Short Sales Fall Sharply in First Quarter

The Federal Housing Finance Agency saidrnon Friday that Freddie Mac and Fannie Mae continue to complete thousands ofrnforeclosure prevention actions in each reporting period.  The two assisted homeowners with a combinedrntotal of 88,800 loan modifications, forbearances, and other assistance. This bringsrnthe total to 3.2 million since the two government sponsored enterprises (GSEs)rnwere put in conservatorship in 2008.  Thatrntotal includes 1.6 million loan modifications. rn</p

Foreclosure previous actions have helpedrnmore than 2.6 million borrowers stay in their homes and another half-millionrnhave been helped to exit home ownership without a foreclosure.  Those home forfeiture actions include shortrnsales and deeds-in-lieu.  FHFA noted thatrnshort sales dropped by 26 percent in the first quarter compared to the previousrnone.  </p

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Fannie Mae and Freddie Mac’s foreclosure prevention arsenals include the HomernAffordable Modification Program (HAMP), a joint effort by FHFA and the TreasuryrnDepartment, and proprietary programs offered by each of the GSEs.  In the first quarter of 2014 there werern10,764 borrowers in active HAMP trials compared to 13,551 in the fourth quarterrnof 2013.  The number of active permanentrnmodifications increased from 431,503 in the fourth quarter to 431,677 in thernfirst.  </p

Since HAMP was initiated in April 2009,rnthere have been 1.1 million trial modifications extended to troubled homeownersrnand approximately 620,400 of them have been granted permanent HAMP modifications.   At the end of the first quarter there werernnearly 10,800 homeowners in a HAMP trial.</p

Non-HAMP modifications however accountedrnfor most of permanent loan modifications in the first quarter, nearlyrn44,800.  Since the housing crisis began,rnmodifications through the GSEs proprietary programs have totaled more thanrn844,400.</p

The number of seriously delinquent borrowers with GSE loans decreased 8rnpercent during the quarter and the serious delinquency rate fell to 2.2 percentrncompared to 6.7 percent for FHA loans, 3.6 percent for VA loans, and a 5.0rnpercent industry average.  </p

While the total number of troubled borrowers continued to decline, 31rnpercent of these borrowers remained deeply delinquent at the end of the firstrnquarter.  Florida, New York and New Jersey have the highest number ofrndeeply delinquent loans (365+ days). </p

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Third-party sales and foreclosure sales fell slightly to 47,300 whilernforeclosure starts decreased 25 percent in the first quarter.</p

The GSE’s inventory of real estate owned (REO) declined by 3 percent in thernfirst quarter as property dispositions outpaced acquisitions 9 percent to 6rnpercent.  REO located in Florida, whichrncomprises a significant portion of the GSEs’ inventory, increased by 9 percentrnduring the quarter.</p

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