LoanDepot brings Ginnie Mae servicing in-house

LoanDepot brings Ginnie Mae servicing in-house
Written by Publishing Team

The company said in an announcement that LoanDepot will stop outsourcing the loan service in Ginnie Mae’s securitization and will manage the process internally.

The company plans to hire an unlimited number of people into the service as a result of this shift, with a particular focus on recruiting people for “customer-facing” positions.

The news of the change came following the company’s earlier receipt of the approval of the government agency. It is also in line with Loan Depot’s earlier decision to begin holding service on loans sold to two government-sponsored institutions.

“We rely less on third-party service delivery partners, which simplifies the process and allows us to work directly with clients,” Dan Benovitz, executive vice president of service and capital markets operations, said in a press release.

CEO Anthony Hsieh earlier indicated that the company is working to reduce outsourcing in this area, noting in Recent earnings call This loan will be “relatively less dependent on third-party service partners” as part of efforts to continue improving retention through more direct contact with customers. He noted that the initial estimate of the recovery rate for refinancing processed through the company’s direct consumer channel was 71% during the twelve months ending September 30, 2021, up from 61% in the previous year.

The company’s move toward hands-on involvement in Ginnie’s services contrasts with a publicly traded competitor distancing itself from it. HomePoint recently Confirmed plans to exit Ginnie Mae’s service After selling some of Ginnie’s MSR wallet to pay off debt.

The service of loans secured by other government agencies and grouped into Ginnie’s insured bonds usually has fewer players than the GSE market, but offers higher compensation for the relatively more complex and highly structured business.

Servants, who can spread operations expenses over larger portfolios, can be a more cost-effective option and often also have specialized holding units, but mortgage companies need to be willing to relinquish some control over operations and may be equipped to manage operations Multi-peer if they outsource.

Both Ginnie and Office of the Comptroller of the Currency Keep a close eye on servicing sub-concentrations of risk, so mortgage companies tend to work with multiple business partners in this area as a result, Hsieh’s comments note to Loan Depot.

The company’s announcement came on the same day he became Ginnie’s first permanent president in several years sworn in, and a more stable leadership could spur more companies to seek approvals from the government agency.


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