Thanks to improvement in its operations compared to its peers, FNF Servicing Inc. saw its mortgage servicer rating improved.
The servicer quality rating for FNF had been SQ3+ as a primary servicer of prime and Alt-A residential.
But the Virginia Beach, Va.-based company’s rating was raised last week, with its servicer quality rating now standing at SQ2-.
Moody’s Investors Service, which announced the upgrade, rates the best servicers at SQ1+ and the worst servicers at SQ5-.
The report indicated that FNF has above-average collection abilities. Moody’s noted that FNF continued to exhibit solid collection roll rates compared to its peers — especially with later stages of delinquency. A spike in call abandonment rates at the end of 2012 has since subsided to acceptable levels.
Loss mitigation results are also above average, improving from average in the last assessment as a result of a rise in completed modification levels and increased loss mitigation activity relative to its peers.
The ratings agency considers FNF’s foreclosure and timeline management to be above average, also better than the prior average assessment. The improved assessment came despite longer foreclosure time frames because of how it compared to peers.
In addition, loan administration is rated above average. The report indicated that FNF stopped being reimbursed for force-placed insurance commissions in June.
But servicer stability at the Fidelity National Financial Inc. subsidiary is just considered to be average. Moody’s did note, however, that FNF restructured its compliance department since the last review to accommodate changes in the federal and state regulatory environment.
Through its LoanCare Servicing division, FNF serviced 416,557 loans for $80.3 billion as of Nov. 30.
The servicing portfolio has significantly increased from 241,685 loans for $45 billion as of Dec. 31, 2012.
