As part of the Obama administrationâs initiative, the U.S. Department of the Treasury created the Home Affordable Modification Program (HMP) as part of the Making Home Affordable program. Government Sponsored Enterprises (GSEs), Fannie Mae and Freddie Mac, were named as the administrators of the HMP. Designed to help as many as three to four million distressed homeowners avoid foreclosure by modifying loans and monthly mortgage payments to an affordable level, the program provides clear and consistent guidelines that the mortgage industry must follow.
The Loan Servicing Platform is an example of Fiservâs processing services core competency and utilizes integrated default management tools that allow servicers to track and study the loans being modified. With this knowledge, servicers can formulate best-option workout scenarios based on operational business rules while meeting HMP guidelines. âFiserv has been fully engaged with the Treasury and GSEs in order to provide all the functionality to meet the programâs specific requirements,â said Greg Fontenot, assistant vice president, Loan Servicing Solutions, Fiserv. âOur continual investment enabled our Loan Servicing Platform to deliver the flexibility and capability required to meet the HMP guideline as soon as it was announced in March.â
Over the past 24 months, Fiserv has focused on enhancing the loan modification and loss mitigation features of the Loan Servicing Platform. The platform has support built into the core system that helps servicers determine if the borrower is eligible for an HMP modification, and was positioned to support HMP guidelines from the start. Platform capabilities include built-in loss mitigation workflow tools to streamline operations and increase efficiency, GSE investor reporting, secure electronic delivery of documents and full escrow analysis processing, among others. In addition, several enhancements are underway, including additional deferred principal functionality, enhanced ability to gather personal financial information, and an HMP-specific screen to present a full picture of the modified loan.
âMaintaining a competitive position when working with distressed borrowers requires efficiency, flexibility and accurate information delivered in real-time,â said Fontenot. âUnder HMP guidelines, defaulted loans must be evaluated one loan at a time. The challenge for servicers is to maintain uniformity and consistency in the qualification process, even as volumes increase and workflow processes change. Fiservâs technology has the ability to coordinate more parts, paper and data sources and keep up with the revisions to the program.â
HMP is effective for mortgages originated on or prior to January 1, 2009, and will expire on December 31, 2012.