Person of the Week: Prommis’ Denis Brosnan On Borrower Communication

s week, MortgageOrb catches up with Denis Brosnan, CEO of[/b] Prommis Solutions, a Georgia-based business processing outsourcing provider. Brosnan sheds some light on Prommis' loss mitigation practices, touching on modifications and the ever-important topic of borrower communication. [b]Q:[/b] Media reports indicate that borrower-servicer communications are strained. Homeowners get inconsistent messages (i.e., the cable-company effect) and receive repeat requests for documents that have already been sent to servicers. How can servicing shops maintain healthy communications in this confusing environment? [b]Denis Brosnan:[/b] Certainly, maintaining healthy borrower communication is difficult at this time. At Prommis, we have found the best way to maintain positive flows of communication is to proactively contact the borrowers. While this requires more time up front, a simple phone call or outreach letter can be instrumental in reducing borrower anxiety and confusion over documents. Our company attempts to make a welcome call to the borrower upon receipt of the initial package. The phone call involves general education on the process and immediate notification of any missing documents. Prommis also utilizes a Web portal in order to allow borrowers up-to-date information on the exact status of their financial package. Borrowers can easily upload documents directly to the portal, which creates a streamlined process for collecting financial information. This, in turn, reduces internal document management issues. [b]Q:[/b] Evictions – always a sensitive topic – are under a particularly bright spotlight nowadays. What must servicers keep in mind if they wish to avoid potentially costly lawsuits, as recently seen in [link=http://www.bizjournals.com/sanfrancisco/stories/2009/06/29/daily90.html][u]Oakland[/u][/link], Calif.? [b]Brsonan:[/b] In the current environment, it is extremely important for servicers to stay abreast of the evolving legal requirements related to evictions in each state and county. Servicers wishing to avoid costly lawsuits must maintain relationships with expert co-counsel in each state. At Prommis Solutions, our Eviction processing teams are assigned to specific states which ensure proper processes are followed. [b]Q:[/b] One of your chief duties at your former company, E-A-G Consultants, was to advise clients on technology selection and implementation. How would you characterize the systemic changes that shops have had to make in response to the Obama administration's Making Home Affordable program? [b]Brosnan:[/b] We've heard that servicers have had to devote considerable resources to changing document templates and to configuring specialty loss mitigation systems to govern the ROI analysis process under the new law. Some servicers of course still use the base servicing system to support their loss mitigation efforts – my guess is that these shops will have to invest in some sort of case management product to manage any degree of volume under the program. [O]ur case management technology allows us to rapidly configure business rules in light of environmental changes like the new law without having to engage in new technical development; this capability has enabled us to help servicers that would otherwise have to invest in their own systems. [b]Q:[/b] Among the loss mitigation services provided by Prommis are short sales and deeds-in-lieu. Has either of these seen an increase in action since the Treasury announced its non-retention foreclosure alternative incentives, or is it still too early to gauge the incentives' impact one way or another? [b]Brosnan:[/b] We have not seen much change in the deed-in-lieu option; however, our short-sale volume has increased. This may be due to the servicer incentive program, but at this point, it is probably too early to tell. If the current trend continues, it is safe to assume this impact is due to greater servicer participation. [b]Q:[/b] The most recent mortgage metrics report put out by the OCC and the OTS shows an increase in payment-reducing modifications. How do you expect the type of modifications performed will evolve over the coming months? Do you believe the administration is on the right track with its emphasis on modifications? [b]Brosnan:[/b] [W]e have seen an increase in payment-reducing modifications. We expect this trend to continue, and possibly even expand to other creative options, including principal reductions and step-rate reductions. Due to the current mortgage climate, it is likely that payment-reducing modifications will become the industry standard. We support this trend as loan modifications can re-establish cash flow stability and term payment feasibility, while preserving property value and homeowne