Quantcast

Fitch Lowers Minimum Servicing Fees on Some Loans

Fitch Ratings has reduced the minimum required servicing fees for prime home loan securitizations backed by fixed- and adjustable-rate mortgages as well as for alt-A securitizations backed by conforming ARM collateral.

Fitch cited the economies of scale brought about by portfolio size, advances in servicing technology, and lower default and recovery costs as factors in the lower minimum servicing fees, as well as the increase in individual loan sizes.

Fitch said the following servicing fees would be adequate to rate residential mortgage backed securities serviced by highly rated Fitch servicers:

* First-lien prime jumbo fixed-rate deals: Old minimum, 20 basis points. New minimum, 17 basis points.

* First-lien prime jumbo adjustable-rate deals: Old minimum, 25 basis points. New minimum, 20 basis points.

* First-lien prime conforming fixed-rate: Old minimum, 25 basis points. New minimum, 22 basis points.

* First-lien prime conforming adjustable rate: Old minimum, 37.5 basis points. New minimum, 25 basis points.

* First-lien alt-A conforming adjustable rate: Old minimum, 37.5 basis points. New minimum, 30 basis points.

Fitch left unchanged the minimum servicing fee for first-lien prime option adjustable-rate deals (37.5 basis points), first-lien alt-A jumbo fixed rate (20 basis points), first-lien alt-A jumbo adjustable rate (25 basis points), first-lien alt-A conforming fixed rate (25 basis points), first-lien alt-A conforming adjustable rate (30 basis points), first-lien alt-A adjustable rate (37.5 basis points), first-lien subprime fixed rate (50 basis points), first-lien subprime adjustable rate (50 basis points), second-lien adjustable rate (50 basis points) and home-equity lines of credit (50 basis points).

Currently, Fitch has 117 outstanding servicer ratings for different products covering 49 companies. (c) 2006 Mortgage Servicing News and SourceMedia, Inc. All Rights Reserved. http://www.mortgageservicingnews.com http://www.sourcemedia.com

Next in News ►