The just lately finished $300 million-plus acquisition of House Level Capital via Mr. Cooper supplied a beautiful alternative to reinforce the corporate’s present loan servicing rights (MSR) portfolio, and it’s anticipated to spice up the corporate’s final analysis throughout the subsequent couple of quarters.

That is in line with Jay Bray, CEO of Mr. Cooper, in an interview on HousingWire’s Housing Information podcast hosted via HW Media CEO Clayton Collins.

“We’ve recognized the control group [at HomePoint] smartly, [and] we’ve talked to them through the years about other strategic choices,” Bray stated. “As we entered the 12 months, we felt like there used to be going to be a possibility to shop for some MSRs, and HomePoint offered a gorgeous alternative.”

A part of that stems from its huge portfolio predominantly composed of Fannie Mae and Freddie Mac-backed loans, and aligned with Mr. Cooper’s personal strengths, Bray defined.

“We simply felt like that made a ton of sense,” he stated. “We will be able to upload [them] to our platform with out numerous incremental prices, and keep growing the platform that we’ve mentioned through the years. And so, it simply made numerous sense for us.”

Bray stated incorporating the corporate and its $84 billion in MSR belongings has confirmed to be a clean procedure up to now, including that it made numerous sense for Mr. Cooper to discover strategically.

When requested concerning the variations in complexity between obtaining an organization and an MSR portfolio, Bray defined that this actual acquisition used to be now not very complicated since House Level Capital had spent a lot of the closing 12 months “simplifying their operation,” he stated. That if truth be told created extra commonality with an asset acquire, he defined.

“After we were given to the degree the place we had been in a position to execute on a transaction, in reality, all that used to be left used to be predominantly the servicing asset,” Bray stated. “And the servicing asset used to be being subserviced, so they simply didn’t have a ton of operations [or] those that had been supporting that asset. So, it used to be nearly like purchasing an MSR asset.”

Prior transactions Mr. Cooper has been inquisitive about had been relatively extra sophisticated since they concerned bringing over other people and related platforms along with the firms themselves, Bray stated. 

“We’ve completed extra, I might say, asset transactions than in reality true corporate or platform transactions prior to now,” he stated. “We will be able to indubitably do both, however the complexity of HomePoint used to be beautiful easy as a result of they’d in reality simplified their operation. So, that’s in reality easy methods to take into accounts it.”

When requested about any added complexity present subservicing relationships would possibly upload to an acquisition, Bray defined that Mr. Cooper most often pulls any similar subservicing into its personal platform.

“We view our platform as, if now not the most productive, one of the environment friendly platforms available in the market,” Bray stated. “And so with our scale, measurement [and] profitability, it all the time is smart to transport it onto our platform. Now, there could also be a time frame that we stay it on the subservicer simply from a logistics [or] approval perspective, however we usually all the time transfer it to our platform.”

There have been no actual surprises to be discovered within the transaction procedure that weren’t prior to now known via prior due diligence performed via Mr. Cooper, Bray added.

Pay attention to the total dialogue with Jay Bray at the fresh episode of Housing Information.