CIT Group has completed the sale of its Financial Freedom reverse mortgage servicing business, marking the company’s exit from the space.
The business, along with a related reverse mortgage portfolio, was sold to an undisclosed buyer. The sale is part of CIT Group’s key strategic initiatives to simplify its mortgage operations and reduce risk.
Under the transaction, CIT Group sold mortgage servicing rights and $879 million of reverse mortgage whole loans and other real estate owned assets as of April 30.
In addition to the sale, the company announced that it has outsourced the payment, servicing, and administration of duties of its ongoing mortgage portfolio to a national provider of residential servicing. The portfolio is approximately $5.2 billion as of March 31.
"These efforts support our plan to simplify CIT and gain greater efficiency in our business," CIT Chairwoman and CEO Ellen Alemany said. "We have addressed another legacy issue by exiting the reverse mortgage business, and we have created greater efficiency in our ongoing mortgage operation by partnering with an industry leader to service our portfolio. CIT remains focused on growing our core commercial and consumer operations, and these actions allow us to apply greater focus in those areas of the business."
Following completion of the sale, CIT continues to operate a consumer single-family home loans business for the purchase of a new property or refinance of an existing property through both the national CIT Bank direct franchise or through the OneWest Bank branch franchise in Southern California. The company also continues to originate residential mortgage loans indirectly, primarily through a network of correspondent lenders.
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