After homeowners have attempted to acquire a home loan modification, there have been many servicers who are seeing both increases in the foreclosure starts and foreclosure completions that have been made throughout the life of the Making Home Affordable Program after homeowners have been denied this form of assistance. However, Wells Fargo did see some mixed results in the most recent report released here in August that tracked data through May of 2011, in terms of number of homeowners who have either seen foreclosure proceedings begin or completed after they failed to either acquire a trial or permanent home loan modification.
As an example, Wells Fargo homeowners who had their trial modification canceled and fell into foreclosure saw decreases in this area of the total number of starts and completions that had been made as of May. This category of homeowners saw a decrease from 16,875 total foreclosure starts to 16,834 total foreclosure starts in the month of May. Also, the total number of foreclosure completion that stood on the record for Wells Fargo in this particular category of homeowners also dropped between April and May from 11,172 to 10,962.
Yet, for homeowners who were not accepted for a trial modification, the total number of foreclosure starts also decreased slightly by about 200, but the total number of foreclosure completions increased from 13,890 to 13,994. Essentially, what this may mean for some homeowners, not just those particularly with Wells Fargo, is that there are banks seeing slowdowns in their foreclosures despite the fact that there are numerous homeowners who are still struggling to stay afloat in terms of their mortgage payment obligation. Some of these foreclosures have been delayed as a result of litigation that is ongoing against major financial institutions but some homeowners are finding foreclosure alternatives or foreclosure prevention programs more helpful thanks to retooling that has taken place.
Homeowners do need to remember that these home loan modification programs are not a guaranteed fix for their situation necessarily and it should be the case that a homeowner who faces financial problems in terms of meeting their mortgage payment should address these issues early so that they can explore more than one option, as homeowners who may only focus on a modification late in the game could potentially see a higher risk of foreclosure than a homeowner who may explore multiple options early when financial problems first arise.
Also, homeowners are usually given a single point of contact with their mortgage servicer, so homeowners are usually advised to direct questions to these individuals but also take advantage of free housing counseling assistance that may be beneficial from the Homeowner’s HOPE Hotline as these resources could also potentially help homeowners make a personal decision as to what routes they may be able to take and what programs will be best for their situation.