Ocwen Financial Corporation’s (OCN – Free Report) wholly-owned subsidiary PHH Mortgage Corporation closes the deal with Reverse Mortgage Solutions, Inc. and its parent company Mortgage Assets Management, LLC.
Ocwen acquires the RMS reverse mortgage servicing platform along with the outstanding equity interests in the RMS Real Estate Owned business, REO Management Solutions, LLC.
Subject to certain holdbacks and adjustments, the purchase price was $12.4 million.
PHH Mortgage is now the subservicer under a five-year subservicing agreement for reverse mortgages owned by Reverse Mortgage Solutions and Mortgage Assets Management, thus assuming approximately 350 reverse servicing and REO Management employees.
Certain third-party subservicing agreements were also assigned from Reverse Mortgage Solutions to PHH Mortgage. This led PHH Mortgage to become the subservicer of approximately 57,000 reverse mortgages or $14.3 billion of unpaid principal balance, which were transferred to PHH Mortgage’s reverse servicing platform upon the deal’s closing.
Subject to final approvals by counterparties, and other customary approvals and conditions, PHH Mortgage expects to begin servicing its owned portfolio of 34,000 reverse mortgages or an unpaid principal balance of $6.7 billion in fourth-quarter 2021.
Ocwen’s president and CEO Glen A. Messina stated, “We are very pleased to complete this transaction which triples our total owned and subserviced reverse portfolio and enables additional growth opportunities through a five-year subservicing agreement. The acquisition provides us with a high-quality reverse servicing platform, experienced people and customized reverse technology and supports our strategy to build an in-house reverse servicing platform. We believe this transaction enables us to significantly grow our reverse servicing portfolio and positions us as the only mortgage company that originates, securitizes and directly services reverse mortgage customers and clients.”
So far this year, shares of Ocwen have lost 0.6% compared with its industry’s decline of 39.3%.
Image Source: Zacks Investment Research
Currently, Ocwen carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
In February this year, LendingTree (TREE – Free Report) announced a partnership with Westlake Technology Holdings to launch an indirect auto lending platform. The move was part of the company’s efforts to enable its consumers to shop and distinguish the pre-qualified indirect auto loan rates on its site, LendingTree.com.
Acquisitions by Other Finance Companies
At present, several finance companies, especially banks are moving toward consolidation to dodge the heightened costs of investments in technology and counter lower rates in a bid to remain competitive. In an effort to diversify revenues, Valley National Bancorp (VLY – Free Report) inked a deal to acquire Bank Leumi Le-Israel B.M.’s U.S. banking arm Bank Leumi USA for $1.15 billion.
In August, Seacoast Banking Corporation of Florida (SBCF – Free Report) announced two separate merger agreements, one with Sabal Palm Bancorp, Inc. and the other, with Business Bank of Florida, Corp.