Nongovernment holders of delinquent mortgages are offering more payment plans with debt forgiveness as Fannie Mae and Freddie Mac resist, according to the U.S. Office of the Comptroller of the Currency.

Debt forgiveness was included in 16% of loans held by private investors, 25% of loans held in bank portfolios and in none owned by the government-run companies.

"Principal modifications can be a tool in the overall arsenal," Bruce Krueger, a senior mortgage expert with the comptroller's office, said in a conference call.

Principal reductions were granted in 8.5% of the 116,153 delinquent mortgages that received permanent modifications in the fourth quarter, according to a report by the OCC, a unit of the Treasury Department.

That's up from 8.1% in the prior three-month period.

Lenders have struggled to find ways to reduce losses as 12.1% of mortgages were delinquent or in foreclosure at the end of last year, down from 12.4% a year earlier, according to the comptroller's report.

About 5 million homeowners have lost their property through foreclosure or other forfeiture actions since 2006, according to RealtyTrac.

Delinquent loans that received payment reductions greater than 10% have had a lower re-default rate than plans with smaller discounts, Krueger said.

The number of permanent modifications fell 44% in the fourth quarter from a year earlier and 16% from the prior three-month period, according to the report.

At the same time, the number of homes seized through foreclosures rose 22% to 116,060 and the number of short sales, when lenders agree to sell for less than the debt on the property, increased 29% from a year earlier to 63,257.

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