Fitch Takes Multiple Actions On Green Tree Ratings

Fitch Ratings has taken several actions on the primary servicer ratings for Green Tree Servicing LLC, the St. Paul, Minn.-based subsidiary of Walter Investment Management Co.

The agency has made the following adjustments to Green Tree's scores:

  • assigned a primary servicer rating of RPS2- for prime product;affirmed the primary servicer rating for subprime product, the primary servicer rating for home equity lines of credit (HELOCs) and the primary specialty servicer rating for second-lien product at RPS2;
  • upgraded the primary servicer rating for high loan-to-value(HLTV) product to RPS2; and
  • affirmed the special servicer rating at RSS2+.

According to Fitch, the rating actions reflect Green Tree's borrower-centric, high-touch servicing model, dedicated borrower-contact process, experienced and highly tenured management team, and significant investment in technology.

The ratings further reflect Green Tree's financial condition and recent acquisition by Tampa-based Walter Investment. As of Fitch's review, the two companies continued to operate independently.

The ratings additionally consider procedural deficiencies highlighted by external audits (which have now been addressed with the addition of various processes and controls), as well as Fitch's overall concerns for the U.S. residential servicing industry.

As of May 31, Green Tree's servicing portfolio consisted of 798,298 loans with an unpaid principal balance (UPB) of approximately $39.2 billion. The portfolio is composed of 33% manufactured-housing product (based on UPB), 31% closed-end second product, 26% Fannie Mae and Freddie Mac product, 7% subprime product and 3% HELOC/prime/HLTV product.

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