First American, FedEx Team to Speed Up Mod Packages
Dallas-First American Outsourcing and Technology Solutions can now send up to 25,000 loan modification packages a day to distressed homeowners around the nation thanks to a new, innovative logistics program the company created with FedEx that streamlines the way modifications are processed and delivered.
The company electronically delivers completed loan mod packages to a dedicated FedEx fulfillment center in Memphis, allowing the production window for loan modifications by an additional eight hours per day.
"We wanted to get ahead of the curve and make sure that we had the scale and capacity to meet the needs of the servicers and to support the activities we've experienced over the last couple of quarters with increased volume for loan modifications," Randy Gilster, director of First American's outsourcing and technology solutions business line, told Mortgage Servicing News.
"We are able to create a more efficient process to be able to improve the timeline, improve the quality and incorporate additional auditing controls in the process."
FedEx prints, packages and delivers these loan-mod packages to homeowners nationwide the next day. It tracks the deliveries and notifies First American of their arrival.
"The big deal for us was that we speed delivery because we move delivery through our hub," said Jess Bunn, a spokesperson for FedEx.
"At the hub in Memphis, you can drop off packages as late as around midnight. And they will be delivered to anywhere in the country by 8:30 in the morning. With that in place, First American is able to take advantage of the fulfillment center, send out documents later, get to customers earlier and turn the process around a lot more quickly."
Within minutes of notification, First American counselors or client call centers follow-up with outbound homeowner calls, walking them through the offers and the acceptance process. Signed loan modification documents are returned to First American via a reusable, custom FedEx envelope specifically designed for the program.
Throughout the process, First American and its servicer clients are able to monitor modification status online. Once modifications are returned, they are scanned and imaged so that servicers and investors can view them online.
The new arrangement will increase First American's productivity, accelerate the acceptance process and lower costs, says Mr. Gilster. From a loss mitigation perspective, First American deals with seven of the top 10 servicers.
As for whether or not the program will help stem the high redefault rate, Mr. Glister doesn't know but he thinks the new program will create a higher sense of urgency for a consumer when they have a FedEx envelope on their doorstep.
"They know that this is something that the servicer is trying to assist them in identifying the best possible way to determine if that consumer is eligible for the program," he said.
"I don't know if it will necessarily decrease redefaults. But what we're able to do on the back end once the package is delivered to the consumer is through the integration we developed it provides a task that goes straight to our call center. So as soon as the package has been delivered to the borrower, it creates a notification in our system that goes to our call center or if the client is leveraging our technology, it will go their call center that notifies the call center that the package has been delivered and the consumer has received it.
"It allows us or the client to be proactive in reaching out to the consumer to follow up on the package that was just delivered."
Typically, call center for First American volume increases on Monday mornings, often because it's the time that the borrower has the opportunity to review the documents. "But our success rate and our response rate has been relatively high for us being able to actually be in contact with the consumer within minutes of FedEx delivering the package."