Servicing

Mortgage servicers have made substantial progress over the last year in improving borrowers' customer experience, a new survey released by J.D. Power shows. In its yearly survey of customer satisfaction for primary mortgage servicers, the company found the servicing industry as a whole averages 754 on a 1,000-point scale, up more than 20 points from last year.

A new $2.5 billion GSE mortgage servicing rights (MSR) portfolio has hit the market. MountainView Servicing Group, acting as exclusive sale advisor to the MSR seller, unveiled the portfolio, which includes both Fannie Mae and Freddie Mac loans. According to MountainView, the portfolio is made up of 94 percent fixed-rate and first-lien product with an average loan size of $226,161.

SunTrust Banks, Inc., announced that it would pay up to $320 million to halt a criminal investigation into whether it had dealt inappropriately with homeowners who were looking to take advantage of the Home Affordable Modification Program (HAMP). "Resolving this legacy matter enhances our ability to focus on the future and support the continued housing recovery," said Jerome Lienhard, SunTrust Mortgage, Inc., president and CEO.

A report released last week by the Office of the Inspector General (OIG) for the Federal Housing Finance Agency (FHFA) outlined the possible risks that nonbank servicers could pose to the greater housing market. To illustrate a point, the OIG pointed to a specific instance where a nonbank servicer had fallen below the minimum threshold capital requirement required by Fannie Mae. The servicer was then prevented from acquiring the right to service Fannie Mae mortgages. Though the OIG did not name names, people familiar with the matter revealed to the Wall Street Journal that the servicer in question was Nationstar.

As scrutiny continues to grow in the servicing arena, the watchdog for the Federal Housing Finance Agency (FHFA) says it has concerns about non-bank servicers working with GSE loans. Out of the 30 largest servicers, FHFA OIG says that non-banks held a 17 percent share of mortgage market as of the end of 2013, representing nearly $1.7 trillion. As a result, the report says these non-bank companies may have taken on more volume than they can handle.

As the second quarter comes to a close, a new $1 billion Fannie Mae bulk residential mortgage servicing rights (MSR) portfolio has hit the market. The announcement of the sale was made by Interactive Mortgage Advisors (IMA), which is acting as exclusive broker. The company describes the offering as "an excellent opportunity to focus and bid on newly originated MSRs with below market interest rates."

SunTrust Banks announced it has struck a nearly $1 billion deal with the government to settle allegations of misconduct in its lending and servicing practices. In an agreement reached with the Consumer Financial Protection Bureau (CFPB), Justice Department, HUD, and attorneys general in 49 states and the District of Columbia, SunTrust agreed to provide relief to consumers and payments to the government totaling a combined value of $968 million.

In a release, Fitch Ratings announced it is changing Green Tree's servicer grades to "Rating Watch Negative," citing "ongoing concerns with Green Tree's rapid growth and portfolio integration" as well as the results of the latest compliance update from the Office of the Mortgage Settlement Oversight (OSMO), which showed the servicer failed to meet some of the minimum requirements agreed to by some of the nation’s biggest outfits.

According to the Mortgage Bankers Association (MBA), independent mortgage banks and mortgage subsidiaries of chartered banks earned an average $1,242 on each loan originated in 2013, down 43.5 percent from $2,199 the previous year. MBA's VP of industry analysis, Marina Walsh, called 2013 net production profits "respectable," even with the massive decline.

The New York regulator who earlier this year launched a probe into the practices of non-bank mortgage servicers revealed Tuesday he plans to expand his investigations. Delivering remarks at the Mortgage Bankers Association' 2014 National Secondary Market Conference, Superintendent Benjamin Lawsky of New York's Department of Financial Services said the agency plans to dig into fee-based ancillary services at non-banks such as Ocwen and Nationstar.