Academic journal article Journal of Accountancy

As Efforts to Keep Borrowers in Their Homes Continued to Escalate, a Report from Major Bank Regulators Said More Than Half of All Mortgages Modified in the First Quarter of 2009 Were in Re-Default in the Third Quarter - 56.2% Were 30 or More Days Delinquent, and 42.7% Were 60 or More Days Delinquent

Academic journal article Journal of Accountancy

As Efforts to Keep Borrowers in Their Homes Continued to Escalate, a Report from Major Bank Regulators Said More Than Half of All Mortgages Modified in the First Quarter of 2009 Were in Re-Default in the Third Quarter - 56.2% Were 30 or More Days Delinquent, and 42.7% Were 60 or More Days Delinquent

Article excerpt

As efforts to keep borrowers in their homes continued to escalate, a report from major bank regulators said more than half of all mortgages modified in the first quarter of 2009 were in re-default in the third quarter--56.2% were 30 or more days delinquent, and 42.7% were 60 or more days delinquent. The overall rate of cur rent and performing loans also worsened, sliding to 87.2% by the end of the third quarter, down from 88.6% in the second quarter and 91.5% a year earlier.

The OCC and OTS Mortgage Metrics Report, Third Quarter 2009 includes data from reporting institutions servicing about 34 million first-lien mortgage loans, totaling approximately $6 trillion. The data account for about 65% of all first-lien mortgages outstanding in the U.S. The report is compiled by the Office of the Comptroller of the Currency and the Office of Thrift Supervision, both departments of the U.S. Treasury.

The efforts to help borrowers--including loan modifications, trial period plans and payment plans that allow borrowers to retain ownership and occupancy of their homes while attempting to return the loans to current and performing status--are known as home retention actions.

Newly initiated home retention actions rose 68.7% in the third quarter to 680,153 (153.2% increase from a year ago). …

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