“Celink, we believe, continues to show good experience levels,” the S&P report states, noting the company’s growing portfolio with additional growth expected later in 2012. 

Among the company’s strengths pointed out by the S&P ranking were Celink’s history of servicing reverse mortgages, its “well-defined policies and procedures,” a change in the company’s tax vendor and single-point-of-contact program for borrowers experiencing a tax and/or insurance default. 

“We consider the company’s monitoring program for telephone staff to be thorough,” S&P writes. “As the company continues to grow, we expect them to further develop the training program and continually strengthen its auditing programs to support the company’s servicing function. We believe Celink will remain a proficient residential reverse mortgage servicer.”

Written by Elizabeth Ecker

We asked Mike: What is on the horizon in terms of opportunities for RMS? Here’s what he had to say.

Interview by Elizabeth Ecker

So far, it is starting to show success.

Last year, RMS told its partners that it would no longer buy closed loans that had certain characteristics: either a new homeowner’s insurance policy, or past incidence of tax default meeting certain characteristics.

Current RMS data indicates that the change was warranted.

“We found 75% of our tax and insurance defaults began as defaults at closing, meaning they either had delinquent taxes or a new insurance policy,” says Mike Kent, president of mortgage lending at Spring, Texas-based RMS. “It was a good place to start. The end game is: how do we help mitigate tax and insurance defaults, but also, how do we mitigate a situation where a senior ends up in foreclosure?”

The question led RMS to begin testing its own version of a financial assessment, without additional underwriting, in its retail call center.

“We took our data and used it to determine financial assessment,” Kent says. “We could have chosen the way the others did it, but we said, ‘Here’s another way.’”

Coupled with the results of its borrowers currently on repayment plans, which is around 50% of those in default who are now making payments as they come due, RMS began to look at the question of willingness versus ability to make tax and insurance payments.

“We would never require of our partners and customers something we wouldn’t require ourselves, so we implemented it as a beta test in December,” Kent says. Four months later, RMS is beginning to see results with a the rough conclusion that between four and six out of 10 loans that would be denied, actually can be made without immediate default danger.

RMS’s multiple business channels from sub-servicing to correspondent lending and retail origination allow for the depth of analysis.

“One nice thing about having all of these channels is we have a lot of data and know how our decisions on the front end are going to effect processes down the road,” Kent says.

As for RMS’s future financial assessment plans, full implementation is pending.

“We have it, it’s written up, it’s good. Our plan is to run in the call center and then tweak it however we need to, then put it out to our partners for their input and comment,” he says.

Written by Elizabeth Ecker

“The mortgage servicing rules we are considering reflect two basic, common-sense principles—no surprises and no runarounds,” said CFPB Director Richard Cordray. “For too long, mortgage servicers have not been held accountable to their customers, and the result has been profoundly punishing to homeowners in distress. It’s time to put the ‘service’ back in mortgage servicing.”

Of the rules the CFPB is considering, one requires servicers to provide clear monthly statements including specifics such as loan terms, payments, future payment due dates, recent activity, any late fee warnings and loss mitigation for any delinquent borrowers.

Other initiatives under the CFPB rule making include providing earlier disclosures before any interest rate changes on most adjustable rate mortgages; options for avoiding costly force-placed insurance; and an effort toward providing early information and options for avoiding foreclosure—a rule under which servicers would be required to make good-faith efforts to contact delinquent borrowers and inform them of their options to help avoid foreclosure.

The Mortgage Bankers Association welcomed the changes in a statement made Tuesday.

“National standards that apply to all residential loan servicers have the potential to create more confidence and certainty in the real estate market for both borrowers and servicers alike,” said MBA president David Stevens. “Borrowers would be protected by a single standard regardless of where they live and servicers would have one set of rules to comply with everywhere they operate….It is important that the final rules don’t give preference to one business type over any other, nor should they inhibit innovation or discourage new companies from entering the marketplace.”

The agency is expected to provide more details on the proposed rules on Tuesday.

Written by Elizabeth Ecker

Irving, Texas-based Deval, LLC is now responsible for Federal Housing Administration Single Family assets including Home Equity Conversion Mortgages (HECMs). Servicers have the option to assign loans to HUD through Deval once they reach 98% of the max claim amount.

Deval took over as HUD’s contractor in March and Mortgagee Letter 2012-07 made the announcement with details this week. Prior to Deval being selected, C&L Service Corporation was HUD’s servicing contractor.

Sources tell RMD that it has been a slow transition with long wait times since Deval began servicing in March.

View the Mortgagee Letter.

Written by Elizabeth Ecker

The Spring, Texas-based company, launched in 2007 as a reverse mortgage servicer, has since grown several other business channels including correspondent lending, wholesale and retail origination. It also is an active Ginnie Mae HMBS issuer and has moved into the REO arena, which it points to as an area for future growth.

Today, it also operates a new, wholly-owned subsidiary, S-Cubed—S3 for Specialty Servicing Solutions—which handles all FHA forward servicing. That is the basis for its entry into the forward business, Mike Kent, President of the Mortgage Lending Division told RMD.

“It’s very similar to the process we had when we started RMS. We start in one place, then as we develop and grow our expertise, our operations grow.”

The company may look to origination in the future, Kent says, although for now it is building from the S-Cubed subsidiary.

“We’re in the planning stages now and growing from there,” he said. “Eventually we may look at origination side of forward FHA loans.”

RMS this year celebrates its fifth anniversary, and with it, the $10 billion mark for the value of its loan portfolio, expected to surpass 70,000 loans in the second quarter of 2012.

“We’re buying and funding loans, handling REO disposition, managing assets and providing technology solutions for seniors and B2B customers,” said Bob Yeary, Chairman and co-founder. “It’s a growth story here, that’s for sure.”

Written by Elizabeth Ecker

John LaRose will remain chairman and CEO of Celink, where he will continue to report to the board of directors, maintain industry leadership and establish the company’s long term goals, marketing and public relations strategies.

“This promotion acknowledges the invaluable contribution Ryan has made to the industry and to the people and mission of Celink,” said John LaRose. ”He has demonstrated mature leadership far beyond his years and I am confident Ryan and his team will continue establishing unparalleled reverse mortgage servicing practices.”

Ryan LaRose has more than 15 years of experience in subservicing, including seven years in the reverse mortgage industry. He serves as co-chair of the servicing committee for the National Reverse Mortgage Lenders Association.

John LaRose has more than 26 years in the subservicing business and serves on NRMLA’s board of directors, executive committee and co-chair of its servicing committee.

Written by Elizabeth Ecker

“It was time for us to focus all of our corporate resourceson a singular product,” said John LaRose, Celink founder and CEO. “Given the new mortgage landscape and the ever-increasing population of retiring boomers, we saw the subservicing of reverse mortgages as defining and directing Celink’s future.”

In late 2011, Celink assisted its forward subservicing clients in moving their loan portfolios either in-house or to an alternate subservicer.

Contrary to some of the challenges facing the forward mortgage world, Celink sees a bright future for the subservicing of reverse mortgage loans.

“Reverse mortgages are a feel-good product,” said RyanLa Rose, Celink COO. “They help people age in their homes, maintain their independence and self-determination, and provide viable and sound financial solutions for so many. We all need joy in our work, and our employees feel joy every single da yas they help seniors retain their dignity and freedom.”

Written by Elizabeth Ecker