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Mortgage mods wind down

By Holden Lewis · Bankrate.com
Tuesday, July 20, 2010
Posted: 3 pm ET

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.

Read tips for getting a mortgage modification.

And follow me on Twitter @HoldenL.

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4 Comments
Greg Howell
August 10, 2010 at 11:34 pm

The major problem is that if your loans with a bank you may stand a chance at getting your loan modifified. My loan is service by a large mortagae company from across the pond. The first modification was taken down by $600.00 I was paying $3756.00 each month. I ran into job cut backs I had to applied for another one and it took that amount down to $3100.00 (BIG DEAL)the next mod went down to $2946.00 This company has no clue what they are doing, long story short just like other people in Central California I will be losing my house of 8 years due job lose by me and my wife being layoff from her job of 6 years I went thought serveal programs that this company says they work with found out this was not true my loan was not backed by freddi mac or fannie Mai OH I forgot to say that this company also had my loan to ballon within 2 years with intrest payments only. But I read the paper work and it was hidden in the boiler plate long story short this company has made so many mistake and have not taken any ownership of what they have done.