Officials at the bank suggest Wells won’t take much of a hit from the loss of correspondent production. And profitability on the servicing side is expected to improve as the portfolio shrinks.
A proposal to streamline servicing and claim requirements for FHA mortgages is in the works, along with expanded loss-mitigation options for VA servicers. VA also plans to issue a final rule on cash-out refis.
Efforts by the MBA and other industry participants to get the California Supreme Court to overturn a lower court’s ruling failed near the end of December. Servicers in the state are now limited on the amount default interest they can charge.
The correspondent channel accounted for 40% of Wells’ originations in 2022, and the bank ranked third among all lenders in the channel. Still, some see Wells’ move as a positive step for the mortgage industry.
Tongues were wagging late in the week concerning a possible $85 billion package of MSRs hitting the auction circuit. Some suggested it might turn out to be a privately negotiated deal with two buyers.
In late December, Ginnie seized HECM servicing from Reverse Mortgage Funding, which had recently filed for bankruptcy. Other HECM servicers are also facing liquidity pressure, according to industry analysts.
Mortgage servicing rights are still a hot commodity and new investors continue to surface, but prices aren't what they used to be. One bright spot: Credit quality looks promising, at least on conventional rights.
Distressed borrowers with subprime mortgages in states with a judicial foreclosure process achieve non-foreclosure outcomes at a higher rate than similar borrowers in states that don’t have a such a process, according to findings from a new paper.