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Loans<\/a> that have been modified since 2014 are redefaulting at faster rates than those that were modified in prior years, according to a new report.<\/p>\n\n Seventy-five percent of the loans that redefaulted did so within the first two years after receiving a loan modification, according to analysis of Fannie Mae loan data.<\/p>\n\n \u201cRelative to prior years, recent trends indicate more modifications made to borrowers that have prior failed loan<\/a> modifications, lower payment reductions, and lower credit scores,\u201d says Samuel So, Fitch Ratings director.<\/p>\n\n Fitch analyzed about 700,000 loans, with cumulative unpaid principal balances of $135 billion, that had been permanently modified between 2010 and 2015.<\/p>\n\n Fitch\u2019s study found that loans modified more recently had lower average FICO scores and a higher number of prior modifications, which appeared to be related to higher redefault risk.<\/p>\n\n In 2009, the average FICO score was 655 and only 1 percent of loans had multiple modifications. By 2015, the average FICO score was 592, and 34 percent of the loans had multiple modifications, the Fitch Ratings study showed.<\/p>\n\n Source: \u201cRecently Modified Loans Redefault at a Faster Pace,\u201d National Mortgage<\/a> News (Feb. 9, 2017)<\/em><\/p>\n<\/div>\n \n \n<\/pre>\n\n<\/div>\n\n\n
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