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Investments

More Fannie Mae, Ginnie MSRs to be sold off

The search for MSR diamonds in the rough continues

diamond in coal

A new mortgage-servicing rights sale is slated for auction this month, providing MSR hunters with another chance to stock up on Fannie Mae and Ginnie Mae MSRs.

Loan sale advisor MountainView Servicing Group is handling the deal, which includes a portfolio of Fannie Mae and Ginnie Mae servicing rights with a total unpaid principal balance of $2.5 billion.

Ninety-seven percent of the loans are fixed-rate mortgages, 100% are classified as first liens and 100% are designated as retail originations. The portfolio also has a weighted average loan-to-value ratio of 84.3% and a weighted average interest rate of 4.16%.

"The seller is one of the first originators to secure financing for their servicing rights, and they originally came to us with an interest in buying MSRs," said Jeff Drott, managing director at MountainView Servicing Group and the lead advisor on the sale. "After watching several packages trade in the past two months, they decided to take advantage of the robust liquidity."

MountainView says it has already received interest from several repeat and new buyers. The top geographic locations represented in the loan pool, include Maryland (8.5% of the loans are situated there), followed by Virginia (7.7%), Pennsylvania (7.7%) and Georgia (6.1%).

The entire portfolio bids out on Oct. 17.

MSR activity continues to rise. In just the first nine months of the year, MountainView served as an advisor on 74 MSR transactions.

And it's not the only firm to go public with a major MSR deal this week. Prestwick Mortgage Group also announced it’s the broker for the $240 million-to-$480 million Ginnie Mae West Coast Flow Servicing Offer.

Prestwick Mortgage is representing a California mortgage banker in the deal. The offering's estimated monthly volume is valued at $20 million to $40 million, with the seller reserving the right to reject all potential bids. A large portion of the loans are tied to California and Washington state properties and carry an average loan balance of $300,000 to $320,000.

The average weighted FICO score is 695, with 63% of the loans tied to single-family homes and 35% linked to condos or townhomes.

Sixty percent are purchase loans while 40% are classified as refinancings.

Seventy-five percent were originated via the retail channel, while 25% went through the wholesale pipeline.

As far as loan types, 75% to 80% of the portfolio is linked to 30-year, fixed-rate mortgages, while 15-year FRMs and various adjustable-rate mortgages make up the rest.

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