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CitiMortgage, the Scores Are In…

Rates BHA recent report brings good news for CitiMortgage, Inc. (CMI) as the institution’s U.S. Residential primary servicer rating for prime product and U.S. Residential master servicer rating both received a ‘RPS2+’, Outlook Stable rating from Fitch Ratings.

“The affirmation of the primary servicer rating and Stable Outlook reflect CMI's comprehensive internal control environment, sustained improvement in audit results, and management and staffing turnover,” says Fitch. “The affirmation of the master servicer rating and Stable Outlook reflect CMI's established master servicing platform, improvement in Regulation AB (Reg AB) results, and the management and reporting structure transition.”

According to the report, As of September 30, 2016, CMI was primary servicing over 1.5 million loans totaling $247.6 billion and master servicing more than 59,000 loans totaling $14.4 billion. The primary servicing portfolio is still declining through strategic asset sales of mortgage servicing rights (MSR) and whole loans.

Additionally, Fitch says the primary servicing portfolio includes approximately 218,000 non-agency prime loans totaling $63.7 billion, while the master servicing portfolio includes legacy RMBS transactions as well as new master servicing assignments including several Redwood Trust issued Sequoia residential mortgage pass-thru certificates.

“CMI has a strong institutional framework for compliance and control utilizing its ‘three lines of defense’ incorporating quality assurance and quality control as the first line; independent control functions as the second line, and internal audit as the third line,” says the report. “Since Fitch's prior review, quality assurance transitioned to a risk based approach and continued its implementation of risk ratings for specific defects identified for each test.”

Fitch says that it is notable to mention that CMI has sustained improvement in audit results with internal audit reports reviewed by Fitch for the current review period containing a relatively low number of significant findings.

Further, CMI's latest Reg AB report for the year ending December 31, 2015 contained no instances of material noncompliance for either the primary or master servicing operations, according to the report. However, Fitch adds that in the prior review period, master servicing had a separately issued Reg AB report that contained two instances of material non-compliance.

To read the full servicing report, click HERE.

About Author: Kendall Baer

Kendall Baer is a Baylor University graduate with a degree in news editorial journalism and a minor in marketing. She is fluent in both English and Italian, and studied abroad in Florence, Italy. Apart from her work as a journalist, she has also managed professional associations such as Association of Corporate Counsel, Commercial Real Estate Women, American Immigration Lawyers Association, and Project Management Institute for Association Management Consultants in Houston, Texas. Born and raised in Texas, Baer now works as the online editor for DS News.
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