Small and mid-sized mortgage servicers may feel a challenge if new standards, proposed by the Consumer Financial Protection Bureau, take hold.
According to the latest Moody’s Investors Service ResiLandscape analysis, the industry-wide changes would largely be a positive for bigger lenders and residential mortgage-backed securities as well.
“Adherence to the guidelines would both improve the quality of servicing in the RMBS sector and help to restore confidence in the servicing industry as a whole,” Moody’s analysts write.
However, the operational changes could be costly for the smaller player, maybe even prohibitively.
“For example, servicers that did not implement a single point of contact strategy for borrowers, which was quite challenging and costly for large servicers to adapt, will encounter significant hurdles in revamping their organizational structure,” the Moody’s note says.
However, the proposal still has scope to change. The CFPB may consider different standards for shops servicing under 1,000 mortgages, for example.
On Wednesday, September 19 at 1p.m. Central time, Pete Carroll with the CFPB will offer a presentation exclusive to HousingWire webinar participants. Replays will likely be available the following day. Registration is available by clicking here.
