Remember when rates ticked up a few weeks ago? Forget about it. Rates fell again, applications are strong and pipelines are full.

Based on reports from non-QM lenders Angel Oak and Citadel, the third quarter was a strong one for most originators. Meanwhile, the Ditech wind-down is almost over.

Bulk mortgage servicing sales have been slow in the third quarter, but that doesn’t mean bidders have been hibernating. If rates rise just a little bit and stay there, auctions of MSRs could boom.

Growth in subservicing contracts slowed a bit in the second quarter as con-tinued low interest rates took their toll. It’s anticipated that once rates in-crease, more vendors could disappear through M&A.

Will the third quarter be better than the second for originators? Looks that way. Meanwhile, mortgage M&A advisor Houlihan Lokey might wind up as one of Treasury's GSE advisors.

 

Mortgage M&A activity is on the light side these days. The reason: Home lenders are too busy originating new loans and reaping the profits. Unless rates spike, the situation is unlikely to change.

After acquiring a mortgage lender, Zillow planned to expand originations. However, issues with technology have slowed its hiring plans.

The transfer of bulk mortgage servicing rights was strong in the second quarter but dealmakers didn’t really feel it in the auction market. Investment bankers believe the second half could see strong MSR sale activity.

Not only are lenders making money these days, so too are the warehouse providers that finance them. Meanwhile, the mortgage IPO market is dormant.

Earlier this year, Wells Fargo offloaded roughly $20.7 billion in Ginnie servicing rights. The buyers? A bank and a nonbank. Meanwhile, the Equifax data hack will cost upwards of $700 million in settlement costs.