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One of the biggest challenges within the mortgage industry is ensuring properties are protected. It’s crucial that mortgage servicers, field service providers and municipalities strive to comply with local, state and federal preservation requirements, which often results in increased litigation exposure and regulatory oversight.
At the Mortgage Bankers Association National Servicing Conference & Expo, a panel of housing experts discussed property preservation and tackled the issues that keep servicers up at night.
William Collins, program director at the U.S. Department of Housing and Urban Development, and Matt Martin, acting director of HUD National Servicing Center, walked the crowd of servicers through the best practices when submitting bid requests to HUD’s web-based Internet Portal, P260.
In order to protect a home’s value, it’s important for servicers to take clear photos that relate to each bid line item. Any attachments sent with the bid request should be labeled with clear description, noted Collins.
To avoid confusion, Collins encouraged servicers to date stamp each photo and provide a wide range of close-ups as well as overview photos.
Rhonda Jinks, default servicing manager at PNC Mortgage, addressed the new servicing guidelines put in place by Fannie Mae.
Jinks informed the crowd that the new guidelines include a seven-day tight securing time frame requirement, a new definition of vacancy (five-day posting plus seven days to secure) and a new definition of vacant versus abandoned.
“It’s really put the servicer in a bind here as to when it’s appropriate to secure the property and when it is not,” Jinks added.
Additionally, Fannie Mae’s new guidelines secure properties during loss mitigation and bankruptcy. Mortgage Contracting Services vice president Tracy Hager added that the guidelines include Office of the Comptroller of the Currency and internal audit written procedure requirements as well as new HomeTracker documentation upload requirements.
Sherilee Massier, vice president at Wells Fargo ($40.84 0%), continued to address the new guidelines, which no longer require two bids if a cost estimator is utilized (approval is required in writing), a seven-day tight time frame (two demolition bids and two repairs bids simultaneously) and BATF emergent issues, which are not allowed on proactive roof tarping, pool securing and code violations.
The tactics and guidelines to preserve neighborhood integrity and protect home values are ever-changing and it's crucial for servicers to remain up-to-date on all changes in requirements.
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