The New Age of Servicing

Industry Update
May 10, 2017

Servicers counting the ripples in the wake of a new administration, rising interest rates, regulatory changes, technological advancements, and a new generation of borrowers can certainly find themselves in a sink-or-swim situation. The industry is evolving before our eyes, and the cumulative effect of undergoing such a tide turn is that we’ve entered a new age of servicing.

To not only survive but also succeed as a next-generation servicer, the status quo must fall by the wayside. Servicers need to stay a step ahead in their practices to build their businesses and their relationships now and into the near—if still unfolding—future.

Navigating the Here and Now

The Federal Reserve recently raised the target for the federal funds rate to a range of 0.75–1 percent, effectively pushing up mortgage rates—they’ve increased roughly 25–30 basis points since late last year—and putting the industry on notice that the Fed is encouraged by the economy’s performance and plans more increases this year.

Although many mortgage originators are now grumbling about the impact rising rates will have on the market, it is important to keep some historical perspective in mind. Mortgage rates are still incredibly low, and those in the business with gray hair can remember the days when mortgage rates hovered in the 7-9 percent range after more than a decade of rates that were typically above 10 percent.

However, that’s not to say that rising rates won’t impact mortgage bankers—in ways both positive and negative. Originators that have focused much of their business in the refinance space will find it challenging to switch gears and build their purchase business, while smart lenders have already begun that process and will find it easier to navigate the market shift.

On a macro level, rising rates should be taken as a welcome sign that our economy is healthy and ready for some strong growth. Within the mortgage space, the market should begin to find a more stable “normal” purchase-oriented balance. Private money will also begin to return to the market, which will help spur some desperately needed innovation in non-QM lending.

Mortgage bankers and servicers also face a new administration in Washington, D.C., that is promising radical change. While it’s early in his term, it appears that President Trump intends to make good on his promise to ease the regulatory burdens that have made it difficult for businesses to thrive and the economy to grow. The industry should be particularly encouraged that he has appointed to office men and women who have run successful businesses themselves.

When it comes to the top regulator, the Consumer Financial Protection Bureau (CFPB), significant change may be on the horizon there as well. Pending litigation (PHH Corporation vs. CFPB) could alter the very structure of the agency and could give the president more direct control over the director, who currently can only be removed “for cause.”

Policy and politics aside, servicers must be ready to embrace change in the market. Rising rates mean consumers will be more likely to hold on to their loans and build equity. Instead of reading about “strategic defaults,” homeowners will watch their homes increase in value while paying down their loans. In fact, this scenario is already happening. ATTOM Data Solutions recently reported that foreclosure activity is at a 10-year low.

Rising rates also mean servicers have a great opportunity to build lasting relationships with their customers. In particular, servicers can begin to really leverage technology and social media not only to service a loan but to truly connect with their customers as well. In addition to having borrowers who are loyal, today’s technology can help streamline operations and mitigate the high cost of servicing in the era of the Dodd-Frank Act and the CFPB.

The Millennial Impact

By now, every mortgage industry professional has read or heard about the millennial generation. Virtually every mortgage conference and seminar for at least the past five years has emphasized the impact millennials would soon have on the housing market. Here are a few key statistics about the generation that will carry the housing market for several decades:

By 2020, Brookings estimates that one in three Americans will be a millennial, and by 2025, millennials will constitute a whopping 75 percent of the workforce.

According to Zillow, more millennials (65 percent) consider homeownership an essential part of the American dream than any other generation.

While they are still “on their way,” millennials are, in significant ways, already “here.” LendingTree recently reported that more than one-third (36.1 percent) of all mortgage requests through its site are from borrowers age 35 and younger. Zillow estimates that up to 42 percent of all homebuyers last year were millennials.

All millennials aren’t stereotypical internet-start-up urbanites. Almost half of all millennial homebuyers live in suburban neighborhoods, and another 20 percent live in rural locations.

Further, researchers at NerdWallet estimate that two-thirds of millennials haven’t even reached the average homebuying age of 31, and 22 percent are still under 25 years old.

Millennials have just begun to arrive, and connecting with them isn’t just the job of the mortgage originator; servicers, too, must act now to create a culture within their companies that values building long-term relationships with their borrowers.

Geared for Interactive Technology

Beyond millennials’ raw numbers and purchasing power (Forbes estimates it’s at least $200 billion), understanding how to connect with them—as well as Generation X—is crucial. First, company websites and social touch points that aren’t mobile friendly may as well be selling Atari systems or vinyl records. Research indicates that 90 percent of millennials use smartphones, 93 percent access the internet on mobile devices, and more than half (53 percent) own a tablet. In between charges, millennials are spending an enormous amount of time on social media—more than six hours per week on average.

This is a huge opportunity to speak to potential customers no matter where they are and actively engage with them in a meaningful way. Today’s consumer won’t buy a product just because they see a TV ad. No longer passive consumers, they want to actually interact with brands.

In many ways, millennials and other internet-savvy generations are becoming more and more immune to traditional forms of advertising. Children who can’t yet talk or walk already understand how to skip an ad to get to the content or game they want. A consumer with that mindset will only respond to content that provides them value. That’s why interactions with them cannot be superficial. Companies must work harder to truly connect with them.

Active Engagement Earns Allegiance

Examine how pop culture icons like Kanye West, politicians like President Trump, and companies like Seamless have maximized their social media platforms by doing more than just posting occasional messages. They engage with their audiences and do so frequently, generating intense brand loyalty.

While mortgage servicers may not have a new album, policy, or menu item to promote, this is where they can turn what is frequently a weakness into a strength. Consider this: What is the most common complaint consumers have about their mortgage servicers? Too often, it is customer service, as the industry hasn’t done enough to effectively communicate with borrowers.

Legacy processes and procedures are geared to satisfy statutory and regulatory rules, and that often means mail, phone, and email communication. However, social networks provide a great opportunity for improving customer service, and successful servicers will soon have dedicated staff scanning social media sites and resolving issues by communicating through Twitter, Facebook, LinkedIn, Snapchat, and more.

Many servicers already have such social media staff in place and are encouraged to see customers proactively reach out to them on social media channels. Online crowdsourced review sites like Yelp provide businesses a chance to monitor consumer sentiment and potential issues in real time. Clearly, with a more responsive, customer-focused approach, servicers can address issues before they see complaints publicly displayed in a government database.

This approach will also provide new business opportunities. Forbes research reveals that 62 percent of millennials say that a brand that actively engages with them on social networks is more likely to earn their loyalty. This 35-and-younger crowd has mostly grown up in a connected world, and just like marketers in the past used catalogs, radio, and television, social media is where today’s consumer can be found.

Additionally, utilizing the mountain of available data and targeted content can increase the effectiveness of messaging. The right message at the right time to the right customer is only possible when marketers know who they are and what they need.

Technology’s Many Roles

New technology isn’t limited to just social media, however. The ability to increasingly automate and streamline servicing operations is crucial to reducing overhead and compliance costs, which have skyrocketed over the past decade.

In addition to fueling growth strategies, new technology will help the industry defend and protect both customers and companies. Considering the threats out there, cyber security is a critical component of any business plan. Intrusions into systems threaten customer personal information and data, and it is incumbent on servicers to take that seriously and invest resources in defensive measures. These efforts should also include hosting high-level executive discussions about what do to in the event of an attack as well as creating and maintaining updated disaster recovery plans.

Although it promises much, technology should not be seen as a silver bullet. While gaining efficiencies and mitigating rising costs are important, losing touch with consumers would be a fatal mistake. The key is to find balance between the need to utilize technology and the necessity of maintaining a human touch with borrowers. This is where social media can be a powerful tool; it’s an effective way to reach borrowers with a personal touch that goes beyond simple auto-generated letters and oft-ignored robocalls.

Today’s mortgage servicer should already begin to think of itself as “tomorrow’smortgage servicer.” New technologies need to be adopted and adapted to existing systems and personnel, not only to streamline operations but to take advantage of rising rates to build relationships with customers, as well.

If rates do continue to climb, many of them will be customers for a long period of time, and servicers need to think not in terms of loans, but loyalty. If companies’ leaders build that kind of culture, they will find that rate fluctuations won’t matter as much. Customers will trust their servicer and, in turn, provide a host of new business opportunities. That’s the future of servicing. 

Source: MReport



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.