Residential mortgage-backed securities servicers are improving their processes despite generally adverse market conditions, Fitch Ratings found.
The cost of servicing mortgages is increasing as a result of such things as heightened regulatory scrutiny. At the same time, servicers might be required to hold on to additional capital in the face of increases in interest rates and the value of mortgage servicing rights.
Despite these trends, most servicers are showing stable performance, according to a Fitch analysis that processes servicer ratings data on a range of RMBS products.
Of the 89 servicers rated by Fitch, 9% got the highest grade, while 54% were rated in the second-best quality rank, 29% were in the third and 8% were in the fourth and second-to-worst. None of the 89 servicers ranked in the bottom tier.
