Bank of America’s residential mortgage servicing ratings remain at ‘outlook negative’ due to ongoing concerns about new regulations and the rising cost of servicing, Fitch Ratings claims in a new report.
BofA’s servicer ratings for prime product, Alt-A, HELOC, subprime, second liens and special servicing remain at outlook negative, with the majority rated RPS2-, and the special servicing rating coming in at RSS2.
The negative outlook reflects concerns over the bank’s ability to meet requirements for servicers set up by the 2011 accord reached between regulators and big banks and the 2012 National Mortgage Settlement.
"Finally, the ratings also reflect Fitch's overall concerns for the U.S. residential servicing industry, which include the ability to maintain high performance standards while addressing the rising cost of servicing and changes to industry practices mandated by regulators and other parties," Fitch explained.
By May 31, Bank of America’s (BAC) mortgage servicing portfolio consisted of 7.97 million loans valued at $1.1 trillion.