Wingspan Finds Benefits for Lenders in Energy Lease Preservation

""Wingspan Portfolio Advisors"":http://www.wingspanportfolioadvisors.com/, a diversified mortgage servicing company operating in the Dallas area, says lenders, servicers, and investors are ""leaving money on the table"" by not doing their homework on oil and gas leases.

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The company worked in 2012 with oil and gas exploration and production companies to help them preserve energy leases in residential communities. In the process, it was discovered that oil companies hold leases under entire communities permitting drilling processes to recover gas and oil deposits--and servicers are often unaware.

""Lenders and servicers are definitely missing a revenue opportunity,"" said Wingspan president and CEO Steven Horne. ""Subordinating a mortgage for an oil and gas lease is not like allowing a typical lien that poses a foreclosure risk. The mortgagee can still foreclose, but it will not wipe out the lease.""

Horne went on to explain that oil and gas companies will pay a subordination fee based on the location and productivity of the lease, some of which can run as high as $500 in the oil rich areas of Texas, Colorado, and Pennsylvania.

At the same time, properties currently in REO portfolios may have former leases that energy companies would want to renew.

""Tens of thousands of leases were wiped out during the foreclosure crisis,"" Horne said. ""When banks own REO, they are generally unwilling to execute a new lease on a property either because they are misinformed or unaware of the benefits they are passing up. Servicers should also know that leaseholders are motivated to help with costs associated with completing loan modifications if it can help keep a borrower in place and preserve an existing energy lease.""

Up to 25 percent of the oil, gas, and mineral leasehold properties in the country may be in danger of losing their leases unnecessarily, Horne said. In order to prevent that, he believes ""the time is ideal for bringing the oil and gas community together with the mortgage industry for the benefit of all.""

""We're in an environment where there is much riding on the success of the oil and gas industry at making us less dependent on foreign energy and on the long-term health of the housing finance system,"" he said. ""Wingspan can help both sides achieve their goals, while enhancing these essential and strategic segments of the economy for generations to come.""