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22 economy and low unemployment rates we have also been seeing." In the past year, servicers have had to adapt to lower default rates. Mortgage servicers felt the pressure as they began to place limitations on their default departments. Courtney ompson, SVP, Director of Default Servicing Operations at Flagstar Bank mentioned that this environment is preventing many servicers from "doing more." "In a lower volume environment, it creates a tension where we don't have all the resources we need to prepare ourselves for when there is more," ompson said. Some months did see month-over-month upticks. In October, for example, lenders repossessed 13,484 U.S. properties through completed foreclosures, up 14% month-over- month and the highest point in total number of completed foreclosures in 2019. However, Todd Teta, Chief Product Officer with ATTOM Data Solutions, stated that this number "is still below where it was a year ago and less than 15% of what it was during the depths of the Great Recession." CoreLogic reported in November that the foreclosure inventory rate fell to 0.4% in June, which equals the lowest for any month since January 1999. e share of mortgages that were in any stage of delinquency was 4% in June—a decline from last year's 4.3%. In response, servicers across the country have continued cutting costs, leaving many default departments "lean," according to Schneiderman & Sherman, PC, Managing Partner Neil Sherman. It isn't just default servicing either—other areas of the mortgage industry have seen streamlining and consolidation alongside volume challenges. "We have also seen a significant amount of consolidation in both the bank and non- bank servicing space, the technology vendor space as well as legal services providers," Sherman said. "As a result of the significant decrease in overall default volume, the consolidation and general aging patterns in our industry, the Great Recession is starting to be a period that many read about but did not live through." However, Michelle Garcia Gilbert, Esquire, President and CEO, Gilbert Garcia Group, P.A., notes that consolidation isn't necessarily a trend that every company will fall into. "Consolidation is a response to market forces, so a business can become more efficient and profitable," Garcia Gilbert said. "I think it will continue, but I don't think every business will consolidate. ere is always room for a small, boutique player." Robyn Padgett, Chief Development Officer at Padgett Law Group, noted how her firm is dealing with the shifting tides. "We've taken a dual approach to cost management by coupling localized legal expertise with support from our national operations, processing, and technology teams, which are centralized throughout our footprint," Padgett said. "is model helps us manage costs, hedge against volume fluctuations, and support our state-specific practices, national bankruptcy clients, and our high-volume, project-based work." Technology, according to Christopher Carman, Litigation & Compliance Counsel for BSI Financial Services, will be key to pivoting should the market eventually take another downturn, pushing default volumes back into a significant upswing. "As long as the servicers and law firms have the proper technology and processes in place, they should both be able to handle any increases at the time when the market does go down, like it inevitably will," Carman said. "Having the proper groundwork in place will minimize having to just increase staffing which is often difficult to achieve." ONE STEP AHEAD OF FRAUD Law professionals are in a unique position in the fight against fraud as they serve as custodians of our customers' personal and sensitive information. For law firms, fighting fraud has largely been an issue of people, not technology. As Richard Nelson, Managing Shareholder, Reimer Law Co. notes, "Your weakest link is your weakest employee," meaning training is more important than technology when it comes to fighting fraud. "e actual technology piece of cybersecurity is now widely available and is good, by and large, within most organizations," Nelson said. "It comes down to the training of your people. If you look at the big frauds that are being committed, that's where they're coming from. ey're doing targeted fishing to get at your weakest link, and most often that is a company's staff." Preparation is mostly about people. With this in mind, Sherman stresses that there is no simple fix to fraud prevention, especially as technology and the increased efficiency expectations have meant that fraud issues are ever-growing. Investment in fraud education, Sherman noted, should be "eternal." "If you are working at a feverish pace and lack substantial fraud prevention training, simple, every day emails or tasks that pose risk of identity theft or fraud may be missed," Sherman said. "e industry needs to continue investing in education internally. Fraud prevention cannot be a 'gotcha' form of education alone. We try and tell a story when it comes to teaching our team about fraud prevention. We bring in speakers, provide presentations along with internal penetration testing. We also highlight how everything we learn about fraud and identity theft prevention can be applied at home with our families." CASES IMPACTING DEFAULT While mortgage default has been dwindling, in some cities, borrowers have been plagued by increased levels of tax foreclosures. In Detroit, for example, 34.4% of homes are currently underwater, and the median home value at the Detroit-Warren- Dearborn metro-area level is $161,300, far below the national median of $226,300, but the city still faces other foreclosure- related challenges—notably, property tax foreclosures. According to e Detroit News, around one in four Detroit homeowners owes more in delinquent property taxes than they did three years ago. A Quicken Loans report also stated that, as of 2018, 21% of homeowners were unaware their property was behind on property taxes, and another 61% of renters in tax-delinquent properties were unaware of the home's tax status. In response, the Michigan Supreme Court is being urged by Pacific Legal Foundation to halt a state law which allows counties to "profit" from the sale of foreclosed properties, after a home in Oakland County was sold for $24,500 after being foreclosed on for $8.41 in unpaid taxes. "It is akin to stealing," said Pacific Legal Foundation attorney Larry Salzman in Bridge Magazine. "e government shouldn't be taking more than is owed to them to cure

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