Welcome from our conference chairman
Dear Servicing Professional,
Mortgage servicers have always had loss mit as a weapon to manage portfolio losses, but what’s going on currently can fairly be classed as Loss Mit 2.0!
Whereas servicers used to look to loan workouts and efficient real estate owned sales, nowadays little-used techniques have come to the forefront.
This year’s flavor is the short sale, where an attempt is made to sell the home of a distressed borrower before the home hits foreclosure status. The sale, if made, is “short” of what’s owed, but the idea is the servicer will make more from this mode of disposition (and consequently mitigate its loss somewhat) than to take it through a costly foreclosure and REO sale process.
Loan modifications were last year’s last word in loss mit. Here, the final verdict is not yet in. Lenders are doing hundreds of thousands of mods, either on their own or through the government HAMP program. In many cases it’s just a stopgap measure. Many borrowers are having trouble qualifying for them, and those that make it through the trial period could still fall out and redefault.
The question isn’t if they will; the question is how many?
All the latest techniques in loss mit will get a full airing in our upcoming Best Practices in Loss Mitigation Conference, to be held July 21-22 at the Westin Galleria in Dallas, the site of our highly successful Mortgage Servicing Conference in April.
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I hope to see you there!
Sincerely,
Mark Fogarty,
Conference Chair,
Editor, NATIONAL MORTGAGE NEWS
