Leisha Delgado

Disaster recovery servicing continues to be a hot topic and the forecast for the Atlantic hurricane season already points to another challenging yearend. The Climate Prediction Center of the National Oceanic and Atmospheric Administration (NOAA) preseason forecast for the current hurricane season (August through November) was recently issued and indicated there would be more than a dozen storms as follows:

• There are 10 to 17 predicted storms with wind speeds of 39 mph or more.
• Five to nine of these storms will become hurricanes with wind speeds of 74 mph or greater.
• The major hurricane prediction subset includes two to four storms with winds of more than 110 mph.

Natural disasters, which include hurricanes, tornadoes, floods and wildfires, continue to impact thousands of mortgage borrowers each year, pushing up corresponding mortgage defaults year-over-year. With an onslaught of agency disaster recovery guidelines and program parameters imposed on servicers over the past few years, it’s important to keep up with state specific requirements. Disaster recovery is a geographic event that can strike anywhere, necessitating strong default partners that understand specific regional nuances pertaining to delinquency, bankruptcy and foreclosure. Hello Solutions’ mission is to bring professional, service-oriented law firms and servicers together, creating a mutually beneficial partnership that helps ensure a sound approach to disaster relief default strategy. To explore the value of default servicing partnership, contact us at [email protected] for more information.

Details of the NOAA 2019 Atlantic Hurricane Season Outlook can be found by clicking here.

Results of this year’s survey indicates that servicers need to rethink their customer experience strategy. The recently released J.D. Power 2019 Primary Mortgage Servicer Satisfaction Study showed that mortgage customers don’t have confidence in their servicer with key results including:

• 70% of mortgage borrowers do not completely trust their servicer. Notably, the other 30% were three times more inclined to return to the same servicer in a purchase scenario.
• Almost 60% of borrowers use their mortgage servicer’s website and 31% are using mobile applications, both fall behind usage for retail banking. “Best-in-class” however, had nearly 20 percent greater usage rates for features such as alerts and messaging.
• Borrowers with transferred servicing had lower scores, with mortgage payment and escrow account issues noted. This is not unique but indicates that servicers still have work to do when it comes to handling servicing transfer borrowers.

The customer experience is a key component when handling delinquent borrowers as well. With borrowers already reticent to return collection calls, servicers need to have a strategy to engage customers and instill trust throughout the mortgage lifecycle. Hello Solutions aligns law firms and servicers to facilitate engagement and collaboration on default legal issues, including business nuances and obstacles encountered by borrowers facing delinquency scenarios. Our goal is to support these partners in their collective efforts to develop creative default solutions and strategies. Contact us today at [email protected] for more information on how the right partner can help you successfully manage the customer experience in default servicing.

The press release and link to this year’s J.D. Power Primary Mortgage Servicer Satisfaction Study can be found by clicking here.

The mortgage industry continues to publish decreasing rates of delinquency, but not all default metrics suggest a decline, leaving industry participants to wonder how long the current trend will last. Increasing delinquency numbers can be found in the yearend 2018 report by the Office of the Comptroller of the Currency (OCC) and the Mortgage Bankers Association’s (MBA) last quarterly report. Additionally, BlackKnight’s recent Mortgage Monitor June 2019 Report reflected several notable reverse trends in delinquency rates as follows:

•  The total national mortgage delinquency rate increased in June to 10.8%, becoming one of the top five monthly increases experienced in the past 10 years.
• June typically results in a seasonal increase in delinquencies; however, on average only rising by 2.5% as compared to 10.8%.
• Foreclosure starts for mortgages in June rose by 2.8%, with mortgages in active foreclosure also increasing.
• As compared to last quarter, the national default rate rose by 3%, which represents the first post financial crisis quarter-over-quarter increase.

There are a number of reasons that can be assigned to disparity in delinquency rates; however, the important issue at hand can be found in the red flag indicators that are increasing in number. Case in point, mortgage debt recently reached 2008 thresholds, consumer debt continues to rise, housing starts and appreciation remain stagnate, not to mention the possibility of a recession. Walking through times of ongoing industry volatility calls for dedicated, innovative, strategic partnerships. Hello Solutions has created a unique niche aimed at bringing together committed professionals in the areas of default litigation and default mortgage servicing. To find a partner that fits your exclusive needs, contact us at [email protected] and join our group of pioneering default players.

Last month’s report on mortgage delinquency data published by Black Knight is available by clicking here.

Leisha Delgado, founder and CEO of Hello Solutions, has joined ALFN Women In Legal Leadership “WILL,”​ a group of industry-leading women and thought leaders in the mortgage servicing industry. To learn more about WILL, click here. [www.alfn.org/will]