FHFA: More than 6.3M Homeowners Helped Since Conservatorship

The Federal Housing Finance Agency released its fourth quarter Foreclosure Prevention and Refinance Report, showing Fannie Mae and Freddie Mac completed 153,793 foreclosure prevention actions during the quarter, raising the total number of homeowners who have been helped to 6,364,278 since the start of conservatorships in September 2008.

The report also said 46 percent of loan modifications completed in the fourth quarter reduced borrowers’ monthly payments by more than 20 percent. The number of refinances decreased slightly from 1.286 million in the third quarter to 1.266 million in the fourth quarter.

The Enterprises’ serious delinquency rate dropped from 1.55 percent to 1.19 percent at the end of the fourth quarter. This compares with 6.48 percent for Federal Housing Administration loans, 3.82 percent for Veterans Affairs loans and 2.83 percent for all loans (industry average).

The report noted loans in forbearance plans continued to trend downward since its peak in May 2020, but remained elevated through the fourth quarter compared with pre-pandemic levels. As of December 31, 2021, FHFA reported 178,019 loans in forbearance, representing 0.59 percent of the Enterprises’ single-family conventional book of business, down from 320,009 or 1.07 percent at the end of the third quarter.

Other highlights from the report include:

• Mortgage Performance: The 60+ days delinquency rate dropped from 1.69 percent at the end of the third quarter to 1.34 percent at the end of the fourth quarter. FHFA said delinquency rates remained elevated as a result of the COVID-19 pandemic and the forbearance programs offered to affected borrowers.
• Foreclosures: Foreclosure starts decreased 15 percent to 6,178, while third-party and foreclosure sales rose 27 percent to 3,213 in the fourth quarter.
• Real Estate Owned Activity & Inventory: The Enterprises’ REO inventory increased 10 percent from 8,001 in the third quarter to 8,781 in the fourth quarter, as REO acquisitions outpaced property dispositions. Property acquisitions increased 29 percent to 1,751, while dispositions decreased 17 percent to 991 during the quarter.

The report can be accessed at Foreclosure Prevention, Refinance, and FPM Report – 4Q2021 (fhfa.gov).