Banks reported an increase in foreclosures during the first quarter of 2022, according to a quarterly survey published by the Office of the Comptroller of Currency this week.
The survey, which examined servicing metrics provided by seven undisclosed national banks, found that 19,542 new foreclosures were initiated in the first quarter of 2022.
The OCC said this marks a jump from the previous quarter, but added the foreclosure volume in the first quarter is comparable to pre-COVID-19 pandemic foreclosure volumes.
Most industry observers predicted that the national foreclosure rate would rise once foreclosure moratoriums ended on July 31, 2021.
Home forfeiture actions, including completed foreclosure sales, short sales, and deed in-lieu-of- foreclosure actions also grew by 26.8% year-over-year to 2,410, the OCC found.
The seven banks surveyed reported a total of 42,427 modifications completed, a 10.7% decrease from the previous quarter.
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Of the modifications completed, the OCC said 97.4% were “combination modifications,” where interest rate reductions and term extensions are applied to a loan to help bring down a borrowers mortgage payment.
Among the combination modification completed, 83% included the capitalization of delinquent interest and fees, 88.6% included an interest rate reduction, 84.2% included a term extension and 22.3% of the loans modified included a principal deferral, the OCC said.
The report added that of the 42,427 modifications completed during the quarter, 34,278 reduced the loan’s pre-modification monthly payment.
The regulator said 3,721 loan modifications were completed during the third quarter of 2021 and six months later, 2,915, or 8.6 %, were 60 or more days past due, or in the process of foreclosure at the end of March 2021.
Banks surveyed reported servicing approximately 12.2 million first-lien residential mortgages with $2.6 trillion in unpaid principal balance, the report said. This represents 22% of all residential mortgage debt outstanding in the nation.
Year-over-year, the OCC found mortgage performance improved – the percentage of mortgage current and performing at the end of the first quarter increased to 96.9% compared to 94.2% last year.