An interesting article from the New York Times about the growing power of mortgage servicers in deciding which get a mortgage modification and which must hand over their home in a foreclosure. The servicers are also forming relationships with companies that can benefit from foreclosures.
These specialty servicers are buying the rights to collect mortgage payments at discounts. The quicker the servicer can make the loan current again, the sooner investors pay back the servicers’ advance in full. This may incentivize servicers to offer modifications that cause borrowers to default again.
For the full article click here: www.nytimes.com