Onity Group Inc (ONIT) 2017 Q1 法說會逐字稿

Good day, ladies and gentlemen, and welcome to the Ocwen Financial's First Quarter 2017 Earnings Conference Call. (Operator Instructions) I would now like to introduce your host for today's conference, Mr. Stephen Swett. You may begin.

Good morning, and thank you for joining us today for Ocwen's First Quarter 2017 Earnings Conference Call. Before we begin, please note that a slide presentation is available to accompany today's call. To access presentation, please go to the shareholder relations section on our website at www.ocwen.com and click on the events and presentations link. Also posted on our shareholders relation site is a second presentation with our traditional financial slides. As a reminder, the presentation and our comments today may contain forward-looking statements made pursuant to the safe harbor provisions of the federal security laws. These forward-looking statements may be identified by reference to a future period or by use of forward-looking terminology. Forward-looking statements, by their nature, address matters that are, to different degrees, uncertain. Our business has been undergoing substantial change, which has magnified such uncertainties. You should bear these factors in mind when considering such statements and should not place undue reliance on such statements. Forward-looking statements involve a number of assumptions, risks and uncertainties that could cause actual results to differ materially. In the past, actual results have differed from those suggested by forward-looking statements, and this may happen again. Our forward-looking statements speak only as of the date they are made, and we disclaim any obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise. In addition, the presentations posted online and our comments contain references to non-GAAP financial measures, such as adjusted operating expense, adjusted pretax income, adjusted pretax income before corporate debt expense, normalized adjusted cash flow from operations, illustrative servicing cash flow or servicing cash generation, and the off-balance sheet value of some of our economic assets. We believe these non-GAAP financial measures provide a useful supplement to discussions and analysis of our financial condition. We also believe these non-GAAP financial measures provide an alternate way to view certain aspects of our business that is instructive. Non-GAAP financial measures should be viewed in addition to, not as an alternative for, the company's reported results under accounting principles generally accepted in the United States.

For an elaboration of the factors I just discussed, please refer to today's earnings release as well as the company's filings with the Securities and Exchange Commission, including Ocwen's 2016 Form 10-K, and once filed, Ocwen's First Quarter 2017 Form 10-Q. Joining me on the call today is Ron Faris, President and Chief Executive Officer; and Michael Bourque, Chief Financial Officer.

Now I will turn the call over to Ron.

Good morning, and thank you for joining us today. There is a lot to discuss. But first, let me make a couple of opening remarks about the preliminary financial results for the first quarter. In the quarter, we recorded a $33 million loss, which is a $79 million improvement versus the first quarter of last year. Obviously, recording a loss is not where we want to be, but it is worth noting the significant improvement. The quarter was pretty straightforward. One notable item was an $8 million litigation reserve related to a legacy securities class action litigation claim. This case has not however settled, had any settlement or final legal outcome could be materially different. We also continue to hold the $12.5 million reserve established last quarter during settlement discussions with the CFPB. However, as you know, the CFPB has filed legal action now and any settlement or finding by the court could be materially different than this amount. We are vigorously defending ourselves in both of these cases. Except the $8 million reserve I just mentioned, the quarter was pretty clean and a bit better than we had anticipated. Despite the runoff in the portfolio, our revenues were about flat to the prior quarter and we saw strong modification performance. Our servicing business earned a profit of $3 million and our lending business earned a profit of $1 million. Also notable was the operating cash flow in the quarter. The business generated $86 million of cash from operating activities and we ended the quarter with $268 million of cash. We are not going to review the financials in detail this morning. But we have posted our traditional earnings slides on the Ocwen's website for your review. And you know where to reach Michael or me if you have any questions. We are operating in an obviously challenged sector and some of the other large non-bank servicers are similarly facing significant headwinds as they manage their businesses. I would like to assure you that I and the rest of my management team, are focused on doing all we can to effectively manage our business through these challenging times and ultimately drive better financial performance.

Next, let me touch upon the potential agreement we are working towards with New Residential. We are excited about the progress we have made in recent date that culminated in our respective announcements earlier this week. Significantly, for shareholders, this arrangement would solidify and strengthen what I consider to be an already strong relationship with our largest counterparty. As we announced, the agreement in principle would extend the relationship out to at least the end of 2020 -- 2022, and reduce the uncertainty around possible transfers resulting from potential servicer rating downgrades. Both of these points are contemplated in the transaction and would be positive for us should we reach a final agreement. Additionally, new residential will take on direct ownership of the MSRs where they own the rights today and we will enter into a more traditional subservicing agreement. New Residential would also pay us an estimated $425 million in the transaction.

Finally, when the deal is finally signed, New Residential will pay us almost $14 million to become a 4.9% shareholder of Ocwen. While the balance sheet today, reflects the current New Residential relationship as a net 0 as the MSR is offset by financing liability, we don't expect to record a $425 million gain at the time of the transaction. As consents are received and MSR is transferred to New Residential, we will receive the respective upfront cash payment. To account for this, we will debit cash and credit deferred revenue, which we expect will amortize the income over the life of the subservicing contract. Going forward, with this agreement in place, we will have a lower monthly subservicing fee than we currently receive under the existing legacy HLSS agreements we have been operating under. I'll remind you that existing HLSS agreements come to an end in stages between February and April 2020. While not precise, we expect that the applied annual subservicing fee to be approximately 30 basis points versus approximately 25 basis points today. We anticipate we will continue to receive HAMP fees and most other traditional ancillary fees that we currently receive under the HLSS agreement. Since we are still working towards a definitive agreement, terms are not final and there is no guarantee we will enter into an agreement. Therefore, we won't be able to answer many questions related to the New Residential transaction. I think it is important to note that we have been in discussions with New Residential about this transaction for more than a month. We appreciate New Residential's continued support of the company regardless of what cycle we are in, and we look forward to them becoming one of our larger shareholders. As time progresses, and we move beyond some of our current restrictions, we believe that this relationship can grow further and benefit both company's shareholders.

Finally, I'd like to address the recent CFPB and state regulatory actions. Let me start first with the states. At this time, 31 states have taken some form of action against us. We are attempting to work with all states, both individually and potentially as a group to try to resolve their joint and individual concerns. While we hope to reach some agreement soon, there is no guarantee we will be able to do so. Where necessary, we have filed certain notices and legal actions to protect our interest and frankly, to provide us more time to work together towards resolution. If we are able to come to resolution with some or all of the states, we do expect that we will continue to be restricted from acquiring new bulk MSRs as we are today for some additional period of time. To date, we believe we’ve taken the necessary steps to comply with the various state actions. This includes pausing for closure activities in 2 states, which currently impacts less than 150 loans and curtailing or stopping certain loan origination activities in 3 states. Additionally, we are arranging to release servicing on new originations in 15 states. We currently don't believe the limitations we are placing on our origination activities will have a material impact on our future financial results, but we do expect our origination volumes to decline in the interim until we can reach some resolutions. The states' primary concerns are related to past servicing activities in our offshore locations, relative to state licensing requirements, historical escrow reconciliations and our overall financial condition, mostly based on a multistate examination that the covered the period from January 2013 through February 2015 and that was conducted in 2015. We continue to provide information requested by the states to help them better understand and resolve their concerns. We hope we will be successful in our efforts to move towards resuming more regular regulatory relations over time. I would highlight the progress and success we have had recently with both New York and California as evidence of our ability to do this.

Moving on to the CFPB allegations. To help you better understand the claims being made by the CFPB, I'd like to give you some examples of loans that we believe the CFPB has identified as having alleged inappropriate foreclosure sales. Looking at these examples and by reviewing customer files, which the CFPB did not do during its investigation of Ocwen, should make clear why we strongly disagree with the headline allegations. Example one, this loan was transferred to Ocwen for servicing in 2010 and was already in foreclosure and almost 3 years delinquent. In 2011, Ocwen provided the customer HAMP modification. This government's sponsored modification allowed the consumer to resume payments, clear the delinquency and remain in the home. In other words, it gave the borrower a second chance. Unfortunately, in late 2012, the consumer again stopped making payments. We attempted to contact the borrower numerous times with only limited success. In mid-2013, the consumer did engage with us about trying to do a deed in lieu of foreclosure. A deed in lieu is where the homeowner turns over the property and walks away from the debt, similar to what occurs in a foreclosure sale. A deed in lieu process is complicated because other liens on the property must clear before we can proceed. In contrast, liens are generally automatically cleared in a foreclosure sale. We tried working with the borrower on the deed in lieu for over a year. However, the homeowner did not return the executed documents required to complete the process. Finally, in October 2014, the foreclosure sale was completed. At the time of the foreclosure sale, the consumer was not living in the property and they had not made a house payment in over 2 years. All in, over a period of 7 years, this homeowner made 26 out of 84 possible mortgage payments. Despite our efforts, and these facts, the CFPB seems to believe that this foreclosure sale was not appropriate. We disagree. Another example of a loan where the CFPB seems to be believe we foreclosed inappropriately, was a loan that was modified three times between 2009 and 2013. Each time the payment was reduced with the last modification resulting in our customer benefiting from a monthly payment that was less than half of the original payment. This last modification was a shared appreciation modification, meaning that our customer also benefited from some amount of principal on their loan being forgiven. Unfortunately, following each modification, our customer experienced financial difficulties and stopped making payments. Finally, in 2014, our customer pursued a deed in lieu. Ocwen actually tentatively approved the deed in lieu, pending approval from the mortgage insurance company. In this case, however, the mortgage insurance company rejected the deed in lieu and had Ocwen continue with foreclosure, which occurred in late 2015. At the time of the foreclosure sale, the loan was over 2 years delinquent. In other words, over a 6-year period, Ocwen went above and beyond to try to assist our customer, having provided 3 modifications, principal reduction, payment reductions and even an attempt at a deed in lieu. Had the CFPB reviewed the actual loan files, we believe they would have concluded that our actions were not only proper, but above and beyond what is generally accepted as industry standard. When we say Ocwen cares, it does really mean something to us and we demonstrated that by the lengths to which we were willing to go to help this customer.

In my final example, this loan was a loan that was transferred to Ocwen for servicing in 2011. At the time of transfer, the loan appeared to be an investment property. Although in the next couple of years, Ocwen offered the borrower modifications on 2 separate occasions, both of which included principal reductions. Unfortunately, the borrower never followed through. In the fall of 2014, our customer again reapplied for modification assistance and was approved for a modification through HAMP. As with the prior 2 modification offers, this third offer included discounting the principal balance, this time by over $78,000. This third offer was made very close to the scheduled foreclosure sale date. And as a result, we were unable to obtain court approval to delay the foreclosure sale. This happens. We did however, rescind the foreclosure sale, thus allowing the consumer to review the HAMP modification offer. In February 2015, the HAMP offer was withdrawn because we did not receive any of the trial payments or the signed modification agreement back from the customer. Eventually, the customer notified us that the property was vacant and they mailed us the keys after which we then completed the foreclosure sale. Ocwen received no payments during the 3 plus years we serviced the loan, but we did try hard to assist the customer. It makes no sense that the CFPB deems our actions to be inappropriate. These are tough examples. In each one, a customer, a family was struggling to keep their home or investment property unsuccessfully. At Ocwen, we have provided ourselves on our ability to work with homeowners in distress, and to offer them modification solutions that not only helped them remain in their home, but also provide better outcomes for RMBS investors that own the mortgage. Since 2008, we've completed over 735,000 modifications and we only pursue a foreclosure class when we’ve exhausted all other options. As per the fourth quarter 2016, Making Home Affordable Program Performance Report by the U.S. Department of the Treasury, we have completed 50% more modifications as compared to the next sized servicer. We have completed over 50% of all modifications in the industry under the streamlined HAMP program. At Ocwen, we strongly believe that helping homeowners is what we do. These are examples are why we believe we must defend our company, and for that matter, the customers who serve -- who we serve and we have helped. We believe that the substantive allegations in this suit are based primarily on the CFPB's flawed analysis of data and it's relying on isolated instances where Ocwen self-identified ways where we can do better. A hallmark of a company with a robust risk and control infrastructure is that it proactively self identifies opportunities for improvement, enabling the company to catch potential issues in real-time before their impact is felt. So we intend to vigorously defend ourselves while staying committed to serving our customers and the communities where we live. We believe that our servicing processes and systems are operating effectively. And third parties have continued to confirm our effectiveness in performing to their expectations. You will note on Slide 7 through 17, we have highlighted several different independent third-party reviews of our operations, which we believe show strong and improving controls and effectiveness. I won't dig deep into each one, but for the most part we're putting forward information from external parties who in some form or another, have audited us, or evaluated us or even was, or is, a customer of the company. We think that the facts speak for themselves. On Slide 7 and 8, you can see the CFPB complaint data. Not only have the complaints drastically fallen, we have a lower complaint level per 1000 loans serviced than 2 very reputable peers who we believe are both looked upon favorably by regulators. On Slide 9, you can see our favorable 4 out of 5-star rating from our customers on customeraffairs.com. On Slide 10, we're sharing our GSE annual audit results for the last couple of years. You can see for each of the agencies our performance has improved.

On Slides 11 and 12, we remind folks of the deep, exhaustive, third-party reviews that have been done inside our servicing business. These are firms that came into Ocwen with the expressed purpose to identify issues. In all cases, we received positive marks. On Slide 13, we shared an overview of the state exam history from 2016. It's hard for me to reconcile this data with actions the states took on April 20. After providing almost 900 loan files for review last year, we received satisfactory or better ratings from 7 of 8 states. The last state issued a report with no ratings, but identified preliminary findings dating back to 2013. These findings have long been remediated.

On Slide 14 and 15, we share some of the internal data management rigor, as well as information on the control assessments done by our internal audit group, which is independent from management and reports to audit committee of the Board of Directors.

And finally, we share the results from the National Mortgage Settlement testing. It would be appropriate to think of this as the CFPBs own monitor, testing the metrics they deem important as part of the 2013 National Mortgage Settlement. You can see the error rate on passing metrics is well below threshold levels. In fact, in all 4 quarters in 2016, testing by our independent internal review group has concluded that there have been no identified tested metric failures. All these reports, individually and together, show a strong and ever improving control and effective business environment. Our dedicated -- one which is dedicated and focused on our customers, and in particular, struggling homeowners. Again, we think the facts speak for themselves. Let me summarize by saying that our first quarter performance was slightly better than we had anticipated. But we do need to evaluate the impact of recent regulatory actions and what effect it'll have on our financial results, including our legal expenses. We believe the proposed, but not finalized New Residential transaction is a significant vote of confidence from our largest counterparty and a positive step towards eliminating uncertainty as to their longer-term intentions relative to Ocwen. We intend to work with all state regulators to resolve their concerns. We intend to vigorously defend ourselves against the CFPB allegations. And most importantly, we intend to continue to help struggling homeowners as we have done in the past while also delivering better outcomes for RMBS investors. Let me close with 2 things that the Ocwen team is very proud of. First, during the first quarter, we received recognition by 2020 Women on Boards as a winning W company for 2016. Winning companies champion diversity, which is something we take seriously and are very proud of.

Lastly, I received the following note from a customer the other day. This is why we do what we do. It goes, "Dear Ocwen, I'm writing as a person, not a company. I've read some negative things in the paper about Ocwen. I disagree. Since Ocwen began handling our mortgage, we have received the help we needed, when we needed it and from some of the kindest, most understanding people I have ever dealt with. I am sure, if not for their great work and understanding, my wife and I would have lost our home years ago. I pray for them and the wonderful work they do on a daily basis. A personal note to the people at Ocwen, may God continue to prosper you as you help those of us who need it to remain in our homes. Signed, a grateful customer". Thank you.

We will now open the call up for questions.

(Operator Instructions) And our first question comes from the line of Bose George from KBW.

First, just on the NRZ transaction, just wanted to go back to what you guys said about the financial impact, so there won't be an impact on the book value and does the deferred revenue essentially reflect the future subservicing fees?

So we don't believe that there will be an upfront gain. We believe that the payments -- or payments as we receive them will amortize into revenue over the life of the subservicing agreement. So you would have that revenue amortizing in on top of the subservicing fee which I mentioned in my prepared remarks along with the various ancillary income that we would continue to receive.

The only thing I would say, sorry Bose, the only other thing I would say is I mean that's our preliminary analysis. The ink's not even dry on the preliminary agreement yet, and so it's somewhat of an unusual transaction that we continue to evaluate. So that maybe subject to change, but that's our read of it today.

Okay, that makes sense. Can you just repeat the impact that you said on subservicing, so what happens to the revenue going forward?

Yes, so again and let me clarify something Michael said. There is no agreement at this point in time, but we are very optimistic about that. Under the HLSS arrangement, you can think of our service -- net servicing fee that we retain being about 25 basis points annually. We anticipate that under the new agreement, if we get there, the subservicing fee would be, say, approximately 13 basis points. And those numbers are not precise, but that's what we said in the prepared remarks.

Okay. And then I mean just in terms of uses of cash. Obviously, there is a lot of cash coming in as part of this transaction. Is it too early to kind of think about what happens to that, potential uses, returns, etcetera?

Yes, I think, it is. I mean first of the timing of the cash coming in, it will be uncertain as we mentioned. It will come in -- we anticipate it would come in as individual PSAs are -- go through the process and receive the proper consent. And so the timing is uncertain at this point in time where we'll be in our cycle related to ability to acquire MSRs or not. Other investment opportunities we might have. We're uncertain at this time, so we can't really comment at this time on what the cash will be used for, but we can evaluate other options, pay down debt, other things. But we don't know at this time, how it will be used.

Okay. Just one on the earnings for this quarter. The $31.8 million MSR mark, just curious what drove that, just given rates were roughly flat for the quarter?

Yes, Bose, that was the mark from the fourth quarter, that favorability doesn't repeat. So as you're walking kind of fourth quarter to first quarter, it looks like a bad guy. But in the quarter, you can see the marks on the back, usually on the last slide of our kind of financial supplement, the fair value changes were less than million dollars kind of all in. So you had some runoff as you would expect, but nothing unusual from a fair value change standpoint.

And our next question comes from the line of Fred Small with Compass Point.

So just on the first one, I guess, you put out the 13 basis points. But do you have a sense of sort of what the overall revenue yield on the servicing book would be pro forma for the entire NRZ transaction?

At this point, we don't have any other information. As I said, we expect that subservicing fee to be what we commented on and we expect to continue to receive most of the ancillary income that we receive today. But we don't have any other information to report at this time.

Okay, sorry. I did not hear that part. You said that ancillary fees stay with Ocwen under the contract?

Yes, I mean you can go back. But I mean HAMP fees and most of the traditional ancillary fees will stay with the company.

Okay. What about the escrow?

We really aren't getting material fees that come off of escrow, but -- so I'm not exactly sure what you're even referring to.

Okay. And then just assuming that this goes through as anticipated, how much more scale do you think you need in order to get to breakeven. Do you have any sort of rough thoughts about that?

No, we're not going to give any projections on that. But as we’ve highlighted in the prior quarters, and as evidenced by this quarter, the continued -- the decline in the portfolio does create a scale issue for us. And we need to over time find both hopefully additional sources of revenue as well as continue to make progress on the cost front. So that's a major focus of the management team. But we don't have any kind of forward-looking statements on that.

Okay. And then just I mean as you look forward to maybe next year and the potential, once the company has passed sort of the current -- I don't want to say regulatory noise, but what's -- some of what's cropped up recently, once you get through that and you look towards maybe acquiring MSR, what's sort of -- what I guess, flavor or what type of MSR do you think makes the most sense? What type of servicing would you look to acquire? Is their legacy nonagency servicing out there that you can still find you think, and acquire at attractive prices? I'm assuming agency doesn't really makes sense for you. Would you look to acquire Ginnie Mae servicing? Can you give any color on that?

So Fred, just -- I mean first off, as you are aware, we really haven't been in the market for the past 3 years. And I'm not sure if you heard all my prepared remarks, but I did indicate that we expect there will be restrictions for the additional period of time on our ability to acquire MSRs. So it's really difficult for us to project out or comment. I think, we have the capability to service FHA/VA loans. We have the ability to service Fannie and Freddie loans. We obviously are one of the larger servicers of nonagency. If things get to the point where we all hope they will be, we would be open to considering any of that. We would also hope that there might be opportunities to work with New Residential in ways to facilitate that at the right time. But really at this point, we have been out of the market for 3 years. We expect to be out of the market for additional period of time. And it's really not feasible to project what might occur when that time comes.

Okay, got it. And then on -- NRZ I think talked about their call -- on their call about the downstream services associated with MSR, but if sole ownership of the MSR transfers to NRZ, does that impact the Ocwen's contractual obligation to use Altisource as a service provider on default services, REO sales etcetera? Does that -- if NRZ owned the MSR outright, does Ocwen need to use -- does Ocwen as a subservicer need to use Altisource as a service provider?

So first off all, let's remind everybody that at this point that there is no agreement. We also commented that we are going to limit our conversation related to this because there is not a signed agreement at this point and there's still discussions going on. We're going to comply with our contractual agreements that we have with Altisource as well as whatever we end up signing with New Residential. We have no reason to believe that the relationship will materially change, but it's really, at this point, not appropriate, or too early to even discuss it any further.

Okay. And then if you were just the subservicer, forget NRZ, if somebody else on the MSR, and Ocwen is just the subservicer, does Ocwen as subservicer and non-MSR owner, have a contractual obligation to use Altisource for default servicing?

Well Fred, I am not a lawyer and I do want to get into the nuances of all of our various contracts. It all depends on the different relationships. But as you probably are aware, we subservice loans and -- for others, and we have our vendors that we use and they're pretty consistent across all portfolios. We have no reason to believe that that's going to change. But again, until agreements are signed, there's really not much more to say on it.

And our next question comes from the line of Kevin Barker with Piper Jaffray.

In regards to the cash payments from the deal with NRZ, would there be any requirements to pay down debt, given it would be considered a material sale of assets?

I think maybe similar to the comments that I made with Fred, we will obviously comply with all of our agreements as I said, maybe with Bose's question. We have not made any determination yet as to what the use of proceeds will be for.

Okay. I believe you made some comments about pulling servicing from some states or not servicing in certain states, could you...

I don't think we said that. But do you want me to just clarify?

Yes, do you mind?

So I think I commented that there were 2 states that required us to pause for closure activity which impacts less than 150 loans and we've done that.

Okay. And within certain states, is it possible to have another servicer service MSRs related to loans in some states, even though they are part of a larger mortgage-backed security and are you able to isolate that? Or do you need to have one servicer servicing the whole mortgage backed security?

Probably varies some depending on the type of security, but you can have subservices in place for subsets of loans in many situations. We don't believe we're headed in that direction. But it will depend on the agreements themselves and so it's a difficult question to answer.

Okay. And then you did make comments that the annual subservicing fee will be around 13 basis points from NRZ. It's close to 25 basis points now. Would the effective impact of this sale essentially be a decline of 12 basis points of compensation annually?

Well, there would be a decline of about 12 basis points annually from the servicing fee component, yes. Obviously, we would be getting this upfront payment, which would be amortized as income, most likely offsetting some of that.

Okay.

But keep in mind, Kevin, you'll also have the reduction in some of the kind of the "interest expense" that we pay NRZ. You'll have offsets in other parts of your income statement that will mute a large part of that impact. So you've got to kind of think of the whole thing changing together.

So on a GAAP or a cash basis, will the net impact, excluding where it is on the income statement, whether it's in interest expense or through servicing fees or amortized, would the net total impact on the income statement essentially be 12 basis points?

We can maybe come back to that as the agreement gets finalized and we talk about it further. This is still very much happening in real-time and I think, it would be premature to say definitively anything like that today.

I appreciate that. I know it's pretty complicated. In regards to the New York Department of Financial Services review of your servicing platform, it appears that that's still ongoing. Absent what's happening with the other states in regards to the New York Department of Financial Services review, will they be finishing a review a year from now as has been indicated in some media reports or is that something that's going to -- that can happen in the near term?

Yes, so we made -- I'm not aware of the media reports or who put out any media reports on that. But just to remind everybody, the monitorship that New York had in place did come to an end in April. And one of the conditions of the consent order that we signed was that the state, intended to do its own examination of Ocwen. They had not done a regulatory exam in a number of years of the company. And that following an examination, that would be a piece of information that they would use in determining whether to potentially grant us the ability to acquire mortgage servicing rights again. We've made no comments, nor do we have any comments about whether there is -- when the exam will occur, what the timing of it will be, anything related to that, nor do we necessarily even know. So we don't have any further comments on that.

Okay. And then just one housekeeping item. How much -- how big were the HAMP fees in this quarter?

So Kevin?

I will wait on that.

Now the HAMP fees in the quarter were $21 million. It was pretty consistent with last quarter, but a step down from our peak in the second and third quarter last year during the big streamline HAMP push.

And that should decline pretty quickly going forward, right? Just because of the expiration of HAMP in December, right?

Yes, as we talked about it in the past, we did expect a pretty good volume of HAMP mods in the first quarter and that was from the folks who kind of had gotten into the pipeline before the end of the program. So I think we did just under 9,000 HAMP mods in the quarter. That will come down rapidly and then we'd expect to be just left with the success fees that we get, which will kind of run down over the next 2 or 3 years.

This concludes the Ocwen Financial's First Quarter Earnings Call. Thank you for attending. And have a nice day.