With smaller down payment requirements and flexible qualification criteria, FHA loans have become increasingly attractive to first-time home buyers in recent years. While foreclosure rates have been dropping to new lows, FHA-insured loans make up an increasingly larger proportion.1 As a result, property preservation field services for properties secured by FHA-insured loans in delinquency and REO phases present a growing area of risk for loan servicers. However, due to complex FHA guidelines, tight timelines and cost penalties, managing preservation services for these properties is a time-consuming, labor-intensive process that could end in financial loss.
Loan servicers can streamline the conveyance process of FHA foreclosure properties and decrease operational risk and financial loss by utilizing a property preservation company that has a proactive, technology-enhanced approach designed specifically for FHA requirements. This white paper outlines the particular challenges of managing property preservation for FHA properties during the period from delinquency to conveyance and provides an efficient framework based on a deep understanding of FHA guidelines and requirements, a nationwide vendor network and a robust technology platform.