Eric Miller’s National Association of Mortgage Field Services (NAMFS) is in dire straights. With contractor’s locks and padlocks receiving 145% tariffs — these are the mainstay of materials — no one is going to go from a $23 profit down to $9. This is based on the MFS Supply price today of $22.20 per set of knob and deadbolt up to $32.19 plus shipping. On a typical lock change order, a contractor has about two hours of round trip windshield time in addition to fuel. Add to that the insurance, which is now going up due to tariffs, ever present inflation, soaring costs for food, housing, and utilities, no one in their right mind would do a lock change for the typical $42.50 paid today.

As new vehicle and auto parts prices go up to cover the cost of tariffs, prices for repairing or replacing a car after an accident, other damage or vehicle theft will rise. Insurers will pay out more for auto insurance claims and then will likely seek higher car insurance rates to compensate for their higher costs.

In requests for comment from the few institutionally based national order mills, both were met with a wait and see approach. The problem with most C Level personnel at these firms is that they understand default rates and the profit margins there as the International Association of Field Service Technicians (IAFST), in the Industry’s first ever petition for a NAICS pointed out here. When it comes to the economic ramifications of tariffs, most have never even heard of the Harmonized Tariff Schedule (HTS) 8301.40.60.30 which is the code assigned for Door locks, locksets and other locks suitable for use with interior or exterior doors (except garage, overhead or sliding doors). And then there are the dozens of other HTS codes for things like hasps, hinges, nails, screws, and the HTS list goes on and on and on. Adding fuel to the fire is the fact that the Trump Administration doesn’t even seem to know what they are or are not tariffing. Complicating matters is that many of the regional order mills are hacking off yet another 30% off of what the nationals pay.

Enter MSI, a Ft Worth based firm that, for years, has never been able to pay contractors on time. During a recent taking of the pulse survey to Labor, there wasn’t a single contractor whose owed balance was caught up in terms of contractual agreement. Moreover, though, a Senior Industry official was quite blunt when it came to warning about MSI in stating that Labor should ensure that they are caught up as MSI “…was on the way out.” Let that statement sink in for a moment as the source was not in competition with MSI and originated work orders as opposed to being the middleman as MSI is. And as many know, the problem with these order mills is that they rarely, if ever, file bankruptcy. Take National Field Network (NFN) whom was forced into involuntary bankruptcy and years later — even after the high speed wreck and death of their owner Shari Nott — still has not yielded a single penny.

Foreclosurepedia is seeing an uptick from Labor in coming to us and requesting assistance in getting paid. The problem today is with fewer and fewer order mills around, the massive shock to the system of those not getting paid is far more dramatic than during the 2008 Financial Crisis. Couple this with being asked by the national order mills to perform services upon the very properties that the regional order mills never paid, Labor has begun yet another exodus. Low volumes + tariffs increasing basic material pricing and operating expenses + lack of pay = No Labor. And with respect to the assistance rendered on the HUD M&M FSM contract above, with respect to 24 Asset Management refusing to pay Labor on federal contracts, maybe it is time that ISN, the mortgagee compliance manager, gets some extreme scrutiny for their refusal to perform their job! I mean it’s not like Sharon Washington or HUD Secretary Scott Turner are going to get involved. Maybe, just maybe, DOGE will take a long, hard look at how US taxpayer monies are being stolen in the aforementioned article.

Wolf Street has a great piece out that really drives home the point that no matter how much of the Kool Ade you have drank, the economy is not doing well. Here is how the headline read, In the West, Inventory of New Houses for Sale Jumps to Highest since 2007. In the South, it’s Bigger than During Housing Bust. Right now, it would take roughly seven and a half months to sell the entire inventory in the South. Something to understand from Wolf’s article is this,

The median contract price of new single-family houses at all stages of construction that sold in February fell to $414,500, down by 10% from the peak in October 2022.

So, if the valuation — read sale price — is dropping, this is going to directly impact those homes which sold previously at inflated prices. And if valuations are dropping for nearly identical homes, this has the potential to rapidly put people in upside down positions. That, in turn, is a recipe for foreclosure regardless of the equity held. Regardless, and as we have stated over the previous months, with the massive federal layoffs nationwide, the more you flood the market with assets, the how low can you go syndrome becomes mainstream. Granted, good for our Industry as volume is king, but bad both for the economy and homeowners alike.

And before anyone says that, “Well, the sales are way up and that inventory is going to drop rapidly,” which is the NAR’s typical mantra, here are the real numbers pertaining to sales,

Pending home sales are a forward-looking indicator of “closed sales” of existing homes to be reported over the next couple of months. From the National Association of Realtors today, seasonally adjusted:

• In the West, pending home sales dropped further, marking the worst February in the data going back to 2011, and just above the all-time low of October 2023.
• In the South, pending sales in February rose from the all-time low in January and mark worst February on record.
• In the Northeast, pending sales dipped further, mark worst February on record.
• In the Midwest, pending sales ticked up a hair, mark worst February on record.

The numbers never lie.

For years, the name Eddie San Roman has been synonymous with lack of payment. Whether it be the nearly one million dollar fraud committed by Assero or the most recent iteration as 24 Asset Management (24AM), the reality has been a loose-loose proposition when it comes to Labor. Foreclosurepedia made no bones when it advised Housing and Urban Development (HUD) about the concerns we had with 24AM’s M&M FSM Award. Early on, their ability to pay was already an issue and when it came to debris removal from hurricanes Helene and Milton, the proverbial financial hole in the floor opened up even more. Last year, one minority contractor had enough. For months, they had struggled to make ends meet being denied monies owed while San Roman and the 24AM Team lived high on the hog. Fast Eddie appeared to believe that the same million dollar fraud at Assero would be tolerated under the HUD M&M FSM.

Look, I get it that Scott Turner, the newly minted Secretary of HUD, is more concerned with parking space allocations than he is with minority contractors being paid on his watch. What I do not get is whom will HUD fill the trenches with to handle the uptick in volume, later this year, when Labor realizes they will never be paid for the work they perform?

As we will release in the Foreclosurepedia Industry Insider this weekend, the problems rose as high as Atlanta OCPO Director, Sharon Washington. What should have been a simple audit and demand for payment simply extended the interest free holding of Labor’s money without explanation. Moreover, though, any HUD Awardee whom is saying that the check is in the mail which becomes lost and then — not one, not two, not three, but FOUR demands later — has to FedEx a check that still never arrives, well that might be a problem. The real irony here is that the very people appointed to oversee the Awardees either willingly or by abject failure was incapable of administering their duties.

Here is a snapshot of previous Assero debt and how Fast Eddie San Roman and his Team determined when to pay. The pattern and practice of Fast Eddie was never to pay according to contract, but pay when Labor screamed enough.

Months after submitting the minority contractor for payment to both HUD and after dozens of requests for payment, Foreclosurepedia penned the below,

From the bottom of my heart and on behalf of all Labor and the IAFST, I want to apologize to you that both HUD and HUD’s protected M&M FSM Awardee, 24 Asset Management, are operating with impunity when it comes to avoiding their contractual commitments. I had attempted to remain out of the fray as I was hopeful that the system might work. I remained cautiously optimistic that even though the track record of 24 Asset Management has been strewn with the wreckage of unpaid Contractors, surely the Atlanta OCPO Director, Sharon Washington, would engage within the process and order Mr San Roman to make good on federal contract debt obligations. I see that I was wrong.

I want to belabor this missive, for a moment. Circular promises of checks that are lost or eaten by the dog in youthful parlance that are resent via FedEx and yet still never arrive is unconscionable. In fact, these statements have the capability to be proven or disproven. In this I mean when you make a statement cognizable under a federally procured contract that payment has been transmitted when it may have not, that would strike me as perjury. And should multiple people gather together, using electronic means such as email, to further the potential artifice and/or scheme to perpetrate a fraud, well I believe we all know where that road would take us. The tragic thing is that this is a pattern and practice harkening back to the nearly one million dollar fraud perpetrated by Assero which was under the management of Mr San Roman and Mr Lee Mertins. HUD was well aware of this. It is winding up to be yet another National Field Network involuntary bankruptcy. I am ultimately more concerned with the fact that when 24AM is paid by the US government — HUD in this case — they affirm that they have paid those performing services. Moreover, though, when we speak of the preemptive debris removal associated with the previous year’s catastrophic hurricanes, the very same damages that President Trump had committed to addressing, and by proxy HUD Secretary Scott Turner, it becomes even more horrific.

While I do not have the power of the purse, I do have the power of the pen. The time is long overdue for HUD to remove 24 Asset Management and in my humble opinion to ensure that this minority contractor is paid, in full, prior to that dismissal. I believe in the cleansing effects of sunlight upon the dark shadows of the M&M contract including upon those whom attempt to obfuscate and shirk their duties. While I type this in the capacity as a journalist, I am far more offended that as a US citizen, my tax dollars are allowed to be pocketed by a regime in Florida and that the fraud perpetrated is protected at such high levels.

This is yet another reason why the wisdom of President Trump in appointing folks to DOGE is so prescient. The levels of fraud, waste, and abuse in the instant case is blinding in its conveyance. It is tragic, in the sense that a minority contractor actually believed they would ever be paid by 24AM, a HUD Awardee. The irony is thick, in my opinion. I think that both 24AM and Ms Washington understand precisely what I imply. Foreclosurepedia and the International Association of Field Service Technicians stand shoulder-to-shoulder with Labor in this cause. Should any party like to opine, prior to publication, feel free to drop me a line here or via separate email.

Thank you.

While Ms Washington was not moved by the email, other senior HUD officials were as we will discuss in this weekend’s Foreclosurepedia Industry Insider. The payoffs, the rip offs, and the things no one saw will be brought out into the open to ensure that Labor completely understands why neither 24 Asset Management nor their minders at HUD are to be trusted. And in fairness, it is not simply 24AM. Problems abound at Spectrum. Here is a quote dealing with them,

These are all pass through jobs (gtr-wons) that i keep getting the run around on getting paid. Took them till end of January to tell me they finally submitted them for approval from HUD and cannot get a straight answer from SSA on the status. We have 4 more pass throughs to complete that I have told them we will not be completing until we receive payment for these outstanding invoices. Monthly payments for routine inspections and grass cuts(if they even give them to us unless I beg) along with HIPRs and initials have typically been paid within the contract time frame minus last month it was 3 days late (that is forgivable to a point). Thank you Paul.

HUD is aware of the issues there and Ms Washington apparently believes that Spectrum Solutions Acquisition’s (SSA) failure to pay is no big issue. I submit that Ms Washington, along with 24AM and SSA are the problem. When you combine this with the problems ongoing with countless extensions to sell HUD assets on the M&M AM side, which HUD is painfully aware of; when HUD says that $100,000 of profit for paid, personal training for a M&M AM Awardee, the solution becomes painfully clear as Cathy Baker is well aware of. Perhaps this is a case for DOGE, I don’t know. What I do know is that when we release all of the emails and asset information in our article this weekend, the real questions will begin to be asked.