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LoanCare LLC ABOVE AVERAGE Residential Primary Servicer Ranking Affirmed; Outlook Is Stable

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LoanCare LLC ABOVE AVERAGE Residential Primary Servicer Ranking Affirmed; Outlook Is Stable

OVERVIEW

  • We affirmed our overall ABOVE AVERAGE ranking on LoanCare LLC as a residential primary (prime) servicer.
  • The company's prime portfolio amounts to almost 1.8 million accounts with an unpaid principal balance of $363.3 billion as of Oct. 31, 2019.
  • It operates from sites located in Virginia Beach, Va., Jacksonville, Fla., Chandler, Ariz., and Pittsburgh, Pa.
  • The outlook is stable.

NEW YORK (S&P Global Ratings) Nov. 4, 2019--S&P Global Ratings today affirmed its ABOVE AVERAGE ranking on LoanCare LLC as a residential primary servicer. The outlook is stable.

Our ranking reflects:

  • An experienced management team, along with competitive turnover metrics;
  • A thorough training regimen;
  • Multiple levels of internal controls that were recently augmented within its first line of defense;
  • A sound technology environment that underwent improvements affecting customer service, loss mitigation, and other functional areas;
  • Well-designed complaint and vendor management processes, the latter of which underwent some enhancements;
  • Satisfactory servicing metrics that generally compare well against similar peers;
  • Proactive default management practices;
  • That certain internal audits and quality control reports had some minimal higher risk findings, most of which have been remediated;
  • Elevated tax penalties; and
  • An average speed of answer within customer service that, though comparable with peers, we consider to be elevated.

Since our prior review (see "Servicer Evaluation: LoanCare LLC," published Aug. 10, 2018), the following changes and/or developments have occurred:

  • LoanCare opened a new site in Pittsburgh.
  • A large bulk transfer occurred in the second quarter of 2019.
  • LoanCare continues to hire additional senior and middle managers who have prior experience at regulated institutions.
  • It introduced an improved website and mobile application;
  • A more formalized first line of defense was created through an operational risk group.
  • A newly formed exam management group liaisons with clients and regulators for various matters.
  • Bilingual customer service functions are handled by internal staff versus a vendor
  • LoanCare introduced speech analytics and enhanced/simplified its voice response unit application for easier customer execution.
  • A new segment of its website provides enhanced information for customers affected by natural disasters.
  • Borrowers may now access the status of their workout requests on the website.

The outlook is stable. LoanCare continues to hire experienced personnel as the portfolio increases while concurrently implementing improvements to the operation affecting technology, internal controls, and other areas. These varied developments should increase efficiencies and allow it to proactively service its customer base. We expect LoanCare to remain a competitive subservicer in the residential marketplace.

The financial position is SUFFICIENT.

Related Research

  • Research Update: Fidelity National Financial Inc. And Subsidiaries Ratings Affirmed; Outlook Stable, Oct. 7, 2019
  • Select Servicer List, Sept. 13, 2019
  • Analytical Approach: Global Servicer Evaluations Rankings, Jan. 7, 2019
  • Servicer Evaluation: LoanCare LLC, Aug. 10, 2018
Servicer Analyst:Steven L Frie, New York (1) 212-438-2458;
steven.frie@spglobal.com
Secondary Contact:Jason Riche, Farmers Branch + 1 (214) 468 3495;
jason.riche@spglobal.com
Analytical Manager, Servicer Evaluations:Robert J Radziul, New York (1) 212-438-1051;
robert.radziul@spglobal.com

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