In today’s complex mortgage industry, Selene Finance stands out as a critical player specializing in both residential primary and special loan servicing. This article offers a thorough look at Selene Finance’s operational strengths, management structure, and performance rankings, helping investors, borrowers, and industry watchers understand why this company plays an important role in mortgage servicing.
Ranking Overview: How Selene Finance Stands Out
Selene Finance has been given varied but hopeful ratings from S&P Global Ratings which point out what the company does well and where it could still improve in several servicing sectors. Experts recently rated Selene as having the following overall rankings:
- Residential Primary Servicing: Rated as Average overall, with Above Average management and organization but average loan administration. The outlook remains stable.
- Residential Special Servicing: Rated Above Average in all categories — overall, management, and loan administration — with a stable outlook.
They demonstrate Selene has the ability to handle both simple and complex debts and its special servicing unit handles delinquent loans effectively. The company is said to have a stable capital base, which allows it to fulfill its obligations to customers.
Restarting Selene’s internal audit program in late 2019 was noted as one of the main improvements made. As a result of the reintroduction implemented by a team outside the company, the business enjoyed stronger oversight, improved quality control and improvements to past issues. Because of this, the company’s outlook for special servicing turned from negative to stable.
Selene normally ranks average in prime servicing as the result of its shrinking prime loan portfolio, which has now remained steady at a lower level. The limited scope makes it more difficult to measure how well the business is doing.
Other advantages the bank has include an experienced team of managers, better training programs, an operational IT system that includes both vendor and proprietary technology and well-structured ways to manage complaints and vendors. Also, Selene’s main management methods are performing on level terms with those in the industry.
Selene managed to maintain business continuity during disruptions, including the COVID-19 pandemic.
Rationale: Selene Finance is a Major Role Player as a Servicer
Selene Finance works with banks, institutions and lenders by handling loans that are being paid on time and also loans that have not been paid according to schedule. It is important because the company can handle loan portfolios, which means investors are paid on time and borrowers have assistance when they need it.
Paying taxes, receiving payments from customers, looking after escrow accounts, managing risk, processing foreclosures and reporting to investors are all part of mortgage loan servicing. Selene is known for how well it handles non-performing loans, which makes it unique during economic downturns when borrower defaults increase.
Because the firm has a balanced portfolio and modern technology for customer care, its cash flows remain balanced, losses are minimized and investors feel sure about their investments. Loan servicing from Selene means homeowners receive continued help and access to loss mitigation programs that strive to keep homes from being foreclosed.
Complaint and Vendor Management
- Complaint Management:
- Executive Resolution Team (ERT) handles escalated complaints, reporting to EVP of servicing.
- Legal department handles complaints from state attorneys general.
- Use of complaint tracking software with root cause analysis.
- Complaint/error resolution committee meets monthly.
- Informal monitoring of social media complaints.
- Executive Resolution Team (ERT) handles escalated complaints, reporting to EVP of servicing.
- Vendor Management:
- Vendor Management Office (VMO) oversees vendor relationships and risk assessments.
- Vendor risk ratings dictate review frequency (high-risk = annual onsite review).
- Vendor scorecards are created by LOB and reviewed independently by VMO.
- Integration of legal department into vendor oversight in progress, especially for attorney performance reviews.
- Vendor Management Office (VMO) oversees vendor relationships and risk assessments.
Profile: An Overview of Selene Finance
On October 1, 2007, Selene Finance L.P. began operation as a subordinate entity of Selene Holdings LLC. Selene started as a captive service provider for a troubled mortgage fund and in 2010 it began handling third-party servicing. In 2019, the company was purchased by Pretium Partners LLC, which provided a large amount of capital for upgrading technology and growing the organization.
Selene operates a number of servicing centers across the United States, for example:
- Jacksonville, Florida (Primary servicing location)
- Houston, Texas
- Operations center and executive office in Dallas, Texas
- Salt Lake City, Utah, is the location of both operations and support services (HQ).
The Horsham, Pennsylvania office has been shut down and work is now being done at other, newer locations that are more efficient.
As well as offering loan servicing, Selene provides other services through their associated firms.
- Selene Title LLC: Once it only handled titles for REO properties in Selene’s portfolio, but now it covers clients other than REO.
- Selene Diligence LLC is a business advisory company that has gained a lot of ground through steady development.
Selene has set a target of around 70,000 loans at the end of 2021, with services provided for performing, re-performing and non-performing loans and REO accounts as well. It now has 24 private clients compared to 19 a few years ago, which points to ongoing business growth.
Key agencies and programs, for example, have approved Selene as one of their servicers:
- Fannie Mae
- Freddie Mac (including special and aggregator servicer roles)
- Government agencies like the VA, USDA, HUD
- Ginnie Mae issuer and servicer
Portfolio Volume Over Time
Selene’s loan portfolio has changed significantly in recent years due to sales and servicing transfers, reflecting market conditions and company strategy.
| Date | Prime Units | Prime Volume ($M) | Special Units | Special Volume ($M) |
| June 30, 2021 | 1,159 | 75.18 | 40,875 | 7,366.85 |
| Dec. 31, 2020 | 1,253 | 82.99 | 32,240 | 5,624.71 |
| Dec. 31, 2019 | 1,538 | 106.63 | 34,964 | 5,553.17 |
| Dec. 31, 2018 | 13,712 | 1,180.26 | 67,018 | 13,001.52 |
| Dec. 31, 2017 | 15,598 | 1,405.52 | 42,569 | 7,450.63 |
This table illustrates the reduction in Selene’s prime servicing portfolio over recent years, alongside fluctuations in the special servicing portfolio.
Management and Organization: Experienced and Growing Leadership
Selene’s team for servicing performs above average in all categories, a sign that the management is doing a good job and the company is well organized.
Most members of the executive team have an average of 19 years of experience in the mortgage industry. The average duration of senior management is lower than that of peers, but after Pretium Partners’ acquisition, many new hires made turnover rates fall and increased job stability.
- Chief Executive Officer (CEO)
- Chief Financial Officer (CFO)
- Chief Technology Officer (CTO)
- Chief Revenue Officer (CRO)
- Chief Risk Officer (CRO)
- Chief Operating Officer (COO)
Nearly half of Selene’s staff are new hires, signaling a strategic talent upgrade aligning with the company’s renewed vision and growth plans.
Training Programs
She gives a lot of importance to the growth of her staff, introducing a new training plan that covers
- Call center and loss mitigation staff receive 40 hours of training in class and on the job.
- Twenty-one hours of compliance training per employee every year
- Courses with a focus on understanding customers and establishing a good connection
- Internship opportunities at colleges were paused since COVID-19 appeared.
- Assessing and certifying a soldier’s skills Drill and training
- Offering staff formal plans to follow and user guides to encourage their growth
A partnership with a Pretium subsidiary is underway to further enhance training, including “train the trainer” programs and improved training resources.
Conclusion
Selene Finance demonstrates a solid and well-structured operational framework supported by advanced technology, comprehensive internal controls, and a committed management team. Their integration of proprietary and vendor servicing systems, alongside robust cybersecurity and disaster recovery protocols, ensures resilient and efficient loan servicing operations. The company’s risk management and governance practices, including regular audits, quality assurance, and compliance monitoring, further reinforce its reliability and ability to meet regulatory standards.
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