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Resolution Trust Corporation: Oversight of Certain Loan Servicers Needs Improvement

GGD-92-76 Published: Apr 24, 1992. Publicly Released: Apr 24, 1992.
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Highlights

GAO assessed: (1) the Resolution Trust Corporation's (RTC) oversight of inherited loan servicers that service the RTC inventory of mortgages and loans from failed thrifts; and (2) the adequacy of RTC policies and procedures for monitoring the servicers' loan collection activities.

Recommendations

Recommendations for Executive Action

Agency Affected Recommendation Status
Resolution Trust Corporation To improve the oversight of inherited loan servicers, the President and Chief Executive Officer, RTC, should move quickly to compile a national inventory of inherited loan servicers.
Closed – Implemented
On August 12, 1993, RTC completed an inventory of inherited loan servicers. This action is fully responsive to the recommendation.
Resolution Trust Corporation To improve the oversight of inherited loan servicers, the President and Chief Executive Officer, RTC, should ensure that it has policies and procedures in place to monitor and periodically evaluate the servicers' loan collection activities, financial conditions, and overall performance.
Closed – Implemented
All inherited loan servicers are required to report to a master loan servicer who will provide first level review and oversight. RTC issued a Loan Servicer Oversight Program directive in January 1993. The program provides a schedule for audits and evaluations of all types of loan servicers, including inherited services. It also has criteria for evaluating the servicers' loan collection activities, financial condition, and performance.

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Topics

AuditsBank failuresFederal property managementFinancial institutionsFinancial managementLoan repaymentsMortgage loansSavings and loan associationsMortgagesFailed thrifts