HOPE NOW: 5.9M Completed Mods Since 2007; Short Sales Increase
Short sales continued to increase in October, while foreclosure starts fell, according to data from HOPE NOW, an industry alliance of mortgage servicers, investors, mortgage insurers, and nonprofit counselors.
Completed short sales reached 38,518 in October, representing a 13 percent increase from September. Since 2009, over one million short sales have been competed, according to HOPE NOW.
Foreclosure startswhich totaled 113,555saw a dramatic decline and dropped by 24 percent from the previous month. As starts fell, foreclosure sales increased 12 percent during the same time period, with sales totaling 71,080 compared to 62,645 in September.
Faith Schwartz, executive director of HOPE NOW, says the significant decrease in foreclosure starts is worth noting, but cautioned one month does not indicate a trend.
With multiple servicing transfers, AG settlement activity, and seasonal adjustments, we will be working with more volatility around monthly data for some time, she said.
Meanwhile, HOPE NOW also reported nearly 6 million struggling homeowners have received a modification since 2007. Among the modifications, 4.8 million were proprietary loan modifications, while 1.1 million mods were through the governments Home Affordable Modification Program (HAMP).
In October alone, HOPE NOW estimates servicers modified 88,583 loans for homeowners, up from 74,329 in September. Of those who were modified in October, 72,580 received proprietary modifications, while 16,003 were modified through HAMP.
The combination of loan modifications and short sales, completed by the industry in the month of October, means that close to 130,000 homeowners received a permanent, alternative to foreclosure, said Schwartz.
However, the number of borrowers who may need to seek a modification increased, with delinquencies edging higher in October. The number of borrowers who were past due by at least 60 days increased by 3 percent to 2.54 million from September.