Servicing Management Article Foreclosure Fast Tracking: A Field Servicer’s Perspective

?Foreclosure Fast-Tracking:? A Field Servicer?s Perspective??

Slowing down the foreclosure process to help encourage home retention makes sense, but once a property is certified as vacant, speeding up the foreclosure process has universal benefits.????

The federal government and state and local legislatures across the country have struggled to find ways to lessen the impact of the housing crisis.? In an attempt to reduce the number of foreclosed and vacant homes, legislators have introduced various initiatives targeting the foreclosure process itself.? These range from the federal government?s moratorium on foreclosures to various states? proposals to either lengthen or shorten time requirements for taking properties through the foreclosure process.???

The state of Colorado, for example, recently introduced a bill that would shorten the time it takes for a lender to take a property through the foreclosure process.? Similarly, Rep. Tom Grady of Naples, Fla., has filed legislation that he says would substantially truncate the state?s foreclosure process. The General Assembly in Georgia, on the other hand, with one of the fastest foreclosure processes in the country, is considering legislation to slow it down.???

As diverse as these proposals are, one aspect they share is good intentions.? These and other states that are considering similar measures, share a common desire to reduce the number of vacant homes and prevent the devastating impact that vacant properties have on neighborhoods and communities.? Despite the best intentions, however, the key to effective legislation is what ultimately happens in the practical application of these measures.? In many cases, an idea that looks good on paper can actually create a worse situation than the one it is designed to improve.? For this reason, it is useful to consider the potential impact of various foreclosure proposals through the lens of a mortgage field servicer.???

Mortgage field servicers are the eyes and ears of the mortgage servicing industry.? They are the companies hired to inspect and maintain millions of vacant defaulted and foreclosed homes across the country.? Field service companies arguably offer the best ?on the ground? perspective to evaluate the real impact of foreclosure-related legislation on properties, neighborhoods and communities.????

When a homeowner defaults on a loan, the field servicer begins monthly inspections of the property on behalf of its mortgage servicing client to verify the occupancy status of the property.? ?While the home is in default, the servicer is attempting to reach the borrower to discuss a work-out arrangement.????

A common public misperception is that mortgage companies want to remove defaulted borrowers from their homes.? In fact, the opposite is true.? Mortgage companies make great efforts to keep borrowers in their homes.? Mortgage companies, which exist to promote homeownership, know that an occupied property maintains its value better, is safer and better protected than a vacant property.? An occupied property is less of a nuisance to neighbors and communities than a vacant property because it is less likely to attract vandals and other criminal activity.????

Our field service experience is that more than 20% of the defaulted properties we inspect will become vacant- in other words, abandoned by the homeowners.? These are homeowners who have made a conscious choice, for whatever reason, to leave their home, often without ever contacting their mortgage company.????

When homes are initially abandoned, field servicers will verify that most are in livable condition.? The properties may not be pristine, but they are habitable, especially by a first-time home buyer willing to invest a bit of ?sweat equity? to have an opportunity to create a comfortable home to raise a family.??

In some cases, a homeowner may damage a property before abandoning it, but these damages usually are not serious enough to make the property inhabitable; the most expensive and irreversible damage to properties occurs over time.????

The servicing industry spends billions of dollars each year inspecting and maintaining vacant properties.? As an industry standard, vacant properties are inspected at least on a monthly basis to check for leaks and other structural issues and to make sure they are secure.? In cold climates, pipes are winterized.? In all properties, broken windows and doors are secured, hazardous chemicals are removed, and infestations are exterminated.? Yard debris is removed, and lawns receive regular maintenance.??? ?

While field servicing certainly slows the deterioration of vacant properties, even these properties will decline over time, no matter how much maintenance and attention they receive.? The irony from a mortgage servicing perspective is that the longer a property sits vacant, the more money is invested, and the less valuable the asset becomes.???

Vacant properties are also expensive and burdensome for municipalities in countless ways.?? They impact the quality of life for neighbors, who often have to endure drug activity, vandalism and nuisances that vacant properties attract.? They are a drain on safety forces, as vacant properties result in more calls for police and fire protection.? As vacant property values decline, so do the property values of other homes in the neighborhood.? With lower property values come lower tax valuations and major hits on already strapped city budgets.

A Chicago study in 2005 concluded that each vacant property cost municipalities upwards of $34,000 per year for additional police and fire protection, court action, inspections, tax losses, unpaid utilities and potential demolition.? That number would undoubtedly be higher if the study were repeated today, as vacant properties now sit even longer and cause even greater harm to neighborhoods and communities.??

For years, the mortgage servicing industry has worked with communities to help address issues related to vacant and abandoned properties.? Outreach to code enforcement officials, stickers on vacant properties with 24-hour contact information, ?good neighbor? door hangers to invite neighbors to report problems, and other efforts have been important to allow servicers to respond more quickly when issues arise.? In the past year, an initiative between the Mortgage Bankers Association and the Mortgage Electronic Registration System (MERS) has allowed hundreds of cities to tap into the MERS system free of charge to obtain contact information for more than 65 million properties registered on the system.???

The strongest collaboration between mortgage servicers, their property preservation field servicers and cities cannot, however, replace the value of having an occupant in a home. When a homeowner is present, every effort should be made to help that homeowner remain in his or her home and legislation to support that is good for everyone.????

Unfortunately, when that legislation also prevents a vacant property from moving through the foreclosure process so that it can be reoccupied more quickly, it can actually create more harm, cost and burden for neighborhoods and communities.? The reality is that no single solution can be a ?magic bullet? for all situations.? The housing and mortgage crisis in the U.S. is a complicated mosaic.? We need laws that recognize different situations and allow flexibility to accommodate those distinctions. ?

Once a property is certified vacant, putting it on a fast track to foreclosure would benefit everyone.? Communities win because the property can return more quickly to contributing to the tax base, and poses less risk and burden on city services and courts.? ?

Neighborhoods win because property values are maintained, and the property is more likely to attract a strong buyer who will be a good neighbor and take care of the property.

Servicers win because the property maintains collateral value and does not require a lengthy and expensive property preservation process.????????

Robert Klein is founder and CEO of Safeguard Properties, the largest privately held mortgage field services company in the U.S. ?He can be contacted at (800) 852-8306.

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About Safeguard
Safeguard Properties is the largest privately held field services company in the country. Located in Cleveland, Ohio and founded in 1990 by Robert Klein, Safeguard has grown from a regional preservation company with a few employees and a handful of contractors performing services in the Midwest, to a national company with over 700 employees. Safeguard is supported by a nationwide network of subcontractors able to perform any requested superintendence, preservation, and maintenance functions, as well as numerous ancillary services in the U.S., the Virgin Islands, and Puerto Rico.



Alan Jaffa

Alan Jaffa is the chief executive officer for Safeguard, 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® finalist in 2013.


Chief Operating Officer

Michael Greenbaum

Michael Greenbaum is the chief operating officer for Safeguard. Mike has been instrumental in aligning operations to become more efficient, effective, and compliant with our ever-changing industry requirements. Mike has a proven track record of excellence, partnership and collaboration at Safeguard. Under Mike’s leadership, all operational departments of Safeguard have reviewed, updated and enhanced their business processes to maximize efficiency and improve quality control.

Mike joined Safeguard in July 2010 as vice president of REO and has continued to take on additional duties and responsibilities within the organization, including the role of vice president of operations in 2013 and then COO in 2015.

Mike built his business career in supply-chain management, operations, finance and marketing. He has held senior management and executive positions with Erico, a manufacturing company in Solon, Ohio; Accel, Inc., a packaging company in Lewis Center, Ohio; and McMaster-Carr, an industrial supply company in Aurora, Ohio.

Before entering the business world, Mike served in the U.S. Army, Ordinance Branch, and specialized in supply chain management. He is a distinguished graduate of West Point (U.S. Military Academy), where he majored in quantitative economics.



Sean Reddington

Sean Reddington is the new Chief Information Officer for Safeguard Properties LLC. Sean has over 15+ years of experience in Information Services Management with a strong focus on Product and Application Management. Sean is responsible for Safeguard’s technological direction, including planning, implementation and maintaining all operational systems

Sean has a proven record of accomplishment for increasing operational efficiencies, improving customer service levels, and implementing and maintaining IT initiatives to support successful business processes.  He has provided the vision and dedicated leadership for key technologies for Fortune 100 companies, and nationally recognized consulting firms including enterprise system architecture, security, desktop and database management systems. Sean possesses strong functional and system knowledge of information security, systems and software, contracts management, budgeting, human resources and legal and related regulatory compliance.

Sean joined Safeguard Properties LLC from RenPSG Inc. which is a nationally leading Philintropic Software Platform in the Fintech space. He oversaw the organization’s technological direction including planning, implementing and maintaining the best practices that align with all corporate functions. He also provided day-to-day technology operations, enterprise security, information risk and vulnerability management, audit and compliance, security awareness and training.

Prior to RenPSG, Sean worked for DMI Consulting as a Client Success Director where he guided the delivery in a multibillion-dollar Fortune 500 enterprise client account. He was responsible for all project deliveries in terms of quality, budget and timeliness and led the team to coordinate development and definition of project scope and limitations. Sean also worked for KPMG Consulting in their Microsoft Practice and Technicolor’s Ebusiness Division where he had responsibility for application development, maintenance, and support.

Sean is a graduate of Rutgers University with a Bachelor of Arts and received his Masters in International Business from Central Michigan University. He was also a commissioned officer in the United States Air Force prior to his career in the business world.


General Counsel and Executive Vice President

Linda Erkkila, Esq.

Linda Erkkila is the general counsel and executive vice president for Safeguard and oversees the legal, human resources, training, and compliance departments. Linda’s responsibilities cover regulatory issues that impact Safeguard’s operations, risk mitigation, enterprise strategic planning, human resources and training initiatives, compliance, litigation and claims management, and 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. Her practice spans over 20 years, and Linda’s experience covers regulatory disclosure, corporate governance compliance, risk assessment, executive compensation, litigation management, and merger and acquisition activity. Her experience at a former Fortune 500 financial institution during the subprime crisis helped develop Linda’s pro-active approach to change management during periods of heightened regulatory scrutiny.

Linda previously served as vice president and attorney for National City Corporation, as securities and corporate governance counsel for Agilysys Inc., and as an associate at Thompson Hine LLP. She earned her JD at Cleveland-Marshall College of Law. Linda holds a degree in economics from Miami University and an MBA. In 2017, Linda was named as both a “Woman of Influence” by HousingWire and as a “Leading Lady” by MReport.


Chief Financial Officer

Joe Iafigliola

Joe Iafigliola is the Chief Financial Officer for Safeguard. Joe is responsible for the Control, Quality Assurance, Business Development, Accounting & Information Security departments, and is a Managing Director of SCG Partners, a middle-market private equity fund focused on diversifying and expanding Safeguard Properties’ business model into complimentary markets.

Joe has been in a wide variety of roles in finance, supply chain management, information systems development, and sales and marketing. His career includes senior positions with McMaster-Carr Supply Company, Newell/Rubbermaid, and Procter and Gamble.

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.


AVP, High Risk and Investor Compliance

Steve Meyer

Steve Meyer is the assistant vice president of high risk and investor compliance for Safeguard. In this role, Steve is responsible for managing our clients’ conveyance processes, Safeguard’s investor compliance team and developing our working relationships with cities and municipalities around the country. He also works directly with our clients in our many outreach efforts and he represents Safeguard at a number of industry conferences each year.

Steve joined Safeguard in 1998 as manager over the hazard claims team. He was instrumental in the development and creation of policies, procedures and operating protocol. Under Steve’s leadership, the department became one of the largest within Safeguard. In 2002, he assumed responsibility for the newly-formed high risk department, once again building its success. Steve was promoted to director over these two areas in 2007, and he was promoted to assistant vice president in 2012.

Prior to joining Safeguard, Steve spent 10 years within the insurance industry, holding a number of positions including multi-line property adjuster, branch claims supervisor, and multi-line and subrogation/litigation supervisor. Steve is a graduate of Grove City College.


AVP, Operations

Jennifer Jozity

Jennifer Jozity is the assistant vice president of operations, overseeing inspections, REO and property preservation for Safeguard. Jen ensures quality work is performed in the field and internally, to meet and exceed our clients’ expectations. Jen has demonstrated the ability to deliver consistent results in order audit and order management.  She will build upon these strengths in order to deliver this level of excellence in both REO and property preservation operations.

Jen joined Safeguard in 1997 and was promoted to director of inspections operations in 2009 and assistant vice president of inspections operations in 2012.

She graduated from Cleveland State University with a degree in business.


AVP, Finance

Jennifer Anspach

Jennifer Anspach is the assistant vice president of finance for Safeguard. She is responsible for the company’s national workforce of approximately 1,000 employees. She manages recruitment strategies, employee relations, training, personnel policies, retention, payroll and benefits programs. Additionally, Jennifer has oversight of the accounts receivable and loss functions formerly within the accounting department.

Jennifer joined the company in April 2009 as a manager of accounting and finance and a year later was promoted to director. She was named AVP of human capital in 2014. Prior to joining Safeguard, she held several management positions at OfficeMax and InkStop in both operations and finance.

Jennifer is a graduate of Youngstown State University. She was named a Crain’s Cleveland Business Archer Award finalist for HR Executive of the Year in 2017.


AVP, Application Architecture

Rick Moran

Rick Moran is the assistant vice president of application architecture for Safeguard. Rick is responsible for evolving the Safeguard IT systems. He leads the design of Safeguard’s enterprise application architecture. This includes Safeguard’s real-time integration with other systems, vendors and clients; the future upgrade roadmap for systems; and standards designed to meet availability, security, performance and goals.

Rick has been with Safeguard since 2011. During that time, he has led the system upgrades necessary to support Safeguard’s growth. In addition, Rick’s team has designed and implemented several innovative systems.

Prior to joining Safeguard, Rick was director of enterprise architecture at Revol Wireless, a privately held CDMA Wireless provider in Ohio and Indiana, and operated his own consulting firm providing services to the manufacturing, telecommunications, and energy sectors.


AVP, Technology Infrastructure and Cloud Services

Steve Machovina

Steve Machovina is the assistant vice president of technology infrastructure and cloud services for Safeguard. He is responsible for the overall management and design of Safeguard’s hybrid cloud infrastructure. He manages all technology engineering staff who support data centers, telecommunications, network, servers, storage, service monitoring, and disaster recovery.

Steve joined Safeguard in November 2013 as director of information technology operations.

Prior to joining Safeguard, Steve was vice president of information technology at Revol Wireless, a privately held wireless provider in Ohio and Indiana. He also held management positions with Northcoast PCS and Corecomm Communications, and spent nine years as a Coast Guard officer and pilot.

Steve holds a BBA in management information systems from Kent State University in Ohio and an MBA from Wayne State University in Michigan.


Assistant Vice president of Application Development

Steve Goberish

Steve Goberish, is the assistant vice president of application development for Safeguard. He is responsible for the maintenance and evolution of Safeguard’s vendor systems ensuring high-availability, security and scalability while advancing the vendor products’ capabilities and enhancing the vendor experience.

Prior to joining Safeguard, Steve was a senior technical architect and development manager at First American Title Insurance, a publicly held title insurance provider based in southern California, in addition to managing and developing applications in multiple sectors from insurance to VOIP.

Steve has a bachelor’s degree from Kent State University in Ohio.