In one fell swoop, McCue Mortgage Co. added 2,600 loans to the 10,000 it already serviced, thanks to a dissatisfied Countrywide customer.


The Connecticut Housing Finance Authority has transferred servicing of 2,600 Countrywide-serviced loans, worth approximately $400 million, to McCue after the New Britain-based company won a bidding process.


The company hired three extra people to handle the addition to its workload, owner William McCue told The Commercial Record. He said his staff has been able to respond quickly to borrower needs – a frequent necessity as high delinquency numbers persist.


McCue has touted the benefits of local servicing: Instead of chasing down the right servicer across a vast nationwide network, homeowners call a central location. If they like, they can even drive to the company’s New Britain office – it’s about a 45 minute drive from any point in the state of Connecticut, McCue said.


‘The Problem Is Over’


Countrywide’s once far-flung network was part of the reason McCue got a crack at taking over those loans in the first place. Before Countrywide was purchased by Bank of America and re-branded as Bank of America Home Loans in 2009, its national network was overburdened, according to Carol DeRosa, spokeswoman for the CHFA. The CHFA still owns the former Countrywide loans now serviced by McCue, DeRosa said.


Prior to the transfer to McCue, homeowners had to call a variety of different offices around the country, and the CHFA eventually got fed up and opened the servicing business to other companies. McCue bid on a takeover of the business – for an undisclosed amount – in November.


DeRosa stressed that the CHFA’s dissatisfaction was with Countrywide’s old system, not Bank of America, and that accountability problems began long before the package of loans was put out to bid.


“The problem is over because Countrywide is now no longer in existence,” she said.


But, she added, CHFA was happy that a local company won out for control of servicing the 2,600 loans.


Dogged By Delinquencies


McCue is not an underdog in the Connecticut mortgage market. According to The Warren Group, publisher of The Commercial Record, McCue Mortgage Co. was the top mortgage company last year across several categories in both dollar volume and number of loans, including single-family, condo and multi-family lending.


While the company has added staff to handle its more than 20 percent increase in loan servicing business, McCue said, his company has been impacted by an overall surge in payment delinquencies across its entire portfolio.


The company’s delinquencies stand at 12 percent, a problem he attributed to long-term unemployment, not inappropriate lending practices or the decline in housing values.


Of the 12 percent that aren’t making their payments, “11.99 percent” do so because they’ve had their hours cut down or lost their jobs completley, he said.


Many of McCue’s borrowers are first-time homebuyers, he added, meaning they’re younger workers more likely to get laid off than their older counterparts. 


Unemployment for Connecticut stood at 8.8 percent in June, according to the Bureau of Labor Statistics. McCue said that when unemployment was at 5 percent – in early 2008, before financial turmoil hit in earnest – his company’s overall delinquencies were at 7 percent.