The Federal Housing Finance Agency (FHFA) on Thursday announced that it initiated 43,459 foreclosure prevention actions in the third quarter of 2024, bringing the total number of homeowners helped to more than 7 million since the government-sponsored enterprises (GSEs) entered conservatorship in 2008. But the number of foreclosure starts spiked by 27% to 22,025 during the quarter.
This is according to the agency’s Q3 2024 foreclosure prevention and refinance report. The FHFA also found that 35% of all loan modifications completed in the third quarter resulted in an average reduction of “more than 20%” to borrowers’ monthly payments, and refinances rose by 9,214 from Q2 to total 98,785 in Q3.
The GSEs’ serious delinquency rate saw a slight uptick in Q3 to 0.53%, but this rate is still lower than those for loans sponsored by the Federal Housing Administration (3.63%) and Department of Veterans Affairs (2.26%), as well as the industrywide average of 1.55%.
Forbearances also increased in Q3 to 39,669 loans as of Sept. 30, or roughly 0.13% of the GSEs’ single-family conventional book of business. This is an increase from 31,827 (or 0.1%) at the end of June, with the agency noting that about 1% of these loans have been on forbearance plans for more than 12 months.
The 60-plus-day delinquency rate also rose to 0.75% in the third quarter, up from 0.7% in Q2. In addition to a 27% increase in foreclosure starts, third-party and foreclosure sales also increased by 3.2% to 3,039.
“Total refinance volume increased in the third quarter of 2024 as mortgage rates decreased but remained above the levels observed through 2021,” the report added. “Mortgage rates fell between June and September: the average interest rate on a 30-year fixed rate mortgage decreased from 6.92% to 6.18%.”
The past three years saw cash-out loans account for as much as 82% of all refinances, but this share fell to 59% in September. “Lower mortgage rates have grown the opportunities for non cash-out borrowers to refinance at lower rates and lower their monthly payments,” the report explained.
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