Servicers Respond to Deutsche Bank Report; Seek Faster Short Sales

A few major servicers responded to the Deutsche Bank report ranking them on the speed of their short sales, confirming efforts to reduce time lines and even disagreeing on some statistics. GMAC pulled down the top spot of all major prime servicers by completing short sales on an average of six months from the day the loan becomes 60 days delinquent to sale, according to the Deutsche Bank report. But James Olecki, a spokesman for GMAC, said while the company has seen a major uptick in short sales, they usually get them done in 90 days. “By using technology and bringing in more people to help with the process, we’ve been extremely proactive by soliciting short sales from those who’ve been denied or failed a modification,” Olecki said. In November 2009, GMAC launched a liquidation advisory unit that tries to reach borrowers who cannot receive a modification and “hand-holds” them through the short sale process. Olecki said the launch of customized software that can handle uploads of documentation such as BPOs and back-and-forth negotiations has also reduced the timelines. GMAC utilizes the Equator short sale platform for these transactions. GMAC saw an 87% increase in short sales from 2008 to 2009. Although Olecki could not disclose the volume of short sales, he did say that number has continued to increase in 2010. Wells Fargo conducted short sales at an average of eight months, the third fastest of the prime servicers, according to Deutsche Bank. While a spokesperson for the bank could not disclose short sale numbers either, Wells has grown its home preservation staff by more than 140% since the beginning of 2009. The bank hired 10,000 people for a total of 17,800 employees who are working to keep foreclosure numbers down and work on short sales, the spokesperson said. The Treasury Department launched the Home Affordable Foreclosure Alternatives (HAFA) program to provide financial incentives to servicers for conducting short sales on mortgage loans that fail the Home Affordable Modification Program (HAMP) and to streamline the short sale process to a 30-day approval. But those in the trenches are still seeing delays in the short sale process. Roger Cummings, president and broker at the Wright House, a California-based firm that does short sales and loan modifications, said short sales are “severely backlogged.” He has three submitted to a bank now, and all have been waiting at least 30 days without approval. HAFA launched April 5, and Olecki said GMAC has taken the necessary steps to comply with the HAFA guidelines. Bank of America did not immediately reply to inquiries on its short sale process, but Matt Vernon, speaking on a panel at REO Expo 2010, said the bank is doing “everything it can” to liquidate a property before foreclosure. It currently has nearly 500,000 loans eligible for HAMP and has conducted 70,000 permanent modifications through that program. Ocwen, one of the largest independent servicers after its acquisition of HomEq, did not immediately provide short sale figures either, but it remains one of the top performers in HAMP, converting 83% of its trial modifications into permanent status. Write to Jon Prior.

Most Popular Articles

Latest Articles

Test post for new category functionality HW+

Lorem ipsum dolor sit amet, consectetur adipiscing elit. Nulla in quam euismod, consectetur urna vel, placerat magna. Sed gravida, nisl eget rutrum porta, libero orci tristique neque, luctus lobortis massa felis sit amet ex. Curabitur ut dapibus enim. Fusce in placerat purus, a hendrerit tortor. Sed neque lorem, tincidunt sed magna suscipit, volutpat rutrum tellus. […]

3d rendering of a row of luxury townhouses along a street

Log In

Forgot Password?

Don't have an account? Please