HAMP Stats and Principal Reductions

Treasury released new numbers for the Home Affordable Modification Program (HAMP). New this month is data on the program's Principal Reduction Alternative (PRA).

Servicers have cut principal balances on 4,938 permanent HAMP modifications under the PRA initiative. Twenty-seven of these have fallen out of the program as 4,911 PRA mods are listed as active.

In addition, there are currently 16,017 HAMP trials in force that have also received principal reductions.

PRA requires servicers of non-GSE loans to calculate the benefit of principal reduction for mortgages with a loan-to-value ratio of 115 percent or greater when evaluating a homeowner for a first-lien HAMP modification.

While servicers are required to evaluate homeowners for PRA, they are not required to reduce principal as part of the modification. Fannie and Freddie do not participate in the PRA initiative.

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