Though only four percent of loans under modification by the Administration’s Home Affordable Modification Program (HAMP) have become permanent to date, a leading monitor of Western foreclosure trends attributes a 40 percent increase in California foreclosure cancellations in November to the program.
“We’ve been waiting to see some impact from the Home Affordable Modification Program,” said Sean O’Toole, founder and CEO of ForeclosureRadar, the only website that tracks every California foreclosure and provides daily auction updates. “The 40 percent increase in cancellations could easily be explained by the recently reported 31,382 permanent modifications nationwide under that program.
Properties remain in foreclosure during the trial period, which can last as long as five months. They can be cancelled only after the modification becomes permanent.
“While many have predicted a wave of foreclosures and REO’s, I believe we are instead likely to see a wave of foreclosure cancellations as the Administration kicks off their conversion drive to make more modifications permanent. While near term this is likely to positively impact housing news, I remain convinced these payment-focused loan mods are the most exotic loans we’ve seen yet, and are destined to fail,” said O’Toole.
Separately ForeclosureListings.com reported that average foreclosure sale prices increased significantly in several states from October to November. In California, foreclosure prices went from $356,608.00 to $379,770.00 for a 6.5% increase. In Florida, prices went from $228,602.00 to $232,249.00, a 1.6% increase. In Miami, prices went from $114,258.00 to $125,015.00, a 9.41% increase. In Texas, prices went from $132,443.00 to $141,128.00, a 6.56% increase. And in Georgia, prices went from $213,046.00 to $298,080.00, for a 39.91% increase. The highest price drop was 5.68% in Maine and the highest price increase was 64.85% in Massachusetts.