Interview: Q&A with Joe Chappell, Executive Vice President of Operations, Covius

Recently, we had the opportunity to chat with Joe Chappell, EVP of Operations at Covius. With their deep connections in the title and default industry, we decided to take advantage of our time with Joe and share some of his insight on the foreclosure industry at large as it stands in 2023.

NetDirector: As a title provider that works with foreclosure attorneys and leading servicers nationwide, how do you see the default landscape for 2023 and beyond?

Joe Chappell: Servicers ask themselves this question every day. For the last three years, COVID-19 forbearance rules have significantly reduced foreclosure activity. Just when it looked as if these rules were about to expire, the CFPB and FHFA said they want servicers to continue to take all possible steps, including offering COVID-era forbearance, to distressed borrowers, whether that distress was due to COVID or not.

As a result, we are seeing servicers take extraordinary measures, including re-modifying existing loan modification terms to prevent consumers from defaulting on their loans and to protect them from foreclosure.

At the same time, some sectors of the economy, like tech and finance, are definitely under pressure, and housing prices are slowing and, in some markets, declining. Does this mean we’re headed for a full-blown recession? At the recent MBA Servicing Conference, our company hosted an event that featured Mark Zandi, Chief Economist at Moody’s. His opinion, shared by some of our servicer clients, is that we’re headed in a “slow-cession”, not a full recession (he put the chance of a recession at 45%).

What might this mean in terms of foreclosures? Mark believes that foreclosure activity could level out at pre-pandemic levels plus a potential 5-10%. This aligns with what our servicer clients are preparing for.

ND: Your firm prepares thousands of property reports and default title policies per month.  What are common title issues that create problems for attorneys?

JC: Recently, we had our default title group look at the issues that they cure for some of the nation’s largest servicers. What they are encountering is similar to the issues and frequency of those issues faced by foreclosure attorneys.

Here’s the summary:

Common Issues	Typically needed to resolve	Percentage
Senior Liens	Policy or release	50%
Junior Liens	Payoff or release	8%
Legal Description/Encroachment issues	Survey or easement	8%
Deceased owner	Death Certificate/Probate/Affidavit of Heirship	7%
Gaps in Chain of Title	Owner’s Policy/sometimes loan policy	5%
Gaps in Assignment Chain	Missing Assignments	5%
Marital Status	Divorce Decree or RMA (Request for Mortgage Assistance)	5%
Mobile Homes	Affixation requirements by state and retire MH title	5%
Bankruptcy Issues, Tax Sales, HOA Foreclosures	Order Authorizing DIL (not order of relief form stay- only works on foreclosures)Redemption Payoff or Deed from Tax sale purchaserDeed from HOA	<3% each

ND: Property reports are all the same, right? Or am I missing something?

JC: Up to a point, that’s the case. But, like everything these days, technology is accelerating the process and enhancing what we deliver. For example, Covius Settlement Solutions is now integrated with Flueid’s Decisioning Engine. This allows us to deliver a property report in as little as 45 seconds rather than the average three days. And we can do this with the majority of property report orders we receive.

Our new analytics also provide a more comprehensive view of the property that evaluates multiple waterfall options from modification, deed in lieu, short sale through foreclosure, to qualify the property. These expanded analytics deliver more insight to our attorney and servicer clients and provide the best alternatives to the consumer.

ND: In your opinion, how can foreclosure attorneys maximize their usage of NetDirector?

JC: NetDirector has always been a critical tool to accelerate the ordering and delivery of critical default products and services, saving attorneys and staffers time and money. In our case, this has primarily involved property reports utilized by captive or servicer-directed title companies requiring default title products and services.

But what users do not always realize is that there are a range of necessary adjacent services that foreclosure attorneys could order and have delivered through the platform. In fact, through Covius’ integrations, an attorney can also order document services, title curative, correct assignment breaks, mail room services and even list a property for auction.

Foreclosure attorneys can save time and enjoy a consistent, standardized experience by finding the right partner(s) and then accessing for multiple services through NetDirector.

Town Title Agency Partners with NetDirector to Provide Centralized Title Services.

Partnership will create a streamlined, automated foreclosure search process.

PARAMUS, NJ – Town Title Agency, a New Jersey-based provider of commercial and residential title insurance and settlement services, announced today a new partnership with NetDirector, a leading provider of data exchange and integration services for the mortgage and title industry.

Through this partnership, Town Title will become a vendor on NetDirector’s centralized data exchange network for title requests and responses. This will allow Town Title to efficiently and securely manage its interactions with a growing network of industry vendors and foreclosure law firms, streamlining the title search and settlement process for customers across the tri-state area.

With decades of experience handling complex title work for commercial properties, Town Title Agency is uniquely positioned to offer high-quality foreclosure searches to law firms across the tri-state area. While headquartered in Paramus, NJ, the company can provide specialized searches in New Jersey, New York, and Pennsylvania.

About Town Title Agency

Town Title Agency is a leading full-service title insurance agency founded in 2002. They have processed over 25,000 title searches, offer national commercial services for real estate transactions, and have direct licensure in 15 states to provide streamlined services to clients nationwide. They are agents for Chicago Title Insurance Company, First American Title Insurance Company, and Stewart Title Insurance.

About NetDirector

NetDirector provides a centralized data exchange for a growing network of vendors, attorneys, and mortgage lenders. By leveraging a cloud-based platform and deep industry expertise, NetDirector simplifies and streamlines data exchange, enabling partners to focus on their core businesses and achieve greater efficiency and automation.

Working Together

Town Title Agency will be able to utilize NetDirector’s platform to efficiently process foreclosure title searches through automation.

No longer receiving full borrower SSN? We can help!

Recently, major servicers in the industry have begun to change their policies around providing PII, especially in regard to providing the full borrower SSN to the attorney network.

Thankfully, NetDirector can help overcome the limitations this might otherwise impose. With the use of our SSN Finder service and other partial information, we can still make PACER Bankruptcy searches and SCRA Military Searches for borrowers even with minimal PII. These automated, fully integrated services ensure your firm is ahead of the compliance curve regardless of what the servicer provides.

Interested in learning more about SSN Finder or any of our other additional services beyond just integration? Reach out to our National Account Manager Gretchen Borer via phone or email at the contact information below to book a meeting today!

Our integration reporting and management interface, TranSend, just got a huge upgrade!

With new features and visual improvements around mapping, reporting, and visualizing your various connections, the newly-upgraded TranSend is your go-to tool for all your integration needs.

Want to dive deeper into the new TranSend? Schedule a demo and a full analysis of your current integrations today!

For more information, and to learn about upcoming expansions of extraction functionality, contact our integration experts.

NetDirector Exceeds Rigorous Industry Security Standards
with SOC 2 and HIPAA/HITECH Audit Completion

Tampa, FL – January 11, 2023 – NetDirector, a cloud-based data exchange and integration platform, has once again completed the extensive process of renewing SOC 2 ® and HIPAA compliance examinations with the help of international security audit firm, A-LIGN. NetDirector was recently awarded with complete attestations in compliance with HIPAA, HITECH, and SOC 2 Type II standards, the leading security standards in both Healthcare and Mortgage Banking.

The SOC 2, or System and Organization Controls 2, is an examination under AICPA standards designed for technology service companies to demonstrate controls around data security and processing integrity. The SOC 2 reports are intended to meet the needs of a broad range of users (particularly those in legal, healthcare, and other industries with stringent regulations) that need to understand internal controls at a service organization as it relates to security, availability, process integrity, confidentiality, and privacy. The Type II report is a report on management’s description of a service organization’s system and the suitability of the design and operating effectiveness of controls.

The Health Insurance Portability and Accountability Act, or HIPAA, defines policies and procedures, as well as processes, which are required of companies that store, process, or handle electronic health information that is considered “protected” (ePHI). HIPAA compliance is essential for both technology service providers and integrators like NetDirector, as well as providers, electronic health records systems, billing platforms, and any other entity who might have access to healthcare data even in passing.

The Health Information Technology for Economic and Clinical Health (HITECH) Act was created to promote and expand the adoption of health information technology, specifically, the use of electronic health records (EHRs) by healthcare providers. The HITECH Act also removed loopholes in HIPAA by tightening up the language. This helped to ensure that business associates of HIPAA covered entities were complying with HIPAA Rules and notifications were sent to affected individuals when health information was compromised.

Both the SOC 2 and the HIPAA audit were performed by Tampa-based global cybersecurity and compliance professional services provider A-LIGN. A-LIGN specializes in helping businesses across a variety of industries navigate the complexities of compliance audits and security assessments, and both the SOC 2 and HIPAA reports of A-LIGN’s findings can be made available to prospective or current customers.

“Our team is committed to security and safety for both our internal data, and the client data we move across systems,” said Harry Beisswenger, NetDirector CEO. “We consistently stay ahead of the curve on security and compliance, and we work diligently all year round to ensure our customers have peace of mind when NetDirector is handling their integrations.”

Company Bio:

NetDirector provides a secure cloud-based data and document exchange solution for the healthcare and mortgage banking industries to deliver seamless data integration between parties. NetDirector bridges gaps created by disparate systems & technologies by allowing companies at any location to share data & documents securely over a single internet connection with any other member of the ecosystem. Our approach allows trading partners to collaborate and exchange data in a seamless, bi-directional, real-time manner. NetDirector currently processes more than 18 million transactions per month.

About A-LIGN

A-LIGN is a technology-enabled security and compliance partner trusted by more than 2,500 global organizations to help mitigate cybersecurity risks. A-LIGN uniquely delivers a single-provider approach as a licensed SOC 1 and SOC 2 Assessor, accredited ISO 27001, ISO 27701 and ISO 22301 Certification Body, HISTRUST CSF Assessor firm, accredited FedRAMP 3PAO, candidate CMMC C3PAO, and Qualified Security Assessor Company. Working with small businesses to global enterprises, A-LIGN experts and its proprietary compliance management platform, A-SCEND, are transforming the compliance experience.

NetDirector Releases Text-Extraction Service for Default Servicing with Machine Learning and Advanced Extraction Workbench

Tampa, FL – November 30th, 2022 – NetDirector, the leading cloud-based integration platform for the default servicing industry, has crafted a new artificial-intelligence-powered solution to address the complex text extraction needs of default servicing called A.I. Extract.

The new A.I. Extract service provides industry-leading results with unparalleled accuracy for extracting complex legal descriptions from flat files, images, PDFs, and more. By leveraging the power of machine learning, A.I. Extract can produce Optical Character Recognition (OCR) results that improve over time based on user approvals and corrections, saving valuable time and manual effort in data entry and review.

The new service also provides exceptional versatility, processing power, and accuracy. A.I. Extract can process documents and images via automated workflow to and from case management systems (CMS), which makes integration an easy choice for existing NetDirector clients. Files can also be loaded in bulk by folder, or simply by copy-pasting an individual screenshot or image file while working side-by-side in a CMS. This flexible approach allows users to implement the Extraction Workbench at any point in their workflow, and to begin using it immediately.

“The new A.I. Extract service has been incredibly valuable to us,” says Rosanna Henry, Director of Compliance at Mackie Wolf Zientz & Mann, P.C. “We’re thrilled with the accuracy, and excited to have a tool that allows us to get simple or complex legal descriptions into our case management system with ease. It saves an enormous amount of time and effort far above and beyond any other current options and was extremely easy to get started with.”

NetDirector has recently expanded A.I. Extract’s functionality beyond legal descriptions, to include Loan Payment History data extraction. This data automation tool extracts and assembles the loan payment history information for the Mortgage Proof of Claim attachment, commonly called the 410a Worksheet, saving hours of manual effort in completing these documents. Additional applications of A.I. Extract (such as the P309) are currently in development. Industry veterans who were early adopters of the service have reported up to eight hours per loan history of manual ledgering and data manipulation that were eliminated with the help of A.I. Extract.

For more information, and to learn about upcoming expansions of extraction functionality, contact our integration experts.