Morgan Stanley’s subprime servicing unit has initiated trial payment plans on a higher share of its borrowers who are eligible for the government’s loan modification program and any other servicer. The company helped the Obama administration achieve a key objective a month early.
As of September, 487,081 trial modifications have been started under the Home Affordable Modification Program, the U.S. Department of the Treasury reported. The total rose from 360,165 a month earlier.
Since the end of last month, the count made it past a key threshold.
“Today, almost one month ahead of a Nov. 1 benchmark set earlier this year, the U.S. Department of the Treasury and U.S. Department of Housing and Urban Development announced a new milestone of more than 500,000 trial loan modifications in progress under the Making Home Affordable program,” HUDÂ said in an announcement.
HOPEÂ NOW praised the early achievement of the 500,000 goal. In addition, the group said steps are being taken to streamline the modification process.
The report indicated that 63 servicers have signed HAMP servicer participation agreements, though eligible loans are serviced by 2,300 participating companies.
Trial offers extended rose to 757,955 from August’s 571,354.
More than 3.1 million 60-day delinquent borrowers were eligible for the program as of the report.
Of Bank of America, N.A.’s, 875,917 HAMP-eligible borrowers, 11 percent had started trial modifications. BoA started on the plan in April.
More than one-quarter of J.P. Morgan Chase Bank, N.A.’s, 437,652 eligible borrowers had started a trial plan. The New York-based institution also started in April.
Trial modifications were started on 17 percent of the 385,790 HAMP-eligible borrowers at Wells Fargo Bank, N.A., and Wachovia Mortgage, FSB.
One-third of CitiMortgage Inc.’s 208,427 borrowers who were eligible for the federal program had started a trial modification by last month.
American Home Mortgage Servicing Inc. has initiated trial plans for less than 1 percent of its 114,272 borrowers who were HAMP-eligible. It was the lowest among all HAMP servicers handling at least 50,000 eligible loans. A spokeswoman wasn’t able to immediately comment on the low level of trials initiated at the Texas-based company, but American Home joined the program on July 22.
Other servicers to fall below the 1 percent level included HomeEq Servicing, which started in August; Home Loan Services Inc., which has been on the program since April; and MorEquity, which signed on in July.
Another big company with a low ratio of trials started was Litton Loan Servicing LP, which last month pointed out that it had only joined the program on Aug. 12. Litton saw 2 percent of its 107,341 eligible borrowers start a trial.
Bayview Loan Servicing LLC, which became a HAMP servicer on July 1, also saw just 2 percent of its eligible 8,987 borrowers start a trial plan.
Morgan Stanley subsidiary Saxon Mortgage Services Inc. initiated trial modifications on 41 percent of its 79,921 eligible borrowers — the highest rate among all servicers reported. Saxon was acquired by Morgan Stanley in 2006.
Aurora Loan Services LLC started trials modifications on one-third of its eligible borrowers, Nationstar Mortgage LLC had a 28 percent rate and GMAC Mortgage reached just over one-quarter.
