Code violations create a number of financial risk and potential collateral loss issues for investors, servicers, and REO outsourcers:

• Accumulation of daily code violation fees
• Registration non-compliance daily penalties
• Clouded title and REO marketability (unrecorded Liens)
• Delay in REO closings & holding costs
• Loss of potential buyers
• Cost of mounting repairs and maintenance
• Demolition risk and total loss of collateral
• Cost of litigation action from local municipalities
• Cost of litigation action after transfer of deed
• All of which lead to closing delays and increased asset loss severity.