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Loan mods could top 1.5 million this year

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Loan servicers are on track to do nearly 3 million workouts this year, but foreclosure starts rose to an annual rate of 3.5 million a year in March, according to the latest numbers from the HOPE NOW coalition of loan servicers. HOPE NOW said its members modified 391,155 loans during the first three months of the year, a 21 percent increase from the previous quarter and more than double the number of loan modifications achieved in the same period of 2008. If that pace can be sustained, HOPE NOW loan servicers are on track to do 1.56 million loan modifications this year, up 57 percent from last year's total of 968,858. An additional 350,398 borrowers received repayment plans, bringing the total number of workouts during the first quarter to 741,553. Consumer advocates say that because they lower a borrower's monthly payments, loan modifications can be more effective in preventing foreclosure than repayment plans, which often involve tacking payments in arrears onto the bac...