The pace of mortgage modifications is slowing down drastically.
According to the Treasury department, lenders in June offered 15,153 trial mods under the Home Affordable Modification Program, or HAMP. That's less than one-tenth of the modifications offered in October, and about one-third of the number of trial mods offered in April.
Meanwhile, 51,205 borrowers were offered permanent modifications in June, after making at least three payments on time under a trial modification.
In all, about 1.3 million borrowers have begun trial modifications since HAMP began in spring 2009, and a little under 400,000 borrowers have been granted permanent mortgage modifications. The vast majority of those permanent mods are still in effect -- in other words, after going through the trial period and getting a permanent mod, they haven't been foreclosed on. Nine months after getting a permanent modification, 7.7 percent of borrowers are more than two months past due. Not to shabby.
Not all mortgage modifications are done under HAMP. Lenders are free to offer mods under their own criteria. The top eight lenders have made 154,873 "alternative modification" offers, according to the Treasury.
Mortgage mods are declining because hardly anyone is left who is qualified. To get a modification, you have to have some income. Unemployed homeowners generally don't get mortgage modifications. Yet unemployment is the main reason that people are falling behind on their mortgage payments.
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