New Loss Mitigation Actions Relative to New Foreclosures

January — June 2008

The following data show new loss mitigation actions during the month as a percentage of foreclosures initiated during the month. For any given risk category, a percentage exceeding 100 percent means there were more new loss mitigation actions than new foreclosures during the month.

New loss mitigation actions increased faster than new foreclosures during the second quarter. Overall, new loss mitigation actions relative to new foreclosures averaged more than 87 percent during the second quarter, about 12 percentage points higher than the first quarter.

Subprime mortgages consistently had the highest percentage of new loss mitigation actions to new foreclosures, well above 100 percent throughout the period. Prime mortgages consistently had the lowest percentage, averaging 43 percent over the last three months of the reporting period.

New foreclosures consist of all mortgages on which servicers commenced formal foreclosure proceedings during the month (e.g., public notice, judicial filing). New foreclosures often do not result in a foreclosure sale or loss of the borrowers' homes, because banks simultaneously pursue other mitigation strategies, or borrowers take action to return their mortgages to a current and performing status.

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