AMCORE Sells MSR Portfolio
AMCORE Financial here is in the process of selling its originated mortgage servicing rights in a move the company says will better position it to grow its mortgage origination business and stabilize mortgage earnings through future economic and rate cycles.
AMCORE said it has entered into a "strategic agreement" with a national mortgage services firm to provide private-label loan processing and servicing support. As part of the arrangement, AMCORE is also selling mortgage servicing rights. The transaction is subject to due diligence and customer closing conditions.
AMCORE said it expects to record a gain in the first quarter of 2007 related to the servicing sale, but the gain will be "partially offset" by transaction costs.
AMCORE said that as a result of the decision to limit its mortgage servicing rights exposure, it will be able to offer a greater breadth of loan products, more competitive pricing to its clients and greater processing efficiencies with a more variable cost structure for the company.
The company said the transaction provides access to the resources of "one of the largest market players for support of its underwriting, processing, settlement and servicing efforts," as well as to that firm's state-of-the-art technology. An AMCORE spokesperson declined to name the service provider.
She said AMCORE will be "maintaining the primary point of contact with the customer" in the private-label arrangement, with back-office support and technology being provided by the third party service firm. (c) 2007 Mortgage Servicing News and SourceMedia, Inc. All Rights Reserved. http://www.mortgageservicingnews.com http://www.sourcemedia.com