Celink will subservice the Financial Freedom reverse mortgage portfolio being sold by CIT Group (NYSE: CIT) and will transfer Financial Freedom staff to become Celink employees, sources have confirmed to RMD.
The loan portfolio, comprising roughly $900 million in unpaid principal balance, is being sold by CIT Group for an undisclosed sum, as specified in a purchase agreement announced in early October. While Celink will subservice the loans, the servicing rights to the loans in the portfolio are being purchased by a separate entity, which has not been disclosed.
Celink is also acquiring the servicing platform, including its proprietary technology.
In announcing the sale of the Financial Freedom portfolio, CIT Group noted its ongoing work to refocus the company on some of its core business segments.
“Throughout this year, we have made continued progress in transforming the company and applying our focus toward maximizing the potential of our commercial banking and deposit franchises, which are the core of our go-forward strategy. We are pleased to have reached this agreement, which will enable CIT to exit the reverse mortgage business,” CIT Group Chairwoman and CEO Ellen R. Alemany said at the time of the agreement.
Financial Freedom was brought under the CIT Group umbrella in 2015, through the company’s acquisition of OneWest Bank, which had previously acquired IndyMac.
The buyer of the servicing rights for the portfolio has not been disclosed. The transaction is expected to close in 2018.
Written by Elizabeth Ecker