Shellpoint was named as servicer on $7.31 billion of non-agency MBS issued during the third quarter. Cenlar, a major subservicer in the sector, is under a consent order with the OCC. (Includes data chart.)
If capital and liquidity requirements for nonbank servicers are too stringent, firms could leave the business and borrowers’ costs for mortgages could increase.
Given the home price spike seen in the past 18 months, many distressed borrowers have enough equity to sell their homes rather than face foreclosure. Still, previous practices suggest that a notable share of borrowers with strong equity positions will go through foreclosure.
The share of securitized non-QMs that are delinquent or modified increased in August for the first time since February. Still, industry analysts are comfortable with the long-term outlook for performance.
The federal regulator will continue to take a close look at mortgage servicers’ actions as a wave of distressed borrowers nears the end of their pandemic-related forbearance programs.
Many of the borrowers facing the end of their forbearance plans are struggling financially. Servicers say they’re ready to help, and for those who can’t resume payments there’s home price appreciation to bank on.
Among a group of 15 servicers tracked by this publication, nonprime servicing balances were essentially unchanged between March and June. At the servicer level, there were some fluctuations. (Includes data chart.)
An increase in jumbo originations helped to grow servicing portfolios at many shops during the second quarter. Top-ranked Wells Fargo, however, saw its jumbo servicing portfolio decline. (Includes data chart.)
The total delinquency rate fell by 155 basis points between March and June, according to Inside Mortgage Finance’s Large Servicer Delinquency Index. Still, close to 1.5 million borrowers are more than 90 days past due. (Includes data chart.)