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HOPE NOW Reports 70K Mods in April, 59K Foreclosure Sales

Nearly 70,000 homeowners received permanent loan modifications in April, while foreclosure sales stood at 59,000 for the month, according to data from HOPE NOW, an alliance of mortgage servicers, investors, mortgage insurers, and nonprofit counselors. Of the 70,000 modifications, about 58,000 were proprietary, or private, loan modifications, while about 12,000 were through the government’s Home Affordable Modification Program (HAMP), HOPE NOW reported. In March, servicers provided over 88,000 modifications for homeowners. Since 2007, a total of 6.39 million homeowners have received permanent modifications. Completed short sales reached 27,000 in April—a slight adjustment from 28,000 in March. This brings the industry total for short sales since 2009 to 1.26 million. When combining loan modifications and short sales, HOPENOW reported over 7.6 million foreclosure prevention solutions have been applied since 2007. Meanwhile, foreclosure sales showed an increase from March to April, rising 14 percent to 59,000. Foreclosure starts were little changed at 115,000 in April compared to 116,000 in March. “HOPE NOW is proud of the efforts its members have made on behalf of the nation’s homeowners. While there is still work to be done in the housing market, significant progress has been made via loan modifications, short sales and other solutions,” said Eric Selk, executive director ofHOPE NOW, in a statement. HOPE NOW also announced upcoming face-to-face eventsit will be hosting this summer in Columbia, South Carolina; Birmingham Alabama; San Antonio, Texas; and San Bernardino, California. This article was posted...
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Obama Administration Extends Application Deadline for the Making Home Affordable Program

Extension through December 2015 Will Provide Struggling Homeowners Additional Time to Access Sustainable Mortgage Relief and Align End Dates for Key Assistance Programs WASHINGTON – The U.S. Department of the Treasury and the U.S. Department of Housing and Urban Development today announced an extension of the Obama Administration’s Making Home Affordable Program through December 31, 2015. The new deadline was determined in coordination with the Federal Housing Finance Agency (FHFA) to align with extended deadlines for the Home Affordable Refinance Program (HARP) and the Streamlined Modification Initiative for homeowners with loans owned or guaranteed by Fannie Mae and Freddie Mac. The Making Home Affordable Program has been a critical part of the Obama Administration’s comprehensive efforts to provide relief to families at risk of foreclosure and help the housing market recover from a historic housing crisis. The program deadline was previously December 31, 2013.  “The housing market is gaining steam, but many homeowners are still struggling,” said Treasury Secretary Jacob J. Lew. “Helping responsible homeowners avoid foreclosure is part of our wide-ranging efforts to strengthen the middle class, and Making Home Affordable offers homeowners some of the deepest and most dependable assistance available to prevent foreclosure. Extending the program for two years will benefit many additional families while maintaining clear standards and accountability for an important part of the mortgage industry.”  “The Making Home Affordable Program has provided help and hope to America’s homeowners,” said HUD Secretary Shaun Donovan. “Families across the country have used its tools to reduce their principal, modify their mortgages, fight off foreclosure and stay in their homes – helping further stimulate our housing market recovery. And with this extension, we ensure that the program keeps supporting communities for years to come.”  Since its launch in March 2009, about 1.6 million actions have been taken through the program to provide relief to homeowners and nearly 1.3 million homeowners have been helped directly by the program. The Making Home Affordable Program includes the Home Affordable Modification Program or HAMP, which modifies the terms of a homeowner’s mortgage to reduce their monthly payment to prevent foreclosure. As of March 2013, more than 1.1 million homeowners have received a permanent modification of their mortgage through HAMP, with a median savings of $546 every month – or 38 percent of their previous payment. Data from the Office of the Comptroller of the Currency (OCC) shows that the median savings for...
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The Mortgage Forgiveness Debt Relief Act and Debt Cancellation

If you owe a debt to someone else and they cancel or forgive that debt, the canceled amount may be taxable. The Mortgage Debt Relief Act of 2007 generally allows taxpayers to exclude income from the discharge of debt on their principal residence. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualifies for the relief. This provision applies to debt forgiven in calendar years 2007 through 2012. Up to $2 million of forgiven debt is eligible for this exclusion ($1 million if married filing separately). The exclusion does not apply if the discharge is due to services performed for the lender or any other reason not directly related to a decline in the home’s value or the taxpayer’s financial condition. More information, including detailed examples can be found in Publication 4681, Canceled Debts, Foreclosures, Repossessions, and Abandonments. Also see IRS news release IR-2008-17. The following are the most commonly asked questions and answers about The Mortgage Forgiveness Debt Relief Act and debt cancellation: What is Cancellation of Debt? If you borrow money from a commercial lender and the lender later cancels or forgives the debt, you may have to include the cancelled amount in income for tax purposes, depending on the circumstances. When you borrowed the money you were not required to include the loan proceeds in income because you had an obligation to repay the lender. When that obligation is subsequently forgiven, the amount you received as loan proceeds is normally reportable as income because you no longer have an obligation to repay the lender. The lender is usually required to report the amount of the canceled debt to you and the IRS on a Form 1099-C, Cancellation of Debt. Here’s a very simplified example. You borrow $10,000 and default on the loan after paying back $2,000. If the lender is unable to collect the remaining debt from you, there is a cancellation of debt of $8,000, which generally is taxable income to you. Is Cancellation of Debt income always taxable? Not always. There are some exceptions. The most common situations when cancellation of debt income is not taxable involve: Qualified principal residence indebtedness: This is the exception created by the Mortgage Debt Relief Act of 2007 and applies to most homeowners. Bankruptcy: Debts discharged through bankruptcy are not considered taxable income. Insolvency: If you are insolvent when the debt is cancelled,...
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HOPE NOW Reports 385K Loan Mods in First Half of 2012

The first half of 2012 saw more than 385,000 permanent loan modifications for struggling homeowners,HOPE NOW reported Tuesday. The voluntary, private sector alliance of mortgage professionals and non-profit counselors released its June 2012 data, showing that 385,468 homeowners received permanent loan modifications for the first half of the year. This statistic brings the total number of loan modifications completed since 2007 to 5.6 million. The data revealed that during the first six months of 2012, 275,324 homeowners received proprietary loan modifications, while 110,144 received loan modifications completed under HAMP. Proprietary modifications continued to show lower monthly principal and interest payments. Of the proprietary modifications completed in the first half of the year, 79 percent included reduced monthly principal and interest payments, and 90 percent had fixed interest rates of 5 years or more. Proprietary mods that reduced principal and interest payments by more than 10 percent made up 72 percent of the total through June. Delinquencies and foreclosures fell during the year’s first half, with serious delinquencies (60 or more days past due) dropping 10 percent from the first half of 2011. Foreclosure starts totaled 1.06 million, a 15 percent drop from 1.3 million during the first half of 2011. HOPE NOW executive director Faith Schwartz said the organization’s goal is to keep that momentum going into the future. “HOPE NOW data for the first half of 2012 shows a continued trend of reduced late stage delinquencies year-over-year. However, efforts and resources have expanded to assist all at-risk homeowners in finding solutions to avoid foreclosure where possible,” Schwartz said. This article was originally posted...
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