By Anthony Garritano

Turning trial mods into permanent mods is a task best achieved by assembling the right technology.

New guidance by Treasury says that now homeowners will have to show documentation regarding income ahead of trial modifications. Why is this needed to build a more successful modification? This revision will ensure upfront — before even the trial modification happens — that the borrower can eventually qualify for a permanent modification. At present, a lot of borrowers are being placed into trial modifications that can't qualify for a permanent mod, but because income verification is being done after the trial mod is set up, servicers don't have all the information needed to determine if a permanent modification is even possible.

Currently most loan servicers are manually attempting to evaluate which loans are candidates for HAMP. This is a very laborious process, riddled with inefficiencies and the potential for mistakes. Once a loan has manually been qualified under the HAMP guidelines, servicers generate a loan modification package, which is distributed to the borrower. Interested borrowers return the package with the required documents to the servicer for processing and underwriting.

Servicers need to embrace technology that enables them to more efficiently meet the ever-increasing need for successfully analyzing and evaluating loss mitigation efforts. To this end, Mortgage Cadence has launched what it calls the Loss Mitigation Gateway, which allows servicers to automatically analyze a bulk set of loans (or on a per-loan basis as needed) against the required HAMP guidelines and automatically generate and distribute loan modification packages for those that qualify.

Mortgage Cadence's Loss Mitigation Gateway allows the user to import a batch of loans to be analyzed against the current HAMP guidelines, run customized analytics to determine which document packages within a batch should be generated for the HAMP modification process, request a HAMP loan modification package be created and distributed to a secure location, request that a review for required loan mod data and documentation be performed by the loan mod underwriter, view a pipeline that displays current loan mods with current status and configure a marketing page within the Gateway with branding/logo options, marketing downloads and information about current service offerings.

Urban Settlement Services, the nation's largest loss mitigation and modification provider, turned to Mortgage Cadence when volumes became too difficult to handle without automation. Jim Smith, president of Urban Settlement Services, said, "As our volumes mounted, we came to the realization that in order to maintain our high level of service we needed to make some strategic changes to how we do business, and in particular find a technology solution that could further automate our processes while delivering validation tools, analytics and document preparation and delivery services."