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Executive Sees Growing Demand for Interim Loan Servicing Expertise

Kevin Quinn sees interim servicing as a great opportunity for his employer, Master Financial Inc.

Mr. Quinn, the subservicing acquisitions manager for the Orange, Calif.-based company, says interim servicing - the temporary subservicing of loans prior to their sale into the secondary market - "seems to be sort of a lost niche" in the marketplace.

"Not a lot of subservicers are doing that," Mr. Quinn said. Large subservicers "don't quite want to worry" about it, while smaller ones aren't equipped to handle it, he said.

But Master Financial has found "a large audience" that is taking advantage of the company's skill in this area, Mr. Quinn said.

"It's a tremendous opportunity for us," he declared.

This year has been "great" for Master Financial so far, he said, especially considering that "we're still working hard to brand our product."

As for the change in the interest rate environment, Mr. Quinn said it is creating a new situation for servicers.

On the one hand, declining originations mean there will be fewer retained loans overall. But, on the other hand, "now is the perfect opportunity for companies to build their portfolios," Mr. Quinn opined.

Citing his conversations with others in the industry, Mr. Quinn said many companies are picking up retained loans because they need to build assets - especially small and midsize mortgage companies.

"I think that's sort of evidenced by servicing brokers I've talked with," he said.

Meanwhile, another source of change that's driving business developments is technology, which Mr. Quinn said is "creating a very competitive marketplace."

In the case of subservicers, they "realize they have to keep trying to push the envelope," he said, not just to benefit their own operations, but to benefit the client.

"You have to stay on the wave of technology, which your competitors are certainly going to do ... and, as much as possible, be on the cutting edge," Mr. Quinn said.

In response to these demands, Master Financial is now developing programs that "we hope will begin to set ourselves apart from the competition," he said.

Overall, he said, the technological scramble for new tools and new ways of doing business is beneficial.

"It might be tough on the IT folks, but it's great for everybody else," he observed.

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