Mr. Cooper’s Acquisitions Continue With MSR Deals

Mortgage News May 9, 2023

Mr. Cooper announced that it had reached a definitive agreement to purchase Rushmore Loan Management Services.

Mr. Cooper has struck a deal with Rushmore to purchase their residential mortgage servicing platform, which includes about $37 billion of outstanding principal balance.In addition, Mr. Cooper has also agreed to acquire Roosevelt Management Company, which will serve as the foundation for its mortgage servicing rights (MSR) fund asset management approach.

Expected to be completed by mid-2023, these deals represent the latest efforts by Mr. Cooper to strengthen its servicing operations through acquisitions.

Terry Smith, the CEO of Rushmore, stated that after several months of discussions with Mr. Cooper’s exceptional leadership team, he was impressed with the depth and breadth of their platform. Smith believes that this combination presents a distinctive opportunity to advance their operations. He also believes that their merged entity will offer an unmatched service to a wider range of clients and customers.

Mr. Cooper Group’s Chairman and CEO, Jay Bray, expressed his satisfaction in welcoming Rushmore’s skilled team to their organization. Bray promised to deliver a seamless experience for Rushmore’s valuable clients, and together, they would create one of the leading special servicers in the industry.

In the first quarter, Mr. Cooper earned a net income of $37 million. Its servicing business contributed a pretax income of $94 million, with $853 billion in unpaid principal balance (UPB) and $6.6 million in mortgage servicing rights (MSRs).

Jay Bray highlighted the strong operating results and increasing returns in Mr. Cooper’s Q1 2023 earnings report, attributing them to their balanced business model. He further stated that the company ended the quarter with a healthy capital position, record liquidity levels, strong asset quality, and an improved hedge on their mortgage servicing rights (MSR) portfolio. Bray believes that these factors will enable Mr. Cooper to navigate through the volatile environment and invest capital in value-enhancing growth opportunities.

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