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This piece originally appeared in the May 2022 edition of DS News magazine, online now.
The complexity involved in evaluating asset disposition paths—ascertaining HUD (U.S. Department of Housing and Urban Development) timelines and due dates, calculating potential curtailments, projecting costs and losses, comparing the outcomes of various scenarios, etc.—can be extremely time-consuming when manual methods are employed.
“Investors and servicers tell us they may have to go to seven different systems and spend as much as four hours to decision one loan,” says Yvette W. Gilmore, SVP of Servicing Product Strategy, Default Services, at ServiceLink. “After all of that, they still may not necessarily know what the ultimate loss could be to them or to HUD.”
A centralized platform can help. “EXOS One Marketplace helps investors and servicers project costs, manage timelines, run simulations, and determine the ideal path for disposition,” says Mandy Zied-Ryan, VP of Servicing Business Implementation at ServiceLink. “The HUD Handbook is built into EXOS One Marketplace, so up-to-date guidelines, timelines, and due dates are right at users’ fingertips. They can also see how much they would need to contribute to get their properties up to HUD standards for conveyance and what costs are claimable under HUD guidelines.”
EXOS One Marketplace was designed to facilitate default asset decisioning through a combination of artificial intelligence, machine learning, personalized performance dashboards, and workflow management. It enables servicers and investors to see their entire portfolios at a glance and provides visibility into each asset throughout its lifecycle. Users can also leverage predictive modeling to compare and adjust disposition paths as new information becomes available.
Navigating HUD Guidelines Made Easier
The incorporation of the HUD Handbook guidelines and deadlines into EXOS One Marketplace can be a tremendous time and money saver. “Once an investor or a servicer provides us with their data, EXOS One Marketplace calculates the actual due dates for required servicing actions. They have a dashboard view of all of those deadlines so they can take proactive measures to avoid missing any of them, which in turn helps them avoid curtailments,” Zied-Ryan explains.
“EXOS One Marketplace makes managing assets more seamless,” Gilmore adds. “It performs calculations for the user, analyzing timelines based on the HUD Handbook so the user doesn’t have to do that manually. Plus, it makes decisions more transparent: The user can immediately see the effect of today’s actions on the ultimate outcome relative to the asset decision.”
For example, subsequent to a missed deadline, EXOS One Marketplace calculates the additional loss to help the user determine whether an alternate disposition path may make more sense. Without a tool like EXOS One Marketplace, an investor or a servicer may not realize a deadline was missed, and so repairs they may have completed to convey the asset are not recoverable. “Had they known of the missed deadline, they may have decided not to repair the property but instead sold it at auction with a contribution. EXOS One Marketplace can help them see the better disposition path,” Zied-Ryan said.
Tailoring Asset Decision Information to Users’ Specific Needs
Recognizing that HUD guidelines are not absolute, and that one servicer or investor may interpret a guideline differently from another, EXOS One Marketplace has the capability to customize the way information shows up for each user.
“EXOS One Marketplace can and will encapsulate a servicer’s interpretation, based on how they effectuate those rules within their servicing shop, and make it a part of the rule for that servicer alone,” Gilmore explains.
State statutes can affect timelines and projections as well, Zied-Ryan adds.
“You may have eviction timelines in one state that say it could take 90 to 180 days to evict. Some clients prefer to assume the worst-case scenario, others best-case, and some want to assume the average when calculating projections.”
Recalculating and Simulating Asset Decision Outcomes
The real estate market is ever-changing; EXOS One Marketplace keeps up. As new information is available—perhaps a new value comes in, reflecting an increase or decrease in property values—EXOS One Marketplace recalculates so the investor or servicer can adjust their strategy as they deem appropriate. They may see an opportunity to profit by holding the asset or, alternately, decide to dispose of the property as quickly as possible to cut their losses.
Users can also use predictive modeling to simulate outcomes based on their business knowledge and loss modeling to explore how they might maximize returns. In fact, EXOS One Marketplace includes a range of modeling tools and calculators to support servicers and investors as they determine their ideal disposition paths.
“This centralized platform enables servicers and investors to monitor and track their assets through the entire default lifecycle, taking a variety of factors into account—carrying costs, property preservation expenses, the cost and time to clear title issues, valuation information, etc.,” Gilmore said. “EXOS One Marketplace centralizes all of the information they need in one system, so they can make well-informed disposition decisions.”
EXOS One Marketplace consolidates title, valuations, auction and property preservation data, and other critical information through one integrated tool to mitigate risk and maximize returns.
