DSnews.com picked up the press release regarding the Safeguard Properties 2009 Vendor Conference.The conference drew record attendance of 1,200 contractors, inspectors, city officials, clients, and investors from across the country.
To view the full press release, click here.
DSNews.com picked up a?story regarding managerial promotions at Safeguard Properties.
Ohio’s Safeguard Properties has promoted two team members and appointed two new hires to managerial positions.
Sam Feuer has been promoted to manager of evaluations. Feuer joined Safeguard in 2001 and has served in supervisory and management roles in the company’s property and preservation, REO, and inspections business units. In his new role, Feuer will manage the Safeguard service line that provides broker price opinions (BPOs) and appraisals. His strategic focus will be to grow business, streamline operations, and organize the company’s valuations broker network.
Karen Sebor has also been promoted, to the position of manager of property preservation regional coordinators. Sebor has been with Safeguard since 2008. She was previously a “manager in training” in the property and preservation service line and also led projects in vendor management. In her new role, Sebor oversees the management of regional coordinators, as well as quality control and performance improvement.
Michael Young has joined the company as director of infrastructure services. Prior to Safeguard, Young held IT management positions with May Department Stores and Lord & Taylor. In his new position with Safeguard, Young will provide leadership and direction to the IT infrastructure team, which includes technical infrastructure architects, network, voice and database administrators, and hardware support.
Marc Ehrenreich has been named manager of training and development. Previously, Ehrenreich held training positions with Intellinex, Key Bank, and Developers Diversified Realty. In his new role, Ehrenreich will manage a department of trainers at Safeguard who are responsible for all learning activities within the company.
Safeguard Properties is the largest privately held mortgage field services company in the United States, managing defaulted and foreclosed properties for banks, financial institutions, and loan servicers. The company was founded in 1990 by CEO Robert Klein, and now employs more than 700.
Robert Klein, CEO of Safeguard Properties and chair of the Mortgage Bankers Association’s vacant property registration committee, was quoted in an article about the aggressive code enforcement of vacant properties in Chula Vista, California.
Chula Vista’s tough anti-blight ordinance has become a national model for requiring lenders to maintain vacant foreclosed homes before they fall into disrepair, but the city is under mounting pressure to reduce the measure’s stiff fines and give lenders more time to improve properties.
The city broke new ground in the fall of 2007 by enacting regulations that allowed it to issue citations for blighted dwellings after lenders filed notices of default, which mark the start of the foreclosure process.
So far, Chula Vista has levied fines totaling more than $1.3 million and collected about $752,000. Registration fees for vacant homes under the program have reached about $183,000.
Some critics say an unintended consequence of the ordinance may be to delay the recovery of the local real estate market. Faced with large fines, some banks may become reluctant to do business in the city, they say.
Initially, some lenders expressed shock at fines that on occasion can exceed $10,000. Officials say the large penalties were necessary to force a change in lender behavior.
Traditionally, cities have waited until lenders have taken formal possession of abandoned foreclosed homes before issuing citations. That can take months in some cases, forcing municipalities to address blight issues on their own. Typically, they remove weeds and drain swimming pools, seeking reimbursement later. Chula Vista has used its measure to place the burden on lenders.
The program requires banks and loan servicers to inspect foreclosed properties to confirm they are occupied. If they are abandoned, the lenders must register the properties with the city and secure and maintain them.
Under the ordinance developed by Doug Leeper, the city’s code enforcement manager, lenders are responsible for upkeep, even if ownership hasn’t formally been transferred to them through foreclosure.
With fines that can reach $1,000 per day, the measure has pushed Chula Vista to the forefront of a national drive to maintain neighborhoods hit hard by the mortgage market meltdown, said Peter Lemos, code enforcement field manager for Stockton.
Stockton is one of more than 200 communities nationally that have adopted anti-blight measures based on Chula Vista’s regulations, Lemos said.
“It brought to light that the lender or the bank is responsible for the vacant properties,” he said. “Before, until you had a new homeowner, no one was responsible.”
Real estate agents typically work closely with lenders, supervising repairs to vacant foreclosed homes and preparing them for resale. Initially, there was little opposition to Chula Vista’s abandoned-property ordinance from agents, said Pat Russiano, president of the Pacific Southwest Association of Realtors, a trade association for South County.
The group has come to believe that banks eventually may avoid doing business in Chula Vista because of the ordinance, Russiano said. With credit tight and many lending institutions struggling to maintain solvency, real estate agents say they don’t want lenders to have another reason not to approve home loans.
“They are already scared to death,” Russiano said. “Why give them one more thing to worry about?”
Large fines could affect lending decisions among banks that already are hurting from widespread home loan failures, said Dave McDonald, government affairs chairman for the San Diego County chapter of the California Association of Mortgage Brokers.
“The effect would not necessarily be redlining, but the manipulation of the foreclosure market,” he said. “If lenders think they will be fined $1,000 a day, there is a motivation to not do business in that area.”
Henish Pulickal is the former manager of San Diego-based Accredited Home Lenders’ department for properties acquired through foreclosure. Accredited, which was caught up in the subprime lending crisis, recently filed for bankruptcy protection. Pulickal said the anti-blight measure places unnecessary burdens on the lending industry.
“They were giving us violations for anything, whether it was a propped-open window, saying it was unsecured, to having dead grass,” Pulickal said.
Jay Norris, an account representative for First American Title, said he recalled a case in which an agreement to sell a foreclosed home fell apart because of a dispute between the city and the bank over a large fine. If banks perceive they are being hurt, they could think twice about how they do loans in Chula Vista, he said.
“There have been a lot of unintended consequences with this ordinance,” said Richard D’Ascoli, director of government affairs for the South County Realtor group. “It’s been a nightmare.”
Fines, in addition to scaring away banks, could end up becoming liens against defaulted properties, discouraging purchases or making lenders reluctant to approve mortgages for the buyers of foreclosed homes, Russiano said.
City officials say such outcomes are highly unlikely. Title insurance protects home buyers and lenders against errors in real estate transactions, such as an undiscovered liens.
Code enforcers stress that they aren’t placing undue pressure on lenders to comply with the abandoned-home measure. Emily Novak, a senior code enforcement officer, said her department gives lenders 30 days to secure abandoned homes and make any necessary repairs. Out of about 3,000 cases in which repairs were needed, fewer than 150 properties have been fined, she added.
Robert Klein, who chairs the Mortgage Bankers Association’s Vacant Property Registration Committee, said he supports measures like the one in Chula Vista. He said it is in everyone’s best interest to deal with abandoned properties early on, before they become blighted.
All lenders need to do to avoid fines is secure and maintain vacant homes until they are sold, said Klein, who heads Safeguard Properties, a property-management firm that represents lenders nationwide.
Alan Mallach, a senior fellow with the Brookings Institution, said the ability to levy high fines has enabled Chula Vista to protect its neighborhoods.
“That was really the important step on the part of Chula Vista,” Mallach said. “A lot of people saw that and followed their lead. It was, as far as I know, the first city in the U.S. that really took hold of this matter and said, ?Lenders, you have to take responsibility for these properties.’?”
Chula Vista Mayor Cheryl Cox said the fact that the ordinance has drawn praise as a national model shouldn’t stop the city from taking a look at how well it works or how it affects the real estate and lending industries. A proposal for modifications from the city staff is expected to reach the City Council by the end of this month.
Chula Vista is one of the communities in San Diego County that was hit hardest by the surge in foreclosures. Cox said that with some indications showing the economy is turning around, she hoped there would be less need for the abandoned-home measure. It may be possible to reach a compromise between supporters of the measure and its detractors, Cox said.
The city staff and the Realtors group already have made progress on some issues. There is a tentative agreement to streamline the process for registering abandoned homes within the city, Deputy City Attorney Chance Hawkins said. The city also is open to a proposal to allow vacant homes to be maintained by national property-management firms rather than only local companies.
The mayor said her goal is to have an anti-blight measure that protects neighborhoods without impeding the ability of lenders and real estate agents to do their jobs.
“Lots of cities have copied our ordinance,” Cox said. “That’s always flattering. That hasn’t stopped our staff from saying, ?Is there a way to shift this a little bit, make it a little more effective, a little more palatable?’?”
As reported in Housing Wire, Safeguard Properties was recognized as the primary donor to the Cuyahoga County Foreclosure Prevention Program.
On June 26th, Safeguard Properties, a privately held field servicer, earned recognition as the primary donor for a three-year commitment to the Cuyahoga County Foreclosure Program.
The program offers homeowners counseling as part of the Don’t Borrow Trouble campaign, which warns borrowers about the dangers of defaulting on their payments or tumbling into foreclosure.
In 2005, Cuyahoga County, which lies in the greater Cleveland, Ohio area, faced an estimated 10,000 foreclosures – four times the amount from 1998, according to their Website.
“The goal of the expanded Don’t Borrow Trouble campaign is to decrease inappropriate mortgage lending and mortgage foreclosures through outreach, education, counseling, legal assistance and advocacy,” the site reads.
Ohio State Representative Mike Foley spoke at the event honoring Safeguard and discussed a bill currently being passed through the state’s general assembly. HB 3 includes a foreclosure moratorium for troubled homeowners in Ohio.
Jim Rokakis, the treasurer of Cuyahoga County, acknowledged others for their contributions including United Way, Chase Bank, Freddie Mac Foundation, The Cleveland Foundation and others.
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MortgageOrb.com?reported that Safeguard Properties CEO Robert Klein was awarded the 2009 Ernst & Young Entrepreneur of the Year Award in the Northeast Ohio region for professional services and asset management firms.
By MortgageOrb.com on Tuesday 16 June 2009
Safeguard Properties founder and CEO Robert Klein received the 2009 Ernst & Young Entrepreneur of the Year Award in the Northeast Ohio region for professional services and asset management firms. The award was presented June 10 at an evening gala awards ceremony at Playhouse Square in Cleveland.
Winners in the awards program, which is now in its 23rd year, are selected by a panel of independent judges, including leaders from civic organizations, academic institutions and local business owners.
Awards are given to entrepreneurs who have demonstrated excellence and extraordinary success in the areas of innovation, financial performance and personal commitment to their businesses and communities.
HousingWire.com reported that Safeguard Properties CEO Robert Klein was awarded the 2009 Ernst & Young Northeast Ohio Region Entrepreneur of the Year Award for financial services or asset management.
By JACOB GAFFNEY
June 15, 2009 5:45 PM CST
The founder and CEO of private servicer Safeguard Properties received the 2009 Ernst & Young Northeast Ohio Region Entrepreneur of the Year Award.
The recognition is for demonstrating excellence and success in the areas of innovation, financial performance and personal commitment to their businesses and communities.
Robert Klein received the award on June 10th at a dedicated evening gala awards ceremony at Playhouse Square in Cleveland, Ohio.
As the 23rd annual award winner, Klein was selected by a panel of independent judges, including leaders from civic organizations, academic institutions and local business owners, many of whom are previous winners of the award.
Safeguard conducts more than 1 million property inspections and maintenance orders on defaulted and foreclosed properties nationally for mortgage service companies, banks, financial institutions and major investors.
DSNews.com reported that Safeguard Properties CEO Robert Klein received the 2009 Ernst & Young Entrepreneur of the Year Award in the Northeast Ohio region for professional services and asset management firms.
Carrie Bay | 06.16.09
Robert Klein, founder and CEO of Cleveland, Ohio’s Safeguard Properties, received the 2009 Ernst & Young Entrepreneur of the Year Award in the Northeast Ohio region for professional services and asset management firms. The award was presented June 10, at an evening gala awards ceremony at Playhouse Square in Cleveland.
The Ernst & Young entrepreneur awards program, now in its 23rd year, is recognized as one of the most prestigious business awards in the country. Winners are selected by a panel of independent judges, including leaders from civic organizations, academic institutions, and local business owners, many of whom are previous winners of the award.
Each year, awards are given to entrepreneurs who have demonstrated excellence and success in the areas of innovation, financial performance, and personal commitment to their businesses and communities.
According to Ernst & Young, entrepreneurship and innovation are key to global economic recovery. The firm released a new report Tuesday at the Detroit Economic Club’s National Summit that highlights the importance of innovation and an entrepreneurial mindset at a time when business leaders are struggling to balance short-term survival with long-term demand for growth.
James S. Turley, global chairman and CEO of Ernst & Young, said, “Entrepreneurship and innovation inherently thrive in downturns; in fact, some of the world’s largest companies were born during a recession. In times like these, it’s especially evident that entrepreneurial thinking isn’t optional. It’s more than a buzz word — it’s a business strategy.”
Klein founded Safeguard Properties in 1990, and has grown it into the largest privately held mortgage field services company in the United States. Safeguard conducts more than one million property inspections and maintenance orders on defaulted and foreclosed properties nationally, for mortgage service companies, banks, financial institutions, and investors.
Robert Klein, CEO of Safeguard Properties, contributed an article to the CMIS (Coalition for Mortgage Industry Solutions) Focus emagazine about theft prevention in vacant properties.
By Robert Klein, CEO Safeguard Properties
Across the country, in cities large and small, our company has witnessed what newspapers and police blotters have reported — significant increases in metal theft from vacant properties, with copper as a prime target.
The rise in thefts is fueled by scrap metal prices that have doubled and even tripled in some markets during the past three years because of growing demand.
The opportunity to make money stealing and selling scrap metals has been so compelling that thieves have risked death, serious injury and jail time to strip metals from city streets, cemeteries, new construction sites and, where it impacts our industry the most, vacant homes.
Metal thefts not only are dangerous for criminals, they create serious hazards for entire neighborhoods when thieves break working water and gas lines and cut live electrical wires to reach copper components.
Theft of copper and other metals in vacant houses contributes significantly to urban blight. While metals stripped from one home in less than an hour can bring hundreds of dollars through a scrap dealer, the cost to repair the damages left behind can run into the thousands.
Especially in struggling neighborhoods, when homes are stripped of their metals, they are also stripped of any value after thieves tear up floors and punch man-sized holes into walls to gain access to copper pipes. Stolen plumbing often causes severe water and flood damage, and the theft of electrical wiring increases the risk of fire.
In fact, metal-stripped properties often end up with negative value because demolition costs can range from $5,000 to $10,000, depending on the market and the size and condition of the property. Many property owners simply abandon these homes, leaving neighbors and cities to deal with the resulting nuisance and eyesore.
Deterring thieves and protecting properties
Cities, neighborhood groups and the mortgage industry have tried many ways to deter metal thieves because of the devastation they leave behind. Increasingly, cities and states have begun to consider and enact legislation requiring scrap dealers to obtain proof of ownership for certain high-theft metal items, and to increase their record-keeping and reporting.
Community and block organizations have strengthened neighborhood watch groups and stepped up efforts to educate neighbors and encourage them to be more vigilant in watching for and quickly reporting suspicious behavior at vacant homes in their neighborhoods.
Likewise, the mortgage and field services industries have routinely taken steps to deter metal thieves and better protect properties from the devastating damages they wreak.
First and most obvious, the simple fact that lenders and servicers utilize field service companies to inspect, maintain and secure vacant properties is a strong deterrent. Thieves are less likely to target properties that appear to receive regular attention, and that have been secured by field service professionals.
Field servicers are always seeking better ways to secure and protect properties on behalf of their clients. For example, Safeguard Properties recently announced a Good Neighbor Door Hanger program to combat thefts and other problems at vacant properties under management.
Under this program, once a property has been secured, in addition to placing a sticker on the front door of the property with emergency contact information, as is standard in the industry, Safeguard will visit neighbors to let them know that the company is managing the property. A door hanger with 24-hour emergency contact information is provided so neighbors can alert Safeguard if an issue arises. It is hoped that this program will encourage neighbors to be more vigilant in watching vacant properties and providing an early alert to report suspicious activities and deter thefts and vandalism.
One of the best ways to protect a vacant property is to give the appearance that it is occupied. While plywood boarding placed over doors and windows that have been breached is effective in keeping properties secure, it is not aesthetically appealing and makes it more obvious that a property is vacant.
Among the initiatives being tested in the industry is artistic boarding, in which plywood boards are covered or painted to give the appearance of actual window panes and doors so that vacant homes are not as obvious and offer a more attractive appearance among other homes in the neighborhood.
Similarly, the industry is upgrading the service packages on post-foreclosure REO properties, as they languish longer on the market and compete increasingly with traditional market homes. For servicers and investors, these homes are even more important to protect from the destruction caused by metal thieves because additional dollars have been invested in them to prepare them for market.
Upgraded services to REO properties include maintaining the exteriors to a neighborhood standard to make them appear occupied, thus deterring theft and vandalism.
The industry also has increased outreach efforts to open lines of communications nationwide with code enforcement officials. An important component in this initiative has been to provide an easy way for code enforcers to obtain contact information for mortgage lenders and servicers. An updated listing for the majority of lenders and servicers is now available through the Mortgage Bankers Association Web site, under its Property Preservation Resource Center (www.mortgagebankers.org/propertypreservation). As a result, when properties experience problems, code enforcers can more quickly identify the person responsible for maintaining a vacant property on behalf of the mortgage lender or servicer. This assures that issues can be addressed quickly and that properties remain safe and secure.
Vacant property registration ordinances
A recent and growing effort by cities has been to enact vacant property registration ordinances, largely in response to increased vandalism and the blight that results when these properties remain unattended. The ordinances allow city officials to reach responsible parties and hold them accountable when code violations occur.
While the industry supports the concept of the ordinances and understands the need for cities to take action, based on our experiences in the field, we believe many of the provisions in ordinances enacted around the country actually have the potential to create consequences that are more severe than the problems they are attempting to address.
This is why mortgage servicers and field servicers have formed a National Vacant Property Registration Committee under the Mortgage Bankers Association to offer our expertise to assure that cities enact the most effective ordinances possible.
With respect to thefts of copper pipe and other metals, the committee has attempted to discourage cities from enacting provisions that draw more attention to the fact that a property is vacant, or that require the installation of materials that are particularly attractive to thieves.
For example, some ordinances require that a large sign be posted in front of a vacant property, readable from the street, identifying a point of contact in case of emergency. The sign itself is more likely to draw criminal behavior, as it identifies the property as vacant. Better alternatives already are in place to identify contacts in a timely manner.
Other provisions under consideration have called for responsible parties to install exterior lighting to vacant properties, or to install metal panels as a more attractive alternative to plywood on doors and windows. In both cases, the lighting and the panels themselves are desirable items for thieves to steal for their scrap value. Artistic boarding, as an example, may be a better option to address the aesthetics and security concerns at the same time.
It is unfortunate but true that even vacant properties under management by field service professionals will become targets of thieves looking to score large quantities of scrap metal for fast profit.
However, working together as an industry, and by reaching out to cities to address the challenge in a spirit of cooperation, our hope is to help deter criminals and minimize damages so that vacant properties can remain viable and return to family homeownership as quickly as possible. There is no better way to combat vacant blight and preserve and maintain the integrity of neighborhoods across the country.
Robert Klein is CEO of Safeguard Properties, the largest privately held mortgage field services company in the U.S.
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The Cleveland Plain Dealer recently?featured efforts by a local community and its partners in the renovation of a dilapidated cemetery on Cleveland’s near west side.
CLEVELAND – Simon Zarumbowitz’s tombstone had been sitting cockeyed for God knows how long.
But on Wednesday, workers muscled old Simon’s marker plumb again, giving it the stately posture it had when gravediggers set it on his fresh grave 108 years ago.
The work is part of a two-year project by a neighborhood block club to fix up the Fir Street Cemetery, one of Cleveland’s oldest Jewish cemeteries — circa 1830s — on the city’s near West Side.
Through foundation grants and donations, the club raised $10,000 to remove old trees, repair broken tombstones and replace a battered fence gate.
Neighborhood volunteers, toiling among the hulking, Hebrew-lettered grave markers, planted trees, tulips and daffodils and removed trash and graffiti.
The Rev. Dean Van Farowe of Calvary Reformed Church on West 65th Street rolled up his sleeves. So did Yasir Hamdallah, a Muslim who lives on West 59th Street.
And now neighbors are inviting the public to an open house Saturday to display their handiwork and to celebrate the preservation of a piece of history tucked away on a side street.
“When we planted the bulbs, the whole neighborhood came out,” said block club member Jonathan Holody, a Methodist. “This project has been something positive and we’re all working on it.”
Neighbors planted 14 trees and 1,000 perennial bulbs. Holody ran five water hoses from his house across the street to the cemetery. Juanita Ortiz of West 61st Street served coffee.
“It got people involved and it shows that we care about this place,” said Holody. “It’s neat to think that some of Cleveland’s most prominent early settlers are buried here.”
The cemetery is on Fir Avenue, originally called Fir Street. Holody and retired autoworker Fred Valentine put up a post for a new sign “Fir Street Cemetery.”
“There’s a lot of history right in there,” said Valentine, 74, sitting on his front porch, pointing to the tombstones.
The neighborhood off West 65th Street, between Lorain and Bridge avenues, has never been Jewish. Cleveland’s early Jews settled on the city’s near East Side, but some crossed the Cuyahoga River to bury their dead.
Some of the earliest graves in the one-acre cemetery are Hungarian Orthodox Jews, according to Cleveland Municipal Housing Court Judge Ray Pianka, who grew up in the neighborhood and still lives there.
“We’re learning about each family,” said Pianka, who remembers walking by the graveyard as a little kid, wondering what the strange inscriptions in Hebrew and Yiddish meant. “Each of the 850 people buried here had contributed to our community.”
The deceased include Polish immigrant Harry “Czar” Bernstein (1856-1920), an East Side political boss who owned saloons and theaters; Russian immigrant Rabbi Gershon Ravinson (1848-1907) of East 40th Street who was of the 10th generation of rabbis in his family; and Hungarian immigrant Fannie Lichtig (1817-1899) of St. Clair Avenue, described in her obituary as a “pious Jewish woman.”
Biographies of about a dozen of the deceased will be placed on their tombstones for Saturday’s open house. Organizers will distribute rice paper and wax crayons to make rubbings of names and epitaphs. And a violinist will play traditional Jewish music.
Organizers have tracked down and invited some relatives of the deceased. And Ken Anthony, executive director of Park Synagogue in Cleveland Heights, which owns the cemetery and cuts the grass, will be there.
“This was a neighborhood thing,” said Anthony. “The people who live there said, ‘What can I do?’ And they’ve made it a very successful project.”
Donors for the project included the Cleveland Foundation and Beachwood resident Robert Klein, owner of Safeguard Properties, a nationwide company that maintains foreclosed properties for banks.
“This project honored the memories of the people buried in the cemetery,” said Klein, an Orthodox Jew. “So many people of different faiths and nationalities came together to make something very special happen.”
Earlier this week, sculptor Ted Stroie, who usually works on Christian art, fixed and straightened broken tombstones.
Stroie, a Romanian immigrant, is an Orthodox Christian. “And here I am,” he laughed, “working for the Orthodox Jews.”
“It’s one God for everybody,” he added. “Like the sun. We’re all under one sun. We all breathe the same air.”
To view the online article, please click here.
Robert Klein, CEO of Safeguard Properties, along with Lawrence M. Garfinkel of Bendelt & McHugh, submitted an article to the USFN about the challenges servicers face in the current climate of foreclosure and increased vacancies in municipalities.
by Robert Klein, CEO
Safeguard Properties
USFN Associate Member
by Lawrence M. Garfinkel
Bendelt & McHugh, PC
USFN Member (CT)
THE ECONOMIC NEWS confirms what the mortgage servicing world sees and feels every day. The mortgage crisis will likely get worse before it gets better. Foreclosures are happening exactly where we would expect to find them, and also where we would not. Large and small homes, primary residences and vacation homes, city and suburb addresses, rich and poor households; they are hitting virtually every zip code in the country.
Meanwhile, a stagnant housing market has meant that traditional sale homes linger on the market for longer periods of time and sell at greatly reduced prices. Higher rates of home foreclosures and a slow traditional market have delivered a one-two punch for servicers trying to move REO properties from their portfolios.
As REO properties stay on the market for longer periods of time, the risks of damage, vandalism, and financial loss increase with each passing day. To reduce these risks, servicers have been forced to re-think their strategies for maintaining and disposing of the properties. A higher volume of vacant homes also has challenged municipal code enforcement officials who are trying to deal with increased code violations in cities across the nation. As an industry, we have come together as never before to reach out to municipalities, opening lines of communication and identifying ways to help them help us to keep vacant properties safe and secure until reoccupied or transitioned to a more productive use.
Sharing Contact Info
As a starting point, the Mortgage Bankers Association (MBA) offered its website as a resource, posting property preservation contact information for the major national servicers so that code enforcement officials could more quickly identify a responsible party when code violations occurred. While that initiative helped, both servicers and city officials recognized the need for more data and resources.
Last year, the MBA took its outreach effort a step further and convened a vacant property registration (VPR) committee. This committee grew out of a need to address the proliferation of vacant property registration ordinances being considered and enacted by cities across the country that were frustrated in obtaining accurate mortgage records and serving notice on responsible parties to address violations in a timely manner. From an industry perspective, the committee recognized the challenges of attempting to comply with hundreds, and potentially thousands, of different ordinances across the country. The VPR committee agreed that there had to be a better way.
Additionally, the committee realized that the vast majority of mortgage servicers who are already proactive, accessible, and responsive to code violations would be the ones most likely to comply. Meanwhile, the parties responsible for the most troublesome properties would continue to be elusive. As a result, the concern for cities was that they would invest significant and precious administrative resources on an effort that would likely yield very little return.
In autumn 2008, the VPR committee developed a pilot program in cooperation with the Mortgage Electronic Records System (MERS) . As part of this program, the MERS database, with information on more than 60 million properties, was made available to code enforcement officials in six test cities.
The trial cities expect to consider mortgage servicers participating in MERS to be automatically compliant with vacant property registration requirements. This reduces the administrative burden for code enforcement departments, and eliminates the need for servicers to comply with a multitude of disparate ordinances. The pilot program has been so successful that it was expanded to 50 cities in March, with a goal of rolling out the system nationally later in the year.
The VPR ordinances began solely as municipal in nature. It has taken some time but the word seems to be out, and more and more municipalities are jumping on the bandwagon. Additionally, there is some movement towards state statutes rather than municipal ordinances. In one sense, this is good for the industry in that there are only 50 states rather than thousands of municipalities. However, it is obviously problematic in that more properties will be covered if the trend continues in this direction. There has been some spirited discussion on the VPR committee calls regarding which structure is better for the industry, municipality or state. As of now, there have been statutes proposed in Florida, California, Pennsylvania, and New York, as well as a notification statute in Connecticut. Thus far, no state has passed a statewide statute on VPR.
Primary Issues
The existing VPR ordinances, and those that are still at the proposal stage, address a number of different matters and concerns. The most common mandate is that the property owner be required to notify the municipality of its ownership of the property as well as identify the proper contact person at its own office and/or at a property management company. Often this requirement states that the contact person must be within a certain mile radius of the city or the property.
Further, there is always a time requirement as to when registration must occur; this is often within a certain number of days after the foreclosure. However, many cities require that the registration take place at some point during the foreclosure procedure, such as seven days after the foreclosure commences rather than after the process concludes. In addition, many cities compel the registration of all properties at a certain stage of the foreclosure process or after title has vested, not just the properties that are vacant. And most cities require registration upon discovery of vacancy, regardless of the property’s delinquency status.
There is almost always a fee required in order to register. Fees vary from city to city across the country. The fees may range from a one-time fee of $35 in Milwaukee, Wisconsin to the payment of an annual fee (e.g., $18 in Palm Springs, California; $100 in Boston, Massachusetts; $500 in Burlington, Vermont). Other municipalities impose an initial fee and then a subsequent one when the property is sold to a third party. In addition, most of the ordinances carry a hefty penalty in the event that a vacant building is not registered in a timely manner.
Additional requirements imposed by the municipalities involve how to board or otherwise secure the properties. Chicago requires a specific amount of lighting and New Haven, Connecticut requires the exterior posting of a specific sign on vacant properties, which is provided by the local police department and warns that trespassers will be arrested.
Future Challenges
There is a great deal of increased liability and responsibility for the servicer of a property in a municipality with a VPR ordinance. Timely decisions need to be made about the party responsible for registering the properties – whether it will be the servicer, lender, property management company, or foreclosure law firm. Just keeping up with the many different ordinances is a challenging task. A helpful resource is the online VPR Matrix maintained by Safeguard Properties at www.safeguardproperties.com. A link to the matrix is also found at www.usfn.org.
CEO
Alan Jaffa
Alan Jaffa is the Chief Executive Officer for Safeguard Properties, steering the company as the mortgage field services industry leader. He also serves on the board of advisors for SCG Partners, a middle-market private equity fund focused on diversifying and expanding Safeguard Properties’ business model into complimentary markets.
Alan joined Safeguard in 1995, learning the business from the ground up. He was promoted to Chief Operating Officer in 2002, and was named CEO in May 2010. His hands-on experience has given him unique insights as a leader to innovate, improve and strengthen Safeguard’s processes to assure that the company adheres to the highest standards of quality and customer service.
Under Alan’s leadership, Safeguard has grown significantly with strategies that have included new and expanded services, technology investments that deliver higher quality and greater efficiency to clients, and strategic acquisitions. He takes a team approach to process improvement, involving staff at all levels of the organization to address issues, brainstorm solutions, and identify new and better ways to serve clients.
In 2008, Alan was recognized by Crain’s Cleveland Business in its annual “40-Under-40” profile of young leaders. He also was named a NEO Ernst & Young Entrepreneur Of The Year® Award finalist in 2013.
Esq., General Counsel and EVP
Linda Erkkila
Linda Erkkila is the General Counsel and Executive Vice President for Safeguard Properties, with oversight of legal, human resources, training, and compliance. Linda’s broad scope of oversight covers regulatory issues that impact Safeguard’s operations, risk mitigation, strategic planning, human resources and training initiatives, compliance, insurance, litigation and claims management, and counsel related to mergers, acquisition and joint ventures.
Linda assures that Safeguard’s strategic initiatives align with its resources, leverage opportunities across the company, and contemplate compliance mandates. She has practiced law for 25 years and her experience, both as outside and in-house counsel, covers a wide range of corporate matters, including regulatory disclosure, corporate governance compliance, risk assessment, compensation and benefits, litigation management, and mergers and acquisitions.
Linda earned her JD at Cleveland-Marshall College of Law. She holds a degree in economics from Miami University and an MBA. Linda was previously named as both a “Woman of Influence” by HousingWire and as a “Leading Lady” by MReport.
COO
Michael Greenbaum
Michael Greenbaum is the Chief Operating Officer of Safeguard Properties, where he has played a pivotal role since joining the company in July 2010. Initially brought on as Vice President of REO, Mike’s exceptional leadership and strategic vision quickly propelled him to Vice President of Operations in 2013, and ultimately to COO in 2015. Over his 14-year tenure at Safeguard, Mike has been instrumental in driving change and fostering innovation within the Property Preservation sector, consistently delivering excellence and becoming a trusted partner to clients and investors.
A distinguished graduate of the United States Military Academy at West Point, Mike earned a degree in Quantitative Economics. Following his graduation, he served in the U.S. Army’s Ordnance Branch, where he specialized in supply chain management. Before his tenure at Safeguard, Mike honed his expertise by managing global supply chains for 13 years, leveraging his military and civilian experience to lead with precision and efficacy.
CFO
Joe Iafigliola
Joe Iafigliola is the Chief Financial Officer for Safeguard Properties. Joe is responsible for the Control, Quality Assurance, Business Development, Marketing, Accounting, and Information Security departments. At the core of his responsibilities is the drive to ensure that Safeguard’s focus remains rooted in Customer Service = Resolution. Through his executive leadership role, he actively supports SGPNOW.com, an on-demand service geared towards real estate and property management professionals as well as individual home owners in need of inspection and property preservation services. Joe is also an integral force behind Compliance Connections, a branch of Safeguard Properties that allows code enforcement professionals to report violations at properties that can then be addressed by the Safeguard vendor network. Compliance Connections also researches and shares vacant property ordinance information with Safeguard clients.
Joe has an MBA from The Weatherhead School of Management at Case Western Reserve University, is a Certified Management Accountant (CMA), and holds a bachelor’s degree from The Ohio State University’s Honors Accounting program.
Business Development
Carrie Tackett
Business Development Safeguard Properties
