LandAmerica Rolls Out Loss Mitigation Automation

Need proof that loss mitigation is big business for vendors in mortgage banking these days? Look no further than the major title companies, which have been moving quickly to put together technology platforms that can help servicers manage a growing inflow of troubled borrowers — with more on the way.

LandAmerica Financial Group, Inc. (LFG: 17.68 -1.34%) is the latest to join the loss mitigation revolution, announcing the release of eZLoan Optimizer on Tuesday, a new solution that it said is designed to help mortgage lenders and servicers identify loans with existing or potential problems, and provide specific actions that can be taken to minimize loss.

According to LandAmerica, eZLoan Optimizer gives mortgage lenders and servicers a fully automated process for analyzing their entire loan portfolio, and scores loans on more than 400 different attributes. Lenders and servicers are them given a forecast of future portfolio performance, as well as identification of individual loans posing the greatest potential for loss and recommended mitigation options.

“Instead of our customers spending unproductive time looking for loans that need actions, they can use eZLoan Optimizer to identify and prioritize problem mortgages as well as receive specific pre-defined action steps,” said Al Will, executive vice president at LandAmerica’s residential services division.

A similar solution was rolled out earlier this month by a subsidiary of title insurance giant the First American Corp. (FAF: 27.21 +2.95%), which said it had put together a platform for credit scoring, valuation services, risk modeling, scoring, document preparation and document recording to identify borrowers who are most at-risk of foreclosure; the company will then provide lenders and servicers with a report on at-risk loans and recommended courses of action.

Regardless of provider, these solutions are a critical link for many servicers, according to various HW sources in the industry — many servicers are being asked to perform loan-level analysis on a narrow, fixed servicing margin.

“It’s asking the impossible of many servicers,” said one industry consultant, who asked not to be named. “Servicers have seen their spreads squeezed, and now they’re supposed to have the resources needed to manage troubled loans on a case-by-case basis, too.”

“Platforms like these will allow servicers to actually do both: perform loan-level analysis and locate those files most in need of their more limited case-by-case attention.”

For more information, visit http://www.landam.com.

Disclosure: The author held no positions in firms mentioned in this story when it was published; indirect holdings may exist via mutual fund investments. HW reporters and writers follow a strict disclosure policy, the first in the mortgage trade.