Nearly 9,000 Permanent Loan Modifications Canceled in November

December 22, 2010 No Comments »

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Last month, 29,972 permanent loan modifications were completed under the Making Home Affordable Program, up from roughly 24,000 a month earlier.

However, the numbers are still below the previous six months, when participating mortgage lenders and loan servicers averaged 37,000 new permanent mods per month.

And 8,766 permanent loan modifications were canceled, bringing the total number of cancellations to date to 44,972.

The most commons causes of cancellation were insufficient documentation, trial plan payment default, and borrower ineligibility due to debt-to-income ratio.

Despite that bad news, aggregate reductions in monthly mortgage payments for borrowers who received permanent modifications is now estimated at $4.1 billion.

And the median savings for borrowers in active permanent modifications is $524.41, or 37 percent of the median payment before loan modification.

Last week, a Congressional Oversight Panel report predicted that only about 700,000 foreclosures will be prevented under HAMP, well short of the eight to 13 million foreclosures expected by 2012.

It looks as if efforts under HAMP are quickly coming to a crawl, as most eligible borrowers have already taken advantage of the program or a proprietary loan modification with their individual mortgage lenders.

Many others have taken advantage of the historically low mortgage rates on offer over the past two years via traditional refinance.

Either way, it looks as if there will be more foreclosures and fewer loan mods going forward.

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