Wells Fargo & Co.'s home mortgage unit has hired Lender Processing Services Inc. to help manage the $118.7 billion portfolio of pick-a-pay loans that the lender would inherit with its pending purchase of Wachovia Corp.
Bob Caruso, Lender Processing's executive vice president of strategy and business development, "will dedicate the vast majority of his time to Wells Fargo," the Jacksonville, Fla., vendor said Thursday. Mr. Caruso is an eight-year veteran and former executive vice president of servicing operations at Wells Fargo Home Mortgage in Des Moines.
He has his work cut out for him. Wachovia said in October that it had raised the portfolio's projected cumulative loss rate to 22%, or $26.1 billion, and that only two-thirds of the loans were eligible for refinancing into traditional mortgages.
The Charlotte banking company inherited the pick-a-pay loans, also known as option adjustable-rate mortgages, from Golden West Financial Corp., which it bought in 2006. Wells Fargo, of San Francisco, is to close the Wachovia purchase this month.