Canada Credit Fix Inc. (CCF) has announced plans to offer its "Foreclosure loss mitigation program" to the Canadian mortgage lenders and insurers. Several Canadian mortgage lenders have entered into negotiations with CCF for exclusive use of their program; however the Debt settlement agency is looking to become a national standard program rather than an exclusive program. Canada Credit Fix president Sheldon Wolf claims that 85% of all Canadian foreclosures can be avoided with their mediation and mitigation system.
Loss mitigation is a huge industry in the United States that sees third party agencies dealing with the homeowner rather than the bank or a lawyer. The problem with the current system is that mortgage lenders and the distressed homeowner often lack the proper communication skills or tools to resolve what becomes a stalemate. Matters almost always end up on a lawyers desk and down the path of inevitable repossession. Within days of the lawyer "touching" this file the already behind homeowner may now be further behind by over $3000 because of the legal fees, inspection fees, appraisals, application costs etc. The real problem lies when the customer had the $5000 mortgage arrears, but not the new balance of $8000 and now the lender has a foreclosure loss. Any intelligent businessman can see that the lawyer’s role in a foreclosure file will almost always be a conflict of interest with the homeowner. Let’s face it the lawyer’s bill will get paid no matter what from either the lender or the homeowner. The fact is we need the lawyer only if this file cannot be resurrected!
Here is what Canadians will rarely find out. Firstly, the use of a foreclosure lawyer is great if the homeowner has no intentions to pay up, (this is not the case 85% of the time) however if the customer wants to work out matters many files end up in a conflict of interest. Does that lawyer want to make $300., $3000. or even $6000. for a completed foreclosure file. CCF has named this "Foreclosure Manufacturing" but the most frightening problem occurs when the mortgage is insured by CMHC or Genworth. There are many cases where a lender would simply rather collect the losses from the insurer, which once again is a conflict of interest. Many times a mortgage lender has a greater benefit to the foreclosure than mitigating matters. There needs to be an unbiased third party to confirm fairness and ethics have prevailed.
Canada Credit Fix Inc is currently investigating several recent cases where the banks may have actually "created" avoidable losses. A lender should be obligated to do what is necessary to avoid any loss to its shareholders, insurers and most importantly its consumers. Intentionally creating millions of dollars in default claims without scrutiny is ridiculous and irresponsible claims CCF.
Canada Credit Fix wants to implement the mitigation program that will see "every" insured mortgage go through a brief process prior to the lenders lawyer executing an action. CCF will provide a written report to the lender prior to them being able to make a claim against the insurer. CCF President Sheldon Wolf has dealt with foreclosures and credit for over 22 years and claims that almost 85% of these cases can be resolved with his effective loss mitigation program. "Let the people stay in their homes" almost everyone wants to work it out and simply needs a friendly voice with options and who better than a third party that is unbiased. Foreclosure prevention is the cure for Canada.