Last month, I attended the IMN Annual Mortgage Servicing Rights (MSR) Forum in Dallas where I had the opportunity to speak on a panel alongside my peers to discuss the benefits of partnering with a subservicer versus servicing in-house.
I wanted to recap highlights from the panel.
Expanding Your Market
Partnering with a subservicer can help you grow your market share by expanding your geographic footprint, introducing new products or selling to agencies and Investors where you did not previously have the servicing expertise on staff. A financial institution who wants to reach a specific target market like originating FHA loans or selling to Ginne Mae will benefit from this partnership because it opens a whole new avenue for their customers.
Managing Staff
Subservicers have the capacity to manage staff fluctuations during challenging times, like rising delinquencies, a global pandemic or other catastrophic event, as well as during heavy growth periods to take advantage of market opportunities. Cenlar has the expertise to hire and train more effectively than most due to our experience managing through these cycles.
Reduce Costs
Servicing in-house can be expensive, especially with the increased frequency and amount of regulatory changes. Processing errors are costly and create customer problems. A subservicer has knowledgeable staff, expertise and infrastructure to minimize those errors.
Delivering the Best Homeowner Experience
While many people associate mortgage servicing as just the administrative function of a mortgage, it’s so much more than that for the homeowner. The homeowner has an expectation that the servicer will deliver a positive experience at every point of contact to meet their individual needs. Whether that is a simple question, working through an insurance loss or providing guidance during a challenging time in the homeowner’s life.
Managing the Partnership
Because subservicers are on the frontline with your customers every day, it’s important to meet with your subservicer regularly to assure that they are delivering the kind of service that is key to your business strategy. Subservicing shouldn’t be on autopilot. We have the reporting capabilities and infrastructure to satisfy any vendor oversight obligations a client may have. We always want to actively engage with you to provide assurances that your portfolio is being well managed.
Keeping You Compliant
The scrutiny of this regulatory environment has resulted in more work for financial institutions that are either originating loans, servicing loans, or doing both. You should expect that your subservicer will keep you fully complaint with all regulatory and GSE change. Using a subservicer that has the expertise to manage the regulatory and compliance requirements is undeniably one of the most critical factors to consider when selecting a subservicer.
Investing in Tech
Subservicing is ripe for innovation and more subservicers are investing in technology to drive a better homeowner experience. The members of the panel all unanimously agreed and talked about areas where they are investing to improve the servicing experience and process.
Subservicer versus Servicing In-House – Takeaways at IMN MSR Forum
