According to the Mortgage Bankers Association, nearly 10% of mortgage loans are either delinquent or in foreclosure. Although many states now have foreclosure inventory rates that are back to pre-crisis levels, other states have foreclosure rates that are two to three times the national average. Mortgage defaults are an unfortunate reality for borrowers and mortgage professionals alike. In an effort to understand why defaults occur and what steps businesses can take to prevent them, we have researched the leading causes of this epidemic.
Stated simply, unfortunate things happen to good people. Many times mortgage defaults are caused by unfortunate things happening to good borrowers: loss of a job, illness, death, divorce, and other things that disrupt lives. Mortgage defaults are a major setback for mortgage professionals. The industry wants to know why mortgage defaults occur. Mostly the mortgage investors or mortgage insurance companies want to find out if there were any poor lending practices during the loan process or if the file contained material defects. From Quality Mortgage Services experience, the majority of the discoveries we find are unfortunate events that occur in the borrower’s life which exonerates our clients from the presumption of writing risky or bad mortgage loans. However, loans made during the subprime days and during economic instability, we have found that many of the loans met the underwriting requirement and the culmination of the economy caused borrowers to default on their mortgage.
Quality Mortgage Services has found a number of loans that did contain mortgage fraud for housing and other loan officer manipulation. However, this is not the norm or standard practice of our client’s loan production.
Mortgage Servicing QC
CFPB Regulatory Audits
Mortgage Compliance Services
At Quality Mortgage Services, we work hard to assess risk and provide solutions to the mortgage industry. Our compliance officers are dedicated to making sure that auditors have the tools necessary to conduct loan servicing audits, reviews and mortgage quality control. Armed with the knowledge and skills necessary to succeed, we provide comprehensive mortgage loan analysis.