Homeowners recover 13.5% of their lost equity

Rising home values have brought homeowner equity to its highest level since the third quarter of 2008 and helped lift 1.3 million families above water. Homeowner equity jumped $406 billion, or 5.9 percent, to $7,275 billion in the second quarter of 2012, according to the Obama Administration’s September Housing
Scorecard.
After a sharp first quarter rise, total equity has grown to $863 billion, or 13.5 percent, since
the end of 2011. The number of underwater borrowers has declined by 11 percent since the
end of last year, from 12.1 million in the 4th quarter of 2011 to 10.8 million in the second
quarter of 2012.
Nearly 1.3 million homeowner assistance actions have taken place through the Making Home
Affordable Program, while the Federal Housing Administration (FHA) has offered more than
1.4 million loss mitigation and early delinquency interventions. The Administration’s programs
continue to encourage improved standards and processes in the industry, with HOPE Now
lenders offering families and individuals more than three million proprietary mortgage
modifications through July.
As of August, more than one million homeowners have received a permanent HAMP
modification, saving approximately $539 apiece on their mortgage payments each month,
and an estimated $15 billion to date. In August, 81 percent of homeowners with eligible non-
GSE mortgages benefitted from principal reduction with their HAMP modification. Eighty-seven
percent of homeowners entering the program in the last two years have received a
permanent modification.
“As the September housing scorecard indicates, our housing market is showing important
signs of recovery – with homeowner equity at a four-year high and summer sales of existing
homes at the strongest pace in two years,” says HUD Acting Assistant Secretary Erika
Poethig. “The Administration’s efforts to keep housing affordable and refinances strong are
critical with so many households still struggling to make ends meet. That is why we continue
to ask Congress to approve the President’s refinancing proposal so that more homeowners
can secure the help they need.”
Rising home values have brought homeowner equity to its highest level since the third
quarter of 2008 and helped lift 1.3 million families above water. Homeowner equity jumped
$406 billion, or 5.9 percent, to $7,275 billion in the second quarter of 2012. After a sharp first
quarter rise, total equity has grown to $863 billion, or 13.5 percent, since the end of 2011.
The number of underwater borrowers has declined by 11 percent since the end of last year,
from 12.1 million in the 4th quarter of 2011 to 10.8 million in the second quarter of 2012.
The Administration’s foreclosure programs are providing relief for millions of homeowners as
we continue to recover from an unprecedented housing crisis. Nearly 1.3 million homeowner
assistance actions have taken place through the Making Home Affordable Program, while the
Federal Housing Administration (FHA) has offered more than 1.4 million loss mitigation and
early delinquency interventions. The Administration’s programs continue to encourage
improved standards and processes in the industry, with HOPE Now lenders offering families
and individuals more than three million proprietary mortgage modifications through July.
Homeowners entering HAMP continue to benefit from deep and sustainable assistance. As of
August, more than one million homeowners have received a permanent HAMP modification,
saving approximately $539 on their mortgage payments each month, and an estimated $15
billion to date. In August, 81 percent of homeowners with eligible non-GSE mortgages
benefitted from principal reduction with their HAMP modification. Eighty-seven percent of
homeowners entering the program in the last two years have received a permanent
modification
For more information, visit www.realestateeconomywatch.com.
Jim Willis

Jim Willis

Associate Broker
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