Holders of non-agency mortgages are showing increased demand for servicing by Planet Management Group, making it one of the fastest-growing non-agency servicers in the industry.

PMG, a subsidiary of Planet Home Lending, handled servicing for $10.50 billion in nonprime mortgages as of the end of June, up 59.0% on an annual basis, according to an Inside Nonconforming Mortgage analysis.

The company handles servicing for non-qualified mortgages, residential transition loans, and small-balance commercial, multifamily and single-family rental loans.

PMG in a recent report said its high-touch customer service and pre-securitization protocols have made it a strong partner for investors in the non-agency space. PMG said its customer service teams have helped keep delinquencies low on loans by staying in constant contact with borrowers and providing them with settlement options.

The servicer said it can leverage its technology stack to optimize servicing for various loan types. It noted that it uses “customized processes” to report on non-agency loans in real time and mitigate risks for investors. 

“Whether it’s managing the uncertainties of RTL projects prone to construction delays and budget overruns or navigating the volatility of SFR loans affected by fluctuating rental markets and tenant turnover, Planet’s strategies are designed to proactively identify risks,” PMG said.

PMG said unique challenges for non-agency servicers include heightened default risk on debt service coverage ratio and SFR loans, which are impacted by rising rental rates and inflationary concerns.

“These dynamics underline the critical need for investors to engage with an asset manager, servicer and subservicer that possess deep expertise in commercial rather than residential servicing,” PMG said in the report.

The servicer also is seeing increased demand from private investors for its asset management and advisory services. It noted that it had reached a record $12.6 billion in assets under its asset management and advisory services programs as of mid-2024.

“Investors are increasingly seeking out Planet for advisory services including loan pricing, due diligence consolidation, servicing transfer coordination, transaction management and deal closing, rapid warrant reviews and interim accounting reconciliation,” James DePalma, executive vice president of private client services at PMG, said in a statement.

Fitch Ratings upgraded its servicer ratings for Planet this month. It upgraded Planet’s primary subprime servicer rating, special servicer rating and primary prime residential servicer rating. Fitch also placed a stable outlook on the ratings.

Fitch noted that Planet has a long-standing executive team, with senior managers in the loan servicing business having 17 years of company tenure on average. It added that employee turnover is competitive with industry averages and has improved since Fitch’s last review of the company in 2023.

Fitch attributed its upgrades of Planet to technology enhancements, including a new automated application repository that eliminates the need for spreadsheets, third-party detection and response tools for serviced loans, and automation tools designed to help fulfillment operations more quickly complete requests.