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Administration Releases December Loan Modification Repot

More Than 850,000 Homeowners Now with Median Payment Reductions Exceeding $500; More Than 100,000 Permanent Modifications Approved to Date

AggressiveAdministration Campaign Significantly Accelerates Conversion Rate;December Push Doubles Number of Permanent Modifications Over Life ofProgram

 

 

WASHINGTON- The U.S. Department of the Treasury and the Department of Housing andUrban Development (HUD) today released an update on theAdministration's aggressive nationwide campaign to help borrowers inthe trial phase of their modified mortgages convert to permanentmodifications under the Home Affordable Modification Program (HAMP).The new December data demonstrates that there has been a significantacceleration in the rate at which borrowers are being approved forpermanent modifications. As of December, more than 100,000 permanentmodifications have been approved, including 66,000 that borrowers haveaccepted and the remainder awaiting only the borrower's signature. Under HAMP, more than 850,000 homeowners have had a median paymentreduction exceeding $500.

 

"Treasuryis committed to working with servicers and borrowers to sustain thisimproved pace," said Chief of Treasury's Homeownership PreservationOffice (HPO) Phyllis Caldwell.

 

HUD Senior Advisorfor Mortgage Finance William Apgar echoed this commitment: "HUD willcontinue to work with our Administration partners and utilize our broadnetwork of housing counseling agencies to increase the number ofborrowers receiving sustainable and affordable modifications underHAMP."

 

TheAdministration has taken a number of steps to assist servicers inramping up to give eligible homeowners the opportunity to participatein HAMP. Over the past month, Administration representatives wereon-site in servicer offices to ensure that servicers increased effortsto deliver decisions to borrowers in trial modifications who hadsubmitted all of their documents and to obtain any missing documentsfrom borrowers. The Administration also implemented a temporary reviewperiod to ensure that all borrowers are being fairly evaluated for theprogram – the temporary review period extends until January 31, 2010.

 

HAMPwas designed to offer up to 3-4 million homeowners reduced monthlymortgage payments that are affordable and sustainable over thelong-term, over the life of the program. Currently, several millionhomeowners are estimated to be eligible for the program and more than 1million have already received modification offers. At this pace, theprogram is on track to meet the goals that President Obama laid out inannouncing the Homeowner Affordability and Stability Plan. This Planincluded several housing initiatives beyond mortgage modifications,including broad support for Fannie Mae and Freddie Mac to keep interestrates low and facilitate mortgage affordability across the market,increased flexibilities for Fannie Mae and Freddie Mac in refinancingmortgages to provide homeowners with lower monthly payments, taxcredits to support development of affordable housing, and support tostate and local housing finance agencies. In just the first year, theAdministration has launched all of these critical initiatives.

 

Aspart of an ongoing commitment to continuously provide greatertransparency in all of the Administration's financial stabilityefforts, the December report includes several new measurementsincluding a breakdown of permanent modification characteristics. Thesecharacteristics include predominant hardship reasons and monthlypayment savings.

 

The December HAMP report can be found here: http://financialstability.gov/docs/report.pdf