Fannie,Freddie Loan Modifications Doubled After Government Takeover

Fannie Mae (FNM) and Freddie Mac (FRE) doubled their loan modifications in the first two full months after being seized by the government, their regulator said Friday.

The mortgage giants' loan modifications for October and November of 2008 were up 50% from the previous two months, reflecting foreclosure freezes at both companies that gave them more time to revamp the terms of troubled loans, said Federal Housing Finance Agency Director James B. Lockhart.

"These data reflect the increased commitment of the servicers and the GSEs to help borrowers in trouble modify their loans to keep them in their homes," he said in a statement.

The data were contained in a November report detailing all loss mitigation efforts by Fannie and Freddie on the 30.6 million residential mortgages they own or guarantee.

The share of mortgages 60 or more days past due that result in foreclosure starts has been steadily dropping, according to the report. The proportion fell to 5.25% in November from 6.44% in October. During the first quarter of 2008, the share of such past due loans that resulted in foreclosure starts was 8.29%.

-By Jessica Holzer, Dow Jones Newswires; 202-862-9228; [e-mail]