Who’s Modifying Mortgages?
With Foreclosures Rising, Why is Housing Market Improving?
Christian Science Monitor
The US housing market shows signs of progress, even in the face of a rising and record tide of foreclosures. On its face, that sounds incongruous. All those loan defaults, unmowed lawns, and fire-sale auctions of bank-owned homes aren’t indicators of stability, after all. Many forecasters say foreclosures may not peak until some time next year or even 2011. That would exert downward pressure on home prices, particularly in certain hard-hit metro areas. Yet, broader indicators of the housing market paint a more encouraging picture – that a bottoming out is under way.
Foreclosure Plan Is Off to a Bumpy Start
Wall Street Journal
A report card released Tuesday by the Treasury Department showed wide variations in how quickly mortgage companies are helping financially troubled borrowers under the Obama administration's foreclosure-prevention plan. So far, more than 400,000 borrowers have been offered help. More than 235,000 borrowers, or roughly 9% of those eligible for the program and at least 60 days past due, have begun trial mortgage modifications, the first step to getting a loan reworked. Among the largest mortgage-servicing companies, J.P. Morgan Chase & Co. has put the most borrowers on a trial modification, having begun the process for roughly 79,000 of them, or about 20% of those whose loans are at least 60 days past due.
Who’s Modifying Mortgages?
New York Times
Washington has pushed hard for the nation’s bailed-out financial institutions to give troubled homeowners a break as well. But according to data released by the Treasury Department on Tuesday, some big banks are moving much faster than others to modify mortgages that they service under the government’s Making Home Affordable program. The chart below shows just how uneven: Among the big lenders, JPMorgan Chase and GMAC have started modifications on about 20 percent of eligible mortgages since the program officially started in March. Wells Fargo and Bank of America have started modifications on a much smaller percentage, 6 percent and 4 percent, respectively, according to the Treasury Department.
Home Sellers Frustrated as Short-sale Deals Collapse
Scores of homeowners who thought they'd cut a deal with their banks to sell their houses for less than their unpaid mortgages are seeing those agreements fall apart months later, contributing to the mounting foreclosures that threaten the housing market's recovery. The sales of homes for less than the amount owed the bank, known as "short sales," have been widely viewed as an alternative that could help slow the foreclosure epidemic. In theory, delinquent homeowners escape a mortgage they cannot afford, and lenders, although taking a loss, avoid the even costlier process of completing a foreclosure.