Rocket
Mortgage
has
struck
a
deal
to
handle
the
servicing
and
recapturing
activities
for
a
portion
of
the
mortgage
servicing
rights
(MSRs)
of
real
estate
investment
trust


Annaly
Capital
Management,
the
companies
announced
on
Tuesday.
Terms
of
the
deal
were
not
disclosed. 

Annaly
has
$75
billion
in
assets
invested
across
its
agency

mortgage-backed
securities
(MBS),
residential
credit
and
MSR
strategies.
It
has
built
an
MSR
platform
with
608,000
loans,
representing
$192
billion
in
unpaid
principal
value
(UPB)
and
$2.8
billion
in
market
value
as
of
June
30. 

Meanwhile,
Rocket’s

servicing
portfolio,
including
subserviced
loans,
had
a
UPB
of
$534.6
billion
as
of
June
30.
The
nation’s
largest
mortgage
lender
serviced
2.6
million
loans,
generating
about
$1.4
billion
in
annual
fee
income
in
the
second
quarter. 

Inside
Mortgage
Finance
ranked
Rocket
as
the
eighth-largest
U.S.
mortgage
servicer
by
owned
portfolio
in
Q2
2024.
Annaly
was
No.
14
in
the
ranking. 

Rocket
said
that
its
recapture
rate,
which
includes
purchase
and
refinance
loans,
is
at
85%,
triple
the
industry
average. 

“Rocket
is
committed
to
the
entire

homeownership
experience
from
budgeting
and
credit
building,
to
home
search,
financing
and
servicing,“
Bill
Banfield,
chief
business
officer
of
Rocket
Companies,
said
in
a
statement.
“We
truly
believe
in
building
relationships
with
our
clients
that
last
a
lifetime
—
whether
through
new
mortgages
or
servicing
loans.”

“We
are
proud
to
have
constructed
one
of
the
most
durable
and
high-quality
portfolios
of
MSR
in
the
market
and
this
partnership
will
allow
us
to
benefit
from
Rocket’s
industry-leading
servicing
capabilities
and
retention
rates,”
said
Steve
Campbell,
Annaly’s
president
and
chief
operating
officer.

Rocket
is
expected
to
start
subservicing
some
of
Annaly’s
MSRs
as
early
as
December.
The
portfolio
comprises
conventional
loans
with
a
weighted
average

FICO
score
of
757
at
origination.

Executives
at
Detroit-based
Rocket
have
said
they
will
continue
to
invest
in

artificial
intelligence
(AI)
to
improve
operational
efficiency
and
grow
their
servicing
portfolio.

Besides
closing
subservicing
deals,
Rocket
has
been
actively
acquiring
servicing
assets
at
higher
coupon
rates
to
create

refinance
and
home
equity
origination
opportunities.
In
the
second
quarter,
it
added
$20.8
billion
in
UPB
to
its
portfolio
for
a
total
consideration
of
$315
million.

“We’re
retaining
clients
for
the
next
transaction
at
rates
three
times
higher
than
the
industry
average,
positioning
ourselves
as
their
lender
for
life
and
generating
recurring
cash
flow
without
additional
acquisition
costs,” Varun
Krishna,
CEO
and
director
of
Rocket
Companies,
told
analysts
during
a

second-quarter
earnings
call.
“We’re
going
to
keep
growing
our
servicing
portfolio.”

Related