Recent Servicing Headlines

B&C-Linked Blue Heron CDOs Downgraded

Franklin Receives NASDAQ Delisting Notice

California Resales Up 43.4%

Thornburg Earnings Takes Big MBS Hit

Fannie Purchase Volume Falls to 41-Month Low

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• Daily headlines with breaking news stories about the mortgage industry
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Mortgage Technology Newsletter

• Mortgage technology headlines, five feature stories and an interactive survey, weekly.
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BrokerUniverse

• News headlines and feature stories aimed for mortgage originators, daily.
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Fraud & Compliance Report

• News headlines and featured stories about the dangers and prevention of mortgage fraud.
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Should Modifications Target a 38% DTI Ratio?

By Ted Cornwell

First, Hope Now servicers agreed to a broad framework for approaching streamlined loan modifications. And now, with a little push from the FDIC (as conservator of IndyMac), further details are emerging about how to apply broad-based, standardized loan modifications.

As with the Hope Now initiative, the IndyMac loan modification program unveiled last week largely targets nonconforming loans, but whereas the Hope Now alliance focused on subprime borrowers, IndyMac's response focuses on loans made to alt-A credit borrowers. And rather than anticipating defaults due to rate resets, the FDIC program targets loans that are already seriously delinquent or in default.

In contrast to most servicers, IndyMac has some clout in dealing with investors and government-sponsored enterprises these days. And the FDIC proposal has some teeth to it: asserting that modifications should reduce a borrower's debt-to-income ratio to 38%.

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Headlines from the Current Issue of Managing REO

• Initiatives to Combat Vacant Blight

In order to mitigate the risk involved with maintaining vacant properties, field service companies are taking extra steps to make sure the home is secured and there are no safety or health hazard issues.

• Key Points to Rehab

Allan Martin, CEO of Mortgage Contracting Services in Tampa, Fla., discusses the latest developments in the world of rehab for real estate-owned assets.

• Foreclosures Touch Everyone

The president of REOMAC says members of the organization are busier than ever before when it comes to dealing with the glut of REO properties across the country.

ForeclosureRadar: California Foreclosure Sales Up 22.5% Since June

By James Comtois

Sales at foreclosure auction in California jumped dramatically in July, increasing by more than $2 billion in combined loan value to $12.55 billion, according to ForeclosureRadar, a website that tracks every California foreclosure with daily auction updates. This represents more than 1,300 properties being taken to auction per business day, up from 415 per day one year ago.

Also, according to ForeclosureRadar's California Foreclosure Report for July notices of default declined for the third straight month. The total number of properties that are still actively scheduled for auction increased to 64,598 at the end of July, up from 59,973 at the end of June and 53,793 at the end of May. This indicates that further increases in foreclosure sales are still likely near term, despite the declining number of defaults.

Other findings from ForeclosureRadar's report include that notices of default declined by 4.6%, to a total of 40,219 filings representing $17.71 billion in loans. Also, notices of trustee sale, which are typically recorded 105 days after the notice of default, and which set the auction date and time, increased 9.8% to 39,010 filings in July. Looking at this number in comparison to notices of default, far fewer homeowners are finding a way out of foreclosure. At 97% of defaults, July's notices of trustee sale filings are nearly double the 50% that were more typical as recently as February.

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Servicing Statistics

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iMortgage Services Releases Comprehensive Collateral Report

By Anthony Garritano

iMortgage Services LLC, an independent national provider of collateral valuation and settlement services for the residential mortgage industry, has released Tier3, a collateral re-evaluation report. In a market environment beset by foreclosures, buybacks, insurance claims and uncertainty, smart mortgage industry professionals are looking for ways to independently and objectively determine the accuracy and validity of origination appraisals used in the decision making process.

Using a three-stage valuation process, Tier3 takes historical market context into full account, coupling it with the depth of knowledge and expertise of the highest quality appraisal professionals to produce the most accurate, objective, documented proof of a property's value at a given point in time.

The report can include two separately focused field inspections, plus a complete written analysis of all findings. The final report always provides a critique of the original appraisal performed by a licensed and certified appraiser on any piece of property or appraisal under quality assurance review.

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