First American Real Estate Information Services, which performs specialized tasks for mortgage servicers, has hired a former MGIC Investment Corp. executive as chief operating officer.
James W. Reichert spent 25 years with MGIC, the nation's largest mortgage insurer. He left last year after being passed over for the presidency, he said.
The heads of First American's six operating subsidiaries will report to him. The St. Petersburg, Fla.-based company offers credit reporting, flood compliance, and real estate tax reporting services to lenders. It also owns Excelis, a leading mortgage servicing system.
First American has made several acquisitions in the last two years, and Mr. Reichert said it would look for more.
"We don't want to just do the same things better. We also want to do different things," he said.
An example of a different business that First American is looking at is a company that would co-service loans for several mortgage lenders.
Mr. Reichert said plans for the co-servicer were still in the preliminary stages but that it was a "high priority on our drawing board."
"We're hugely committed to never leaving any stone unturned," he said.
Mr. Reichert said he and James Long, First American's chief executive officer, will meet today with Stuart McFarland, a former GE Mortgage executive who first approached First American about the plan for the co- servicer.
Mr. Reichert said Perot Systems, Dallas, is interested in owning part of the co-servicing venture.
Under a co-servicing arrangement, the vendor performs some of the servicing tasks and the owner of the servicing rights continues to perform some.
First American would not own any of the rights, Mr. Reichert said.
"The idea is to provide a mechanical link rather than take any position in the mortgages," he said.
In that sense, the venture would be very similar to subservicing arrangements in which companies receive a fee for performing servicing functions for other companies but do not own the servicing rights.
But this co-servicer would work on a much larger scale. Industry sources said that First American is hoping to use its Excelis software to manage between $250 billion and $300 billion in servicing. If so, it would be the largest servicer of loans in the country.
Still, several servicing brokers - people who buy and sell servicing rights - said the First American venture has not become a hot topic.
