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""Equator"":http://www.equator.com has initiated 200,000 short sale transactions through its technology platform since the system was first launched just seven months ago. Another 15,000 short[IMAGE]
sales have been initiated on the Equator platform that conform to the guidelines of the federal government's Home Affordable Foreclosure Alternatives (HAFA) program.
Chris Saitta, the Los Angeles-based company's CEO, explained to DSNews.com that he's beginning to see a shift from the ""traditional"" short sale flow â€" which as it stands now makes up the lion's share of the business coming into the Equator platform â€" towards more HAFA-esque short sales.
HAFA, which officially got underway April 5th, has a few more restrictions than lenders' conventional short sales, namely the borrower must meet the requirements for the Home Affordable Modification Program (HAMP) before HAFA can be considered. But Saitta says he expects HAFA volume to increase steadily as more borrowers find themselves at the end of the HAMP evaluation.
Fannie Mae and Freddie Mac both announced their ""own renditions of HAFA"":http://dsnews.comarticles/gses-to-begin-accepting-hafa-short-sales-2010-06-01 last week, which take effect August 1st,
[COLUMN_BREAK]and Saitta said his company is already working on short sale platforms tailored specifically for the GSEs' programs.
He explained that with Equator's automation and the connections the system establishes between all relevant parties, short sales processed through the company's platform take two and a half months from initial contact to funds received post-closing. That compares to the typical eight-month long short sale process many industry players had previously been accustomed to.
""I really believe the short sale is the right solution for what homeowners are facing,"" Saitta said. ""Not only does it provide them with a graceful exit, but it's also more cost-effective for servicers.""
And more and more, servicers and homeowners are opting for short sales â€" even without the federal HAFA incentives. Saitta says last month alone, Equator saw nearly twice as many short sales comes through its platform than REOs â€" 55,000 short sales vs. 28,000 REO transactions.
REO volume right now is ""flat,"" according to Saitta. But that's likely to change soon. He says in about four months, we'll see a ""significant"" ramp-up in REO, as modifications and other loss mitigation options are exhausted and properties that have been stuck in a holding pattern get pushed down the pipeline.
Currently Equator's system is used by about 60 servicers, including seven of the top 10. The company has also recently rolled out what it calls the PRO version of its platform, which is targeted at the mid-level market.
The PRO platform can be deployed within a day, and Saitta says it's ideal for credit unions, outsourcers, and even Wall Street firms that are looking to value, acquire, and manage loan portfolios that may have performance issues.
