Government Moves Suggest Further Growth in Subservicing
While pending regulation and other government actions make trends a bit of a moving target, on a net basis they currently argue for a continued increase in subservicing work this year.
“Almost any way you look at it business should grow this year on the subservicing side,” Carrington Mortgage Holdings executive vice president Rick Sharga told this publication Tuesday.
The Consumer Financial Protection Bureau’s new set of national servicing standards, for example, should increase subservicing “if it’s executed correctly,” he said.
There is a risk to this forecast in that “there are some discussions going on I’m hearing that the CFPB is a little concerned about massive amounts of servicing transfers. They’re concerned about the impact on the consumer.
“But the reality suggests that the consumer, for the most part, will actually be better served by working with a specialty servicer who is more adept and focused on ways to modify loans or other workouts,” Sharga said, adding that also “from an industry perspective, it just doesn’t seem like a good business decision for…servicers to have to re-engineer all the processes to stay in compliance when handling a problem that really has a life expectancy of another couple of years.”