Looking for some guidance on servicers and and forced placed insurance

5 Replies

hey everyone,

i am looking for a little bit of guidance on servicers. who would you guys recommend?

also forced placed insurance, who do you guys recommend? 

thank you for any help in advance.

Hi Stas, 

We have been using FCI as our servicer and earlier this year they have implemented a blanket FP insurance policy for all clients with their insurer, OSC. Basically as soon as our loan is boarded with FCI, the property is insured under the blanket policy. OSC then sends the borrower a request for proof of insurance and if satisfied, the policy is revoked. If not satisfied the policy remains in force and we are billed for the coverage from OSC. Once the borrower provides proof of insurance, then OSC will refund us the cost of the policy paid, pro rata to the date of new insurance by the borrower. Its a nice touch and saves us having to add FP insurance to our procedures. 

Bob

Servicer is certainly an easy way to go.  If you would like more of an unbundled experience we have 5 A+ rated markets that write FP coverage.  But unless you really want to service your own note, I suggest bundling the service, we really use the FP polices for the community banks we write which are better enabled to service their own loans.  

thank you guys. i guess i will try fci. appreciate your input.

@Stas Finelt

 Stas, I wouldn't use FCI just because of their insurance.  What type of notes do you need serviced?

We use FCI to service three of my portfolios. We do our own loss mit and since my corp is trustee, I have a different company handle foreclosures as my sub-agent. 

FCI did a really crappy job on announcing and explaining their forced place policy with OSC. Lots of confusion, poorly communicated. However, it sounds attractive, although we have yet to utilize.

For 20+ years I serviced my own notes in-house. It satisfied my control issues and concerns. Compliance was never my concern because of the type paper I buy and originate.

Today, using a third-party servicer simply makes sense. We used another company and found their service lacking. FCI is certainly not the only player however they have crafted their programs to be reasonably well-suited for the smaller note investor. Sadly, compliance is taking the limelight once reserved for creative dealmaking brainpower.