Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto
Mutual Funds

Ocwen Chairman Bill Erbey Talks Housing

Tickers in this article: ASPS OCN RESI TRLA Z

NEW YORK ( TheStreet) -- Bill Erbey, chairman of Ocwen Financial Corp. , Altisource Portfolio Solutions , Altisource Residential Corp. , Home Loan Servicing Solutions and Altisource Asset Management spent several hours talking with TheStreet for his first-ever profile entitled "Bill Erbey Made $2.3B Off Your Underwater Mortgage" .

Below are excerpts from the interviews, edited for clarity

You are chairman of five public companies. How much time do you spend with each of them?

Bill Erbey

That varies depending on what's going on, what the opportunities are, the challenges with each of the businesses so that can vary from time to time. I spend the majority of my time at all the companies thinking about a couple of things. How do we develop the talent pool of people that we need to execute on our business plan? What is our strategy -- where do we want to put our resources? Also, then I'll get involved in acquisitions to the extent that we're doing them, and also I get involved in the, if you will, the technology of how does one process technology and how does one get a non-performing loan current and performing. Basically, what we consider to be our competitive advantage with respect to our loss mitigation capabilities, and our ability to be a process manager.

TheStreet

Is servicing the main business that you consider yourself to be in?

Erbey

Certainly our largest business is the servicing business today in terms of that. We really operate in a space that provides people with shelter. When we think about it in a more global sense, it is the largest segment of the economy, and we like to participate in those segments where we think we have a competitive advantage. We go all the way from providing servicing, we provide all the third parties with the services associated with either origination or servicing a loan. We're one of the largest sellers of real estate in the United States today. HLSS for example, has a fairly large portfolio of advances and MSR's, non-prime MSR's and then you look at our most recent entrance into the space, it's the ability to purchase non-performing loans, convert as many as we absolutely possibly can into performing loans. Then those which we can't get into a performing status, we're going to renovate them and add them to the rental housing stock.

TheStreet

What is the biggest opportunity that you see, you could look at any time frame you like?

Erbey

I think there are two significant secular trends that are occurring within shelter, if you will. On the lending side, you very well identified that servicing is shifting from the large banks to the servicers, and it's shifting primarily because the large banks, I believe, want to focus on their core customer base where they have multiple relationships with that borrower. They have a credit card, an auto loan, etc. and those which are non-core, they would just as soon have someone like ourselves be the servicer for that. I think there's going to be a large shift to the non-banks. In the same space, there is a large shift in terms of simply how many Americans can get a new mortgage. That's a fairly major social issue that I think hopefully will be addressed at some point in time. Only about 35 percent pre-Dodd-Frank could actually get a new mortgage, 35 percent of the households, and Dodd-Frank obviously has had some impact. I think it was well meaning, but I think one of the second order effects is fewer people will qualify for a mortgage.