Improvements to its distressed servicing process, the replacement of a servicing system and the elimination of an outside vendor used for foreclosure processing all contributed to an upgraded servicer quality rating at Bayview Loan Servicing LLC.
Bayview’s residential special servicer rating was raised to SQ2 from SQ2- by Moody’s Investors Service.
The servicer quality ratings range from SQ1+, which is the best assessment Moody’s has, to SQ5-, the worst possible rating.
Moody’s said that the rating action was based on improved foreclosure and REO timeline assessment, which was raised to strong from above average. The improvement reflects the termination of the vendor performing foreclosure processing, a function that the company now handles itself. The in-house proprietary software for REO management has been replaced with a web-based system — a move that enables asset managers to handle bigger property portfolios.
In addition, Bayview’s servicing stability assessment is above-average, as are its collection results and loss mitigation abilities.
The stability assessment was bolstered by the history of consistent profitability for the subsidiary of Bayview Asset Management LLC. But the private ownership structure adds uncertainty to the stability of the servicing platform.
The ratings agency explained that the servicer has implemented the MSP servicing platform, and around a third of its loans have been transitioned so far. The new system improves operational efficiencies and facilitates growth of its servicing portfolio.
The rest of the loans are serviced on the Servicing Director platform.
Bayview serviced 35,490 residential loans as of March 31 from centers in Chicago; Ft. Washington, Pa.; Hurst, Texas; Miami; and Pompano Beach, Fla. Including 11,028 small balance commercial loans, the unpaid principal balance of its portfolio is around $11.2 billion. (a Moody’s spokesman clarified after the publication of this story that the residential portion of the servicing portfolio was approximately $6.2 billion)