FHFA OIG Recommends More Efficient Pursuit of Deficiencies

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Reports like this are getting old. Freddy Mac lets 4 Billion dollars just melt away with no effort to recover it and Fanny Mae does the same thing with over 2 billion dollars of your tax money. They blame it on the people that are servicing the foreclosures but in reality they are the ones that these people work for.

If you can’t oversee your employees then you’re should be out and let’s find someone who can. As far as anything can be found by searching records no one has been disciplined for this foul up let alone fired. What would your boss do if you lost 4 billion dollars without any effort to recover it? GSE’s answer is – we’re sorry we will try to fix it by next year. Please read the article below.

The FHA Condos Approval Company, Inc.

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The Office of the Inspector General (OIG) of the Federal Housing Finance Agency (FHFA) has issued a pair of reports critical of the GSEs’ efforts to collect billions of dollars in deficiencies from underwater homeowners who walked away from their mortgages.

“If either the foreclosure sale’s proceeds or the value at which [the GSE] records a property in its real estate owned portfolio is less than the borrower’s mortgage loan balance, the shortfall (or deficiency) represents a loss to [the GSE],” one of the reports explained. “Such losses can be reduced if the enterprise recovers deficiencies from borrowers who possess the ability to repay. Enhanced deficiency management practices can also serve as a deterrent to those who would choose to strategically default on their mortgage obligations.”

The reports found that Freddie Mac did not refer nearly 58,000 foreclosures with estimated total deficiencies of approximately $4.6 billion to its deficiency collection vendors. Between January 2010 and June 2012 Fannie Mae failed to pursue 26,000 foreclosures that had an average deficiency of $79,000.

In most cases the collection of deficiencies was abandoned because of state laws limiting the amount of time that can pass between a foreclosure sale and a collection action. Delays in collecting and processing paperwork often allowed this statute of limitations to pass.

To read the complete article please use the link below.

Efficient Pursuit of Deficiencies

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