Ocwen's Resi and Special Servicer Ratings Affirmed
Fitch Ratings today affirmed Ocwen Financial Corporation's 'RPS2' residential primary servicer rating for subprime mortgages and its 'RSS2' residential special servicer rating. According to a statement released by the rating agency,Â its rating actionsÂ are based on what it sees asÂ Ocwen's solid capabilities in loan administration and default management, comprehensive servicing technology, established training programs, and effectiveness in servicing nonperforming loans and liquidating real estate owned assets. As of Sept. 30, 2006, Ocwen serviced over 445,000 loans totaling $50 billion, an increase of 36.5 percent in loan count and 38.9 percent in unpaid principal balance from 326,000 loans totaling $36 billion as of June 30, 2005. The portfolio is comprised of $39.5 billion of subprime loans, with the balance consisting of conforming, Alt-A, FHA/VA and high loan-to-value loans. Ocwen currently has four servicing sites located in West Palm Beach and Orlando, FL, and Bangalore and Mumbai, India. Since Fitch's prior review, Ocwen reconfigured its Interactive Voice Response (IVR) unit to provide more customer self-fulfillment options, including full Spanish functionality and the ability to make payments by phone and request payoff quotes for loans that are less than 59 days delinquent; enhanced call routing and prioritization for incoming calls; and created a specialized group to focus on early payment defaults using manual calling campaigns and a door knocker service in cases where the company is unable to contact the borrowers. Ocwen continues to develop its interactive agent scripting for customer service and collections calls. In addition, Ocwen set up a dedicated disaster recovery site in India and completed initial application recovery testing for servicing related systems with no significant issues noted. Ocwen has been an ongoing legal target for consumer advocates, but Fitch said it feels that the company is progressing in its efforts to resolve outstanding litigation. To date, the company has been successful in resolving some of the lawsuits it faces and continues to work to have the remaining cases dismissed, consolidated or moved to more favorable venues. In spite of progress, the rating agency indicated that it takes existing litigation very seriously and will continue to monitor the company's legal situation in order to evaluate any potential impact on Ocwen's loan servicing and operational capabilities. For more information, visit http://www.fitchratings.com.