An award-winning specialty servicer and a national attorney group have teamed up to create a program aiming to help lenders comply with foreclosure legislation.


Wingspan Portfolio Advisors, LLC, a Dallas-based mortgage servicer specializing in highly delinquent loans, and the American Financial Network (AFN), a national network of mortgage banking and legal professionals headquartered in St. Louis, recently announced the launch of their national residential property receivership program.

The goal of the program is to provide lenders, investors, and servicers solutions to the problems arising from the Protecting Tenants at Foreclosure Act (PTFA). Signed into law in May of this year, PTFA presents the financial services community with new and potentially dangerous risks related to servicing certain types of residential properties, and creates an additional layer of duties that some lenders, investors, and servicers are ill-equipped to undertake when foreclosing on properties, according to the program’s founders.

“When borrowers own property, they are required by the lender to make payments and maintain insurance to safeguard the home,” William LeRoy, president and CEO of AFN explained. “Under the new legislation, when lenders take the property back, many new responsibilities shift to them. They include duties to tenants, who are often the previous owners, and to local municipalities, which impose penalties if the real estate is not properly maintained.”

LeRoy added that the requirements of the new legislation have heightened the responsibilities and legal risks of investors, servicers, and lenders who are generally not prepared for them. While in most states, courts appoint receivers to perform these necessary duties, the national residential property receivership program has been created to specialize in assuming these responsibilities.

Steven Horne, CEO of Wingspan Portfolio Advisors, said, “Receivers stand in the shoes of the lender and administer the needs of the property. They are often the best option for lenders when faced with the challenges of servicing tenant-occupied properties, impaired or abandoned houses, or properties with unfinished construction.”

By creating a unique residential receivership department and utilizing its preferred attorney network relations with AFN, as well as its own property management capabilities, the goal of Wingspan is to ensure the needs of any investor, lender, or residential loan servicing company are met. Servicers and investors who utilize this new program can be ensured that the receiver is operating with the independence required by the court and in compliance with the new legislation.

“It is a powerful alternative to servicers taking immediate possession of foreclosed properties,” Horne said. He explained that the legal and regulatory demands of applicable city, county, and state governments are frequently beyond the expertise of property managers and non-specialist loan servicers.

According to LeRoy, the program can assist lenders and servicers in a majority of the foreclosures around the country. He expects courts to experience tremendous demand for qualified receivers to help prevent communities from becoming blighted and keep properties in safe, saleable condition.

“Bringing together the servicing and legal skill to provide focused, expert receivership capabilities makes tremendous sense in the effort to safeguard tenants, preserve communities and ensure compliance for all parties with these challenging laws,” LeRoy said.

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