Joseph A. Smith Jr., Monitor of the National Mortgage Settlement (NMS), has released a summary of six compliance reports he filed with the U.S. District Court for the District of Columbia. This summary details the results of his tests to determine Bank of America, Chase, Citi, Ocwen and Wells Fargo’s compliance with the NMS servicing rules from July 1, 2013 to Dec. 31 2013. This report also contains the test results for Green Tree from Oct. 1, 2013 to Dec. 31, 2013.
“My colleagues and I conducted a rigorous testing process to review five servicers’ compliance with the National Mortgage Settlement’s original 29 metrics for the third and fourth quarters of 2013. I’m pleased to report that these servicers passed all tests during this reporting period," said Smith. "In addition, this report contains the results from the first quarter Green Tree was tested for the loans it acquired from the ResCap Parties. After extensive testing, I can confirm that Green Tree failed eight metrics. These results show that Green Tree must make significant changes to improve its practices and comply with the Settlement."
Shaun Donovan, Secretary of the U.S. Department of Housing & Urban Development (HUD) praised the report issued by Smith, stating, "I look forward to the Monitor’s next report which tests the banks on four new metrics issued in October. These will help the Monitor measure and ensure that the banks are doing a better job sending notices and communicating with struggling homeowners in a timely manner.”
Green Tree failed over a quarter of the testing issued by Smith and the individuals at the Monitor. Green Tree, a division of Walter Invesment Corporation, took on Ally Financial's servicing rights back in October of 2012, with the deal reportedly being worth upwards of $20 billion.
Smith announced that he is pleased with the findings of the report. “I believe that these results, when compared to my previous reports, show that, under the Settlement, servicers are addressing problems quickly and effectively through focused corrective action plans," said Smith. “While these results are encouraging, work still remains to ensure that the servicers treat their customers fairly. My colleagues and I continue to test their compliance with the original 29 metrics. In addition, we have started testing the servicers on the four new metrics issued in October which provide more stringent review on the loan modification process, single point of contact and billing accuracy. I look forward to reporting those results in my next compliance report.”
