Safeguard Properties

The Shutdown’s Impact on Financial Services

Posted on by Ashley Shepherd

Industry Update
January 13, 2019

Source: National Mortgage News

The government shutdown is now the longest in American history, officially hitting that mark over the weekend. Though only a partial shutdown, it is having an outsize impact on banks, credit unions and mortgage lenders across the country. Some of these have been mitigated due to actions by the Trump administration, while others continue largely unaddressed.

With President Trump refusing to end the shutdown until Democrats agree to fund a wall on the southern border, it is unclear when the shutdown will end. Some predict Trump may eventually give up and instead seek to invoke emergency powers to build the wall, a strategy that carries significant legal risk. Others argue the president will keep the shutdown in place in the hopes pressure builds on Democrats to make a deal.

Following is a look at where financial services are most affected.

IRS income verification

The government shutdown, which began on Dec. 22, has already caused a backlog of mortgage applications and was threatening to do even worse.

Some lenders had become wary of closing loans without IRS documentation known as Form 4506-T, which provides official income verification and tax return transcripts. The form was unavailable with the government closed. But after mortgage officials began lobbying the Treasury Department on the issue, the Trump administration opted to declare personnel who deal with the form as “essential,” thus allowing them to return to work, according to a story that The Washington Post broke late last week.

Though the Post story couched it as the administration doing a favor for a powerful lobby, it may be as much about self-preservation as helping the industry itself. Without access to the form, the mortgage market was in danger of grinding to a standstill, a prospect that would worsen the economic damage from the shutdown. With most polls showing that Americans blame Trump, not Democrats, for the shutdown, the administration was highly motivated to find a way around the issue.

Broader mortgage impact

The Federal Housing Administration has continued to process government-backed loans during the shutdown, but since only a fraction of the mortgage insurance agency is at work, a paperwork backlog has built up and is expected to grow as the shutdown goes on.

The FHA has also stopped assisting financial institutions in underwriting loans. That move mostly doesn’t hurt larger lenders that use the FHA’s automated underwriting system, but it is potentially causing delays for smaller banks, credit unions and other lenders.

House Financial Services Committee Chairwoman Maxine Waters, D-Calif., has warned that worse is yet to come, noting that 95% of Department of Housing and Urban Development employees are on furlough. She noted other areas beyond the FHA that could be affected, including those that rely on HUD’s rental assistance programs.

SBA lending grinds to a halt

The shutdown is eroding confidence in the Small Business Administration as it is unable to process and approve loan applications, creating a backlog that is pushing small businesses to costlier alternative financing.

“Depending on how long the shutdown is in effect, we could see some negative impact to the program and economy,” said Miguel Maldonado, senior vice president at the $9 billion-asset Randolph-Brooks Federal Credit Union in Live Oak, Texas. “The delay … can affect small businesses and their ability to operate, or even get off the ground.”

The longer the shutdown drags out, the worse the impact is liable to be, according to financial services executives.

Alternative lenders, meanwhile, have tried to fill the void, positioning themselves as able to help while banks and credit unions cannot.

Flood insurance

After protest from lawmakers and the mortgage industry, the Federal Emergency Management Agency has resumed selling and renewing flood insurance policies during the shutdown.

The turnabout came after earlier guidance that said FEMA would suspend sales as a result of a lapse in funding.

The agency faced backlash from Waters and industry groups because Congress had voted in December to extend the National Flood Insurance Program through May 31, 2019.

Banks, credit union cut rates

Banks and credit unions across the country are waiving fees and offering low- to no-interest loans to help federal workers affected by the partial government shutdown.

U.S. Bancorp on Friday began offering loans of $100 to $6,000 at low rates to qualified federal employees who have an existing U.S. Bank account so they can cover expenses until they return to work.

Many other large and regional banks have taken similar steps. Citigroup, for example, will make adjustments to fees and interest rates to affected customers across several lines of business, a company spokesman said. Bank of America said late Friday that it had contacted its customers who are affected by the shutdown to let them know about the bank’s assistance programs.

The five federal banking regulators issued a joint statement on Friday encouraging banks and credit unions to assist customers in these ways. The agencies said that assistance offered to workers “should not be subject to examiner criticism.”

Impact on federal employees

Among the hardest hit are federal employees, many of whom are either furloughed and not being paid or forced to work without pay.

For those 800,000 or so employees, not including government contractors, many will miss their ability to pay mortgage or rent payments. Zillow estimated $249 million in lost residential mortgage payments, and further noted that many employees will be scared off from buying new homes or moving.

For now, many lenders are treating the shutdown as if it were a natural disaster.

Overall economic impact?

One thing is clear: The longer the shutdown goes on, the bigger overall economic impact it’s going to have.

S&P has said that if it lasts two more weeks, it will cost the economy roughly $6 billion, more than the $5.7 billion in funding Trump wants to start building the wall.

There are also fears, however, that a prolonged shutdown will depress stock prices, hurt consumer confidence and possibly even start a recession. Retailers, too, may feel pain, though it would be mild if the shutdown ends soon. But with no end to the shutdown in sight, it’s hard to predict what the full toll will be.

MBA’s National Mortgage Servicing Conference & Expo 2019

Posted on by Safeguard

February 25-28
Orlando, FL

Safeguard is proud to introduce New York Times Best-Selling Author Janine Driver at the MBA National Mortgage Servicing Conference Feb. 25-28, 2019 in Orlando, Fla., as part of our Diamond sponsorship. Join us as we lead a roundtable discussion on the New York Zombie Properties Law from 2-5 p.m. on Feb. 26 or meet us in booth 601 on the exhibit floor. We would love to share with you all of the new and exciting services Safeguard has to offer!

For more information on this event, please click here.

Servicers Must Adjust Operation Policies to Meet HUD Conveyance Deadlines and Avoid Delays

Posted on by Safeguard

Safeguard in the News
January 11, 2019

Source: HousingWire

Q&A with Michael Greenbaum on the role HUD plays for conveyance deadlines

Executive Conversations is a HousingWire web series that profiles powerful people in the financial industry, highlighting the operations and the people that make this sector tick. In the latest installment, we sit down with Michael Greenbaum, COO of Safeguard, to talk about steps servicers can take to meet conveyance deadlines and the expansion of FHA’s CWCOT program.  

Q. What are the best strategies for meeting conveyance deadlines?

A. Reconveyances are one of the biggest challenges mortgage servicers face. Coupled with constant changes in leadership, guidelines, HUD vendors, and the interpretations of regulations, servicers face some significant hurdles with FHA loans. While these revisions to regulatory requirements keep the servicing and property preservation industry on their toes, the resistance and/or inability to efficiently make changes within the organization tend to halt progress and affect the timely conveyance of properties to FHA.

Servicing rules within organizations can stall the conveyance of files in an effort to obtain written approval of expenses to avoid out-of-pocket costs. This is true in waiting for the insurance company to issue a check, as well as waiting for MCM approval of over allowable requests. While some files deserve prudent review and follow up for large expenses, many files can efficiently move through the process with the establishment of standard cost-benefit analysis. Safeguard has worked with several clients to establish standard cost forms that account for unpaid principle balance, cost of repairs for conveyance condition, pending insurance funds, possibility of HUD reimbursement, and expenditures-to-date. Utilization of a standard template can empower front line staff to make decisions faster and avoid bottlenecks of management reviews required within the servicing shop.

The 60-day to sale program would help mortgage servicers and their property preservation partners meet conveyances deadlines more regularly. The concept is completing a convey maintenance inspection 60 days prior to the sale of the property.  This ensures that all work is completed in a timely manner, and any issues are remediated prior to sale. Bids can be approved more timely, and pre-sale hazard repairs are not held for post-sale.

Mortgage servicers might also consider giving their property preservation providers delegated authority to place properties ICC. This means allowing them to have the money up-front to get a property ICC and bid to HUD later to decrease risk. At the first post-sale order they will have authority to complete all of the work that is needed.

Q. What is one important policy that needs to be defined with the P&P vendor?

A. Removing personal property following the foreclosure sale is one area where costs can rise and conveyances can experience delays, and procedures already exist to manage this issue. A majority of states do not prohibit servicers from self-help to remove abandoned property following foreclosure sale. Despite this, the majority of servicers do not utilize the FHA allowable to remove and store these items following foreclosure sale. With the release of HUD ML 2010-18, servicers were required prior to HUD conveyance to remove all debris and personals, and place properties into broom swept condition. This was a significant change from prior conveyance requirements and sparked debate between HUD and servicers with regard to shifting liability and risk of an increase in litigation from borrowers citing missing personal property.

HUD reacted quickly with the release of a frequently asked questions (FAQ) providing servicers with a $300 allowable for reimbursement to store abandoned personals in lieu of disposal. The FAQ provided guidance to follow local laws with regard to the removal, disposal and/or storage of abandoned personals. This guidance afforded servicers the ability to pursue self-help and remove the items in effort to convey the property to HUD quicker. Despite the accommodation from HUD, the allowable and guidance is not common practice even today, seven years after the new requirement for broom swept condition.

Alternatively, servicers seek guidance from counsel as to whether or not to pursue an eviction of personal property on a case-by-case basis. This delays conveyance and leaves the property subject to new damages, complaints from neighbors, and potential code violations. The absence of a clear, consistently executed matrix regarding the removal, disposal or storage of abandoned personal property leads to unnecessary bids submitted to HUD, ambiguity in the definition of possession, and confusion surrounding the calculation of the convey due date. Establishing a personal property matrix and providing guidance to your property preservation vendor to execute is a prerequisite for timely conveyance. Likewise, a well-researched, defined policy serves as a defense if legal complaints ensue.

Q. How do you coordinate all players involved?

A. With guidance from FHA prohibiting reimbursement of property preservation and inspection costs incurred after the convey due date, the inability to adopt and revise procedures that bog down the convey process will undoubtedly cost servicers millions of dollars in non-reimbursable expenses. Partnering with your property preservation vendor and adopting best practices communicated by FHA staff and their MCM vendor is crucial in reducing or eliminating out-of-pocket expenses.

To reduce the costs of servicing FHA loans and conveying timely, policies regarding personal property removal, repairing of insurable damages, and waiting for bid approval from the MCM are in need of re-examination. Servicers need to adjust their operating policies to complement the expectations of HUD to avoid conveyance delays. Additionally, pre-foreclosure sale FHA loans have historically taken a back seat to the management of post-sale assets within servicers’ shops. Servicers could realize significant cost savings from taking another look at prioritization of pre-sale assets – specifically in the areas of personal property, insurable repairs, servicing rules and insurance claim settlements.

Q. What are the effects of the CWCOT program?

A. Servicers should re-evaluate the timeframes of when to begin management of post-foreclosure sale files. With the expansion of the (Claims Without Conveyance of Title) CWCOT program allowing servicers to bid market value at the scheduled sale, appraisals are requested well in advance of the scheduled sale and properties reviewed for inclusion in the CWCOT program. This is the time to review the file for outstanding impediments to conveyance condition and status of over allowable requests, in addition to hazard insurance recovery or repairs.

The single largest driver of denied over allowable requests from HUD is missed due diligence timeframes causing the property to be overdue for conveyance. Decisioning the property conditions and denied over allowable requests 60 days prior to scheduled foreclosure sale and providing authorization to your property preservation vendor will result in 20 or more days shaved off the timeframe to place in conveyance condition and greatly reduce out-of-pocket costs associated with missing the due date for conveyance.

Safeguard Properties Unveils Workflow Management Platform

Posted on by Safeguard

News Release
September 17, 2018

Dallas, Texas, September 17, 2018 — Safeguard Properties is unveiling its integrated field services platform at the Five Star Conference and Expo this week. The platform, named SafeView®, is designed to meet the ever-changing requirements of the mortgage servicing industry and to improve the timeliness and quality of the services Safeguard provides.

SafeView provides order processing, routing, invoicing, and reporting services to ensure quality results to clients through a dynamic rules-based engine. It also integrates with a mobile platform consisting of Safeguard’s proprietary field services applications that provide near real-time property results.

“Safeguard continues to develop technologies that are designed to manage millions of assets while reducing risk, maintaining compliance, and driving client profitability,” said Alan Jaffa, CEO of Safeguard. “This platform is just another example of our commitment to investing in state-of-the-art systems to ensure we remain the most advanced in the mortgage field services industry.”

Consisting of five modules, SafeView delivers end-to-end automated order management, mobile data collection, workflow, billing and analytics through integrated field services software. Those five modules include:

•SafeView Connect serves as the integration gateway, allowing for configurable work orders, results and invoicing data exchange that connects vendors, clients and other partners.

•SafeView Inspect is an integrated mobile inspection app and administrative portal designed to provide full-service field support to our inspectors.

•SafeView Preserve is an integrated mobile property maintenance app and administrative portal utilized by contractors to receive, assign and complete property preservation work orders.

•SafeView Access is designed for clients to manage their portfolio by providing the property-level details including the status of work orders, bids and the results of work that has been performed.

•SafeView Analytics provides customizable current, historical, and location-based data analytics and reporting of field services operations through the life cycle of property inspections and maintenance.

“SafeView is the first full-service inspections and property preservation system that utilizes ‘smart’ scripting, panoramic photos, video and audio to provide a comprehensive assessment of our clients’ properties,” said George Mehok, chief information officer for Safeguard Properties. “It is uniquely designed to integrate with our vendors, client systems and technology partners, which enables an efficient work flow.”

About Safeguard

Safeguard Properties is the mortgage field services industry leader, inspecting and preserving vacant and foreclosed properties across the U.S. With a focus and investment in innovative technologies, Safeguard provides the highest quality service to our clients by proactively developing industry best practices and quality control procedures. We pride ourselves in our dedication to working with community leaders and officials to eliminate blight and stabilize neighborhoods across the country. Learn more at www.safeguardproperties.com.

Supreme Court Debates Meaning of ‘Debt Collector’ in Foreclosure Protections Case

Posted on by Safeguard

Updated 3/20/19: HousingWire published an article outlining a Supreme Court ruling that has awarded mortgage lenders and servicers additional protection when serving non-judicial foreclosures.

Article (Supreme Court Makes it Harder for Borrowers to Fight Foreclosures in Non-Judicial States)

Supreme Court Decision (OBDUSKEY v. MCCARTHY & HOLTHUS LLP)

Updated 3/20/19: DS News published an article discussing the Supreme Court decision for the case of Obduskey v. McCarthy & Holthus LLP.

Article (McCarthy & Holthus Responds to Supreme Court Foreclosure Ruling)

Industry Update
January 7, 2019

Source: CNBC

WASHINGTON – Markets are racked by turmoil, and there are signs the booming U.S. economy could slow down later this year. Yet the Supreme Court is reckoning with the lingering fallout from the financial crisis that rocked the global economy a decade ago.

The top court on Monday attempted to resolve a legal question that could have broad ramifications on hundreds of thousands of Americans who are foreclosed on without a judicial process each year. A key issue in the matter is who or what can be considered a “debt collector.”

The justices were divided, but not into clear ideological zones. Chief Justice John Roberts and Justice Brett Kavanaugh, Republican-appointed conservatives who are typically business friendly, were among the most skeptical questioners of the respondent in the case, a law firm working on behalf of Wells Fargo.

To be sure, there are ideological divides at issue. Sen. Elizabeth Warren, D-Mass., who announced a formal step toward a bid for the presidency last month, took a public stance on behalf of the petitioner in the case.

Warren, alongside potential 2020 contender Sen. Sherrod Brown, D-Ohio; Rep. Maxine Waters, D-Calif.; and a slate of other liberal lawmakers, filed a brief outlining what they believed was Congress’s intent in drafting the law at issue.

On the other side was the Trump administration, which dispatched the solicitor general, as well as powerful business interests including the Chamber of Commerce and associations representing bankers.

The case centers on Dennis Obduskey, a Colorado man who defaulted on his $329,940 home loan in the aftermath of the 2007 financial crisis. The question in the case is whether Obduskey is entitled to legal protections for debtors provided by Congress in 1977, or whether the foreclosure is exempt because it is Obduskey’s home, and not money, that is at stake.

Obduskey obtained his home loan from a company called the Magnus Financial Corporation in 2007. Like many other Americans, he defaulted on the loan in 2009.

The bank then attempted to foreclose on Obduskey for six years, to no avail. Finally, in 2015, Wells Fargo retained a law firm — McCarthy & Holthus — to handle the foreclosure proceedings. But, as of the latest briefs in the case, Obduskey’s home has yet to be sold.

The question of whether a law firm seeking to foreclose on a property is a debt collector is one that could affect millions of Americans. In 2016, about 200,000 homes were lost to foreclosure in states that permit lenders to foreclose on a property without going to court. Business groups have argued that these so-called non-judicial foreclosures are more efficient and fair to borrowers. Progressives say borrowers are entitled to more protections.

Obduskey’s attorney, Daniel Geyser, argued that McCarthy & Holthus is a debt collector and therefore required to comply with certain procedural protections contained in the 1977 Fair Debt Collection Practices Act. That law was passed to prevent debt collectors from engaging in abusive or predatory practices.

But Kannok Shanmugam, the attorney for the respondent in the case, argued that the FDCPA does not apply because, he said, the firm is not a debt collector. Shanmugam argued that Congress has long made a distinction between those collecting debts and those who seek to enforce security interests, or collect property that is owed without demanding payment.

The court is expected to issue a ruling by late June.

Justices look split

The semantic fight seemed split the justices into unusual camps, with Roberts at one point remarking to Shanmugam that the law is “not the way you would have told Congress how to write the statute.” Neither was it the way “your friend on the other side” would want Congress to write it, he added, referring to Geyser.

Kavanaugh suggested that he believed the firm was a debt collector. The purpose of a foreclosure, he said, is telling somebody “you need to pay or you’ll lose your house.”

Roberts added that “it certainly is an indirect effort to collect the debt,” which led Shanmugan to concede that Roberts’ point “makes it harder for me,” before he pointed to what he said was a longstanding distinction between debt collectors and those seeking to enforce security interests. It would not make any sense for Congress to distinguish between the two groups if someone enforcing a security interest is a debt collector, he said.

Importantly, the meaning of “debt collector” under the law does not necessarily have to hew to what it means in common speech. Indeed, McCarthy & Holthus itself sent Obduskey a notice identifying itself as a debt collector and requesting payment, which a federal appeals court said was not enough to invoke the FDCPA.

In order to establish what the law meant by “debt collector,” the justices sparred with counsel for much of the argument over the similarities between a law firm seeking to foreclose on a property and a repossession agent, or repo man, who arrives in the “dead of night.”

While a repossession agent might traditionally be considered a debt collector, Geyser argued that in fact Congress meant to distinguish the category.

Repossession agents do not demand payment – they are paid for collecting the property – and therefore would be exempt from some portions of the law, Geyser argued. That is why, he said, Congress made the distinction. But Shanmugam argued that it would not make sense for Congress to have exempted such a narrow category from the law.

Justice Samuel Alito seemed the most receptive to that argument, telling Geyser that Congress’s apparent exception of those enforcing a security interest from the definition of “debt collector” gave Geyser a “tough time.”

Justice Elena Kagan noted that “the grammar of the statute” suggests that the law firm can either be a debt collector, or it can be seeking to enforce a security interest, but not both. Because the firm is “paradigmatic” as a collector of a security interest, it is “a little less odd” to say they are not a debt collector.

Justice Sonia Sotomayor, however, appeared to agree with Geyser’s argument that the firm could be both, and noted that “what’s really at issue is the unfair practices.”

The justices were missing Ruth Bader Ginsburg, who did not attend oral arguments for the first time in more than 25 years on the bench.

The federal appeals courts are divided on the issue. At least two federal appeals courts have reasoned that “debt is synonymous with money” and so the FDCPA therefore would not apply to a law firm that is seeking to collect property.

The district court dismissed Obduskey’s complaint on those grounds, and that decision was ultimately affirmed by the U.S. 10th Circuit Court of Appeals.

At least three other federal circuits have staked out a different interpretation of the law. For instance, the 6th U.S. Circuit Court of Appeals has held that every mortgage foreclosure is undertaken “for the very purpose of obtaining payment on the underlying debt.”

The court, in the 2013 case Glazer v. Chase Home Finance, held that there “can be no serious doubt that the ultimate purpose of foreclosure is the payment of money.”

In a brief, an array of business groups including the Chamber of Commerce and the Mortgage Bankers Association wrote that applying the FDCPA protections to the foreclosure process would add “an additional, unwarranted layer of complexity in the foreclosure process, thereby harming both lenders and borrowers.”

It was not clear on Monday which side would be able to secure the five votes necessary to win. Making any inferences harder was the absence of Ginsburg, who is expected to vote in the case but who was not able to ask any questions of counsel.

Servicers’ Status for 2019? It’s Complicated

Posted on by Safeguard

Industry Update
December 24, 2018

Source: National Mortgage News

Mortgage servicers should expect reliable profits in 2019, but origination challenges may spill over into their sector in the form of operational complexities and higher costs.

Servicing portfolio runoff could decrease and mortgage servicing rights valuations could increase in 2019 in ways that bode well for servicers, but continuing constraints on originations also could make their work more complex and expensive.

There may be more stress on subservicers’ budgets

For subservicers, an uptick in transfers next year as lenders release more servicing or consolidate could make their work more complex, and costly.

Subservicing work might be more complicated because clients that retained historically, and are starting to sell, will only need subservicers to handle their servicing in the short-term, from after origination until it is sold.

“A transfer, depending on where you sit, may or may not be good for your business,” said David Vida, executive vice president at Specialized Loan Servicing, a subsidiary of Computershare.

So can companies make money as an interim servicer?

“People need to pay you the right amount of money to board and de-board a loan. That’s where automation, technology, and a smart process make a huge difference,” said Vida. “It’s a thin-margin business. Our challenge is how to provide a strong customer experience while spending less money.”

The need to service second mortgages could grow

Another trend subservicers will have to contend with in 2019 is demand to service the growing number of home equity products lenders are expected to originate if rates and home prices keep rising.

“Next year could be the year of home equity,” said Gagan Sharma, president and CEO at BSI Financial Services. The product is more complicated for monoline servicers to handle than traditional mortgages because of the mix of short-term draws and longer-term withdrawals that may be involved.

While most servicers and subservicers are largely expecting a continuing climb in home equity business as home prices and rates rise; they tend to also agree there are a couple of risks to this forecast.

The economy may be overdue for a downturn

One common concern is that the length of the recent economic expansion suggests it is due for a reversal.

“I worry about the economy,” said Sharma.

Among developments that could weaken the market’s strong housing and loan performance, or lower rates, are global turmoil, excessive damage from natural disasters, the spread of local housing bubbles, or excessive consumer debt.

“I don’t believe the housing market will be the cause of the next downturn, but if there is ever a downturn the housing industry will definitely be impacted,” said Sharma.

Mortgage delinquency rates could bottom out

So far, however, there is little sign of any deterioration in mortgage credit at Fannie Mae, the largest secondary market buyer in the market.

“The Fannie delinquency rate is the lowest is has been in some time,” Sharma noted.

So long as no unexpected development such as a significant uptick in delinquencies occurs, next year could be a relatively good one for performing servicers with strong cost controls and technology.

Foreclosures in the Big Apple

Posted on by Safeguard

Industry Update
January 4, 2019

Source: DS News

First-time foreclosure cases decreased quarter-over-quarter across New York in 2018, according to Property Shark’s Q42018 report on foreclosures in the Big Apple. The report indicated that across all New York boroughs 720 homes “hit the auction block for the first time.” This is a 14 percent year-over-year decrease, with lis pendens cases also declining by 16 percent during this period.

The only exception was Queens, which saw an 8 percent year-over-year increase in foreclosures during the quarter. The borough saw 252 first-time foreclosure cases during the quarter. However, on a quarter-over-quarter basis, Queens saw a 17 percent drop compared to Q32018.

On a quarter-over-quarter basis, first-time cases in Staten Island increased by 269 percent, the report said, “due to the very limited number of foreclosures that occurred in Q32018.”

“In Q3, there were only 48 cases registered, while in Q4 177 residential properties were auctioned off” in Staten Island, the report indicated. Year-over-year, the borough saw a decrease of 4 percent in foreclosures.

Lis pendens or pre-foreclosure cases are also declining across the city. The report found that such cases had contracted 16 percent year-over-year with 2,113 lis pendens notices registered in the last quarter of 2018. Each borough saw decreases between 7 percent and 29 percent. The only exception, in this case, was Manhattan where pre-foreclosures saw an uptick of 2 percent during the quarter. The largest drop in these cases occurred in the Bronx, declining 29 percent, while most cases were registered in Queens.

Despite an uptick in pre-foreclosures, Manhattan saw only 23 homes heading for the auction block in Q42018, compared with the same period last year, when 28 homes were in foreclosure in this area. The borough, according to the report, continues to remain stable in terms of foreclosures with “first-time cases constantly hovering around 20 and 30 over the last couple of quarters.”

The Bronx saw the steepest drop in residential foreclosures with the number of cases dropping to more than half in Q42018, compared with the same period last year. The borough also registered the steepest quarter-over-quarter decrease in foreclosures among all five areas with the decline pegged at 36 percent by Property Shark.

Click here to read the full report.

Servicers Treating Government Shutdown Like a Natural Disaster

Posted on by Ashley Shepherd

Industry Update
January 4, 2019

Source: National Mortgage News

As the government shutdown enters its third week, mortgage servicers are activating the response plans they normally use during hurricanes and wildfires to assist federal workers who may have trouble paying their mortgages.

On Jan. 4, the president said he’s prepared to keep the shutdown going for “months or even years.” With that kind of ambiguity surrounding Washington, federal employees need fallbacks for their mortgages.

The shutdown impacts nearly 800,000 government employees. About 420,000 are currently working without pay and 380,000 are furloughed and not working at all.

During the shutdown in 2013, the FHA, Fannie Mae and Freddie Mac all called for temporary postponement on mortgage payments for furloughed workers. Lenders are offering paycheck loan assistance programs this time around.

Credit unions like Navy Federal and PenFed, are providing 0% APR loans for impacted members who have established direct deposit accounts with them.

“Our members deserve peace of mind during a government shutdown, and eligible members can register to get some relief,” Tynika Wilson, Navy Federal senior vice president of debit card and fund services, said in a press release.

Mortgage servicers offer forbearance to bridge the gap.

“LoanCare is working with customers who have been impacted by the federal government shutdown, which may include normal forbearance or other relief,” Tim O’Bryant, senior vice president of customer experience at LoanCare, said in a statement to National Mortgage News.

“Mortgage servicers can offer assistance, such as forbearance, to customers who are struggling to make their mortgage payment. Federal government employees who will experience difficulty paying their mortgage due to delays in receiving a paycheck should contact their mortgage servicer to discuss assistance options,” Ruth Green, the chief operating officer of Primary Residential Mortgage, said in a statement to NMN.

Loan applications already dropped in light of the market uncertainty. With those furloughed technically being unemployed, it presents problems at the closing table with the documents required, including recent paystubs and employment verification.

“We are providing flexibilities, where possible, in order to assist customers in closing their transaction on time,” Green continued. “The most significant impact is for customers in rural communities who have applied for USDA Rural Housing financing. At this time USDA is not issuing commitments that allow lenders to close these transactions.”

If the shutdown does drag out, companies should stay proactive in assisting struggling homeowners.

“In the event the shutdown looks like it will persist into February, we plan to do an outreach campaign to educate customers on the forbearance option. If a customer has a unique situation or special circumstance, our management team and loss mitigation department are ready to assist,” said O’Bryant.

OCC: Chief Counsel Named

Posted on by Safeguard

Investor Update
December 26, 2018

Source: OCC

WASHINGTON—The Office of the Comptroller of the Currency (OCC) today announced Jonathan Gould as Senior Deputy Comptroller and Chief Counsel.

“Jonathan’s extensive background in banking law and regulation, together with his impressive relationship-building experience throughout Washington and the banking industry, bring tremendous value to the OCC and its efforts to promote the agency’s important mission, policies, and programs,” said Comptroller of the Currency Joseph Otting. “We are pleased to add someone of Jonathan’s caliber to our agency and our executive team.”

Mr. Gould joins the OCC from the U.S. Senate Committee on Banking, Housing, and Urban Affairs, where he served as Chief Counsel. Prior to that role, he worked in the private sector at BlackRock and at Promontory Financial Group where he served as Promontory’s Deputy General Counsel. Previously, he served on the Senate Banking Committee staff. Mr. Gould began his professional career with Alston & Bird LLP, advising financial services companies on banking and corporate law, including bank regulation and mergers and acquisitions. He assumed his duties on December 24, 2018.

Mr. Gould earned his bachelor’s degree from Princeton University and his law degree from Washington and Lee University.

Karen Solomon and then Bao Nguyen served as Acting Chief Counsel successively for the agency since the retirement of Amy Friend in 2017.

 

Fannie Mae: Sellers/Servicers Must Submit Annual Certifications

Posted on by Safeguard

Investor Update
January 8, 2018

Source: Fannie Mae (Form 582 information page)

Additional Resource:

Fannie Mae (Seller/Servicer Reporting Calendar)

Fannie Mae sellers/servicers with a Dec. 31 fiscal year end must submit their annual certification and audited financial statements to us by March 31. Recent enhancements to the Lender Record Information Form 582 platform will simplify the certification process.