HELOC Servicing Added to Cenlar's Menu of Options.

New York -- The days of plain vanilla may be numbered in the subservicing business, according to senior executives at Cenlar FSB, the nation's second-largest subservicer.

Senior vice president and business development director Dave Miller says that subservicing is an increasingly customized business, with companies like Cenlar working closely with clients to tailor services to improve efficiency and provide high-quality service for home loan borrowers.

Cenlar, which has resisted the temptation to expand beyond servicing of residential mortgage loans, has been expanding its menu of services within the residential lending field recently.

Cenlar is conducting a "very controlled rollout" of its new home-equity line of credit servicing option, Mr. Miller said. And the company is working with clients on "service plus" options that involve outsourcing some underwriting and origination functions to Cenlar. Mr. Miller said many lenders are now taking time to review practices and relationships and think about alternatives that might make them more efficient.

"Since the refinancing craze has gone away, people have turned to other things and are focusing their attention on profitability and efficiency," he said. "Subservicing is absolutely one of the things that they should look at."

Essentially, lenders are asking themselves if they need expertise in all areas of lending, or should they focus on specific areas and outsource other functions. Because of this trend, subservicing has become more widely accepted in the marketplace, Mr. Miller said. And he believes many can benefit by choosing to focus their energy on income generating activity while outsourcing loan administration functions.

But client lenders want more than ...