Press
Midwest Loan Services and Nationstar Mortgage introduce “Secondary+”
(September 30, 2013) — Midwest Loan Services, Inc., the largest mortgage Sub-Servicer in the country that specializes in the Credit Union market, and Nationstar Mortgage, one of the leading buyers and holders of Mortgage Servicing Rights (MSRs) nationwide, today introduced Secondary+™, a unique and timely new Secondary Market option that will allow Credit Unions to:
- Sell flow mortgage loans Servicing-Released.
- Sell bulk Mortgage Servicing Rights (MSR’s) for balance sheet relief.
- Receive a competitive Service-Released Premium (SRP)
- Still have those loans Sub-Serviced in the Credit Union name.
In announcing this unique option, Ed Burger, Founder and President of Midwest stated “with our Members For Life® philosophy and services, our objective at Midwest has always been very simple – to achieve the objectives of our Credit Union partners.
In recent years Credit Unions have wanted, and needed to sell loans to the Secondary market, but many have been unable to acquire their direct GSE license. Those that have it are confronted with challenges in booking, valuing and managing the mortgage servicing rights (MSR’s) on their balance sheets.
Our new Secondary+™ relationship with Nationstar Mortgage provides a compelling solution to both those dilemmas. It will allow Credit Unions, for the very first time, to sell both bulk and flow mortgage loans servicing-released, receive a competitive servicing-release premium (SRP), and still have these loans serviced by Midwest in the Credit Union’s name to retain their most valuable member relationships.”
Joining Mr. Burger in this announcement, Jay Bray, CEO of Nationstar Mortgage, stated “Nationstar Mortgage recognizes the significant role that Credit Unions play in today’s financial services marketplace. That’s why we’re so excited to be working with Midwest Loan Services, a world class sub-servicer to Credit Unions.
We believe the combined strength of our organizations will provide Credit Unions with the ability they need to sell mortgage servicing rights while remaining connected to their members. Through our innovative, white glove, private label platform, we’re confident we have a winning program that will work well for everyone involved.”
Allen Price, Senior Vice President, Business Development for Nationstar Mortgage, added, that “as increased competition, regulatory and compliance headwinds continue to impact the overall financial services industry, Credit Union’s need to find new ways to retain (and grow) their membership base, and increase liquidity. This innovative option from Midwest and Nationstar enables Credit Union’s to do that, reduce risk, and differentiate themselves by retaining the member relationship through a servicing-released transaction.“
Emphasizing the impact Secondary+™ could have on individual Credit Unions, Steve VanSickler, President, Silver State Schools Mortgage Company in Las Vegas, NV, submits that “mortgage loan servicing is becoming more complex, and whether a Credit Union handles it in-house or out-sources, the operating cost is increasing, net income from a mortgage loan servicing operation is becoming smaller, and the operating risk is growing.
With this program, Midwest and Nationstar have developed the unique capability for Credit Unions to have their mortgage loans private label Sub-Serviced and also receive up-front income from the sale of mortgage servicing rights. This will allow Credit Unions to meet their member service objectives, reduce risk and operating costs, and grow operating income responsibly.
Midwest is a long-time advocate and partner for Credit Unions. This new relationship with Nationstar provides a unique new secondary execution option for Credit Unions to manage their residential real estate assets on the balance sheet and avoid the growing complexities of valuation of mortgage serving rights while continuing to protect their member service dynamics.”
Another Credit Union reaction to the program came from Alissa Sykes, Director of Mortgage Lending, Sunmark Federal Credit Union, Albany, NY, who added “We’re extremely excited that Sunmark Federal Credit Union will be able to take advantage of this new program. It supports Credit Union mortgage lending by providing for income on sale and by having those mortgages serviced in Sunmark’s name. It also enables us to provide the local, personal service that our members are accustomed to which sets Credit Unions apart, and helps us deliver on our brand promise.”