Servicing giant Nationstar Mortgage Holdings Inc. (NYSE:NSM) today announced it is acquiring Greenlight Financial Services, which includes a growing reverse mortgage division based in Irvine, Calif. The total acquisition is valued at up to $75 million.
Nationstar is no stranger to the reverse mortgage space; the company purchased MetLife’s reverse mortgage servicing portfolio when MetLife announced it would shutter that business in April 2012. Previously, the company purchased $18 billion in reverse mortgage servicing rights from Bank of America through a deal announced in late 2011.
The Greenlight acquisition gives the company a channel to support its loan generation, the company’s leadership said Tuesday in announcing the deal.
“We are excited to announce the strategic acquisition of Greenlight Financial Services, a leading direct-to-consumer originator that provides us with another profitable lending channel for servicing asset generation,” said Nationstar CEO Jay Bray in a statement.
The deal specified a purchase price of up to $75 million in cash with the expectation of “sizable volume and profitability uplift” and additional annual volume of $8 billion-plus. The deal is accretive to earnings per share by at least $.70 annually, the company projected upon announcing earnings for the first quarter of $62.6 million or $.70 per share.
Earnings saw a slight decline from fourth quarter earnings of $63.8 million or $.71 cents per share.
Nationstar did not note specifics regarding Greenlight’s reverse mortgage business which has included an Irvine-based call center for originations. Greenlight has closed 217 reverse mortgages year to date since January according to the latest report by Reverse Market Insight, marking a 90% increase over last year.
“We welcome the Greenlight employees to the Nationstar family,” Bray said. “The macro landscape offers tremendous opportunities to Nationstar, and we will continue to be opportunistic as we focus on the customer experience, asset performance and shareholder value.”
The company had not returned a request for comment as of press time.
Written by Elizabeth Ecker