Servicing

Homesaledirectory.com, a Flagstaff, Ariz.-based home for sale listing website for buyers and sellers, has formed a strategic partnership with RealtyTrac, in which RealtyTrac will power a nationwide foreclosure home search on Homesaledirectory.com. Said Jason Dittberner, president of Homesaledirectory, "Home buyers and investors are searching for the best buying opportunities available and this partnership adds yet another valuable resource." With real estate in a downturn in most markets nationwide, the foreclosure marketplace is one of the few growing areas in real estate. More than 750,000 homes received a foreclosure notice in the third quarter of 2008, up 71% from the third quarter of 2007, according to the RealtyTrac U.S. Foreclosure Market Report. Said Ari Monkarsh, vice president at RealtyTrac, "We look forward to providing Homesaledirectory.com and its customers the most comprehensive foreclosure data available on the Internet."

The California housing market, which is still reeling from foreclosures and declining values, now has something new to worry about: what might happen to prices if an earthquake strikes. According to a new report issued by Impact Forecasting LLC and Aon Benfield, only 14% of California homeowners carry earthquake insurance. The report notes that a natural disaster, such as a "great" earthquake in southern California "could send shockwaves throughout the financial and insurance industries." Aon, a reinsurance company, says many mortgagors could walk away "from their damaged homes without repairing them, leaving many homes in foreclosure and forcing the banks to bear the brunt of the loss in capital." California, typically, represents 20% of all residential loans serviced in the U.S. "Thoughts of just how bad this mortgage crisis might be should a significant earthquake occur in the next couple of years have crossed many of our minds," the authors write.

Roughly 50 different investors received confidential bid packages on IndyMac Bank FSB, the insolvent thrift that is also the nation's ninth largest residential servicer. A spokesman for the Federal Deposit Insurance Corp. also clarified that the investor group awarded IndyMac this past Friday is putting roughly $2.9 billion into the deal: $1.6 billion that represents the difference between the thrift's liabilities and the value of its assets (after the assets have been marked-to-market) and another $1.3 billion in cash that will be used to capitalize the re-constituted lender/servicer. "It's failed bank math," he said. The spokesman said at least 80 different investors were invited to bid but declined to say how many were involved in the final bid process. Of the 80, 50 received bid packages. Late last week the FDIC agreed to sell the Pasadena, Calif.-based IndyMac to IMB Management Holdings, a consortium of hedge funds led by Dune Capital, J.C. Flowers, Paulson & Co., and others. IndyMac has $13.9 billion in assets and $12.3 billion in liabilities, said the spokesman.

Javid Jaberi, senior vice president of servicing operations for Residential Capital Corp., Horsham, Pa., has left the company as part of a reorganization, according to a memo provided to MortgageWire. According to an email written by ResCap chief operating officer Tony Renzi, Mr. Jaberi "has made the decision to leave the company to pursue other interests." No further information was provided. Mr. Renzi did not return a telephone call about the matter. According to one executive at the company, who requested his name not be used, Mr. Jaberi had been running ResCap's loss mitigation and collections effort. The source said another servicing official, Ron Poindexter, also has left ResCap. The Renzi memo notes that ResCap executive John Vella "will expand the scope" of ResCap's business operations "to include our non-conforming and special servicing portfolios including responsibilities for all REO functions." ResCap's parent company, GMAC Financial Services, recently received a $5 billion investment from the U.S. Treasury under the Troubled Asset Relief Program.

President-elect Barack Obama and vice president-elect Joe Biden want to provide "immediate assistance" for struggling homeowners as part of their economic stimulus plan. They are urging Congress to enact a 90-day moratorium on foreclosures and changes to the bankruptcy code that allow judges to modify mortgages on primary residences. "Obama and Biden are calling for legislation to close the loophole in our bankruptcy code that allows bankruptcy judges to modify the terms of mortgages on investment properties and vacation homes but not on primary residences," according to "The Obama-Biden Plan" that the president elect's transition team provided congressional staffers on Monday. The mortgage industry strongly opposes such changes to the bankruptcy code, claiming it will increase mortgage rates and slow the recovery of the secondary mortgage market. The plan directs the Department of Housing and Urban Development to move "aggressively" in implementing the Hope for Homeowners Program, which uses Federal Housing Administration loans to refinance underwater mortgages. So far, the H4H program has been a flop. But the plan calls for Congress to remove any tax or legal impediments to encourage the use of shared-equity mortgages in H4H refinancings. And it calls for the Treasury Department to use its authority to guarantee newly modified loans. The Obama-Biden Plan is posted on the transition team's website: change.gov.

Homesaledirectory.com, a Flagstaff, Ariz.-based home for sale listing website for buyers and sellers, has formed a strategic partnership with RealtyTrac, in which RealtyTrac will power a nationwide foreclosure home search on Homesaledirectory.com. Said Jason Dittberner, president of Homesaledirectory, "Home buyers and investors are searching for the best buying opportunities available and this partnership adds yet another valuable resource." With real estate in a downturn in most markets nationwide, the foreclosure marketplace is one of the few growing areas in real estate. More than 750,000 homes received a foreclosure notice in the third quarter of 2008, up 71% from the third quarter of 2007, according to the RealtyTrac U.S. Foreclosure Market Report. Said Ari Monkarsh, vice president at RealtyTrac, "We look forward to providing Homesaledirectory.com and its customers the most comprehensive foreclosure data available on the Internet."

Columbus, Ga.-based Synovus is taking a fourth quarter loan loss provision of $350 million with a charge-off ratio of 3.2% due to residential real estate credits in the Atlanta market. The financial services company had originally issued a press release on Jan. 2, which incorrectly stated loan loss provision as $250 million with charge-off ratio of 2.2%. Synovus, with $34 billion in assets, is assessing its goodwill for potential impairment during the fourth quarter. The company plans to release fourth quarter 2008 earnings on Thursday, Jan. 22. For more information, go to http://www.synovus.com.

First American Outsourcing and Technology Solutions has developed a new auditing solution designed to reduce the cost and risk of servicing, acquiring and selling adjustable-rate mortgage portfolios. The solution identifies data issues with existing ARM portfolios and can "scrub" loan-pool acquisitions during the transfer and boarding process or as pre-sale due diligence. The new service can correct errors uncovered by the audit and re-post the changes to the servicer's system. Specifically, the solution can re-amortize and repair loan files and customer histories and automatically generate corrected borrower loan statements. The highly automated, scalable solution identifies exceptions and provides comprehensive loan work-ups for clients. Audits can be conducted 24 hours a day, six days a week and maintain a 99.97% data accuracy rate. The ARM Audit and Repair offering includes triple-key data auditing, historic re-amortization of ARMs, forensic loan history analysis, and due diligence and pre-acquisition or pre-sale scrubbing. "Industry-wide as much as $350 billion of unsecuritized ARMs are still held in portfolios," said Scott Brinkley, executive vice president of First American Outsourcing and Technology Solutions. "Whether they are traded or retained by the servicer, there are significant data issues that can result in incorrect rate adjustments, defaults, foreclosures and lawsuits."

The Tennessee Commissioner of Commerce and Insurance is now requiring fingerprints from certain license and registration applicants, including mortgage lenders, brokers, servicers and loan originators. According to written analysis from iComply, which is authored and published by a team of mortgage banking attorneys, there must be provisional authorization for mortgage loan originators to conduct business while awaiting registration approval from the commissioner. The requirement became effective on January 1. In other regulatory news, with the start of the new year North Carolina is requiring mortgage servicers to be licensed by the its Commissioner of Banks before acting as a servicer. The bill also changes the "brick-and-mortar" requirements for mortgage brokers to specify that a broker's physical location in North Carolina may not be a home or residence.

Now that GMAC Financial Services has received both bank holding company approval and a $5 billion investment from the U.S. Treasury, one of its next moves will be to ramp up its deposit gathering capabilities. A spokeswoman for the company said GMAC's bank, GMAC Bank of Utah, will remain as an online bank. She said marketing plans regarding deposits could be announced over the next few weeks. GMACFS also controls Residential Capital Corp. of Horsham, Pa., a $391 billion servicer. In late December the Treasury invested $5 billion in GMACFS, by purchasing preferred stock that carries an 8% yield. "The overall health of GMAC has greatly improved," said the spokeswoman. The company recently completed a note exchange offer that fell short of its goals but the government investment in the company boosted its immediate financial outlook. The warehouse lending platform of GMAC is housed in its bank.