Onity owns roughly $123 billion of MSR and has a growing subservicing business. But still, the market treats its stock like a leper. Might de-leveraging help?
Falling interest rates are never good for the value of mortgage servicing rights. But with so many MSR owners keeping their 3% to 4% rights of 2020 and 2021 and selling the rest, marks for the third quarter of 2024 could be benign.
The Federal Reserve announced a 50-basis-point reduction in the federal funds rate this week. Interest rates on mortgages have come down by more than that in recent weeks in anticipation of the Fed’s move.