Lien release backlogs likely as short sales increase; servicers face recording challenges as GSE guidelines effective November 1 make the short sale process easier and speedier
PASADENA, Calif., Nov. 27, 2012 — /PRNewswire/ — Rekon Technologies, the largest provider of advanced lien release, assignment processing and document preparation software for mortgage servicers, has seen a steady increase in the use of its Rekon lien release software by servicers for short sales, illuminating a trend that has picked up pace this year as lenders seek to minimize losses on defaulted loans and avoid foreclosures. Short sales in the first quarter of 2012 reached a three-year high, according to RealtyTrac, a real estate data firm.
Short sales today are saving lenders and servicers time and money over the alternative of foreclosure. New short sale guidelines effective November 1, 2012 by the Federal Housing Finance Agency for Fannie Mae and Freddie Mac, make the short sale process easier and speedier for lenders and borrowers, but will present new challenges for servicers in getting lien releases executed in time.
“We’re seeing a tremendous increase in the number of short sales we’re handling,” said an executive with a top nationwide sub-servicer, who is a Rekon lien release software customer. “With short sale volume increasing, the ability to create lien releases for short sales around the country with Rekon’s software is so much easier and accurate than doing the work manually. We can avoid lien release backlogs that can be costly.”
The uptick in short sales should gather steam coming into 2013. According to housing analysts, there are still 12 million borrowers whose mortgages have higher balances than the value of their homes. Those struggling with delinquent payments are potential short sale candidates. Also, the new GSE guidelines will allow borrowers who have suffered a hardship such as a job loss to seek a short sale even if they are current on their mortgage payments.
Rekon software helps servicers expeditiously establish the chain of title for short sale properties, bringing transparency and increased speed to the short sales process. The technology empowers servicers to accurately create lien releases and mortgage assignments in more than 3,600 recording districts in all 50 states. The software provides an up-to-date status on the requirements, fees and deadlines for preparing lien release documents in all recording districts nationwide. And Rekon creates a permanent tracking history for all recorded documents in its system.
“The short sales process can be complex and time consuming in the best of circumstances,” said Aurora Marsh, chief executive officer of Rekon Technologies. “Rekon’s software enables servicers to avoid document mistakes and filing miscues when creating lien release documents for short sales that can further delay closings or even add to the dissolution of a short sales transaction.”
Marsh said, “Rekon’s eRecording capability for lien releases in the 750 recording districts across the country that offer it lets servicers smoothly handle the increasing volume of short sales in an orderly process and avoid recording delays. By electronically recording a short sale lien release, a servicer will receive confirmation within 24 to 72 hours, or receive a note that there is a problem with the document and that it must be resubmitted. There is a return notification on every single lien release, which helps expedite short sales, reducing costs for lenders, sellers and buyers.”
“Servicers handling short sales are wise to evaluate lien release technology at this time, as doing lien releases manually is a costly, time-consuming process,” Marsh added.
About Rekon Technologies Rekon Technologies provides advanced software solutions to loan servicers and lenders that prepare, record, manage and track loan documents, such as assignments, lien releases, UCC terminations and trailing documents, among others. Rekon software is used by the largest servicers in the industry and is designed to handle growing volumes of document preparation and recording in the more than 3,600 recording districts in all 50 states. The company’s flagship product and namesake Rekon is a fully automated system for document preparation and management, integrated with imaging and eRecording capabilities, that processes loans from payoff to recording in a paperless environment from anywhere in the world. Rekon also offers DokTrak, the most versatile document tracking and data warehouse technology product available for managing documents in the gap between origination and servicing, resolving issues in post-closing and file certification for securitization. Rekon Technologies is based in Pasadena, California. For more information, please visit www.Rekon.com.
SOURCE Rekon Technologies