The Treasury's Making Home Affordable Program (HAMP), designed to prevent foreclosures, continued to struggle in July. Fewer trial modifications were started and made permanent last month than in June, according to the latest report (.pdf). There were also more cancellations. Although the program continues to slow, foreclosures remain high.
HAMP's performance last month can be summed up through this chart:
You can see that the gold line for trials started and the green line for modifications made permanent both ticked downward last month. New trials hit a new low, while monthly loans made permanent nearly matched the December 2009 level. The red line shows total cancellations in July eclipsed June's number. This indicates more borrowers with either a trial or permanent modification left the program last month. Obviously, these trends are all the opposite of what the Treasury wants to see.
As for cancellations, they're becoming increasingly significant. At this point, a whopping 47% of trial modifications started have been cancelled. In July, there were nearly twice as many borrowers with modifications cancelled as there were borrowers who obtained trials or permanent modifications combined. The number of permanent cancellations, in particular, was the highest we've seen yet at 4,089. The previous high occurred in May with 2,613. So you can see how big of a number July's was compared to prior months. Remember, borrowers have to pass through a number of filters before they achieve permanent status, so very few cancellations should occur at that point.