Executives from Fannie Mae say they recognize the loss-mitigation process has become complex for mortgage servicers and borrowers, prompting the government-sponsored enterprise to continue to search for ways to improve it.
Leslie Peeler, vice president of Fannie Mae, said current documentation requirements could prove overwhelming to servicers.
“What we are looking to do is eliminate the pieces of the process or reduce the pieces that are not critical to reach a decision that is best,” Peeler said while serving on a panel at the REperform Summit in Dallas, a mortgage servicing conference hosted by HousingWire.
Peeler said the GSE recently reduced the documentation requirements for borrowers who are more than 90 days delinquent.
“Once a homeowner is that delinquent, they don’t need to establish that they have a hardship,” she explained.
Bill Cleary, vice president of the credit portfolio strategy for Fannie Mae, said there are major efforts under way to help servicers. One is the “Know Your Options Customer Care Program,” which provides servicer employees with scripts to use when interacting with borrowers along with assistance in putting quality control measures in place.
“The minute the borrower goes delinquent that has a big impact on their credit score,” said Cleary. “We want to try and make it easy for them to avoid foreclosure.”