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Loss Mitigation

Mortgage Delinquencies Drop in Third Quarter: MBA

The nation's mortgage delinquency rate declined in the third quarter as the job market showed signs of marginal improvements, the Mortgage Bankers Association (MBA) said Thursday. But lenders are still dealing with a massive backlog of defaults, and they stepped up initiations of foreclosure proceedings during the quarter. Even with an increase in foreclosure starts, MBA says the ratio of home loans in the foreclosure process declined, signaling servicers are pushing unpaid mortgages through the pipeline at a faster pace.

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Distressed Sales, Federal Programs Drive 20% Jump in Mortgage Fraud

Mortgage fraud has increased by more than 20 percent since fraud rates reached their lowest point in early 2009, according to CoreLogic. The company says higher risk, high-volume programs, including those offered by the Federal Housing Administration and the Treasury's Home Affordable Refinance Program, as well as REO and short sales accounted for much of the increase. All are areas where activity has risen sharply over short periods of time, or where safeguards are not squarely in place, CoreLogic says.

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FHA’s Year-End Report Shows Cash Reserves Remain Below Legal Limit

The Federal Housing Administration says it has sustained significant losses from home loans insured prior to 2009. As a result, its capital reserve ratio remains below the threshold mandated by law. The agency has $4.7 billion in cash reserves, which equals 0.5 percent of outstanding single-family mortgages insured. The minimum requirement is 2 percent. Despite the shortfall, Commissioner David Stevens says the agency will not need a taxpayer subsidy, and he stressed that even in a worst-case scenario, there's enough money to cover claim losses.

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Loan Value Group’s RH Reward Program Named a 2010 Best Invention

Loan Value Group recently announced that its Responsible Homeowner Reward program was chosen by Time magazine as one of the 50 Best Inventions of 2010. Ranked fifth and the only financial product on the list, RH Reward is a system that monetarily rewards borrowers for timely mortgage payments. The publication touts the company's program as a solution to reducing foreclosures by addressing the problem of strategic default, which accounts for as many as 30 percent of all home-loan defaults.

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iServe Aligns Servicing and Real Estate Operations

iServe Servicing, Inc., a residential mortgage special servicer of performing, sub-performing, nonperforming, and bank-owned assets, announced Monday that it has integrated its business operations with iServe Real Estate Operations Inc. (iServe REO). The combined business unit will maintain the iServe Servicing title and be led by current iServe Servicing CEO Richard Cimino.

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Green River Capital Names New President

Green River Capital (GRC), an REO asset management and loss mitigation provider for mortgage servicers, investment firms, and banking institutions, has named Joseph D'Urso company president. D'Urso brings more than 20 years of financial industry experience to the company. He is the former CEO of GC Mortgage Advisors LLC, was also head of the residential loan businesses at Merrill Lynch, and spent a decade with Goldman Sachs in various roles.

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Banks Prepare to Shed Nonperformers as Year-End Nears

With the dawning of a new year comes the sense of starting fresh and leaving the previous year's baggage behind. A number of mortgage lenders are applying this same adage to their loan portfolios as the close of 2010 nears, and selling off blocks of nonperforming mortgage assets to clean up their balance sheets for a new year of business. It's a common trend for banks to get their house in order during the fourth quarter of a fiscal year, but this year, it seems there's a larger pool of eager buyers for soured real estate assets.

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More Homeowners Opt for Fixed-Rate Mortgage Products

Fixed-rate mortgages have become the dominant choice among borrowers looking to refinance their home loans, with more applicants gravitating toward shorter loan terms. A study by Freddie Mac on loan transition trends found that in the third quarter, more than 95 percent of homeowners who refinanced chose fixed-rate loans, regardless of whether their original loan was an adjustable- or fixed-rate mortgage. Borrowers who previously held shorter-term mortgages also showed a stronger preference for staying with a 15-year or 20-year loan.

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Fannie’s New Mortgage Help Center Combats Foreclosure in Phoenix

Counseling and foreclosure prevention services are now available for free to struggling homeowners with Fannie Mae loans in Phoenix. Fannie Mae's fifth facility in a series of nationwide help centers, the Phoenix Mortgage Help Center allows borrowers to meet with on-site English- and Spanish-speaking staff and experienced housing counselors to discuss their mortgage situations.

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GSE Tells Servicers to Transfer Foreclosure Cases from Stern Law Firm

Fannie Mae has issued a notice instructing servicers that have cases at the Law Offices of David J. Stern, P.A. to take immediate action to transfer those matters to other firms in the Fannie Mae Retained Attorney Network in Florida. By November 15, servicers must determine transfer locations for the Fannie Mae matters currently at the Stern firm, notify the new firms, and inform the GSE of the destination for the cases in question.

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