Despite helping 244,000 at-risk homeowners with loan modifications and repayment plans in February, the Hope Now alliance says the number of foreclosures continues to rise and foreclosures involving prime loans topped subprime by a significant margin.
The alliance of 28 servicers reported that foreclosure sales increased to 87,000 in February, up from 68,000 in January. Meanwhile, foreclosure sales involving prime loans jumped to 55,500 in February from 30,400 in January. Foreclosure sales involving subprime loans fell to 31,800 in February from 37,700 the previous month.
The February report also shows servicers modified more mortgages as opposed to placing troubled borrowers in repayment plans. Loan modifications totaled 133,800 in February, compared to 110,600 repayment plans.
Hope Now executive director Faith Schwartz expects the percentage of loan modifications will continue to rise as servicers implement the Obama administration's loan modification and refinancing programs.
"The mortgage industry is responding to the need of its customers and offering solutions that are appropriate to the current market and economic conditions," Schwartz said.