MReport January 2018

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42 | TH E M R EP O RT SERVICING THE LATEST O R I G I NAT I O N S E R V I C I N G DATA G O V E R N M E N T S E C O N DA R Y M A R K E T Mortgage Organizations' Relief Efforts in Effect Two organizations recently announced how they intend on helping those in need of housing assistance—from the homeless to homeowners facing tax foreclosure. F rom the homeless to homeowners facing tax foreclosure, TD Bank and Quicken Loans recently announced the differ - ent ways they intend on helping those in need of housing relief. TD Bank will assist in financ- ing Project HOME, a nonprofit organization, developed an afford- able housing residence for young adults who have experienced homelessness or are at risk of homelessness, those who have aged out of foster care, disabled or special needs households, and LGBTQ individuals in North Philadelphia. The bank has committed $11 million in total, including a $6.7 million tax-exempt construction loan. Additionally, TD Bank will provide a $4.3 million invest - ment through the Community Capital Group in partnership with Raymond James Tax Credit Funds, a national sponsor of af - fordable housing, with more than $1.1 billion in tax credit equity closed in fiscal year 2017. The money will be used for the construction of a four-story build - ing with 30 one-bedroom apart- ments including a living area, a full-size eat-in kitchen, a bedroom, and a bathroom; property manage- ment and residential services of- fices, among many other amenities. In a separate announcement, Quicken Loans is working to help in their own way—by assisting homeowners avoid foreclosure. With over two thousand Detroit families and households losing their homes due to tax foreclo - sure, Quicken Loans Community Investment Fund (QLCIF) is funding a new $500,000 campaign called the "Neighbor to Neighbor" effort, according to the Detroit Metro Times. Through this campaign, QLCIF and the United Community Housing Coalition (UCHC) will partner with about two dozen com - munity groups and nonprofits in an effort to reach the 65,000 Detroit households behind on their taxes. The "Neighbor to Neighbor" effort involved Quicken Loans' community investment fund partnering with UCHC to knock on the doors of 3,300 residents of Detroit homes facing the 2017 tax foreclosure auction. According to QLCIF, that outreach effort helped residents in 2,100 homes avoid tax foreclosure. "Our goal is to start getting in front of people as soon as they get behind on their tax bill and letting them know that there are networks of support and that things like the poverty tax exemp - tion exist," Laura Grannemann, the VP of Community Investments at Quicken Loans, told Detroit Metro Times. The focus will be on informing homeowners about an underutilized property tax exemption that can reduce or eliminate the tax bill for low-income households. According to Grannemann, only 3,600 Detroit households are currently enrolled in the exemption—despite census data suggesting about 40,000 households could be qualified. Servicers Keen on Performance, Technology, and Regulation in 2018 U.S. mortgage servicers aim to enter 2018 with a strong focus on maintaining performance and enhancing the use of technology in a regulated environment. D espite rising servicing costs mortgage servicers remain focused on per- formance, regulations, and the leverage of technology in 2018, according to a report by Fitch Ratings issued recently. The report, which is based on the U.S. RMBS Servicer Roundtable in New York, says that servicers identified five key performance ar - eas of focus during the roundtable, including preparedness for future industry performance stress, exist- ing service continuity risk in U.S. RMBS, cost of servicing, challenges in comparing servicer performance, and the impact of the 2017 hurri- canes on performance. Approximately 69 percent of servicers at the roundtable responded that they were seeing negative impact after Hurricanes Harvey and Irma earlier this year. However, they agreed that the ripple effect was not as bad as originally feared, even though most of the borrowers in the affected areas lacked flood insur - ance. The servicers indicated that most of the property inspec- tions have been completed and estimated that 5 to 10 percent of loans suffered significant damage. Servicers also agreed that their performance has been enhanced through the use of technology and leveraging it will be their key focus for 2018. According to the report, servicers have been leveraging technology to increase automation and provide efficien - cies to the servicing platform. The availability of new, improved technology has made tracking and dissemination of regulatory changes easier, leading to greater standardization and reduced risk of regulatory noncompliance. While servicing technology re - mains expensive and burdensome to implement, it can increase busi- ness efficiency. Servicers said that they con- tinued to invest in technologies and processes to make servicing transfers less disruptive, which should help to ensure smoother RMBS transaction cash flows. Approximately 75 percent of the roundtable attendees indicated that new technologies have proved ben - eficial in servicing transfers. Control over servicing costs and the increase in the number of states scrutinizing servicers are other trends for 2018 the servicers identified.

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