PHH Mortgage Corporation, a subsidiary of Ocwen Financial and parent company of Liberty Reverse Mortgage, announced on Wednesday that it has entered into a new reverse mortgage subservicing agreement with Finance of America Reverse (FAR).
The agreement is in line with PHH’s goal to bolster its subservicing portfolio, according to PHH’s EVP and Chief Servicing Officer Scott Anderson.
“We are very pleased to enter into this new subservicing relationship with FAR,” Anderson said in a statement. “This agreement is consistent with one of our core business strategies of growing our subservicing portfolio and is a testament to the strength and quality of our servicing platform as a premier subservicer for both forward and reverse mortgages.”
According to Anderson, both companies anticipate a long runway for the relationship ahead.
“We look forward to a long-term relationship with FAR and delivering on the expectations that they have for their servicing partners and customers,” he said.
As of Q4 2022, Ocwen/PHH/Liberty’s total reverse mortgage servicing portfolio stood at approximately $31 billion in unpaid principal balance (UPB), including approximately $23 billion in subservicing UPB.
“The agreement with FAR provides a meaningful opportunity to grow PHH’s reverse subservicing portfolio and strengthens its standing as the only organization in the U.S. that can both originate and subservice reverse mortgages,” the company said.
Ocwen is scheduled to announce its Q1 2023 business results on Thursday. For its Q4 2022 results, the company posted a net loss of $80 million in the fourth quarter of 2022 under generally accepted accounting principles (GAAP), but noted that its growing servicing and subservicing segment was a bright spot.
Finance of America Companies is set to announce its Q1 2023 financial results on May 8.
PHH SVP of Industry Relationships and Corporate Development Mike Kent said in March that servicing opportunities are one of the core elements in keeping the company on course.
“About 75% of our total reverse servicing portfolio is subservicing, so servicing reverse mortgages on behalf of other issuers and originators,” Kent said. “Then, from a product perspective, pretty close to 100% of our servicing is HECM, which is a more stable securitization market, we think, than the proprietary market. We see that as a plus, and we feel really good about our performance in reverse last year — and very excited about that balance diversification we created across both our servicing and origination platforms.”
In March, reverse mortgage servicing company Celink renewed a multiyear subservicing contract agreement with FAR. Celink said in a statement that the new contract will renew the subservicing agreement “for years to come,” extending an accord in place since 2011.