Nationstar Mortgage (NSM) advances its plan for a low-cost, capital-light acquisition structure, initially selling $3.2B in servicing advances to New Residential (NRZ) and other investors, with the potential for that amount to rise as high as $6.3B. The advances are for MSRs with UPB of about $58B. The sale price is $3.2B.
For Nationstar, the move unlocks $362M of advance equity (with the potential for up to $681M) for redeployment into higher return opportunities.
Nationstar will continue to service the loans in the transaction portfolios for a base servicing fee with the potential to earn addition fees based on performance.
"We have been working rigorously to evaluate capital structure alternatives for acquisitions to unlock Nationstar's growth potential," says CEO Jay Bray.