Hope Now program


16 Nov 2009.

Hope Now is (according to the Hope Now website) “an alliance between HUD approved counseling agents, mortgage companies, investors and other mortgage market participants that provides free foreclosure prevention assistance.” It is a private sector alliance, whose formation was encouraged by HUD and Treasury. In addition to free counseling, the alliance has agreed on guidelines for workouts.

Hope now also extrapolates from their members' numbers to provide industry-wide estimates of progress on foreclosure mitigation via workouts. These data are freely available on the Hope Now website, but may not be reproduced here. Suffice it to say that the results are similar to those shown by Fannie Mae and Freddie Mac, and by the joint OTS/OCC report: there is significant progress on modifications, but severe delinquencies are still rising rapidly.


Clippings below covered through 1 Apr 2009.

  • Coverage (16 Nov 2009) Hope Now estimated in Sep 2009 that its data covered 72% of the industry.
  • Modifications and repayment plans (1 Apr 2009) See graph in 18 Feb 2009 entry (below) for a breakdown of workouts into modifications and repayment plans, Jul 2007 to Nov 2008.
  • Delinquencies are still rising rapidly (16 Nov 2009) See the Hope Now website for details. Despite significant progress on modifications, delinquencies of 60 days or more are still rising rapidly.


See also

Below are clippings used in construction of this page

Paulson speaking on the creation of Hope Now

10 Oct 2007. US Treasury press release.

“Statement by Secretary Henry M. Paulson, Jr. on Announcement of New Private Sector Alliance – HOPE NOW”

“Today, for the first time, 11 of the largest mortgage servicers representing 60 percent of the mortgages in America, several of the leading mortgage counselors, investors, and large trade organizations have come together and formed a partnership to help more Americans keep their homes. …

Their partnership, called HOPE NOW, has put together an aggressive plan to reach more homeowners and help them find a way to stay in their homes. And I'm glad to see the American Securitization Forum, representing investors as well as servicers, is joining this alliance, recognizing that mortgage investors also have an interest in expanding the reach of mortgage counselors to prevent foreclosures whenever possible. …

the servicers here represent 60 percent of mortgages outstanding”

JPMorgan Chase announcement on creation of Hope Now

10 Oct 2007. JPMorgan Chase investor relations.

“HOPE NOW Alliance Created to Help Distressed Homeowners”

“The HOPE NOW collaboration of credit and homeowners' counselors, mortgage servicers, and mortgage market participants was formed with the encouragement of the Department of the Treasury and Department of Housing and Urban Development.

The alliance will:

  • Explore a variety of methods to reach out to at-risk homeowners, including a direct-mail campaign to encourage at-risk borrowers to call their mortgage servicer or a credit counselor.
  • Work to improve communications between servicers and non-profit counselors to speed outreach and to develop and explain options for at-risk borrowers.
  • Develop standards with investors to enable counseling sessions for homeowners to be funded by servicing contracts. …

HOPE NOW is an alliance between counselors, mortgage market participants, and mortgage servicers to create a unified, coordinated plan to reach and help as many homeowners as possible. The members of this alliance recognize that by working together, they will be more effective than by working independently. The Department of the Treasury and the Department of Housing and Urban Development encouraged these leaders to form this alliance, which includes, as of October 10th, American Financial Services Association, American Securitization Forum, Assurant, Inc., Bank of America, CCCS Atlanta, Inc., Citigroup Inc., Consumer Bankers Association, Consumer Mortgage Coalition, Countrywide Financial Corporation, Fannie Mae, The Financial Services Roundtable, First Horizon National Corporation, Freddie Mac, GMAC ResCap, Homeownership Preservation Foundation, Housing Partnership Network, The Housing Policy Council, HSBC North America Holdings, Inc., JPMorgan Chase & Co, National City, NeighborWorks America, Mortgage Bankers Association, Option One Mortgage, PMI Mortgage Insurance Co., Securities Industry and Financial Markets Association, State Farm Insurance Companies, SunTrust Mortgage, Inc., Washington Mutual, Inc., Wells Fargo & Company. More companies and organizations are expected to join in the coming months.”

Teaser freezer may affect only 5% of resets, according to Deutsche Bank

22 Dec 2007. FTUSA p11.

“Helping hand could prolong subprime pain. SASKIA SCHOLTES”

“Mr Paulson's plan lays out a framework to classify resetting borrowers based on the characteristics of their loans and their payment history. Borrowers that meet certain criteria will qualify for a five-year freeze of their loan's interest rate. … a very small number of borrowers will qualify. According to research from Deutsche Bank, only about 90,000 loans will qualify for the rate freeze - 5 per cent of the loans facing resets in the next two years. The plan is also fraught with problems such as categorising borrowers whose financial information has not been collected before, and potentially encouraging some borrowers to change their payment behaviour in order to qualify for the break.”

Hope Now may not be helping much

4 Feb 2008. FTUSA p3.

“Washington urged to focus on home foreclosures; JEREMY GRANT.”

“Last week the non-profit Center for Responsible Lending claimed Hope Now would prevent foreclosures in only 3 per cent of the outstanding subprime mortgages with adjustable rates. It said foreclosures were outnumbering loan modifications by 13:1. The Mortgage Bankers' Association takes issue with the report, citing figures from rating agency Moody's showing that more than 50 per cent of borrowers with subprime adjustable rate mortgages due to reset in the first eight months of 2007 refinanced or otherwise paid off their loans prior to reset.”

Hope Now has low response rate but has still helped about 1 million

3 Mar 2008.

“Paulson says 1 mln homeowners got mortgage workouts since July”

“Slightly more than 1 mln homeowners have received mortgage refinancings since last July under the HOPE NOW alliance, Treasury Secretary Henry Paulson said today … Paulson said response rates to mailings by the HOPE NOW private-sector alliance have been as low as 20 pct and that borrowers who don't get in contact with their lenders 'will have to bear the consequences which could include losing their homes'.”

Progress of Hope Now

30 May 2008.

“Mortgage group says loan workouts hit record in April”

“Statistics released Friday by Hope Now … show that nearly 183,000 borrowers received some form of loan workout in April. That was the highest monthly number since the effort started last summer. … statistics include repayment plans, which allow borrowers to get back on track after missing payments. … More than 243,000 U.S. homes received at least one foreclosure-related filing in April, up 65 percent the same month last year, according to RealtyTrac Inc. The Hope Now group, however, said loan servicers, which collect and distribute mortgage payments, have stepped up the pace of loan modifications in recent months. Loan modifications accounted for 42 percent of total workouts in April, up from 19 percent in the third quarter of 2007. The alliance also claims 1.56 million homeowners have received loan workouts since July 2007. Of those, 30 percent were permanent modifications. … Hope Now also said that among the more than 600,000 subprime mortgages that adjusted to higher levels in the first four months of this year, only about 5 percent, were modified. A far greater share, 45 percent, were either refinanced or paid off when a house was sold. Members of Hope Now include Bank of America Corp., Citigroup Inc., Washington Mutual Inc. and Wells Fargo & Co.”

Some Hope Now changes

17 Jun 2008. FTUSA p6.

“New guidelines for US lenders. James Politi”

“an effort by Hope Now to improve its performance and speed up decisions by lenders … Under the new, non-binding rules, which were agreed by large lenders such as Countrywide and Wells Fargo, borrowers will receive an acknowledgment within five working days of a request for help and will receive a decision on their prospects for a loan modification within 45 days.”

Progress of Hope Now

30 Jul 2008.

“US mortgage companies boost changes to subprime loans. Reporting by Al Yoon; Editing by Theodore d'Afflisio”

“So-called “workouts,” which include new repayment plans for homeowners or a new, less risky loan contract, increased to more than 522,000 last quarter from 482,996 in the first three months of 2008, according to Hope Now, an alliance of mortgage lenders, servicing companies and counselors formed last year. … For the first time, more than half of the workouts in June and the second quarter were contractual changes to subprime loans, Hope Now said. Such modifications are seen as more important in stopping foreclosures than negotiating new payment plans since they more directly deal with effects of the ailing housing market.”

IMF report on foreclosure mitigation

18 Feb 2009. IMF staff position note.

“Foreclosure Mitigation Efforts in the United States: Approaches and Challenges. Kiff, John & Klyuev, Vladimir”

“Private-sector initiatives to reduce the number of foreclosures have been spearheaded by HOPE NOW—an alliance of servicers, housing counselors, lenders, investors, and mortgage market participants that was created, with the government’s encouragement, on October 10, 2007. The alliance includes 26 servicers, representing over 90% of the subprime market and 70% of the prime market. It is aimed at developing a common approach to reaching out to and dealing with homeowners who cannot pay their mortgages. In particular, its members have designed tools for dealing with the payment shocks that occur when the initial “teaser” rates on hybrid ARMs expire. 24 While home prices were rising, borrowers avoided the shocks by refinancing into new teaser-rate ARMs (i.e., “serial refinancing”). However, as a result of recent home price declines, many recent nonprime borrowers owe more than their homes are worth, which makes refinancing impossible. HOPE NOW buys them some time by extending the teaser rate on for five years. As is the case with all such programs, only mortgages backed by owner-occupied residential properties are eligible.”

Hope Now's "About us"

undated; accessed 1 Apr 2009. Hope Now website.

“What is HOPE NOW?”

“HOPE NOW is an alliance between counselors, mortgage companies, investors, and other mortgage market participants. This alliance will maximize outreach efforts to homeowners in distress to help them stay in their homes and will create a unified, coordinated plan to reach and help as many homeowners as possible. The members of this alliance recognize that by working together, they will be more effective than by working independently. … The Department of the Treasury and the U.S. Department of Housing and Urban Development encouraged leaders in the lending industry, investors and non-profits to form this alliance.”

Results through Q3 2009

Undated. Hope Now “Industry data” page.

“HOPE NOW National Data July07 to September09”

“Hope Now estimated percent of industry 71.7”

Hope Now surpasses HAMP

31 Mar 2010. Hope Now press release.

“HOPE NOW Reports Mortgage Servicers Complete 148,000 Total Loan Modifications in February”

“HOPE NOW, the private sector alliance of mortgage servicers, investors, mortgage insurers and non-profit counselors announced today that its February 2010 data estimates 95,586 homeowners received proprietary loan modifications for the month. Combined with the United States Treasury’s recently released Home Affordable Modification Program (HAMP) data that showed 52,905 HAMP modifications for February, a total of 148,000 loan modifications were provided to homeowners in February. Approximately 78% of the proprietary loan modifications completed in February included reduction of principal and interest – a lower monthly payment for at-risk homeowners.

The data also showed that foreclosure starts and sales dropped 17% for the month, along with a 4% decrease in the number of 60+ day delinquencies.

The total number of loan workout plans provided to homeowners (including repayment plans) in February was 279,831.

“Our data shows that mortgage servicers are continuing a strong effort on proprietary and HAMP modifications in the first two months of 2010. Additionally, we are encouraged by the decreases in serious delinquencies and foreclosures. With almost 4 million loans currently in default, we realize that our work is not yet done. Since 2007, the industry has completed more than 6.7 million workout solutions, including almost 2.7 million loan modifications. Mortgage servicers and housing counselors have worked extremely hard through aggressive borrower outreach and HOPE NOW remains determined to keep as many families as possible in their homes.” said Faith Schwartz, Executive Director of HOPE NOW.”

Hope Now modifications

21 Jun 2010. Obama housing “scorecard”

“The Obama Administration’s Efforts To Stabilize The Housing Market and Help American Homeowners”

“Based on newly available survey data, nearly half of homeowners unable to enter a HAMP permanent modification enter an alternative modification with their servicer”