CRFS is once again participating in a full slate of industry conferences and trade shows in 2019, and we’ll be speaking at quite a few. We look forward to engaging with our clients and partners at these events, so here’s the current list of shows we’re scheduled to attend.  We hope to see you at many of these great venues during the course of 2019.

 MBA Independent Mortgage Bankers Conference, January 28-31 – San Francisco, CA

IMN NPL Notes and Default Servicing Forum East, February 7-8 – Ft. Lauderdale, FL

MBA National Mortgage Servicing Conference & Expo, February 25-28 – Orlando, FL

IMN MSR Conference, April 15-16 – New York, NY

Five Star Government Forum, April 23 – Washington, DC

MBA National Secondary Market Conference and Expo, May 19-22 – New York, NY

IMN NPL/RPL & Mortgage Notes Forum West, June 3-4 – Dana Point, CA

Five Star Conference, September 23-25 – Dallas, TX

MBA Annual Conference & Expo, October 27-30 – Austin, TX

Safeguard National P&P Conference, November 3-5 – Baltimore, MD


With the federal government currently in a state of partial shutdown with no clear timeline for resolution, CRFS would like to communicate the impact that clients and partners may see with the claim filing process. Our Compliance Team has put together the following information based on what we know at this time. As more information becomes available, we will be sure to communicate it to the CRFS community.



The VA appropriations bill was already passed, so these files will not impacted by the shutdown.



Claims can still be submitted to HUD, and claim payments will be issued as long as no manual intervention is necessary. However, HUD files requiring manual effort will be delayed. The HUD mail room is still open to allow for the submission of supplemental claims, and they will be time stamped to confirm date of receipt.



No impact on the claims process.



The LINC system is available and claims can be entered and saved, but the submit function appears to be disabled. As of now, claims can be entered and saved in LINC so they can be submitted immediately upon restoration of full system functionality.



The FEMA website was last updated on December 21, 2018 and will not be updated until after funding is enacted. As such, information on the website may not be up to date. Transactions submitted via the website might not be processed and FEMA will not be able to respond to inquiries until after appropriations are enacted.


Should you have any additional questions, please contact Sean Snook at

CRFS Launches Refreshed Brand and New Interactive Website Ahead of Mortgage Conference Season

Having recently celebrated 15 years in the mortgage claims management business, Claims Recovery Financial Services (CRFS) unveiled their evolved brand and launched their comprehensive new website, in advance of several industry conferences this fall.

New website. 

CRFS’ new website was launched in August.  Those interested can get to know the team and the reasons why CRFS has become the industry leader in mortgage claims management and consulting services.

Evolved brand. 

The company’s new logo is the most outward sign of their evolving brand, representing the experience of the entire CRFS team working together to solve a myriad of default servicing issues.

Learn their story. 

CRFS has released a brief video telling the story of rapid growth from a home startup into a recognized industry leader. This includes successfully overcoming the extraordinary challenges the industry faced during the housing crisis a decade ago when CRFS averaged 10,000 processed mortgage claims per month.

Busy with fall conferences.

Armed with this refreshed brand and a dedication to quality, CRFS will have a strong presence at several industry conferences this fall, including the October MBA Annual Conference & Expo in Washington DC and the MBA Accounting and Financial Management Conference in Orlando, FL, November 12-14.

CRFS will also sponsor the Safeguard National P&P Conference in Baltimore, November 5-7.

Based in Albion, N.Y., CRFS is the industry’s largest non-bank processor of post-foreclosure FHA, VA, MI, and investor claims. They also provide consulting and data analytics services. For more information, please visit

CRFS Update: Fannie Mae Claims

Fannie Mae released an updated Servicer Expense Reimbursement Job Aid on September 19, 2018. The release of this job aid continues Fannie Mae’s efforts to simplify communication and streamline processes via Fannie Mae’s Expense Straight Through Processing efforts.

After a thorough review of the job aid, CRFS has determined the following changes which impact the claims process:

  • Removal of the required documentation table from the “What to Submit for an Expense Reimbursement Claim”
  • Updated the Pending Submitter Review section
  • Added a Post-Payment Review section

Removal of the required documentation table

With the effective date of this job aid, October 1st; Fannie Mae has removed the prior requirements to have all supporting documentation accompany the claim at the time of submission.  Based upon our review of this communication, Fannie Mae is only requiring supporting documentation for the following expense types at the time of claim submission:  (1) Flood Insurance; (2) One-time inspections in the state of New Jersey; and, (3) Requests from Fannie Mae’s title/closing department to pay a utility expense.

Additionally, Fannie Mae still has the requirement that all supporting documentation must be maintained and available upon their request.  So it is still important to validate you have all necessary supporting documentation ready and available should Fannie Mae select the loan for either Pre-Payment Review or Post-Payment Audit.

Updated the Pending Submitter Review section

Fannie Mae has updated this section to align with the Pre-Payment Review process.  Once the claim is submitted, if exceptions occur or Fannie Mae randomly selects the loan, Fannie Mae may require additional supporting documentation for expenses claimed.  When that documentation is needed, Fannie Mae will place the loan in the Pending Submitter Review queue which notifies the claim filer that additional documentation is needed.

Added a Post-Payment Review section

With this update, Fannie Mae has created a Post-Payment Review process which all claims are eligible for.  In the event Fannie Mae needs additional information or documentation, Servicers will receive an email request from the Post-Payment Documentation Request Portal.  Servicers will have 10 days to acknowledge and respond to the request.

Please contact Sean Snook at CRFS at 585.590.5406 for additional information on this important change to FNMA’s procedures.

CRFS Update: FHA Preforeclosure/Short Sale Claims

On September 27, 2018 the Office of Inspector General (OIG) released Audit 2018-LA-0007 in
which it conducted a review on HUD’s preforeclosure sale claim process.

After conducting their review, the OIG stated HUD currently has insufficient requirements and
procedures in relation to the preforeclosure claim process. Specifically, HUD does not have the
necessary procedures in place to limit the payment of interest and other costs when servicing
delays exist. The report estimates $413 million in overpayment based upon a statistical sampling
of 72 loans which was then projected across a total population of 27,634 loans.

OIG’s recommendation to HUD involves implementing a regulatory change to require the curtailment
of preforeclosure interest and other costs when servicing delays exist. The servicing delays
specifically referenced within this audit were untimely foreclosure institution, missed deadlines for
completing the preforeclosure marketing period, and delays in the timeline to complete the
foreclosure action.

CRFS expects HUD to issue a proposed rule change to 24 CFR 203 in the near future. CRFS
Compliance is monitoring for this release and will provide further communication as proposed changes
are published.

To review the full report from the OIG, please click here.

read an expert’s take on the importance of effective claims management

Last Line of Defense: Claims Management

The teams that oversee the various aspects of pre- and post-foreclosure sale claim production strive toward a single ultimate end goal—to maximize the retrieval of all eligible claim proceeds. They coordinate to secure qualified principal balance deficiencies and default-related servicer advances while maintaining adherence with investor/insurer guidelines. The layered and complex task of claims management relies on continuous oversight, tight production monitoring across numerous functional areas, and reliable quality-assurance measurements. Cross-functional coordination and continuous efficiency are critical to the success of this last line of defense.


Navigating the Field: It Takes a Team

Claims management requires more than just one-star player. It does not fall under the scope of one particular position or team. Instead, the expansive activities that directly impact the claims environment generally include property maintenance and preservation, vendor management, eviction, claim preparation, quality assurance, loss analysis, inventory pipeline monitoring, exposure projecting, and corporate advance reconciliation, which includes all post-default recoverable and non-recoverable servicer advances.

In order to maximize returns, servicers are charged with successfully navigating dozens of discrete claims-related activities and processes across numerous teams. Failing to do so can lead to diminished qualified claims proceeds and an increased potential for claim-filing inaccuracies. The ultimate payment of reimbursable investor/ insurer claims truly does represent the last line of defense from a financial perspective, so it is imperative that the mechanics of milestone activity oversight, intermittent activity coordination, and inventory pipeline monitoring are tightly managed. Once the claims process runs its course, loans are liquidated and resultant losses or gains are booked.

Focusing on the Goal

The migration of the loan cycle, from the time of initial default through the final claim filing stage, can span several months or even years. Even when there are no upstream delays or intervening circumstances, corporate servicer advances—in connection with various attorney/ legal services, routine property inspections, and property securing and maintenance—are inherently part of the claims world even if the underlying activities occur outside of the typical realm of claims. If ‘advance ownership’ falls outside of claims, line-item allowable-claim thresholds, which vary depending on the investor or insurer, should be accurately captured at the time of service to ensure the team can reliably estimate upstream line-item advance recoverability through the downstream claims process. The continuous monitoring of line-item allowable-claim threshold rules, reconciliation of per-advance invoices, and the timely recording of trends in areas of monitoring opportunities will result in reliable financial-position estimates long before ultimate loan liquidation.

In addition to corporate servicer advance reconciliation, maintaining timely default oversight actions, including foreclosure initiation, default reporting, and post-default inspections, reduces the potential for delayed claim submissions and mitigates missed claims opportunities.

The Offense: The Importance of Anticipation

Additional processes can be implemented to maximize claim-proceeds retrieval and decrease operational inefficiencies and pressures. One process strategy is to take an offensive stance on claims preparation by preparing claims prior to applicable the foreclosure or third-party sale. In general, these termination events represent claim-submission deadline-trigger dates, so the sooner claims can be built for submission, the better. Completing claim preparations before expected claim-termination events both minimizes the likelihood of missing claim-filing deadlines and reduces downstream production pressure given wider preparation timelines.

Another strategy is competitive foreclosure/ post-foreclosure sale efforts, which can reduce operational claims-monitoring costs, decrease claim-submission volumes, mitigate financial exposure and holding risks, and accelerate the retrieval of expected claim proceeds.

Full Speed Ahead

In the post-foreclosure sale/post-termination event world, time is of the essence when it comes to asset liquidation and claim submission. Delays in property conveyances for FHA loans and reimbursable expense-claim submissions heighten potential downstream operational and financial risks. Property-preservation expenses relative to FHA-insured assets, for example, cannot be claimed from HUD if the expenses are incurred more than 30 days after foreclosure sale dates (or dates of possession, extended milestones). Moreover, delayed property liquidations present supplemental risk factors, such as code-violation assessments, hazard-claim damages, and various title impediments—none of which are reimbursable.

Aside from the potential inability to claim certain expense types due to unapproved upstream activity delays, debenture interest on FHA-insured assets may not be fully earned. While unearned debenture interest can’t always be avoided due to uncontrollable delays that do not qualify for insurer approval, the severity of lost debenture interest can be mitigated. Effective oversight of various pre-claim events, including first legal, foreclosure due diligence, default reporting, evictions, conveyance, and claim submission, will decrease missed reimbursement opportunities and increase levels of earned debenture interest.

Bolstering the Defense Line

The unknown can be very expensive. Investor and insurer reimbursement levels vary relative to extended lapses and uncontrollable events. Servicers can take several steps to maximize reimbursable-claim opportunities and decrease operational and financial risks for general FHA insured assets:

  • Accurately identify property damages at the time of vacancy, separating those repairs that are covered through hazard policies from those that are reimbursable from the insurer.
    • Request and receive repair bids in a timely manner.
    • File hazard insurance claims for those damages not covered by the insurer.
    • Submit and monitor over-allowable and extension requests as necessary.
  • Develop a transparent partnership with property-preservation firms.
  • Board properties that are not impacted by surchargeable damages or mortgagee neglect, nor subject to insurer indemnification for competitive-auction efforts.
  • Manage to dual conveyance and third-party sale outcomes:
    • Conduct financial analysis around corporate contributions.
    • Submit and monitor extension requests as necessary.
  • Conduct quality-assurance reviews prior to claim submissions.
    • Trend and report missed claim opportunities and third-party losses.

Keeping an Eye on the Ball

Successfully managing a pipeline of hundreds or thousands of accounts pending ultimate retrieval of claim proceeds requires continual routine inventory-reporting methods. To fully understand operational impacts and projected financial losses and gains, fluid claim-eligibility volume and account aging should be fully transparent. The ability to report holistic and segmented views of various claim phases across all claim types allows servicers to understand short- and long-term staff scaling needs and anticipated financial impacts.

Tight pipeline reporting also identifies production-efficiency opportunities around those pre-claim stages where delays may exist. The various processes within the claims environment—including property maintenance and preservation, vendor management, eviction, corporate advance and invoice reconciliation, third-party sales coordination, claim preparation, quality assurance, loss analysis, and future loss projection activities—often run concurrently at some level. However, active-volume levels within each of the claims oversight and production teams tend to fluctuate. As a result, effective and continuous progress may require cross-functional training to ensure the ability to scale up or down across more than one functional process.

Knowing When to Pass the Ball

Servicers with internal structures that are not built for internal scale may be better suited to outsource certain task-driven, highly specialized, analytical, and/or quality-assurance components. Since the claims process represents the end of the line, the last line of defense, financially, it makes a lot of sense to facilitate independent performance and structural reviews across key functional activities. On a related note, from a regulatory perspective, claim errors, including claiming unallowable expenses, overclaiming allowable expenses, and providing inadequate support of claimable expenses, can result in potential sanctions and/or significant monetary fines as investors and insurers often extrapolate audit findings across full production populations through the production timeline audit scope.

Accuracy, Efficiency, and Transparency in the Last Line of Defense

Finally, robust quality-assurance measures developed to manage performance levels/SLAs of third-party vendor partners and internal processing activities promote the ultimate retrieval of qualified reimbursable claim proceeds. Quality assurance and throughput measurements quickly isolate corrective action targets across key functional segments.

The full scope of claims management, including various encompassing cross-functional areas, can be a challenging space for servicers to navigate given the breadth and overlapping nature of various claims-related operational and oversight activities. Therefore, the methods used to routinely monitor overall performance at all operational levels are key to maintaining accuracy, operational efficiency, and financial exposure transparency.


About Author: Kelly Conley

Kelly Conley is Founder and Principal of KAC Advisory, providing de-risking strategies and process-optimization solutions to mortgageservicing partners within the distressed-property disposition and investor claims spaces. Conley has nearly 20 years’ combined leadership, credit risk, repurchase mitigation, property preservation, and alternative asset-disposition expertise across the mortgage lending and servicing sectors. Prior to launching KAC Advisory, Conley was FVP of Investor Claims for Flagstar Bank, an $18 billion community bank with a servicing/subservicing platform of $104 billion.


Editor’s Note: This feature originally appeared in the August issue of DSNews

Claims Recovery Financial Services (CRFS) announces expansion of client product offerings

For more than 15 years, CRFS has been the industry leader for delivering comprehensive investor and insurer claims management solutions across a diverse and expansive servicing clientele. CRFS’s services have helped clients to achieve unmatched quality results, submission timeliness, loss reductions, and recovery maximizations. CRFS’s independence and industry expertise provide its partners with the ability to reallocate vital internal resources, successfully scale production operations, and ultimately reduce risk while enhancing financial outcomes.

CRFS is pleased to announce the addition of new Consulting services, expanding its platform of defaulted-loan product offerings. The following added services complement CRFS’s claims processing solutions platform, allowing clients to choose from a comprehensive, full-plate menu of operational and data analytics Consulting services based on their unique business needs.

New CRFS Services

  • Investor / Insurer Mock HUD Audit Review service includes a comprehensive review of previously filed claims, as a preemptive measure to actual audits, to ensure claim-filing accuracy and / or identify areas of operational efficiency. Investor and insurer mortgage servicing audits are routine, so claim-filing accuracy is critical both from a regulatory and financial-exposure perspective.
  • Investor / Insurer HUD Audit Support service provides clients with front-to-back support in the event of an actual FHA claim audit. We will conduct an independent findings audit, support formal responses, and provide feedback around validity, training opportunities, and operational process recommendations.
  • Operational Enhancement Consulting engagements involve in-depth claim processing best practice studies conducted on-site by CRFS’s highly experienced consulting staff and cover areas including but not limited to claims processing workflow management, reporting routines, file preparation and processing guidelines, and adherence to investor/insurer rules and regulations.
  • Accelerated Disposition Dashboard analysis delivers strategic loan-level reviews, high-risk property assessments, and financial-exposure consequences associated with alternative asset liquidation options including REO, CWCOT, and traditional conveyance.
  • Surchargeable Damage (Property Preservation) Review service, offered in conjunction with the Accelerated Disposition Dashboard analysis, involves a comprehensive review of property inspection and preservation histories, ensuring that property conditions comply with third-party sale or property conveyance requirements relative to surchargeable damage (including mortgagee neglect).

The addition of the above-mentioned services provides clients with a comprehensive product scope, across all facets within the claims, audit quality assurance, and property liquidation environments. Whether a servicer’s needs involve an individual service or a bundled set of comprehensive services, CRFS will customize a plan based on the needs of each individual client.



Jeffrey Clark, Vice President, Director of Sales and Marketing
Office: 585.590.5422
Mobile: 585.455.0328


Claims Recovery Financial Services, LLC (CRFS), the mortgage industry’s premier provider of claim filing and recovery services, is celebrating 15 years of growth as the industry leader in claims recovery.

CRFS started out with one employee processing a few claims for one client. Today, more than 300 employees handle an average of 15,000 claims each

“Fifteen years – that’s reason to celebrate!” exclaimed Co-founder and Vice-Chair Jodi Gaines. “We could not have reached this milestone without our skilled team of managers and employees. They don’t just stop once the minimums are reached – they push to exceed the expectations of every client. We now help our clients recover an average of $2.25 billion each year.”

Widely-recognized as the industry leader in claims recovery, CRFS recovers, on average, an additional $2,500 per file for their clients. Clients also turn to CRFS
for expertise in FHA, VA, and USDA claims recovery, HUD Audit support, loss analysis review, consulting, and much more.

“We’re happy to kick off our 16 th year at the MBA National Mortgage Servicing Conference and Expo,” said Gaines “We look forward to seeing our clients and
partners in Texas.”

The conference is February 6-9 in Grapevine, Texas.



Jeffrey Clark, Vice President, Director of Sales and Marketing
Office: 585.590.5422
Mobile: 585.455.0328

jodi gaines named rochester athena award finalist

CRFS Congratulates our Founder, Jodi Gaines, on being named an Athena Award finalist for 2018 and applauds her continued hard work on behalf of Western New York’s professional women.

In collaboration with the Rochester Business Journal and presented by the Greater Rochester Chamber of Commerce and its affiliate, the Women’s Council, the ATHENA Award® is Rochester, N.Y.’s premier honor for business and professional women. The 32nd annual ATHENA Awards dinner is scheduled for January 25 at the Rochester Riverside Convention Center.