InsightsServicers Prep For Moratorium Lifts & Default Servicing Technologies

Default Servicing Technology

As they ready for the financial impact of the COVID-19 pandemic, mortgage servicers and investors are putting their experience from the 2008 housing crash to use by focusing on the creation of positive outcomes. Servicers are leveraging trusted partnerships and default servicing technologies to prepare for impending defaults.

Today, unlike 2008, legislation, such as the CARES Act, investor, state and local foreclosure and eviction moratoriums – added a layer of complexity and paused the majority of foreclosures and evictions. Whereas in 2008 the housing industry saw huge spikes in default volumes, today servicers and investors are keenly aware of what is in their pipeline and where performance is with all of their loans. There is the unique outreach opportunity to provide options to borrowers – and today’s servicers are poised with solutions.

“Technology is key to staying ahead of this influx of volume,” says Steve Crocker, SVP, Pre-Foreclosure, ServiceLink. “There are so many different third-party resources out there to help, not only for servicers and lenders, but for law firms. Title companies are also coming up with far more integrated and automated solutions. That in itself has really prepared our industry immensely as we address the changes presented by the COVID-19 pandemic.”

From loan modifications and foreclosure to post-foreclosure and other liquidation paths, the default industry is closely monitoring borrower behaviors. For example, isolating those borrowers who became delinquent before and during COVID. Borrowers are faced with reinstatement, deferrals and/or repayment plans. For those who cannot qualify for these solutions, loan modification, deed-in-lieu and short sales are their best option to avoid foreclosure. ServiceLink has seen these steps being taken by our clients now as they prepare for possible increases in delinquencies.

“We work with servicers and investors today who have borrowers that are in some kind of crisis – and we predict a significant increase in volume in the coming months,” says Amy Borsi Daniel, SVP, REO, ServiceLink. “Deed-in-lieu options offer a better alternative for both the borrower and servicers over foreclosure. By negotiating liens down and deeding the property back, we can often save money as well as minimize borrower hardship.”

Securing these servicing partnerships in advance of the pending default volume is essential. And, it’s also the right time for servicers to improve decision-making ability by using predictive modeling and bleeding-edge default servicing technologies. Until recently, many servicers were constrained by lack of full transparency into their portfolios, unable to easily compare disposition options and make informed strategic decisions.

With EXOS One Marketplace™, servicers can view their entire portfolios at a glance. EXOS One Marketplace™ combines technology and transparency to allow servicers and investors to make faster and better-informed decisions with their assets. Their entire portfolios are easily available, allowing them to monitor and manage properties, compare disposition options, and adjust their strategies as needed. Traditionally complex manual processes have been replaced by machine learning and artificial intelligence, allowing this technology solution to dramatically reduce time, cost, and effort.

While servicers are always concerned with mitigating risk, streamlining operations, minimizing losses, reducing costs and elevating the borrower experience, today’s extraordinarily active and challenging marketplace is truly putting them to the test in each of these areas. Those whose portfolios are growing in number and/or the variety of properties face the added challenge of managing this new influx without slowdowns or errors. Again, now is the time for servicers to leverage partnership and transformative technology to prepare.

“Our goal is to help with the sheer volume our servicer and investor clients will face in this moment in history,” says Crocker. “We do that by putting our technology solutions to work to improve the overall borrower experience and streamline the process at the same time. Things may get worse before they get better but having trusted partners internally and externally is a positive first step. Since the COVID-19 pandemic became more widespread in March 2020, we’ve listened to our clients and have continued to enhance our products, reporting, technology offerings and grown our staffing levels to help prepare our partners with new technology and workflows to be positioned to handle expected volumes.”

“FACT SHEET: Biden-Harris Administration Announces Initiatives to Promote Housing Stability By Supporting Vulnerable Tenants and Preventing Foreclosures.” The White House, The United States Government, 24 June 2021,

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