WASHINGTON May 14 Mortgage servicer Green Tree
failed more than one-quarter of tests that assess how it deals
with struggling borrowers, a watchdog said on Wednesday, adding
further pressure on nonbank servicers who have faced increasing
concerns from regulators.
Green Tree, a subsidary of Walter Investment Management Corp
, had acquired mortgage servicing rights from a unit of
Ally Financial Inc, which had earlier entered a
settlement that subjected it to the tests.
The report of Green Tree's failures comes from a monitor
appointed to review compliance with the settlement, which was
with state and federal authorities.
Walter Investment Management, along with Ocwen Financial
Corp and Nationstar Mortgage Holdings Inc, have
been the most aggressive nonbank acquirers of servicing rights
on home loans. Walter was the ninth-biggest mortgage servicer in
the country in 2013, according to industry publication Inside
Last week the U.S. financial risk council raised red flags
about new, potentially risky practices by nonbank mortgage
servicers, which it said are not regulated as carefully as
Mortgage servicers handle borrowers' accounts, processing
payments and handling foreclosure proceedings.
(Reporting by Aruna Viswanatha in Washington and Peter
Rudegeair in New York; Editing by Meredith Mazzilli)