Mortgage Servicer Ocwen to Acquire PHH Corp. for $360 Million


Mortgage servicer Ocwen Financial Corp. has entered into a definitive agreement to acquire mortgage originator and servicer PHH Corp.

As per the agreement, Ocwen will acquire all of the outstanding shares of PHH or approximately $360 million in cash.

The purchase price represents a 35% discount to PHH’s GAAP book equity at Dec. 31, 2017.

Provided the deal goes through, Ocwen will service 1.9 million loans with an unpaid principal balance of $328 billion and originate over $3 billion of residential mortgage loans, including reverse mortgages, annually.

Ocwen says the merger will provide it with numerous benefits, including a faster transition over to an “industry leading servicing platform.” The company announced in December that – as per its settlement with more than 20 states which had filed complaints against it over alleged servicing violations – that it would be replacing its current mortgage servicing system, REALServicing, with Black Knight’s mortgage servicing platform, MSP, for all new loans it boards.

Other benefits of the deal for Owen include improved economies of scale, reduced fixed costs through the elimination of redundant corporate overhead and, perhaps most important, the ability to “resume new business and growth activities to offset portfolio runoff.”

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