In recent news there have been signs indicating defaults are slowly but steadily declining as more homeowners pay their mortgages on time. The percentage of mortgages in default more than 60 days in Fannie Mae’s portfolio have fallen to the lowest level in two years. This is great news and gives hope to some in the real estate market that things are starting to stabilize, at least for the time being.
Defaults of conventional mortgages were reported to have fallen to 4.08 percent in June and July. Serious defaults peaked in February 2010 when they reached 5.59 percent of all mortgages in Fannie’s portfolio. Currently Fannie holds about $728 billion worth of mortgages in its portfolio.
Government-controlled mortgage company Fannie Mae reported that its second-quarter loss widened as it continues to seek loan modifications to help reduce defaults amid the ongoing difficulties in the housing and mortgage markets.
Fannie Mae announced it will ask for $5.1 billion in funds from the Treasury to reduce its losses by reducing defaults through loan modifications for borrowers having trouble paying their mortgages.
Here are some facts about Fannie Mae in recent months; Fannie completed more than 80,000 single-family loan workouts in the second quarter, with more than 59,000 of them involving loan modifications, repayment plans and forbearances. They also remain the largest source of liquidity for the U.S. mortgage market.
There is still a lot to be done within this market, that’s a given, however reprieve does seem to be ahead and it’s important to stay positive. For my team it’s exciting to see the instability of this market finally start to level off, even if it’s only a slightly for now.
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