National Creditors Connection Establishes New Short Sales Desk

New incentives intended to stem deteriorating conditions in housing markets, and even spark a revival, encourage the use of foreclosure alternatives for troubled properties. Options such as short sales, deeds-in-lieu, and alternative modifications are becoming more prevalent, and their success is dependent on targeted, effective borrower contact strategies.

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To address this need, Lake Forest, California-based ""National Creditors Connection Inc."":http://www.nationalcreditors.com (NCCI) has established a ""Short Sales Desk"" to help servicers assess whether delinquent borrowers are good candidates for a short sale or other foreclosure alternative program.

Jay Loeb, VP and a principal owner of NCCI, explained that the company's personnel will collect all necessary documents from borrowers and work with Realtors on an ""arm's-length transaction.""

""Once we have the documents, all parties can roll right into the HAFA program or at least determine where there may be a need to re-contact borrowers to complete the process,"" added Bart Brainard, director of strategic default management for NCCI. ""It may be that we could offer something else entirely to resolve the situation.""

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For example, Brainard says in its pursuit of delinquency resolutions, NCCI is discovering that about 30 percent of all delinquent borrowers' properties are non-owner occupied and often vacant, which means they don't qualify for some short sale or modification programs, including the government's housing programs.

As a result of such discoveries, NCCI says it is expanding its interactions with borrowers, from basic contact, to a deeper evaluation of the options available to produce a positive outcome, including an objective assessment of the consumer's true financial condition.

The company says this requires acquisition and cross-comparisons of detailed data including title reports and broker price opinions (BPOs). As a result, NCCI says it will be acting as component servicers.

NCCI offers a range of servicing assistance, from the initial door-knock through document retrieval, signature services, and extracting financials. The company's clients are able to choose which services they want and customize a solution that supplements their own loss mitigation efforts.

Brainard noted that the demand for short sales and other foreclosure alternatives is expected to increase still.

By August 1, Fannie Mae and Freddie Mac servicers are expected to have the GSEs' own Home Affordable Foreclosure Alternative (HAFA) programs in place and up and running. At which time, Brainard says ""boots on the ground and eyes on the street could spell the difference between new success and old failures.""

According to the GSEs' HAFA guidelines, ""Once all other home retention options have been exhausted, eligible borrowers must be considered"" for a short sale.

Acknowledging this sea change, NCCI says its new Short Sales Desk can provide servicers, investors, and even distressed homeowners with a new ally in the struggle to find the best resolution for a troubled property.