According to the National Oceanic and Atmospheric Administration (NOAA), Hurricanes Harvey, Irma, and Maria caused an approximated $265 billion in damages, impacting the U.S mainland and territories. Three tropical storms and four hurricanes made landfall in the United States, including Puerto Rico—the most hurricane landfalls since 2005.
With one of the most impactful hurricane seasons in recent memory, the consequences still linger for many thousands of homeowners and servicers in these affected areas. A recent article from the Wall Street Journal outlined the increase in federal flood policies covering Florida homes and small businesses from September 2017 to May 2018, rising to 1.7 million—a 2 percent increase. The number of federal flood policies in Puerto Rico spiked 77 percent, to 9,199. Texas increased 17 percent, to 702,800.
With the Atlantic hurricane season nearly two months underway, Americans are reflecting and preparing for the potential of storms ahead.
"The mortgage servicing industry learned many painful lessons in the aftermath of 2017’s very busy storm season," said Denis Brosnan, President and CEO of Dallas-based DIMONT [1], a provider of specialty insurance and loan administration services for the residential and commercial financial industries in the United States. "The value of an insurance audit cannot be understated. Servicers need to be aware of gaps or deficiencies in coverage on loan collateral before an expensive storm season occurs."
Data from CoreLogic found that 6.9 million homes are at risk of hurricane storm damage in the 2018 season, with $1.6 trillion in potential reconstruction costs on the line.
"It is also critical that mortgage servicers act fast once storms actually occur," Brosnan said. "In 2017, many servicers struggled to scale up and this caused expensive delays that could have been avoided. Another important lesson was that servicers needed to do a much better job communicating with homeowners. The lack of communication not only caused chaos among servicers’ disaster recovery teams but damaged their reputations with homeowners."
An upcoming Disaster Preparedness Summit—hosted by the Five Star Institute [2], DIMONT, and Five Brothers Asset Management Solutions [3]—will focus on answering questions about how servicers can better communicate with homeowners in the aftermath of a disaster, what changes can be implemented to help combat fraud, and how the industry can work to improve cohesion, understanding, and speed to execution.
Some of the key topics that will be discussed include a review of 2017's disaster impact, the outlook for 2018 disaster areas, how to service loans in impacted areas, and strengthening the relationship between servicers and customers. The summit will be hosted at the Hyatt Regency in Dallas, on Wednesday, July 25. The summit is co-hosted by Auction.com [4], Apex Asset Management Group [5], ArkForecast [6], Cyprexx [7], DLS Servicing Consultants [8], Laudan Properties [9], Mortgage Contracting Services [10], Vacant Property Security [11], RES.NET [12], and WeatherCheck [13].
See more stories about Disaster Preparedness below:
Mortgage Servicing Industry Braces for Next Disaster [14]
HUD Greenlights $5B Texas Disaster Recovery Plan [15]
Pending Home Sales Underperform for Fifth Straight Month [16]