Fiserv unveils tools to help keep borrowers in their homesMortgagePress.comFiserv, Predictive Risk Index Score Modeling, PRISM, Home Retention Solutions
Fiserv, a provider of information technology services to the
financial and insurance industries, has announced the release of
preemptive mortgage default resources including, Predictive Risk
Index Score Modeling (PRISM) and Home Retention Solutions, that
enable financial institutions to proactively identify and contact
troubled borrowers with customized repayment solutions to try to
keep them out of foreclosure.
According to the Mortgage Bankers Association (MBA), the rate of
foreclosure starts and the percent of loans in the process of
foreclosure are the highest recorded since 1979. The number of
homes in the foreclosure process or delinquent on payments is 8.82
percent (6.35 percent past due but not in foreclosure plus 2.47
percent in foreclosure). When faced with mortgage delinquency, due
to high debt-to-income ratios, minimum payment resets on adjustable
rate mortgages, rising living expenses or job losses, many
borrowers fail to contact their financial institutions. Often
borrowers avoid discussions with their mortgage lenders until after
they have missed several payments, a situation that increases the
possibility of foreclosure. Fiserv PRISM and Home Retention
Solutions focus on helping financial institutions forecast
delinquencies, before defaults occur, and provide expanded customer
care to proactively offer refinancing and negotiate workable
resolutions.
"The ability to identify, monitor and create solutions for
at-risk borrowers is critically important to financial
institutions," said James L. Smith, executive vice president of
portfolio services for Fiserv. "It is not economically beneficial
to lenders or borrowers to have mortgage loans enter into
foreclosure. By using Fiserv PRISM and Home Retention Solutions,
financial institutions are better positioned to assess portfolio
risk, cure delinquencies and serve their borrowers. We believe that
in this difficult market, financial institutions that invest
carefully in technology such as PRISM and Home Retention Solutions
will become more efficient and responsive to customer needs, with
the potential to excel as market leaders when the current downturn
starts to improve."
The surge in delinquencies strains the resources of financial
institutions that are already experiencing lower production volumes
and tighter operating margins. By outsourcing loan analysis and
customer contact to Fiserv, financial institutions can meet the
needs of challenged borrowers without having to purchase and deploy
analytic software or employ mortgage default experts.
"Nobody wins when a home goes into foreclosure," said Kristin
Moyer, research director at Gartner Inc. "Banks and servicers need
a better way to deal with both current and future delinquent
borrowers. They need predictive assessment technology in order to
identify borrowers that may be in trouble. They then need to engage
borrowers and provide loan counseling that is focused on home
retention."
The PRISM analysis can provide a glimpse into the extent of the
damage the credit crisis is likely to inflict across a lenders
mortgage loan portfolio. To do this the PRISM analysis classifies
at-risk assets into tiers taking into consideration many data
points, including the Fiserv Case Shiller Home Price Index, loan
servicing data, risk grade and credit, collateral and overall risk
scores. Through this process PRISM is able to identify risky
accounts long before they become delinquent. After an analysis is
complete, financial institutions may decide to have Fiserv perform
more detailed loan-level risk analyses on identified accounts. This
process requires no additional information from the financial
institution and leverages the use of the PRISM data along with AVMs
and other sources. Fiserv default management experts then review
the findings and recommend steps financial institutions can take to
mitigate loss and help borrowers remain in their homes.
Once action plans are developed for the at-risk loans, financial
institutions may choose to refer borrowers to a loan officer for
refinance options or, in the case of a delinquency, to Fiserv Home
Retention Solutions. Home Retention Solutions works one-on-one with
borrowers to negotiate a repayment plan, forbearance or
modification. In cases where it is not in the borrowers best
interest to keep the home, Fiserv experts can take a deed in lieu
of foreclosure or short sale.
If property ownership is transferred to the financial
institution, Home Management Solutions maintains the property and
manages the sale of the asset. Fiserv's real time, interactive
dashboard keeps lenders aware of loan workouts and all loss
mitigation activities.
For more information, visit www.fiserv.com.
