Technology Needed to Service Loans Under HAFA
The challenges mortgage servicers face with regulations like HAFA is execution, according to Chris Saitta, chief executive officer of Equator.
"These regulations are designed to prevent additional foreclosures, which due to substantially increased volumes, many servicers are already struggling with," says Saitta.
Equator, which has the largest vendor management platform used by real estate-owned departments across the country, launched its Home Affordable Foreclosure Alternatives software solution, coinciding with the beginning of HAFA regulations. The solution provides lenders and servicers with the technology needed to service the hundreds of thousands of loans estimated to be eligible for HAFA in 2010.
HAFA is intended for homeowners who applied for HAMP but were declined for loan modifications. The program allows a homeowner to satisfy a mortgage obligation by completing a short sale or deed-In-lieu on his property.
Equator's HAFA solution will offer a specifically designed best-practice workflow that enables users to complete short sale and deed-in-lieu dispositions, satisfying homeowners' burdensome loan obligations. It also facilitates governmental compliance by incorporating necessary forms, capturing all of the mandated reporting data and conforming to specified audit requirements.
"With the start of HAFA, lenders and servicers will be processing a record number of short sale and deed-in-lieu dispositions," adds Saitta.
"Our HAFA solution was created to facilitate compliance with all HAFA regulations and timeframes."
The software provider says its platform is automating over 125,000 active short sales.
In the past, Saitta says many short sales would never come to fruition and the ones that did averaged over six months to complete.
The company's platform has dramatically increased short sale success rates, he says. Short sales sold through Equator averaged 88 days from initial contact to the sale closing. "One property closed in 17 days, which is not the norm but it's nice to know it's possible" explains Saitta.
Short sales are becoming an increasingly vital strategy for lenders in their struggle to clear underperforming assets. The keys to a successful short sale are accessibility, responsiveness, communication and fulfillment.