Let’s face it the post-2008 financial crisis was both good and bad for the servicing side of the business.
Servicing is generally a space that runs counter to what’s happening in the marketplace.
When consumers are happy and confident and making their payments, servicing shops become the forgotten, although still needed, segment of housing finance.
When the rough and tumble begins, providers of default processing solutions capture market attention again.
Judging by some of the headlines coming out of servicing this week, it seems the market continues to shift away from the ‘servicing-focus’ that captured headlines post-2008.
Bank of America [stock BAC] [/stock] announced plans to slash 400 jobs in Dallas and Richardson, Texas, the Dallas Morning News reports. The cause: a sharp drop in troubled loans prompted a reduction in servicing positions.
Smaller players in the servicing space also witnessed a seismic shift this year.
The market already experienced the Chapter 11 bankruptcy filing of foreclosure processor Prommis Holdings in March. Now Prommis affiliate, EC Closing Corp., is filing for bankruptcy reorganization.
It’s safe to say servicers are living in a post-crisis phase. The only lingering question is what will their space look like a year from now?
