Loan modifications by Fannie Mae and Freddie Mac rose 24% during the second quarter, with the majority of mods completed under the government's Home Affordable Modification Program.

The government-sponsored enterprises finished a total of 171,176 loan modifications, more than half of which reduced borrowers' monthly payments by more than 30%.

The second-quarter statistics, released Friday by the Federal Housing Finance Agency, Fannie and Freddie's regulator, also showed that foreclosure starts increased 12%, to nearly 275,100.

Completed foreclosure and third-party sales rose 15% during the period, to nearly 112,400.

In a bit of good news, the FHFA said recent loan modifications are performing better than loans modified in earlier periods.

Less than 10% of loans modified in the fourth quarter of 2009 and first quarter of 2010 were 60 days or more delinquent three months after modification.

Comparatively, more than 20% of loans modified a year earlier were 60 days or more delinquent three months after modification.

Cumulative permanent Hamp modifications totaled nearly 225,000 at the end of the second quarter as roughly 88,600 Hamp trials became permanent mods. Roughly 202,000 borrowers were in Hamp trials at the end of the period, down from nearly 448,100 at the end of the first quarter.

The decline was in part because of a "new requirement to verify documentation at the beginning of the process and cancellations as a result of missed payments and inadequate documentation," the FHFA said.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.