Case Study: Ensuring Stability & Performance
Vervent demonstrates its expertise in managing a complex portfolio transfer, ensuring seamless integration and maintaining high performance standards. Explore the strategies and solutions that led to a successful transition and enhanced client satisfaction.
The Stakes: What Was on the Line?
Partnering with an experienced Backup Servicer is essential to protecting and maintaining portfolio performance during a trigger event. Uncertainty isn’t an option; failure meant escalating delinquencies, investor panic, and borrower confusion. Experience, security, capacity, and infrastructure is necessary to efficiently onboard and manage a portfolio while maintaining full compliance.
In 2019, a leading lender and debt consolidator appointed Vervent as a Backup Servicer to ensure portfolio stability in the event of a servicing transfer. In 2024, a trigger event prompted the transition of the ~$90 million unsecured consumer loan portfolio. During the uncertainty of a trigger event, relying on all parties involved to assist in servicing transfers is critical.
With full cooperation and Vervent’s extensive financial servicing experience, Vervent rapidly assumed the role of Successor Servicer, minimizing disruptions and ensuring business continuity. Additionally, Vervent’s team of specialists enhanced borrower communication strategies while maintaining portfolio performance.
The Disruption: Risk to Portfolio Returns
The originator was unavailable to assist during the conversion, requiring outside parties to support in transferring processes and working in an unfamiliar platform, including but not limited to:
- Credit Reporting
- Payment Processing
- Borrower Communication Strategies
- Data Mapping Inconsistencies
- Rapid Turnaround
Each day a portfolio is left without an engaged servicer, investors and borrowers are exposed to a wide range of risks and detrimental losses.
Solution: Vervent’s Precision and Expertise Creates a Turning Point
Challenges such as inconsistent data and gaps in procedural knowledge are common and require an experienced successor servicer to guide outside parties throughout the transfer.
With 35+ years of experience, Vervent effectively collaborated with outside parties, guiding them through payment processing, credit bureau reporting, borrower communication, and data mapping procedures.
Throughout the onboarding process, Vervent conducted daily meetings with outside parties, ensuring a seamless transition and preventing any gaps in servicing and portfolio losses.
Typically, delinquency rates increase by ~8% post-migration*. Vervent ensured seamless service continuity, maintaining stable delinquency rates throughout the conversion.
Vervent agents, many of whom are tenured and highly experienced in servicing unsecured consumer loan portfolios, were rapidly trained on the product and its features, standing by to assist borrowers. Agents utilized omni-channel communication to contact borrowers, successfully preventing defaults and delinquencies from rising.
Results
Challenges such as inconsistent data and gaps in procedural knowledge are common and require an experienced successor servicer to guide outside parties throughout the transfer.
Through strategic execution and expert guidance, Vervent:
- Ensured the successful transition of servicing responsibilities
- Maintained investor confidence and borrower satisfaction
- Preserved portfolio integrity and performance
By swiftly adapting to challenges and leveraging industry expertise, Vervent successfully fulfilled its role as a successor servicer, ensuring a seamless transition and reinforcing its position as a trusted leader in financial servicing.
