AgentMarkets & Economy

RealtyTrac reports less than 1 percent of delinquent homes qualify for FHFA program

RealtyTrac Q1 2016 U.S. Home Equity and Underwater Report shows Denver, Austin among top improving markets
  • Dallas, Austin, Denver, Albuquerque and Provo saw the largest increase in equity rich homeowners.
  • Philadelphia, New York and Chicago were among the metros with the largest share of homeowners who qualify for the FHFA program.
  • To qualify, homeowners must occupy their homes, be 90 days delinquent, have an unpaid principal of at least $250,000 and must have a loan-to-value ratio of at least 115 percent after capitalization.

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In April, the Federal Housing Finance Agency unveiled a new mortgage modification program to offer homeowners who are seriously underwater on their housing payments the opportunity to swim their way out and avoid foreclosure. According to the FHFA, homeowners eligible for the program must own and occupy their homes, be 90 days delinquent, have an unpaid principal of at least $250,000 and must have a loan-to-value ratio of at least 115 percent after capitalization. With all of these factors considered, less than 1 percent of all seriously underwater homes actually qualify, according to the RealtyTrac Q1 2016 U.S. Home Equity and Underwater Report, which named Dallas, Austin, Denver, Albuquerque and Provo as metros with the largest increase in equity rich homeowners. “This new principal reduction program is designed to reach a highly targeted group of borrowers, so it’s not surprising that the share of seriously underwater borrowers who potentially qualify is razor-th...