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Editor's NoteServicers Wonder How Long Foreclosures Can Be DelayedBy Amilda Dymi 
The ever-increasing delinquency-to-foreclosure timeline and the question of whether loan modifications really work, as well as the inevitability of a delayed next-wave of foreclosures were among themes under discussion at the Mortgage Bankers Association's National Mortgage Servicing Conference in San Diego last week. At the conference National Mortgage News convened a roundtable of servicing executives at the show to share their thoughts on these topics and more. The participants generally sounded concerned about the current situation, especially given the rules the federal government, as well as many state governments, are imposing. While there has been talk of recovery in the market at large, executives that took part in the roundtable indicated they fear a continuing downward spiral from negative equity situations. Participating were Cary Sternberg, president of Excellon REO, a division of Titanium Holdings; Scott Goldstein, president of National Default Exchange Index; Richard Powers, senior vice president of real estate services for Altisource Portfolio Solutions; Ron Deutsch with Cohn, Goldberg and Deutsch; and Jim Satterwhite, EVP with Infusion Technologies. Featured StoryTreasury To Review MBA's New Forbearance OptionBy Amilda Dymi 
SAN DIEGO—If a new Mortgage Bankers Association program takes hold — which can happen only if the Treasury Department gets on board by agreeing to supply additional funds to participating servicers — unemployed borrowers may be able to count on up to nine months of forbearance as a way to stay in their home.
And it may happen sooner, rather than later. MBA’s associate vice president of public policy, Josh Stern, said that it has received an affirmative response where Treasury calls the proposal helpful and states it will continue to have a dialogue with the banking group. Generic Servicing Assets
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Free NewsletterSign up for our complimentary email newsletterEnter your email here to sign up for Mortgage Servicing News Bulletin, our free semimonthly email newsletter. Inside TakePrinceRidge Aims to Ignite The Jumbo MBS MarketBy Paul Muolo 
For the past few months rumors have been circulating around the industry about a hedge fund or two - or an investment banking firm, perhaps - working on a plan to enter the jumbo securitization market. Well, we finally have a name. PrinceRidge Group, a broker/dealer, founded by two Wall Street veterans, is in the laboratory, working on a plan to either issue bonds backed by newly originated jumbo loans or hold them in a special investment fund. The need, to say the least, is there. But will it come off? That's a different matter. Kimberly Brown, who's heading the effort for PRG, wasn't keen to talk about it, but certain mortgage officials familiar with the effort have been briefed on the plan. The way things stand now, PRG hopes to have a program in place within 90 to 120 days, said one advisor who didn't want his name disclosed. "They're looking to do a couple of hundred million a month," he said, "and if all goes well they'll ramp it up from there." Executive ViewAre Your Loss Mitigation Requests Backlogged?Perspectives by Nathan Lind 
If the answer is yes, automated technology can help. The mortgage servicing industry has taken a lot of heat over the last 18 months for reacting slowly to the foreclosure crisis and rightly so. Except perhaps for the S&L crisis of the early 1990's, never before has the spotlight shined so brightly on mortgage servicing practices in the United States. The Treasury Department has taken a keen interest on the activity from the Home Affordable Modification Program and is poised to berate or reward based on the nation's top servicers on the number of homeowners transitioned from temporary to permanent loan modifications through the current HAMP initiatives. The critical component in resolving this foreclosure crisis is the servicing industry's ability to respond to all the calls and the reams of paper spilling out of fax machines with hardship letters and pleas for assistance. Servicing HeadlinesLate Pays on UK Nonconforming MBS Seen as Stable in MonthMarch 15, 2010 Weighted average delinquencies in nonconforming United Kingdom mortgage-backed securities were stable in January, according to Moody's Investors Service. Click here for more.Fitch: U.S. CREL CDOs Get Delinquency ReprieveMarch 15, 2010 The level of U.S. commercial real estate loan delinquencies in collateralized debt obligations has decreased slightly, according to Fitch Ratings. Click here for more.CMBS Special Servicers Put a Dent in Their Massive WorkloadMarch 15, 2010 It was a productive year for special servicers in 2009, but there's a lot more where that came from, according to a new Fitch Ratings report. Click here for more.It Looks As if Problem Loans Aren't Getting Any YoungerMarch 15, 2010 The average age of newly delinquent loans is higher today than in 2007, according to a recent Lender Processing Services report. Click here for more.One Third of FHA's Streamlined Refis Could Be UnderwaterMarch 15, 2010 One third of the streamlined refinanced loans that the Federal Housing Administration insured in 2009 are probably underwater, according to a New York University economics professor. Click here for more. |
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Pessimists vs. Optimists
Are Trial Modifications Just Another Moratorium?
The mortgage marketplace, especially servicers, are continually engaged in loss mitigation processes that entail new legislation, counseling, data analytics systems, technology, and other tools designed to ease the crisis. Related issues within the mortgage servicing space are subject to debate and grounds for differing opinions. Insiders’ pros and cons to current market changes reflect how experts see the future of their industry, how soon they expect to see the light at the end of the tunnel — and whether they are more optimistic about the present.
Moratoriums already have received negative press. Many disagreed with the idea calling it a political measure disconnected with market reality that simply postpones the inevitable. The inevitable being: a borrowers inability to pay the mortgage either willingly or unwillingly. That discourse has died down. New market developments, including the Home Affordable Modification Program and its trial modification requirement are now at the forefront. And the 90-day trial period before a loan modification is officially recorded on the books as successful, besides complicating data reporting and overall delinquency statistics, reminds one of a moratorium. If unpredictable factors such as job loss, health issues and natural disasters are taken out of the equation, there is little borrower information, if anything left to add to justify the prolonged suspense.
Is the trial-modification period worth it, or is it just another moratorium that postpones the inevitable?
Managing REO
Click the image above to start a video of editor Jennifer Harmon introducing the latest issue of Managing REO. |
Headlines from the Current Issue of Managing REOMBA MERS Initiative Makes A Difference A unique collaboration between MERS, the Mortgage Bankers Association, and the CEO of Safeguard Properties has changed the way vacant properties are registered with cities across the country. 'Cross-Qualifying' Helps Banks Poach REO Loans Discover the controversial tactic of "cross-qualifying" that some lenders are engaging in to unload bank owned assets. Tool Responds to Loan Portfolio Toxicity XSite's Loan Portfolio Toxicity Analysis Report enables mortgage lenders and servicers to analyze, stabilize and ultimately revitalize their commercial loan portfolios. |
