Group Makes Mortgage Loan Modification Easier
A consortium of individuals and companies throughout the mortgage industry have achieved notable success helping homeowners complete mortgage loan modifications. Known as the Hope Now alliance, the group is comprised of companies that service mortgages, mortgage insurance providers, private investors and nonprofit counselors.
As of the end of August, the group estimates that it completed nearly 150,000 mortgage loan modifications.These were comprised both private and government loan modifications. The government loan modifications were made under the Home Affordable Modification Program (HAMP) which was introduced by Congress in 2009 to help struggling homeowners avoid losing their property in foreclosure.
In terms of numbers of modifications performed, the private loan modifications totaled approximately 116,000 while those performed under the HAMP program totaled approximately 33,000. For those loan modifications performed by private interests, approximately 90 percent of them also saw a reduction in both principal and interest payments. This is an indication that these types of loan modifications are likely to make payments more affordable for homeowners over the long term.
Overall, industry estimates are that more than 1.3 million mortgage loan modifications have occurred thus far in 2010. In total, 3.7 million modifications have been finalized since 2007. Additionally, delinquencies have been trending downward since the beginning of 2010. This is significant since industry watchers use delinquency rates as a future indicator of foreclosures.
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