Best of Counsel’s Corner – Part I

Each month, Counsel’s Corner brings you insights from the attorneys working in the trenches of default servicing and the larger mortgage industry. From their most challenging casework to tips on how best to thrive in the current low-default environment, Counsel’s Corner provides a direct feed into the minds and experiences of the industry’s talented legal professionals. Here are some of the highlights from 2018’s DS News attorney interviews.

Roy A. Diaz, Managing Partner, SHD Legal Group; Chair, Legal League 100

Originally Ran—March 2018

Current volume has resulted in transitioning the practice to “milestone processing, which broadens the scope of responsibility of each portion of the case. This facilitates volume changes, allows for cross training, and assures fluid file management at current low volumes. Reporting technology is critically important to assure that high-quality work-product is produced on behalf of the firm's clients. Data-reporting technology enables me to have critical information related to each step of the foreclosure process at my fingertips. This provides me and the management team the ability to review and manage process flow at every step, identify issues, proactively resolve issues, and assure that client expectations are being met. The firm utilizes a Snapshot Report, which I particularly utilize as part of my day-to-day management. The Snapshot Report provides both the firm and firm's clients complete access to the client’s entire portfolio with the ability to drill down at a loan level at every juncture.

Gregory J. Sanda, Associate Attorney, Schiller, Knapp, Lefkowitz & Hertzel, LLP

Originally Ran—April 2018

A law firm’s ability to grow is a function of its ability to achieve cost-effective results and to meet client expectations. These, in turn, are functions of a law firm’s systems, institutionalized knowledge base, ability to adapt to change, and, of course, its people. These processes must be sharpened continuously for a firm to remain competitive, particularly given the increased complexity of foreclosure law over the past 10 years. Focused improvement in these four areas translates to quicker turnarounds on recovery, an improved reputation in the courts and with servicers, and growing business. Neglecting any of these areas can lead to recovery delays, mistakes, and losses, which will ultimately result in a shrinking business. Mortgage servicers need counsel who are fully-versed in the changing legal landscape, and who possess the creativity and resourcefulness to adapt to these changes and produce winning results that are cost-effective.

Stephen M. Hladik, Partner, Hladik, Onorato & Federman, LLP

Originally Ran—May 2018

Law firms can be a major help to clients by being proactive and keeping clients advised of any regulatory, statutory, or case law decisions that impact lenders. It is a major task for any lender or servicer to be on top of every statute or judicial decision in all 50 states. Law firms can also assist clients with on-site training in best practices and the latest issues affecting bankruptcy and foreclosures. Law firms can assist servicers by engaging the servicers' trial witnesses in mock cross-examination and other techniques to succeed in getting key information into evidence. As obvious as it may sound, law firms can also help keep servicers informed of issues in general legal matters. Sometimes a firm can get so focused on actions relating solely to lending that issues of importance get overlooked, such as key evidentiary rulings, UDAP decisions in other industries that have a spillover effect on lenders, and contractual or Uniform Commercial Code matters.

Steven C. Lindberg, Managing Partner, Anselmo Lindberg & Associates, LLC

Originally Ran—June 2018

The biggest challenge is how to pare expenses to meet the lower volumes and income. The natural inclination is to reduce support staff since that represents the largest expense that a law firm has. The problem is that when a firm reduces staffing, the metrics begin to suffer, and when this happens, the scorecards reflect this. It requires firms to up their game on technology so that the key metrics established by the clients are met. The idea is that your case management system and other technology integrations can provide the support that some of your staff previously provided, allowing the firm to jettison some staff. The problem with this is that technology and client requirements are always changing, and it does take time to initiate the necessary changes to put the firm in a position where staff can be decreased. This means that the firms will be expending additional sums of money during a period where reducing costs is crucial.

Neil Sherman, Managing Partner, Schneiderman & Sherman

Originally Ran—July 2018

if you're not learning about the fintech side of our industry, if you're not contemplating how that will adjust the way that we do business, then you'll likely be left behind. It doesn't mean that fintech will 100 percent control how we do business moving forward. People and methodical thinking will be as important as ever, but we will do it with some new tools. It's incredibly important that we understand both on the default servicing side and the head of our beast, the origination side, how technology is going to impact what they're doing and how we have to adjust as small businesses. The reality is, if you are a large bank servicer or non-bank servicer, you're putting incredible manpower and money behind fintech. If you are a small business law firm, you are working hard to stay mentally current and technically current. One area where there could be some exceptional collaboration between vendors, servicers, and their legal partners is on the education side of fintech.