Section III. The State Working Group’s Next Steps and Future Reporting

The State Working Group anticipates future reporting on the data collected from servicers. The State Working Group will continue to collect monthly data from Reporting  Servicers in order to provide public information on trends in the servicing industry as we move through this foreclosure crisis. As this first report was going to press, the State Working Group completed the collection of data for November 2007 servicing activity, and that data should be forthcoming on the Conference of State Bank Supervisors’ website at www.csbs.org.

A preliminary review of the November 2007 data suggests that subprime and Alt-A delinquency rates continued to rise in November; however, loss mitigations in process failed to keep pace. The November data also indicates that the overwhelming number of resolutions continues to be due to the efforts of the borrower. These early trends confirm our concern with servicing staffing levels and the inadequacy of current efforts to prevent unnecessary foreclosures.

In addition, the State Working Group intends to update its data request to begin tracking information related to the loans covered by the ASF Framework and other commitments made by servicers regarding their practices. Since these programs are just now being implemented, we may be a few months from seeing measurable outcomes from those efforts. The State Working Group supports the ASF’s efforts in both developing methods for modifying more loans and in tracking outcomes, and we hope they continue to expand the numbers of loans that merit the fast-track approach. Given the increasing negative trends in the performance of loans other than subprime hybrid ARMs, such as payment option ARMs and Alt-A loans, we need to move quickly to address the subprime loans so we can begin to expand our efforts to deal with these other types of loans needing attention.

The State Working Group continues to seek cooperation from a few servicers that have refused to provide this important data to our group. In particular, we ask the Office of the Comptroller of the Currency to urge national banks to provide this data to the State Working Group. The State Working Group has repeatedly emphasized that this is a voluntary and cooperative effort to prevent unnecessary foreclosures and has made assurances to the participating servicers that the State Working Group is not attempting to exercise jurisdiction over national banks or federal thrifts. Furthermore, we believe the HOPE NOW data collection effort complements our data collection efforts and that our projects are not mutually exclusive. In our view, this crisis is too important to waste time on turf battles between regulators.

Finally, the State Working Group will continue to work directly with the top twenty subprime servicers to remove barriers and obstacles to increasing the numbers of loan modifications. It is our sense that many servicers are making positive efforts to avert foreclosures, but that we are still losing the larger battle to stop unnecessary foreclosures and stem the foreclosure crisis.

The Foreclosure Fraud Alert Website http://www.foreclosurefraudalert.com/

The Foreclosure Fraud Alert Blog  http://www.foreclosurefraudalert.com/fraudblog