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32 | Th e M Rep o RT Feature report aims to provide the industry with a closer look at the CFPB's data, so they have an accurate assessment of what is happen- ing with both current loans and non-current loans facing servicing complaints. Daganhardt said the data is intended to inform both regulators and financial firms as they track and respond to trends in the CFPB database. Her interpretation of this first report is that the "industry has been responding to the complaints and has tackled probably the most difficult cohort of the whole servicing book." She added, "What we see in the data, complaints are falling in the delinquent, de- fault, and foreclosure category, but the overall book is falling. The absolute overall number of complaints has decreased, and the overall book of loans has declined." For Daganhardt, this "speaks positively of the efforts servicers have undertaken." The Industry Responds B ob Caruso, EVP of sales, strategy, and servicing at Black Knight firm ServiceLink, supports the ongoing loan- level analysis and suggests the industry is hungry for data that will detect areas of risk, while celebrating improvements. "The report helps servicers understand how they are performing versus the average and whether we have the same pain points as our peers," Caruso said. "We're all happy that complaint volume is low but also quite aware that we have more opportunity to improve. My hope is that consumers better understand that although the industry has been through a lot, we are better for it and will continue to improve. Complaints are much lower than we think customers may be aware." Ray Barbone, EVP of mortgage services at BankUnited, suggested the Black Knight white paper is a revelation of sorts—one that will hopefully show the industry is performing quite well when it comes to loan servicing. "More specifically, notwithstanding the fact it has been widely publicized that mort- gage servicing issues are one of the highest segments of complaints and that there have been thousands of such complaints received, it is equally worth noting that, according to the report, complaints related to general servicing of performing loans appears to be running at less than one 1/100th of a percent," he explained. "It would be interest- ing to see a comparison of similar analyses for other financial services segments as well as non-financial service industries. Further, I think the report provides lenders with the benefit of some very high-level data by which to benchmark themselves." The white paper reflects a change in how the industry not only interacts with data, but also with the CFPB itself. The industry has shown an interest in working with its newest regulator to fix the problems detected, but at the same time, ser- vicers desire more informed data. One issue yet to be addressed is whether the regulator is able to add context to complaints that enter into the CFPB database. "I would like to see the industry and CFPB continue to work together to provide even deeper context relative to complaints re- ceived, particularly regarding the percentage of complaints verified," Barbone added. The issue of whether complaints are ana- lyzed and probed for accuracy and context is a sticking point for others in the industry as well. "I think the whole report is interesting," Caruso said. "I would like all the servicing company participants to contribute more data so we can get more granular. That may enable us to learn more yet. I'm curious on the amount of relief being given to customers and why, and I'd like to learn more details on whether many of the complaints are really complaints. Our data indicates that many of the complaints are really just inquiries and that other complaints are simply due to the customer not getting the answer they want." Caruso went on to explain that customers typically become upset when denied a loan modification, and the reason for the deni- als should not be extracted from complaints made to the CFPB. "The report is not to 'dismiss or diminish' the validity of the inquiries by consumers, but rather to "position and better understand the data." — Ed Delgado, Five Star President and CEO

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