ResCap Consolidates Servicing Operations, Sees Some Ratings Drop

Several press statements put out Wednesday by Fitch Ratings confirm that the primary, master, special and subservicing operations of GMAC’s residential mortgage servicing businesses — which includes GMAC Mortgage, GMAC-RFC, and Homecomings Financial Network — have been integrated into Residential Capital LLC. Fitch withdrew all of its ratings for each component servicer and assigned new servicer ratings for ResCap, although not all of the new ratings remained the same. Hidden in the transfer of ratings were two apparent downgrades: one to the company’s residential primary servicer rating; and another to its residential special servicer rating. Homecomings had held a primary servicer rating of ‘RPS1-‘ but saw ResCap’s servicer rating assigned to ‘RPS2+’. Both Homecomings and GMAC Mortgage had held a ‘RSS1-‘ rating for special servicing, but saw ResCap assigned a rating of ‘RSS2+’. The rest of the consolidated ratings assigned to ResCap remained unchanged between ‘RPS2’ and ‘RPS2+’. Fitch said that in conjunction with the operational integration, ResCap also consolidated its mortgage servicing sites to three locations in Waterloo, IA, Dallas, TX, and Fort Washington, PA; master servicing operation remains in Burbank, CA. As of June 30, 2007, ResCap was servicing over 3.4 million mortgage loans totaling $481 billion. The portfolio was comprised of over 1.6 million prime loans for $287 billion, 323,000 Alt-A loans for $81 billion, 428,000 subprime loans for $56 billion, 85,000 HLTV loans for $3.4 billion, and 748,000 HE/HELOC loans for $32 billion. For more information, visit http://www.fitchratings.com.