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- Alexander Solzhenitsyn (1918 - 2008), Russian Novelist and Historian, Awarded Nobel Prize in Literature in 1970
As dedicated default industry professionals, REOMAC® members have stood ready during the last 3 years for an influx of real-estate owned properties. After enduring the biggest mortgage meltdown and foreclosure crisis since the Great Depression, intuition and conventional wisdom told us that REOs would soon flood real estate markets. Even now with government intervention and severe public pressure, the number of short sale cases and other forms of loss mitigation are diminutive compared to the overall avalanche of loans in default status. If loans cannot be cured during the default process, then where else could they go, except into REO status?
The record number of defaulted loans continue at all-time highs. Loss mitigation efforts continue at minimal success levels. And yet, the REOs still haven’t come.
This lack of REOs has caused turmoil in our industry and for us personally as REOMAC® members struggling to survive during this drought. Make no mistake: Loan servicers, outsourcers, title companies, attorneys, field services companies, real estate brokers, and closing services providers are all struggling today due to lack of business volume. They are struggling to maintain their platforms, systems, employees, and capacity.
In the face of what we still expect to be unprecedented levels of REOs in the near future, we have a number of members who are laying off tenured, valuable employees or putting their companies up for sale. They are unable to maintain their professional staff with such low levels of business volume. From a personal standpoint, layoffs and exits are tragic; where business is concerned, our industry may be crippled with lack of capacity to meet high foreclosure volumes in the near future.
In the face of what we still expect to be unprecedented levels of REOs in the near future, we have a number of members who are laying off tenured, valuable employees or putting their companies up for sale. They are unable to maintain their professional staff with such low levels of business volume. From a personal standpoint, layoffs and exits are tragic; where business is concerned, our industry may be crippled with lack of capacity to meet high foreclosure volumes in the near future.
Despite this life-and-death business situation, as REOMAC® members we cannot compromise our commitment to ethics and fair business practices. In times of need, ethical lapses are magnified. The industry has asset managers who accept gifts from real estate brokers, field service contractors who charge for services not rendered, or attorneys who collude with local courts or other parties in order to extract the highest fees.
I am urging all REOMAC® members to continue to do what is right, despite the overwhelming hardships we are facing both personally and in business. Our industry is plagued with possible ethical lapses and indiscretions. Whatever the case, whether it is a clear RESPA violation or a situation that is more gray, as REOMAC® members we must do what is right. Your business viability and REOMAC®’s reputation as a non-profit association depends on it.
As REOMAC® President, I am proud to be associated with you. On behalf of the Board of Directors, thank you for the opportunity to serve REOMAC®, especially in its 25th year. All my very best to each and every one of you, our REOMAC® members.
Ivan Choi
2010 REOMAC® President
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