The Department of Housing and Urban Development released its servicer Tier Ranking Scores for Round 38 last week.
The scores, which determine if a servicer is eligible for additional incentives this year, are based on loss mitigation and foreclosure activity from October 2008 through September 2009.
Tier 1 servicers receive $200 for each special forbearance (versus $100 for non-Tier 1 servicers), an increased reimbursement for foreclosure costs (75% of Part B claims, rather than two-thirds) and additional time to market short sale properties (six months instead of four).
"We pay out a lot of extra money in tier ranking, but that's one thing I don't mind doing because it shows people are in compliance and that the companies are working with the homeowners to try to help them retain their homes," Sarah Martin, HUD's chief of single-family claims, said last month during a panel session at the Mortgage Bankers Association's National Servicing Conference & Expo.
Bank of America, Chase, CitiMortgage, GMAC Mortgage, Midland Mortgage, PNC Bank, US Bank and Wells Fargo all ranked as Tier 1 servicers in the high-volume category, which includes lenders servicing 100,000 or more FHA loans.
HUD implemented itÂ Tier Ranking System in2000 as a pilot to measure servicer's utilization of HUD's loss mitigation program.