Tips, Takeaways and More - What We Heard at IMN's Mortgage Servicing Rights Forum

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A summary of key discussion points at IMN's Mortgage Servicing Rights Forum, hosted on November 9-10 in New York.

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A MOMENT FOR MSR

• A lot of capital has entered the market making it very healthy.

• Overdemand for assets means that sellers, even if truly distressed, can get fairly healthy pricing.

• The biggest flow we’ve seen in MSR. A lot of supply but it’s being met with equal demand.

• Mortgage servicers have evolved, creating significantly more competition in this space therefore more competitive pricing.

• We are observing more sophistication in technology.

• Seeing increased efficiency in mortgage servicing when outsourced.

BANK VS. NON BANK

• Big differentiator is cost of capital where banks have the advantage.

• If a bank comes into the market and wants to buy an MSR package it is very hard for an IMB to compete.

• However, regulation of bank lending policies has made it more costly and burdensome for the banks.

• There has been a decrease in mortgage loan servicing that’s owned by the banks.

THE GROWING PROMINENCE OF ESCROW

• ‘Escrow’ or as one speaker put it: “the most important word at this conference.”

• Escrow used to be something you skipped over, but today, it is far more impactful than in years past.

• Not just escrow, but other float components have become increasingly important.

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