This is a single-family/residential course.
Before a property becomes real estate owned (REO), there are a number of potential loss mitigation solutions that should be explored to assist a distressed homeowner to retain ownership while minimizing loss for the mortgage servicer and investor. Unfortunately, some borrowers continue to experience difficulty meeting payment obligations despite loss mitigation efforts. In extreme instances, this may lead to a foreclosure or a deed-in-lieu of foreclosure, which results in a loss for all parties: borrower, investor, and servicer.
Once a loan has been through default, delinquency, loss mitigation, and foreclosure/deed-in-lieu, the property is usually sold at the foreclosure sale. If the property is not sold to a third party at the foreclosure sale, and the borrower does not recover it in redemption, the property becomes real estate owned (REO) and is managed by the servicer. As manager of the REO property, the servicer continues to mitigate loss to the investor and servicer until the property is sold and is no longer in the REO inventory.
This course provides a general introduction to REO and the servicer's REO processes. It begins with a review of the history and evolution of REO. Next, it reviews the role of REO in investor and servicer portfolios. It then provides an overview of the REO process, from acquisition and boarding through the REO sale. Toward the end of the course, it explores vendor management, which is a continual challenge for REO servicers. At the end of the course, it describes today's REO market and the market outlook for the future.
History of REO
Role of REO in Investor and Servicer Portfolios
The REO Process
Seat time approximately one (1) hour.