Home prices have risen for much of the year, which has helped many underwater borrowers improve their situation. According to President Barack Obama and his administration's Housing Scorecard, more than 1.3 million families have been able to get above water on their mortgage through October.
"As the October housing scorecard indicates, our housing market is continuing to show important signs of recovery – with the [Federal Housing Finance Agency] housing price index posting the largest annual gain in five years and new home sales at its fastest pace since April 2010," said Department of Housing and Urban Development acting assistant secretary for policy development and research Erika Poethig.
The Home Affordable Modification Program has played a large role in helping homeowners avoid foreclosure. As of September, more than one million borrowers have used a permanent HAMP modification to save about $541 a month on their mortgage payments.
This program was created in 2009 and revamped in mid-2012 to help include more borrowers, which may have contributed to the high amount of HAMP mods completed this year so far. These mods have show lower delinquency and default rates than private industry mods.