Mortgage Servicers:

  • Maintain contractual agreements with investors to service their loan portfolio. These are commonly referred to as ‘Pooling & Servicing Agreements’ or PSA’s for short.
  • Are contractually bound to maintain the investors’ fiduciary best interest, and on occasion, with blatant disregard for the homeowner’s well-being.
  • Generate profits by churning accounts, delaying or denying resolutions, constantly imposing conditions which are often repetitive, time-consuming, or subject to error. By doing so the Mortgage servicer is able to increase the charging of late fees, penalties, and transaction fees on your loan over an extended period of time. Ultimately, the investor and/or homeowner are the ones footing the bill.
  • Benefit from loans in default status – instead of .25 basis points commission on interest earned, the Mortgage servicer is paid 1.25 basis points commission on interest earned and collected if a loan is in default.
  • Often fail to disclose alternative options which may benefit you or the investor, promoting a foreclosure-driven environment.
  • Most Mortgage Bank and Mortgage Servicer business models are based on foreclosure and asset preservation to the degree that internal bias hinders the servicers’ ability to maintain objectivity when approached. This approach only adds to the bewilderment because the Mortgage servicer is resistant to other financially viable alternatives which may appeal to the homeowner and the Investor alike.
  • sd

 

Mortgage Investors:

  • Maintain contractual agreements with Mortgage servicers and banks to service their loan portfolio. These are commonly referred to as ‘Pooling & Servicing Agreements’ or PSAs for short.
  • Are contractually bound to maintain a securitized portfolio of loans for their shareholders, including, but not limited to, preservation of assets and maintaining profitability. Private Mortgage investors on the other hand exercise discretionary control over decision-making of loans based on their own criteria, but both types of Mortgage investors all too often lack the necessary knowledge of alternative work-out options such as those addressed in the LDA Report.
  • Often fail to disclose alternative options which may benefit the home owner other than foreclosure, and often proceed in said direction as a result of fear of losing equity on investment and/or breaching the terms of the securitization agreement with their shareholders.
  • Most Mortgage Investor business models focus on are based on asset preservation through  foreclosure to the degree that internal bias hinders the Mortgage investors’ ability to maintain objectivity when approached  with the possibility of considering alternative work-out plans.