Ocwen Financial Corp.’s wholly-owned subsidiary, PHH Mortgage Corp., has completed the previously announced transaction with Reverse Mortgage Solutions Inc. (RMS) and its parent, Mortgage Assets Management LLC (MAM), to acquire substantially all of the RMS reverse mortgage servicing platform and all of the outstanding equity interests in the RMS Real Estate Owned business, REO Management Solutions LLC (REO). MAM is a subsidiary of investment funds managed by Waterfall Asset Management LLC.
Concurrent with the closing of the transaction, PHH became the subservicer under a five-year subservicing agreement for reverse mortgages owned by RMS and MAM and assumed approximately 350 reverse servicing and REO employees. In addition, certain third-party subservicing agreements were assigned from RMS to PHH. As a result, PHH became the subservicer for approximately 57,000 reverse mortgages, or approximately $14.3 billion in unpaid principal balance (UPB), which were transferred to PHH’s reverse servicing platform concurrent with the closing.
Additionally, PHH expects to begin servicing its owned portfolio of approximately 34,000 reverse mortgages, or a UPB of approximately $6.7 billion, in the fourth quarter of 2021, subject to final approvals by counterparties and other customary approvals and conditions.
The aggregate purchase price at closing was approximately $12.4 million, subject to certain holdbacks and adjustments.
“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,” says Glen A. Messina, president and CEO of Ocwen. “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.”