Due to more stringent government loan requirements and increased oversight by regulators, small servicers have experienced problems with traditional subservicers. These problems include high delinquency ratios under Ginnie Mae, high FHA curtailments, low loss mitigation workout ratios and challenges with conveying properties to FHA.
To assist small servicers in reducing these problems, the privately held mortgage banking firm Gateway Mortgage Group has launched an in-house default services division to provide specialty sub-servicing solutions to mortgage lenders.
This subservicing unit was created to help small servicers and community-based financial institutions reduce risk when working with government loans. The new division also provides a servicing solution for community institutions to retain their customer relationships, the Tulsa, Okla.-based firm said.
“In 2008 Gateway decided to retain our servicing in house to keep the entire lending relationship from origination through servicing under our roof to ensure quality service for our borrowers,” said Kevin Stitt, president of Gateway Mortgage Group. “We now want to use our experience to provide smaller companies with an alternative to traditional subservicers, offering the expertise and performance of a large organization with the personal care of a smaller institution.”
Mortgage industry veteran Kevin Osuna has been appointed to direct the operations of the new division. Prior to joining Gateway, Osuna spent 15 years in the default management department of a top five FHA servicer. He has managed each of the functions within default management, most recently overseeing collection and loss mitigation strategies while serving as senior vice president of default and credit risk management.
“It became clear that traditional subservicers and small community banks were struggling with FHA default servicing requirements,” said Osuna, named vice president of default services of Gateway Mortgage Group. “Gateway has the knowledge and processes to remove this burden from small servicers and mitigate the risks, such as findings and penalties on FHA claims or audits.”
Gateway is a complete end-to-end mortgage banking firm that offers conventional, FHA, VA, Section 184 and USDA loans through 50 retail branches across 25 states.