Fitch Affirms Wells Fargo's U.S. Primary Residential Servicer Ratings
OREANDA-NEWS. Fitch Ratings has affirmed the following U.S. residential primary servicer ratings for Wells Fargo Home Mortgage (WFHM), a division of Wells Fargo Bank, N.A.:
--Residential primary servicer rating for Prime product at 'RPS1-'; Outlook Stable;
--Residential primary servicer rating for Alt-A product at 'RPS1-'; Outlook Stable;
--Residential primary servicer rating for Subprime product at 'RPS1-'; Outlook Stable.
WFHM's servicer ratings affirmation and Stable Outlook reflect the servicer's highly developed control environment, the efficacy of its succession and transition planning, and its effectiveness in consolidating and realigning its performing and default servicing under one business unit to reflect the reductions in default processing. Additionally, the ratings also take into consideration the financial support of its ultimate parent Wells Fargo & Company, which was affirmed at 'AA-'; Outlook Stable by Fitch as of Oct. 13, 2015.
WFHM remains the largest mortgage servicer and it continues to make meaningful enhancements to its systems and processes. The servicer does not offshore any customer-facing functions and indicates that it has no immediate intention to pursue this objective.
WFHM remains under signed consent orders with both the U.S. Federal Reserve Bank (FRB) and the Office of the Comptroller of the Currency (OCC) and the respective attorneys general that were executed in April 2011. On March 18, 2014, WFHM announced that it had successfully executed activities required under both the consumer relief (and state-level subcommittees) and the refinance programs in accordance with the terms of its obligations under the various settlement agreements with both federal and state agencies.
In June 2015, the OCC issued a second Amended Consent Order outlining 15 of the 98 specific items in the April consent orders remaining outstanding. WFHM indicated that it believes that it has implemented all of the operational changes that resulted from the expanded servicing responsibilities outlined in the consent orders, including those outlined in the June 2015 Amended Consent Order.
During Fitch's review period, the servicer closed its Milwaukee and Alaska sites and moved the functions to other locations. The servicer also consolidated portions of its mortgage servicing operations in its Springfield, IL and Birmingham, AL locations. Fitch believes that WFHM has effectively executed these changes, and continues to maintain a robust servicing-site system network.
WFHM is headquartered in Des Moines, IA operating seven servicing/customer centers and four specialized loss mitigation centers throughout the U.S. As of June 30, 2015, WFHM serviced approximately 8.9 million loans totaling $1.56 trillion. This includes approximately 7.7 million agency loans totaling $1.24 trillion, 794,381 prime loans totaling $253 billion, 10,545 Alt-A loans totaling $2.5 billion and 80,349 subprime loans totaling $10.7 billion.