Among the hot topics Brent Taggart, a senior vice president at Green River Capital, anticipates and wants to hear more about at the MBA’s servicing conference is short sales.
“What I am expecting at the servicing conference quite honestly is for people to talk a little bit more about short sales, the short sales being a larger part of their loss mitigation strategies,” said Taggart, whose company is based on West Valley, Utah.
Taggart said he believes specifically there will be talk about how to decrease the timelines that it takes to complete a short sale, what the best practices for short sales are.
“That’s something I’m really looking forward to and hoping there’s going to be more of…there,” he said.
Green River’s flagship is an REO asset management company, but it also has as short sale unit that was formed a couple of years ago and is licensed in 50 states to be a debt collector.
Among the best practices Taggart said the company recently has found work include reducing handoffs and continually honing a compassionate and listening-based approach to borrowers.
“We’re a full service REO asset management company and we have our own agents that we can use to go out there and can discuss frankly with the borrowers options that they have on their home. So we thought it was a great fit for us to get this licensing,” said Taggart. “We train all of real estate professionals in [the Fair Debt Collection Practices Act]. They must go through training they have to test to show proficiency in what that training is and know what the laws are and there’s just less handoff.”
“What’s happening in the industry now is everybody is so specialized,” he observed. “You have a door knocking group and then they pass that along to a management group or a servicer and then they pass it along to a real estate agent. So you have three or more handoffs and what we’ve done is created out company so that…there’s no handoff.”
Borrowers want to be able to talk with one person and “not get passed around,” he said.
“We understand that they don’t want to explain their situation more than once or twice,” said Taggart.
Also to reduce handoffs and speed the process for borrowers, Taggart said the company has found it is a best practice to discuss with clients upfront what can be offered to them.
“Obviously every client is different but what we try to do is set up with client to try to determine a value where we think the property would sell at if they choose the short sale option. We discuss with them, have they considered the possibility of modification? If not, would they like us to offer? We speak with them about the possibility of deed in lieu if they would like to forgo the foreclosure process and ask ‘How much cash for cooperation are you going to give the borrower at the end of the short sale cycle if they cooperate with us in terms of showing the property?’”
“We make sure the borrower’s treated professionally, that they know all of their options, that they’re laid out, and really having people go to do the door knocking that are very well versed in all those options,” he added.
“We understand that this is a very tough time for some borrowers,” Taggart said. “Our agents and our neighborhood home consultants are very thoughtful. We’ve gone through and created our own training for our agents. We’ve partnered with a law firm.”
The neighborhood home consultants Green River uses are local, preferred agents it uses on the REO side of the business who must have achieve a certain minimum percentage score on their FDCPA tests and also help with broker price opinions. (Green River also has a BPO company called Infinity Valuation Services.)
In addition to talk about best practices in the short sales and other loss mit areas, Taggart said he is looking forward to seeing at this year’s convention is hard data on what is and isn’t working that was not available in the past when programs were too new.
“A couple years ago the convention was focused on HAMP and ‘we need to modify people’ and there was a lot of talk around HAMP and requirements for it. Then they rolled out HAFA and requirements for it and I think this year there will be more data to support those or data to say, ‘We need to try something different,’” said Taggart, who in the course of his career has worked with analytics on the servicing side of the business as well as on Wall Street with nonperforming loans. “I’m really interested in seeing some of those numbers.”
Taggart’s firm does only peripheral work when it comes to modifications, although when it does it aims to refer borrowers directly and immediately to phone contacts on servicer hotlines, so it does not have data to share in that area. But he can speak to conversion rates for short sales, which he said he is pleased with and have improved since the company reduced handoffs. He feels its training approach has contributed as well.
“When we do a door knock, approximately 80% of the people that we speak with, we get some sort of right-party contact,” he said. “Of those that we speak with, approximately 35%-40%...choose the short sale strategy.”
Knowing data and trends proves helpful with client meetings, which Taggart cited as a key reason for their attendance at shows like MBA servicing. He notes that cash for keys, for example, a data point that is ever-changing and varies depending on local markets is a topic clients often ask him about.
Ultimately, Taggart indicated he is likely to split his time at the show between client meetings and information gathering that might be helpful both when it comes to those meetings and drawing up business strategies.
“We’re going to visit with clients, a lot of people do that. It’s easier to get clients in one general area. We spend a lot of time focusing on meeting with potential clients, making our name known.
“Certain sessions don’t pertain to line of business. We don’t really need to go to those. But anything in short sales, anything in REO asset management, we’ll make an effort. We want to know what our peers are doing, what people in industry are doing so we can get better. We definitely take…those panels in.”
“The MBA always puts on a Fannie Mae or a Freddie Mac update,” he added. “We’re always interested in what they’re doing. We want to see what their thoughts are, if they have a lot of data.”
