WASHINGTON — With expectations for millions of foreclosures on the horizon, only 116,000 troubled borrowers have had their mortgages modified from three-month temporary plans into more affordable permanent loans as part of a $75-billion Obama administration program, the Treasury Department said last week.
That number, which the Treasury reported for January, is up from 66,485 permanently modified loans as of the end of December.
Specifically, 116,297 homeowners have permanent modifications, according to the Treasury’s January data. More than 76,000 additional homeowners have been offered permanent modifications by lenders. These borrowers must still sign documents and return them to the lender to be approved.
According to the Treasury report, over 1 million trial three-month modifications have started since the program’s inception, up from 902,620 last month.
As part of the program, roughly 940,000 homeowners have their median monthly payment reduced by more than $500 a month. That number is up from 850,000 homeowners having their median payments reduced based on the program’s December data.
Also, 1.3 million modification offers have been extended to borrowers by the end of December, up from roughly 1.2 million offers in December.
Meanwhile, roughly 8 million to 13 million foreclosures are expected to take place over the next five years, according to the Congressional Oversight Panel for the $700-billion bank bailout program.
A number of the major banks made major strides in making trial modifications permanent.
Bank of America Corp. approved 12,761 permanent modifications by the end of January, up from 3,183 at the end of December and up from 98 at the end of November. In addition, the company started 237,766 trial modifications, the report said, up from 206,775 in the previous period.
Citigroup Inc. approved 10,929 permanent modifications by the end of January, up from 4,999 in the previous period, according to the report. Citigroup started 130,817 three-month modifications under the plan by the end of December, up from 119,097 in December.
Through the end of January, J.P. Morgan Chase &Co. had 11,581 trial modifications made permanent, up from 7,139 at the end of December. It had 170,028 three-month trial modifications started under the program as of the end of January, up from 156,359 started under the program at the end of December.
Wells Fargo &Co. has 144,904 trial modifications started, up from 126,413 trial modifications at the end of December, and 17,652 permanent, up from 8,424 permanent modifications using the program in December.
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