Only 37 percent of Colorado homeowners who entered foreclosure last year were able to escape without losing their home in a forced sale.
But one mortgage-insurance company, Genworth Financial, claims a cure rate of 80 percent for its Colorado borrowers who got behind.
“We are really on the side of the borrower. We are trying to work out the best situation we can,” said Chris Antonello, a spokesman for the Raleigh, N.C., company.
The 108 Colorado loans Genworth cured in the past year typically involved changing loan terms or creating separate loans that allowed borrowers to catch up on unpaid amounts.
Alan Goldberg, vice president of homeowner assistance at Genworth Financial, said insurers are typically more motivated to keep a borrower in a home than overwhelmed loan servicers.
“If there is a loss, we are the ones that are going to pay most of it,” Goldberg said. “The borrower wants to keep the home.”
To be fair, insured mortgages are usually underwritten more conservatively to begin with, meaning they are less likely to be subprime, interest- only or adjustable-rate.
And they have one lender, which makes structuring a workout easier.
Mortgages where a second lender provided the down payment became a popular alternative to mortgage insurance this decade.
But two-lender mortgages are harder to resolve, meaning borrowers are more likely to fall through the cracks.
Nationally, Genworth has a cure rate of 90 percent, higher than its 80 percent cure rate in Colorado. Goldberg said he couldn’t explain why Colorado’s cure rate was lower.
A change in state law last year that gives borrowers more time to cure their mortgages in foreclosure is also expected to boost the rates of saves, said Ryan McMaken, a spokesman for the Colorado Division of Housing.
Aldo Svaldi: 303-954-1410 or asvaldi@denverpost.com
