Although Flagstar led the pack, it was the only bank to rank among the top five sellers of brokered loans.

However, ARMs remain relatively rare in the MBS market. Fannie Mae, Freddie Mac and Ginnie Mae securitized only $41.6 billion of ARMs for all of last year, about 2.7 percent of their total MBS production volume.

Mortgage originators note that because the rule is more than 1,800 pages long and was issued just 10 weeks ago, there has been little time to study it, let alone consider its implications.

A nonbank wholesaler, Carrington is allowing credit scores as low as 580 for FHA and USDA mortgages, along with some VA loans.

Some analysts believe the $200 billion estimate on flow MSR transactions might be a bit low.

Also, Morgan Stanley recently increased its stake in Arch Capital Group to 6.3 percent. Arch owns CMG Mortgage Insurance, which is being renamed Arch Mortgage Insurance Company.

The entire group is moving to the Connecticut-based nonbank from a company called Mortgage Services, a subsidiary of First State Bank of Mendota, IL.

Orange Capital is a private equity firm that has been gobbling up stakes in PHH Corp. over the past year. A few months back Inside Mortgage Finance first reported that PHH might be a takeover target.

The FHA allows low downpayments on loans that have credit scores as low as 580, but numerous lenders have established their own underwriting overlays to protect against poor performance.

According to interviews conducted by Inside Mortgage Finance, Lau’s company, Pingora Loan Servicing, has amassed roughly $10 billion in MSRs in less than nine months.