Industry NewsMortgage

Offshoring home-loan services

Workers in Mumbai, Costa Rica attend to U.S. real estate

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By JANIS MARA Stanley Varghese, an REO sales consultant for West Palm Beach, Fla.-based Ocwen Loan Servicing, contacts brokers to get opinions on the value of bank-owned foreclosure properties, has the properties cleaned and repaired, and arranges showings -- and does it all from Mumbai, India, some 7,800 miles from New York City. Varghese is one of a growing number of third-party workers in other countries working with home loans and distressed properties for U.S. financial institutions. Foreclosure processes, loan servicing, loan modifications and loan processing are increasingly being moved overseas in an effort to cut costs. The practice is formally known as offshore outsourcing, a $50 billion-a-year industry in which U.S. firms use third-party companies in other countries to perform specified services. In just one example, Bank of America has third-party workers in India and Costa Rica performing loss mitigation, according to Michael Gross, the bank's managing dire...