mods started/787,231 currently active, only 66,465 have been made permanent (another 46,056 perm mods are pending). Maybe those pending perm mods still have more time to accept before we can really know whether this program is working but I suspect given the huge spread, that MHA is not a solution that is in line with our current housing problems.