Just over a year since its launch, permanent HAMP conversions are approaching 300,000 with a median reduction of about $500 per month. As part of a new emphasis on provider accountability and transparency, the Treasury is reporting participant conversion levels, with little variation among the banking giants. See the following article from HousingWire for more on this.
Mortgage servicers participating in the Home Affordable Modification Program (HAMP) converted more than 68,000 trial modifications into permanent status in April, pushing the total to 299,092.
Servicers conducted almost 13% more conversions in April than the 57,000 in March. The Treasury Department launched HAMP in March 2009 to provide incentives to servicers for the modification of loans on the verge of foreclosure. Borrowers must make three monthly payments in the trial stages of a HAMP modification before it is converted to a permanent status.
The Obama Administration initially targeted 3m to 4m homeowners to receive assistance under HAMP.
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“The number of homeowners receiving significant relief through a mortgage modification continues to rise,” said Chief of Treasury’s Homeownership Preservation Office (HPO) Phyllis Caldwell. “Our focus now is on improving the homeowner experience and holding servicers accountable for their performance. Increased transparency through more robust reporting of servicer-specific data will contribute handily to those efforts.”
Servicers reduced payments under a permanent modification at a 36% median, translating to more than $500 a month.
For the first time, the Treasury included conversion rates for each of the participating servicers. HomeEq Servicing and Ocwen Financial held the highest conversion rates at 83%.
The big-four banks all held conversion rates in the same range. Bank of America (BAC: 15.98 -2.20%) and Wells Fargo (WFC: 31.27 -2.40%) both converted 25% of their trial modifications into permanent status. JPMorgan Chase (JPM: 38.89 -2.51%) converted 22% of its trials, and the Citigroup (C: 3.78 -5.03%) servicing arm CitiMortgage had a 21% conversion rate.
BofA had a total of 56,398 permanent modifications since HAMP launched, the most of any servicer. JPMorgan was second with 39,507. Wells Fargo had 36,094 for third, and CitiMortgage had 28,556 permanent modifications.
This article has been republished from HousingWire. You can also view this article at HousingWire, a mortgage and real estate news site.