The sale of mortgage servicing rights in the secondary market stayed red hot in the third quarter with a whopping $138.9 billion of agency product changing hands, but deal makers believe the market is in for a bit of a breather, at least for a little while.

With the origination market expected to suffer the next two quarters – at least – some lenders are battening down the hatches, watching expenses, while others are pondering a serious move into non-qualified mortgages, something that wasn’t even on their radar screens two years ago.

Close observers of the politics of housing finance generally expect the next director of the Federal Housing Finance Agency to steer Fannie Mae and Freddie Mac toward a smaller market presence without creating a huge disruption in the industry.

David Fleig of MorVest: “We have numerous active conversations with clients thinking about selling MSRs and I am sure our competitors do as well.”

First Pacific is an institutional money management firm...

Meanwhile, the group of servicers ranked sixth through 25th had a combined increase of $119.9 billion from June 30…

According to Inside Mortgage Finance, New Residential ranks fifth among all residential servicers with a $384.0 billion portfolio at Sept. 30.

The deal is backed by jumbo reverse loans with a total unpaid principal balance of $571.8 million…

Eric Kaplan of the Milken Institute: “I don’t think the non-agency market is ready to absorb the market that’s taken away from the GSEs without some significant signaling in advance.”

Freddie CEO Don Layton said the CRT deals are “amazingly efficient…”