Geithner, Donovan Reach Out To Servicers

Posted by Orb Staff on July 13, 2009 No Comments
Categories : Mortgage Servicing

ies participating in the government's Making Home Affordable (MHA) program are expected to meet with Treasury and Department of Housing and Urban Development officials later this month to discuss the program's progress and ways of solving administrative impediments. In a letter to the servicing companies' CEOs, secretaries Tim Geithner and Shaun Donovan wrote that they believe there is "a general need for servicers to devote substantially more resources to this program for it to fully succeed and achieve the objectives we all share." Federal officials and MHA servicers are scheduled to meet July 28, according to a copy of the [link=http://graphics8.nytimes.com/packages/pdf/serviceletter.pdf][u]letter[/u][/link] posted on The New York Times' Web site. The secretaries' message to servicers arrived shortly after [link=http://www.mortgageorb.com/e107_plugins/content/content.php?content.3840][u]Senate Democrats[/u][/link] took Geithner to task for MHA's slow implementation. A June 24 correspondence from 20 senators to Geithner expressed their concern about the difficulty homeowners are having in accessing MHA. "The administration must keep pushing to ensure that servicers' public pronouncements translate into relief for homeowners," said Sen. Jack Reed, D-R.I. Geithner and Donovan's letter requests MHA companies to designate senior liaisons, who will be responsible for working directly with the federal departments, before the July 28 meeting. The liaisons are expected to have authority to make decisions on behalf of their CEOs and to make suggestions on improving the program's design. The Treasury says it will begin issuing monthly reports with servicer-specific performance measures by Aug. 4. The reports will include data on the numbers of trial loan modification offers, trial plans under way and final modifications. The secretaries also said in their letter that they plan to set "more exacting operational metrics" to measure the program's performance. Metrics will include average borrower wait time for inbound calls and response time for completed applications. The Treasury has also tapped Freddie Mac, the program's compliance officer, to develop a "second look" process, whereby the company will audit a sample of MHA modification applications that have been declined to determine whether servicers took appropriate actions. Geithner and Donovan's letter offered servicers a final suggestion leading into the July 28 meeting: boost your capacity. "This will require adding more staff than previously planned, expanding call centers beyond their current size, providing an escalation path for borrowers dissatisfied with the service they have received, bolstering training of representatives, developing extra online tools and sending additional mailings to borrowers who may be eligible for the program," the letter says. SOURCE: New Yor

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