Posted on Thursday, June 30, 2011
Mortgage insurer PMI has announced the launch of its new MODEL Servicer Program to identify mortgage servicers who score high marks for keeping borrowers in their homes. These companies will benefit from certain advantages when doing business with PMI.
“Since the beginning of the housing crisis, PMI has seen that the use of certain mortgage servicing best practices plays a central role in maximizing the level of home retention and achieving positive results for borrowers, communities, and mortgage investors,” said Chris Hovey, SVP of servicing operations and loss management at the California-based PMI.
“PMI believes servicers that have demonstrated effective use of these best practices deserve recognition for the positive impact they have in preserving homeownership in communities nationwide,” Hovey said.
The new program was designed to recognize and reward “best-in-class” servicers for the work they put into preventing foreclosures.
The program is being offered to companies that service 500 or more PMI-insured delinquent loans.
In order to be eligible for the program, servicers must exhibit superior foreclosure prevention results on PMI’s servicer scorecard. Their operations must also substantially adhere to industry best practices as outlined in PMI’s Best Practice Principles.
The first benchmark included in these principles is that servicers should create a rewarding “prevention culture” that encourages staff to view credit losses as if they were their own.
PMI’s guiding best practices also address employee training, inter-departmental coordination, borrowers’ single point-of-contact, the technology of the business, and preventing re-defaults.
The servicers’ executives must meet regularly with PMI, both prior to and after acceptance into the program, and PMI’s guidelines state that to maintain eligibility, “the servicer must maintain a positive public reputation.”
“These servicers will receive multiple benefits to reward their excellent performance in sustaining homeownership,” Hovey said.
In addition to recognition as a MODEL servicer, benefits include a shortened claims documentation and review process, expedited payment processing of claims, and the suspension of loan investigations involving successful workout activities.
PMI Mortgage Insurance Co. is the principal operating subsidiary of the PMI Group, Inc., which provides residential mortgage insurance and credit enhancement products.
By: Heather Hill Cernoch and Carrie Bay DS NEWS