The performance of mortgages held by the top banks was largely unchanged from a year ago with 95% of loans current and performing at the end of the third quarter, the Office of the Comptroller of the Currency said Friday.
The OCC’s Mortgage Metrics Report found that foreclosure activity fell 28.5% in the third quarter, from a year earlier, to 34,266 foreclosures. Foreclosures dipped 4.7% from the second quarter.
Servicers modified 25,799 loans in the third quarter, a 28% decrease from a year earlier, and a nearly 16% drop from the second quarter, the 14-page report found. Roughly 90% of modifications involved lowering the interest rate and extending the term of the loan.
Of the roughly 35,000 loan modifications completed during the first quarter of 2017, servicers reported that 14% were 60 days or more past due or in the process of foreclosure after they became six months old.
The OCC data shows that the largest banks have pulled back dramatically from the mortgage market in the past four years and now hold or service a combined 33% of all outstanding first-lien residential mortgages, down from 55% in 2013. The top seven banks own or service 18.4 million loans with a combined $3.3 trillion in principal balances.
The seven institutions covered by the report are: Bank of America, Citigroup, JPMorgan Chase, HSBC, PNC, U.S. Bancorp and Wells Fargo. (One West, formerly IndyMac, had been on the list until the fourth quarter of 2015 when it was sold to CIT Group.)