The acquisition of PHH Corp., which has operated as an independent organization for more than a dozen years, has been completed.
Mount Laurel, New Jersey-based PHH previously operated as part of Cendant Corp. At the time, PHH Mortgage Corp. was known as Cendant Mortgage.
As a subsidiary of Cendant, the mortgage unit had a built-in referral network since Cendant was also the parent of real estate franchise businesses that included Century 21 and Coldwell Banker.
But the mortgage unit and another business were spun off by Cendant in 2005 through a stock distribution, and the home lending operation became known as PHH Mortgage.
PHH operated robust private-label origination and servicing
businesses and ranked as the 10th-biggest lender in 2016.
But in November 2016, it disclosed plans to abandon the private-label business following the loss of big clients. The following month it revealed it would sell all of its mortgage-servicing rights.
PHH appeared to be operating in runoff off mode after that point until
this past February, when a deal was announced for Ocwen Financial Corp. to acquire PHH.
Following the disclosure of the merger, the companies revealed that former PHH president chief executive officer Glen A. Messina will replace Ron Faris as president and CEO of Ocwen when the merger is completed.
On Thursday, an announcement indicated that the merger has closed
and Messina has been handed the reins.
“The close of this acquisition marks a new chapter in our history, and creates a strong non-bank mortgage servicer, positioned for growth, and better able to serve borrowers and loan investors,” Ocwen Financial Chair Phyllis Caldwell stated in the announcement. “We believe our increased size and scale will create both strategic and financial benefits including accelerating our transition to an industry leading servicing platform, reducing servicing, originating and overhead costs on a combined basis through the realization of $100 million in targeted cost synergies and improved economies of scale, and providing a foundation to enable Ocwen to resume new business and growth activities to offset portfolio runoff in the future.”
Previously reported earnings indicate that the combined 2017 originations of the two companies was $23.4 billion — including nearly $20 billion at PHH and $3.6 billion at Ocwen. But
recent lending at PHH has been sharply curtailed with production plummeting to a paltry $0.1 billion in the second quarter of this year.
Today’s announcement indicated that
the total mortgage servicing portfolio for the merged firm stands at around 1.7 million loans for more than $296 billion based on June 30 data.
