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July 2023 » thefivestar.com 29 July 2023 F E A T U R E or simply do not care about their customer or client experience that cause the biggest headaches. The transfer data is inconsistent, lacking key information, or in some cases just wrong altogether. Meanwhile, their communica- tion with customers about the transfer is like the data … it is inconsistent, lacking key info, or in some cases, just wrong. We do not just assume that our vendors and other subservicers will operate with perfection. In the end, we own the relationship with the customer and clients, so we must engineer solutions to ensure our customers and clients still get the best experience. As such, we put what we call "bubble wrap" around those points that exist where we do not control the entire process, such as with vendors or other subservicers, to protect the experience we want to deliver. This "bubble wrap" consists of extra layers of oversight, more frequent calibration meetings, triple data validation checks, or in some cases, taking an entire process in-house where we feel the vendor cannot meet our standards. It is a perpetual "trust but verify" philosophy on steroids. This approach allows us to definitively say that, regardless of the situation or circumstance, we still deliver a frictionless, top-quality experience for our customers and clients. Martin-Leano: The proliferation of state guidelines has challenged platform-system providers to keep up with industry changes. Most of these state rules require implementa- tion during short timeframes, thus causing servicers to create inelegant, manual-based solutions until service providers can keep up. Vendors who serve the origination space have been challenged as well. These chal- lenges impact their capabilities to deploy capital to invest in their product offerings for servicing. Russell: Carrington Mortgage Services experiences the industrywide "sprinters pace and marathon length" of the attempt to support customers through loss mitigation changes, which came fast and furious, and are still being enacted and retooled three years later. Beyond industrywide experi- ences, as a successful asset manager, we have not experienced quite as many pain points given the self-hedged nature of our platform, which is critically important in the current environment. Our origination and servicing businesses complement and support each other through any undulation in the markets. Q: What trends are you seeing in the servicer space? Martin-Leano: Employee engagement and hybrid work situations continue to evolve and affect the servicing space. Origination excess labor capacity has little room for absorption in servicing as loss mitigation, a typical spot for displaced LOs has low demand. These tend to be symbiotic; instead, both are moving in parallel with no countercyclicality. Q: How has inflation impacted your volume? Keaton: We have not seen inflation impact our subservicing and origination volumes per se, but like most nonbank ser- vicers and originators, we have felt the pinch of higher interest rates. Industry origina- tion volumes are down compared to 18 to 24 months ago, which hurts originations. However, prepayment speeds are also down, which is a boost for servicing. Merritt: Inflation has had an interesting impact on volumes, really leading to volatil- ity in the marketplace. With higher rates, there has been less run-off of the servicing "The marketplace is full of opportunity in that being good at servicing, regulatory change management, and loss mitigation is a very specific formula, and when done well, can make you valuable in the current ecosystem. ... Unusual times present unusual opportunities." —Candace Russell, VP-Post Sale, Carrington Mortgage Services, LLC