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Servicing

Vericrest Financial scoops up $2.7 billion in MSRs

The trend of mortgage servicers chasing after new mortgage servicing rights continued with Vericrest Financial's decision to sign a deal to buy $2.7 billion in MSRs.

The mortgage loan servicer signed two deals to acquire the rights as it moves to enhance its position as a mortgage servicer with national reach, according to a statement from Vericrest CEO David Schneider.

"Combined with our innovative service offerings and state-of-the-art platforms, the increased scale we will achieve through these transactions will support our growth strategy and allow us to deliver best-in-class solutions to a broader client base," added Schneider.

One of the deals will close on Nov. 16, and the other is expected to close on Dec. 1.

Vericrest's move to expand its MSR reach is in line with an ongoing trend where firms such as Ocwen Mortgage Servicing (OCN) and Walter Investment Management (WAC) are acquiring MSRs, including assets belonging to Residential Capital – the former subsidiary of Ally Financial – out of bankruptcy.

But leaders in the mortgage servicing space said finding assets at the right price remains an essential part of the process with profit margins generally thin in the space and the fact that there are still inherent risks when acquiring new MSRs.

Still, while firms like MetLife Bank and others, decided to sell MSRs in 2012, big banks, including JPMorgan Chase (JPM), have been acquiring MSR assets this year.

Even credit unions are contemplating a future in which they desire more regulatory room to acquire MSRs as investments, rather than just servicing their own loans.  

Sources told Housingwire in October that Vericrest may have obtained servicing rights out of Berkshire Hathaway's (BRK) acquisition of whole loans from Residential Capital out of the bankruptcy proceedings. The company did not comment on those reports at the time.

kpanchuk@housingwire.com

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