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» default servicing in print and online d e fa u lt se r v ic in p g in onl a nd r in t in e @ d VILLAINS … OR 12 .2 0 VICTIMS? PROGRAMMED FOR PERFORMANCE Did officials in Nevada bend the rules m 11 a criminal offense, Incentives, better communication, to make key to creating s.c o is it robo-signing the end justifies and personal service areand reducing or a case where low-default solutions sn e w the means? foreclosures. @ MARKET PULSE dsnews.com 02.2013 SEISMIC SHIFT IN SERVICING IS THE RECOVERY THE REAL DEAL? With mortgage servicing rights trading hands at a furious pace, non-bank servicers stand to gain from banks' portfolio trimming. Things are looking up for the country with most economic indicators pointing toward recovery, but are they legit or is it a case of wishful thinking? AR RNACUL n As' VE breakdow n ee n NG HO betw SPEAKI unicatio tion meowner mm nten ts Roommunity o h C The t Grow of Co ds co d ho service bree icers an t field e gap. serv ns, bu idge th ciatio n br S asso iders ca AN-LOS prov ER LO still iffy, ss DS OV beef AT OD fiscal fitne rs tos, but de With want len erve that's res tors n-loss ain ne. regulaeir loa ers maint an do th bank id th up r sa some easie TS POINT— COUNTERPOINT While the resolution of the government role is yet to be determined, King believes private insurers are heading toward a happy ending. "Private mortgage insurance works within the existing GSE model," King said, "and will work under virtually all housing reform frameworks, which should increase chances of legislative and operational success." Krista Franks Brock is a freelance writer and editor and regular contributor to DSNews.com and TheMReport.com. She was previously managing editor of DS News magazine and prior to that, was managing editor of Southern Distinction, a regional lifestyle magazine based in Georgia. SUBSCRIBE TO THE LEADER IN DEFAULT SERVICING NEWS PROFILE IN LEADERSHIP Happily Ever After for PMIs COVER STORY they say it is twice as much as would have been necessary to cover the losses the system suffered during the recent crisis. Private insurers do not seem to flinch at this plan. They are ready for the risk. "The private [mortgage insurance] industry has raised more than $9 billion in new capital since 2008, including $2 billion in the last 12 months, so the industry has more capacity to take on first loss risk," King said. Likewise, investors appear to have faith in the private market. King continued, "The start-up of new MI [mortgage insurance] companies shows that investors remain confident about the viability of the private mortgage insurance model, and the ability to attract new capital in our industry is a positive development." The standard set forth in the Corker-Warner bill—which calls for a deeper level of private capital coverage than what has been common in the past—"is the most common coverage today, widely accepted by borrowers, lenders, and investors," according to King. Traditionally, private mortgage insurers take on less than 20 percent of the GSEs' exposure. However, a "deep" insurance role on loans with loan-to-value ratios of more than 80 percent gives more than 30 percent of the GSEs' risk to the private market. Adding private insurance to all loans with loan-to-value ratios of 80 percent or less would rid the GSEs of "virtually all" risk, according to Genworth. "The use of private mortgage insurance can materially reduce GSE and taxpayer risks, while preserving creditworthy borrowers' access to affordable, conventional, low down payment mortgage loans," King said. In a recent discussion with Zillow chief economist Stan Humphries, Sens. Corker and Warner said their bill is gaining momentum in Congress and is widely accepted by the industry. VISIT US ONLINE @ DSNEWS.COM GHOS SPELLIN Typified byDItheirG fluid business formulas and time-tested tactics, these 25 top-of-the-line leaders have the art of servicing down to a science. s of ance the nu ration ating y regist ting, Navigpropert is a daun able, nt ge es vaca inanc unmana siness. ord not bu but rt of the pa es with s allianc erica's rative ing Am the seed Collaboare help ods plant ho fits nonpro neighbor future. tful a frui for DS News is the only publication in the country solely dedicated to providing default servicing professionals with news and content focused on their industry. SUBSCRIBE NOW! Call 214.525.6700 or connect with us online at DSNews.com. 53

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