Mortgage

Foreclosure starts, mods on Fannie Mae, Freddie Mac loans rose in 3Q

Foreclosure starts, mods on Fannie Mae, Freddie Mac loans rose in 3Q
Written by Publishing Team

Foreclosure and adjustment activity and short-term delays in government-sponsored enterprise loans increased during the third quarter as some pandemic-related relief began to be phased out, although long-term distress eased.

Foreclosures jumped 16% from the second quarter, rising to 7,253 from 6,233, according to the Federal Housing Finance Agency, custodian and regulator for Fannie Mae and Freddie Mac. It allowed a lot of foreclosure activity to move forward with new consumer protection measures.

The adjustments, in which borrowers with long-term reductions in income receive affordable loan terms, rose 11% to 17,930 from 16,134. The number of short-term delinquencies (60 days or less) also rose 5% to 218,894 from 207,034. .

With that said, the severe delinquency rate fell to 1.55% from 1.99%, outperforming the 3.40% average for the mortgage market as a whole.

However, serious delinquency cases vary widely across the country, with numbers in places like California Being particularly high, highlighting the importance of combining the assistance available from GSEs with the distributed state homeowner assistance fund Money in efforts to lessen the remainder of the ordeal linked to the pandemic. The number of serious non-performing loans by the state ranged from less than 1,000 in Idaho to nearly 54,000 in California.

The FHFA also noted that the third quarter was a slow period for a program aiming to deliver more Rate cut chances For low-income borrowers with a high loan-to-value ratio in deciding foreclosure and refinancing. Only four of these loans were reported, compared to 19 in the previous quarter.

These numbers could grow if Freddie Mac, called by the FHFA Increasing its reform activity for low-income peoplechooses to take advantage of this program in response.

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