Deal is expected to double its reverse mortgage servicing and subservicing portfolio
Ocwen Financial Corporation has announced plans to purchase Reverse Mortgage Solutions (RMS) from its parent company Mortgage Assets Management (MAM), for an aggregate purchase price of approximately $12.4 million.
The nonbank mortgage servicer and originator announced Friday that its subsidiary, PHH Mortgage, has reached an agreement to acquire all of the operations, assets, and employees of the RMS reverse mortgage servicing platform. PHH Mortgage will also acquire all outstanding equity interests in the RMS Real Estate Owned business, REO Management Solutions (REO).
“We are very pleased to announce the proposed acquisition of the RMS reverse mortgage servicing and REO platforms,” said Glen Messina, president and CEO of Ocwen. “The acquisition is expected to double our reverse servicing/subservicing portfolio and will provide us with a high-quality reverse servicing platform, experienced people and customized reverse technology. In addition to our current relationship with Waterfall across the reverse mortgage product spectrum, we are excited and honored to broaden our partnership with them through the long-term subservicing agreement and to support their asset growth and investment objectives in the reverse mortgage industry.”
Under the terms of the deal, RMS will assign the subservicing contracts for the reverse mortgages it currently subservices to PHH. As of March 31, RMS serviced roughly 35,000 reverse mortgages, or approximately $7.8 billion in unpaid principal balance.
The transaction will also see PHH assume the vast majority of the RMS reverse servicing and REO employees. PHH will become the subservicer under the five-year agreement for reverse mortgages owned by RMS and MAM.
The acquisition is expected to close in the third quarter of 2021 and is still subject to certain post-closing adjustments, regulatory approvals, and other customary closing conditions.
“Our Liberty Reverse Mortgage platform is one of the premier reverse mortgage lenders in the industry, and we believe this transaction complements our existing capabilities and further solidifies our leadership position. We look forward to closing this transaction, welcoming the RMS team, clients and customers to the Ocwen/PHH family, and continuing our long-term partnership with Waterfall,” Messina said.