Poor servicing performance compared to its peers prompted a downgrade to MetLife Home Loan’s servicer rating.
The company’s primary servicer quality rating for prime loans was cut to SQ2- from SQ2 by Moody’s Investors Service today.
The best possible rating is SQ1+, while the lowest is SQ5-.
The MetLife Bank N.A. subsidiary handles servicing from Irving, Texas. The servicing portfolio was 340,544 loans for $63 billion as of June 30. Its subservicing portfolio finished June at 167,507 loans for $32 billion.
MetLife employed 222 full-time employees as of last month in servicing. In addition, 69 part-time employees were on staff.
Compared to its peers, MetLife’s collections and loss mitigation metrics have deteriorated. Moody’s also noted that fewer loss mitigation workouts were offered to imminent-default and early-stage delinquent borrowers compared to its peers.
“During much of the review period, MetLife was not sufficiently staffed in collections and customer service, resulting in abandoned phone calls and longer wait times,” the ratings agency stated. “However, more recently, MetLife has increased staff and focused more on imminent defaults by using a vendor to handle these loans.”
MetLife’s total cure and cash flow metric deteriorated compared to its peers, though the use of short sales increased. Also, the servicer has recently stopped outsourcing loss mitigation decisioning.
