Downey Financial Corp., Newport Beach, Calif., says it will sell most of its third-party mortgage servicing rights after taking an $18.4 million impairment hit in the third quarter.In the firm's quarterly earnings report, CEO Daniel Rosenthal said that after the end of the third quarter, Downey entered into agreements to sell about 80% of its MSRs on loans serviced for others. "Virtually all of the underlying loans represent borrowers with whom we have no other business relationship," he said, adding that the sale of the third-party servicing should reduce earnings volatility in future quarters. Downey reported net income of $24.5 million in the third quarter, or $0.88 per share, down 16.2% from the third quarter of last year.
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