Thursday, May 29, 2014

Foreclosure Prevention Work in the FHFA

Foreclosure activity is down everywhere.  In fact, a recent article in the National Mortgage Professional Magazine reported that April 2014 foreclosure filings, which include default notices, bank repossessions, and scheduled auctions, are down by 20 percent from April 2013.  And the numbers have been dropping over the last few months, too.  The April 2014 foreclosure statistics are down one percent from March 2014.  But the rate of foreclosure remains a serious issue in Chicago and throughout the state.
Illinois Foreclosure Statistics
What do the numbers look like?  In April of this year, about 116,000 properties across the country were linked to foreclosure filings, and this shows a significant decline on the whole.  However, according to data gathered by RealtyTrac, Illinois continues to have one of the highest foreclosure rates in America.  It’s listed as having the sixth-highest rate of foreclosure, with 14 percent of residential units at a stage of foreclosure.  That means that one out of every 706 housing units in our state had a foreclosure filing at the time of RealtyTrac’s measure.  And when it comes to metro areas, Chicago has the fifteenth-highest rate of foreclosure, with “one in every 550 housing units with a foreclosure filing.”
So what is the Federal Housing Finance Agency (FHFA) doing for Illinois and some of the other states with a surprisingly high number of foreclosures on record?  A report in indicated that the FHFA’s Foreclosure Prevention Report suggests that the agency has actually been doing quite a bit to prevent foreclosures in Illinois and throughout the country.
The FHFA’s Foreclosure Prevention Report
According to the article in, the FHFA’s Foreclosure Prevention Report contains important information about the future of Fannie Mae and Freddie Mac when it comes to completing foreclosures.  In February 2014, Fannie and Freddie completed more than 28,000 “foreclosure prevention actions,” and approximately 58,000 foreclosure prevention actions in 2014 as of May of this year.  In total, Fannie and Freddie have recorded about 3.2 million foreclosure prevention actions since 2008.
What is a foreclosure prevention action?  In many cases, it’s a permanent modification.  For instance, in February of 2014, about 60 percent of all actions were permanent modifications.  But modifications in general tend to be on the decline.  Indeed, permanent modifications were down 7 percent from the beginning of the year.  And other foreclosure prevention actions also exist, such as principal forbearance.  In addition, approximately 4,500 short sales and deeds-in-lieu of foreclosure were completed in February 2014, which showed a 19 percent decline from January of this year.
The report also depicted declines in “serious delinquency rates,” which were at 2.28 percent by the end of February.  And it looks like homeowners aren’t likely to begin the descent into foreclosure, either.  According to the FHFA, “foreclosure starts dropped 33 percent to 21,900 in February.”   
Foreclosures no longer account for a large part of the real estate market, but many families in the Chicago area continue to struggle with monthly mortgage payments.  If you’re concerned about foreclosure, it’s important to speak to an experienced Oak Park foreclosure defense lawyer at the Emerson Law Firm today.
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