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FANNIE MAE WARNS FALLING ECONOMIC CONFIDENCE COULD SLOW HOUSING RECOVERY HOPE NOW: PROPRIETARY LOAN MODS UP 43% IN JULY permanent proprietary loan modifications jumped 43 percent from June to July, HOPE NOW reported last month. The private sector alliance of servicers, The number of homeowners who received mortgage professionals, and nonprofit counsel- ors released its July 2012 loan modification data, revealing that an estimated 66,002 homeowners received proprietary loan modifications in July compared to 46,208 in June. The group's report did not include loan mods completed under the government's Home Affordable Modification Program (HAMP), as that data had not been released by Treasury when HOPE NOW published its report. Year-to-date through June, an estimated 110,144 homeowners received HAMP modifications. For the month of July, proprietary loan mods timistic of housing as home prices rise, Fannie Mae reported in early September. According to the GSE's national monthly American consumers remain cautiously op- survey, consumers, on average, are expecting home prices to rise 1.6 percent during the next 12 months, mostly consistent with the previous month's results but down from expectations of a 2.0 percent gain reported in July. Meanwhile, 11 percent in the most recent survey say home prices will go down in the next year. That's the lowest percentage anticipating further declines since the survey began in 2010. Eighteen percent of respondents say it is a the economy is headed in the wrong direction continued to tick up to 60 percent, the third straight rise to the highest reading since the start of the year. Thirty-three percent said the economy is on the right track, a slight drop from last month and 5 percentage points down from May's peak. Those who expect their financial situation to The number of respondents who believe that included fixed interest rates for five or more years accounted for 96 percent of the total. Loan restructurings that reduced monthly principal and interest payments by more than 10 percent accounted for 71 percent of all proprietary mods. Proprietary modifications on loans that had good time to sell a home, the highest level since the survey began. At the same time, the per- centage of respondents who say it is a good time to buy is holding steady at 73 percent. Approxi- mately 40 percent of respondents said mortgage rates will go up in the next year. Consumers scaled back rental expectations a bit. Of those surveyed, 44 percent said they expect rental prices to increase in the next year, while 5 percent expect rental prices to fall. The average rental price change expectation fell 0.7 percent to 3.2 percent, the lowest level since January of this year. While consumer sentiment demonstrated get worse dipped to 13 percent, while those who expect no changes in their financial situation increased to 41 percent. The share of respon- dents who say their household income is signifi- cantly higher than it was a year ago remained level at 20 percent, while those who say it is significantly lower increased to 16 percent. KNOW THIS a slight shift toward buying over renting, flat- tening expectations related to respondents' own household finances and falling confidence in the overall economy could temper the housing market recovery. 30 When Americans head to the polls in November, they'll be electing the president and vice president of the United States, 33 senators, and the entire House of Representatives. been delinquent 90 or more days hit their low- est level on record with HOPE NOW. At the same time, the re-default rate for modified loans fell to 8.9 percent, a substantial drop from 10.3 percent in June. Faith Schwartz, executive director of HOPE NOW, says the increase in modifications il- lustrates the efforts of industry, nonprofit, and government groups on behalf of homeowners. "HOPE NOW has always been about col- laboration, aggressive outreach to borrowers, and education on options," Schwartz said. "Our data, which has been collected monthly for five years, continues to support these activities, and our members remain active in helping families find sustainable and realistic mortgage solu- tions." Industry-wide, mortgage delinquencies of 60-plus days declined to 2.47 million in July, down from 2.52 million in June, according to HOPE NOW. The group's data also showed that short sales continued to have a significant impact on the market. July saw 36,260 short sales, bringing the total of short sales since 2009 up to 974,000. The total number of permanent, non-foreclo- sure solutions completed by the industry, which HOPE NOW calculates as the combination of loan mods and short sales, talies approximately 6.63 million since 2009.

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