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Companies Partner to Offer E-Processing for Federal Loan Modifications

Three Texas-based companies - ""REO Alternatives"":http://www.reoalt.com, ""Rapid Reporting Verification Company"":http://www.rapidreporting.com, and ""SigniaDocs"":http://www.SigniaDocs.com - together with Maryland's ""Overture Technologies"":http://www.overturecorp.com unveiled plans on Tuesday to offer expedited electronic loan modifications through a collaborative initiative they've dubbed the eMortgage System Processing (ESP) program.
The companies explained that ""eMortgage System Processing"":http://www.reoalt.com/esp accelerates the task of identifying distressed borrowers and placing them into an appropriate loan modification under the administration’s Making Home Affordable program, allowing mortgage companies to save millions of dollars while meeting urgent timetables for homeowners facing foreclosure. In addition, the companies said, with ESP mortgage servicers, lenders, and investors can create electronic loan files that eliminate paper-based inefficiencies, increase data transparency, and provide added safeguards against mortgage fraud.
ESP identifies eligible borrowers, performs due diligence, and integrates the government's home retention guidelines with lender and investor programs to create an electronic modification package for each borrower. According to the partnering companies, users of the system can immediately provide loan documents to borrowers electronically, within minutes of qualifying - this immediacy, they say, results in 50 percent of borrowers e-signing right away, and 80 percent within 24 hours.
Paul Anselmo, president and CEO of ""REO Alternatives"":http://www.reoalt.com, said, ""Government and financial institutions are simply not using automation to administer these modifications, and pressure is growing for the administration to deliver results. Every day, more homeowners are falling into arrears or foreclosure, and face delays that only worsen their circumstances. ESP can help homeowners in distress, while greatly reducing the costs involved.""
Dennis Stowe, president at lending partner ""Residential Credit Solutions"":http://www.residentialcredit.com, added, ""We as an industry can no longer afford to rely on manual processes. We have a responsibility to conduct business efficiently, and we want to save as many homeowners as possible from going into foreclosure.""
The companies say the primary focus of ESP is to deliver a fast, efficient automated process to keep borrowers in their homes. They point to statistics that show it costs lenders anywhere from $50,000 to $100,000 if a loan goes into foreclosure - and that doesn't include the ripple effect foreclosures have on neighboring properties. When compared against this figure, the partners contend, the time and cost savings of an electronic homeowner retention process is compelling, particularly when multiplied by the estimated seven to nine million distressed loans the administration's program intends to address.
Mortgage servicers have been challenged with a tremendous backlog of foreclosure processing over the last few months, compounded by changes in government regulations. The partnering companies say that ESP can also ensure servicers are fully compliant with evolving regulations, meeting all federal and state government and investor document requirements. In addition, ESP provides compliance with HUD's newly revised Real Estate Settlement Procedures Act (RESPA) and maintains program guidelines for Fannie Mae, Freddie Mac, and Federal Housing Administration (FHA) refinances and modifications.
Steven Horne, CEO of special servicer ""Wingspan Portfolio Advisors"":http://www.wingspanportfolioadvisors.com, says he has witnessed the efficiencies afforded by electronic processing. ""Our company has been using eMortgage System Processing technology for months now, and the results have been a significant improvement in terms of time, cost, and the likelihood of completing a successful loan modification.""
Horne went on to explain, ""Instead of obtaining a verbal agreement and sending paper documents by courier, we walk the borrower through the process while they are still on the phone. They execute documents securely over the Internet, and send them back to us electronically. The loan modification can be completed in minutes.""
According to Horne, distressed borrowers today need immediate help, and he calls ESP a ""game-changer,"" adding that it is the ideal approach for making President Obama's mortgage relief programs work the way the administration intends.
ESP uses SMART Doc electronic document technology for all loan closing documents. This application combines the document view and data into a single electronic file and enables systems to automatically verify the document and data, and perform quality control and due diligence checks in near-real-time. ""REO Alternatives"":http://www.reoalt.com also plans to address the needs of Hispanic homeowners affected by the housing crisis with a Spanish-language version of the ESP system.

About Author: Carrie Bay

Carrie Bay is a freelance writer for DS News and its sister publication MReport. She served as online editor for DSNews.com from 2008 through 2011. Prior to joining DS News and the Five Star organization, she managed public relations, marketing, and media relations initiatives for several B2B companies in the financial services, technology, and telecommunications industries. She also wrote for retail and nonprofit organizations upon graduating from Texas A&M University with degrees in journalism and English.
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