- Photo by Robert Chase
By Tom Kirvan
Legal News
As president of NDeX, the Farmington Hills based company that is one of the nation’s leading providers of mortgage default processing services, Scott Goldstein has a firm appreciation for the value of technology.
The company that he has headed since 2006, in the dual role of president and chief financial officer, depends on the “smart use of technology and processing staff to support and enhance the legal process for foreclosures, bankruptcies, evictions, and loss mitigation.”
To a point.
Then it is all about having the “right people” in place, ensuring that “technology needs to be viewed as our servant, not our savior,” according to Goldstein.
Such candor is part of his make-up, a character trait that he now displays as a member of Federal Reserve Bank of Chicago Advisory Council.
Goldstein, a CPA who earned his master of business administration degree in finance from Fordham University, received the coveted two-year appointment this spring.
The 15-member Advisory Council meets twice annually with Chicago Federal Reserve President Charles Evans and other senior bank officials to “provide insight on current business conditions,” contributing to the formulation of the nation’s monetary policy.
In particular, Goldstein will be looked upon to help gauge the outlook in the real estate sector, an area that has been rocked in recent years by declining property values and a continuing surge in foreclosure activity.
NDeX, which is owned by The Dolan Company, is a provider of technology and processing services for law firms in an eight-state region, including Michigan, Florida, California, and Texas.
“My role with NDeX gives me daily insight into the trends affecting the housing market and how they impact our economic recovery,” Goldstein said in a recent interview at his Farmington Hills office off Northwestern Highway. “The sector has been so unpredictable and volatile in recent years that we are all hoping for a more stable real estate environment, one that will help boost our overall economy.”
Goldstein isn’t ready to predict that it will happen anytime soon, however.
In fact, he believes “we haven’t hit bottom yet,” partly due to the aftershocks from the robo-signing scandal that unfolded last fall, forcing some of the nation’s largest banks to suspend foreclosures after they were caught cutting corners to complete the paperwork process faster.
In those foreclosure cases in which problems were uncovered, it was determined that low-cost paper-pushers were signing off on scores of affidavits a day, without verifying the information on the documents.
“We don’t need any fresh reminders that the default servicing industry has an absolute need for a legally enforceable foreclosure file; a foolproof chain of documentation that will withstand any judicial, claimant’s counsel, or regulatory challenge,” Goldstein wrote in a recent article for a trade publication.
“The practice of foreclosure law and related servicing has changed dramatically over the last decade,” Goldstein added. “All parties are being asked to do more, do it better, and at a lower cost. Yes, speed is critical, but quality legal work product, measured by sound judgment, clear thought process and legal acumen, is the ultimate goal of all law firms serving the mortgage lending and servicing industries.”
Goldstein and other industry experts also have watched with growing alarm a decided uptick in the number of “strategic defaults” that are skewing foreclosure figures nationwide.
“There is a growing trend of homeowners who have the ability to pay their mortgage but are electing not to, thereby forcing the foreclosure process for strategic purposes,” Goldstein said. “In effect, they are able to stay in their homes for up to two years or longer without making a mortgage payment. Those kind of defaults are on the upswing as more and more people find themselves underwater in their mortgages. It will probably get to a point where there will have to be some sort of legislative response as a result.”
A native of Connecticut, Goldstein earned his bachelor’s degree in accounting from Lehigh University, a small private college located in Bethlehem, Pa. Upon graduation, he went to work for one of the then Big Eight accounting firms, Ernst & Whinney, now known as Ernst & Young, one of the Big Four after the fallout from the Enron debacle in 2001.
His career path then took him to a key financial position in New York with Schlumberger, the largest oilfield services company in the world.
He appeared headed for a position at the company’s headquarters in Paris when he was re-routed to an executive role at its Ann Arbor office instead, eventually spending 19 years with the company.
In 2003, after serving as controller for Kelly Services and then as chief financial officer for The Phoenix Group, Goldstein was appointed CFO at Trott & Trott, the largest mortgage default law firm in Michigan. Three years later, he was named president of NDeX.
“We run the back office side of law firms that service the mortgage default industry,” Goldstein said of NDeX, which was founded in 2003 and has grown to 1,100 employees today.
His decision to accept the position at NDeX was a “leap of faith” at the time, Goldstein admitted, acknowledging that he was much more comfortable in a financial rather than a business development and management role.
“But it was a challenge I was eager to take and it has proven to be a tremendous experience for me professionally,” he said of the move. “I was fortunate to be given an opportunity to grow while moving out of my comfort zone.”
Goldstein can trace his business roots to his first job working in a drug store, a quintessential downtown shop owned by his father in Westport, Conn.
“I did whatever it took to help out, stocking shelves, labeling items, running the cash register, you name it,” Goldstein said of his responsibilities at the family drug store. “It was a great place to learn about the value of hard work and the importance of customer service.”
His father, Bill, who recently celebrated his 74th birthday, was a good teacher, as was his mother, Linda, who died of cancer in 2000 at age 60.
He shared the workload with his younger brother, Jay, a Bucknell graduate who now handles franchise lending operations for Regions Bank.
Goldstein and his wife, Laura, who grew up on Long Island and obtained her bachelor’s degree from The State University of New York at Buffalo, met on a blind date and have been married for 23 years. Their daughter, Megan, is a freshman at the University of Michigan this fall after graduating from Andover High School in June. Her brother, Brady, is a freshman at Andover, where he is a member of the junior varsity soccer team.
Goldstein can take pride in his own athletic accomplishments as well, annually competing in the Detroit and Boston marathons. Since beginning his running career 15 years ago, Goldstein has 40 marathons to his credit, including a personal best of 3 hours and 15 minutes, a nifty 7:26 pace per mile over the 26.2-mile trek.
“I run with a group of friends at 5:45 each morning,” said Goldstein, who typically logs 50 miles per week. “It’s a great outlet for us each day, a time that we can come together to run and to share what is going on in each of our lives. It’s like a vitamin for me.”
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