Moody's downgrades BofA servicing rating on government-insured loans
Moody's Investors Service continues to lower ratings for Bank of America's (BAC) mortgage servicing units, downgrading BAC Home Loans Servicing LP and Bank of America NA for failing to remit requested data on government-backed loans. Analysts said the servicers didn't provide necessary Federal Housing Administration and Veterans Affairs claims information for the review. Moody's, which treats BofA and BAC Home Loan as one servicing operation, dropped the company's rating as primary servicer of government-insured residential mortgages to SQ3 from SQ1-. Analysts determine a mortgage servicer's ability to prevent or mitigate asset pool losses as markets move and then issue a rating on a scale of SQ1, the strongest, to SQ5, the weakest. Earlier this week, Moody's downgraded BofA's servicer rating on prime, subprime and second lien mortgages, as well. Bank of America services 13.1 million home loans with a total principal balance of $2.03 trillion. Bank of America assumed Countrywide Financial Corp.'s assets when it acquired the troubled subprime lender three years ago. Last October, Moody's placed all of Bank of America's servicer quality ratings on a warning for possible downgrade after noticing irregularities in BofA's foreclosure processes and deterioration in the company's performance metrics, Moody's said. Write to: Kerri Panchuk.