Servicing Activities (Tables)
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12 Months Ended |
Dec. 31, 2019 |
|---|
| Disclosures Pertaining to Servicing Assets and Servicing Liabilities [Abstract] |
|
| Schedule of Servicing Assets at Fair Value |
The following table summarizes activity related to MSR for the years ended December 31, 2019, 2018 and 2017.
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Year Ended |
|
December 31, |
(in thousands) |
2019 |
|
2018 |
|
2017 |
Balance at beginning of period |
$ |
1,993,440 |
|
|
$ |
1,086,717 |
|
|
$ |
693,815 |
|
Purchases of mortgage servicing rights |
627,815 |
|
|
988,283 |
|
|
499,866 |
|
Additions from sales of residential mortgage loans |
— |
|
|
— |
|
|
20 |
|
Sales of mortgage servicing rights |
2,306 |
|
|
— |
|
|
(946 |
) |
Changes in fair value due to: |
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|
|
|
Changes in valuation inputs or assumptions used in the valuation model |
(390,149 |
) |
|
80,209 |
|
|
6,339 |
|
Other changes in fair value (1)
|
(307,918 |
) |
|
(149,879 |
) |
|
(96,781 |
) |
Other changes (2)
|
(16,050 |
) |
|
(11,890 |
) |
|
(15,596 |
) |
Balance at end of period |
$ |
1,909,444 |
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|
$ |
1,993,440 |
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|
$ |
1,086,717 |
|
____________________
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|
(1) |
Other changes in fair value primarily represents changes due to the realization of expected cash flows. |
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(2) |
Other changes includes purchase price adjustments, contractual prepayment protection, and changes due to the Company’s purchase of the underlying collateral. |
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| Schedule of Sensitivity Analysis of Fair Value, Transferor's Interests in Transferred Financial Assets |
As of December 31, 2019 and December 31, 2018, the key economic assumptions and sensitivity of the fair value of MSR to immediate 10% and 20% adverse changes in these assumptions were as follows:
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(dollars in thousands, except per loan data) |
December 31,
2019 |
|
December 31,
2018 |
Weighted average prepayment speed: |
14.8 |
% |
|
8.6 |
% |
Impact on fair value of 10% adverse change |
$ |
(88,459 |
) |
|
(67,245 |
) |
Impact on fair value of 20% adverse change |
$ |
(188,209 |
) |
|
(130,371 |
) |
Weighted average delinquency: |
0.9 |
% |
|
1.3 |
% |
Impact on fair value of 10% adverse change |
$ |
(7,470 |
) |
|
(6,911 |
) |
Impact on fair value of 20% adverse change |
$ |
(15,020 |
) |
|
(13,688 |
) |
Weighted average discount rate: |
7.2 |
% |
|
9.4 |
% |
Impact on fair value of 10% adverse change |
$ |
(49,274 |
) |
|
(62,528 |
) |
Impact on fair value of 20% adverse change |
$ |
(95,963 |
) |
|
(121,135 |
) |
Weighted average per loan annual cost to service: |
$ |
66.62 |
|
|
$ |
69.34 |
|
Impact on fair value of 10% adverse change |
$ |
(23,932 |
) |
|
$ |
(24,386 |
) |
Impact on fair value of 20% adverse change |
$ |
(48,054 |
) |
|
$ |
(48,972 |
) |
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| Components of Servicing Revenue |
The following table presents the components of servicing income recorded on the Company’s consolidated statements of comprehensive income (loss) for the years ended December 31, 2019, 2018 and 2017:
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Year Ended |
|
December 31, |
(in thousands) |
2019 |
|
2018 |
|
2017 |
Servicing fee income |
$ |
436,587 |
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|
$ |
312,100 |
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|
$ |
197,902 |
|
Ancillary and other fee income |
1,801 |
|
|
1,280 |
|
|
1,009 |
|
Float income |
63,224 |
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|
29,716 |
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|
10,154 |
|
Total |
$ |
501,612 |
|
|
$ |
343,096 |
|
|
$ |
209,065 |
|
|
| Schedule of Total Serviced Mortgage Assets |
The following table presents the number of loans and unpaid principal balance of the mortgage assets for which the Company manages the servicing as of December 31, 2019 and December 31, 2018:
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December 31, 2019 |
|
December 31, 2018 |
(dollars in thousands) |
Number of Loans |
|
Unpaid Principal Balance |
|
Number of Loans |
|
Unpaid Principal Balance |
Mortgage servicing rights |
793,470 |
|
|
$ |
175,882,142 |
|
|
717,167 |
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|
$ |
163,102,308 |
|
Residential mortgage loans in securitization trusts |
3,157 |
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|
2,033,951 |
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|
3,612 |
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|
2,392,471 |
|
Other assets |
71 |
|
|
12,511 |
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|
220 |
|
|
34,374 |
|
Total serviced mortgage assets |
796,698 |
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|
$ |
177,928,604 |
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|
720,999 |
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|
$ |
165,529,153 |
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