The State Working Group believes more robust approaches to avoid preventable foreclosures are necessary. Servicers, investors, and state officials have opportunities to work together on the following: 

·         Developing a more systematic loan work-out system to replace the intensive   “hands-on” loss mitigation approach. The continued reliance on intensive individual interaction to identify alternatives to foreclosure misses out on opportunities to implement solutions that can reach more homeowners facing foreclosure. A more systematic approach would benefit homeowners and investors by reaching more people with more streamlined solutions. Such an approach would build on the initial effort of the ASF Framework, but cover many more loans. 

·         Slowing down the foreclosure process to allow for more work-outs. Many states have passed or are considering legislation to slow down the foreclosure process and to increase notice to delinquent homeowners. Targeted efforts to slow down subprime foreclosures may give homeowners and servicers more time to find solutions to avoid foreclosure. 

In addition to these efforts, the State Working Group recognizes that federal officials have proposed or are considering legislation, such as permitting judicial modification of loans in bankruptcy and expanding FHA refinancing of subprime loans, that would mark a significant change to the current mortgage servicing dynamics. While we do not endorse any specific federal approach, we support the development of innovative approaches that recognize the extent and scale of the foreclosure crisis.

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

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