Mortgage Servicing Rights (MSR) Valuation & Hedging
Whether you are getting your agency approvals, selling through co-issue, or actively growing your portfolio, MCT offers a suite of tools along with an experienced team to help you with all your mortgage servicing rights needs. Choose the combination of services to achieve your MSR risk management goals:
- MSRlive! is a new MSR portfolio valuation software tool that supports your efforts to build, maintain, and optimize your servicing portfolio.
- Portfolio Valuation Reports determine the value of your asset but also detail risk and exposure sensitivities.
- Enhanced Retain-Release Extension for MCT’s Best Execution Analysis offers additional customizations for your specific servicing goals.
- MSR Strategy Consulting is available for MSR Services clients along with a robust network of subservicers and MSR financing institutions.
- Custom MSR Grids let MCT calculate MSR values based on your costs and key assumptions.
- MSR Hedging & Brokerage strategies include setup, assistance with trade decisions, and in-depth risk/return analysis.
Discover the robust valuation, analysis, and forecasting power of MSRlive!, our new cloud-based software for mortgage servicing rights valuation. With MSRlive!, users can value their portfolio at 30 loans per second. Users can also analyze the effect of predictive market scenarios on their portfolio.
- Portfolio Valuations – Value and analyze your portfolio at 30 loans per second.
- Create Grid Pricing – Define your typical loans characteristics to generate a pricing grids in minutes.
- Run Rate Shock Analysis – View the effect of market changes on your portfolio with a range of +/- 200 basis points.
Servicing Portfolio Valuation Reports
For those clients who do not desire the sophistication of our MSRlive! servicing model software but still need to determine the value of their MSR asset, MCT offers monthly, quarterly or annual portfolio valuations.
- Precise analysis and opinion of value
- Summary tables of major portfolio characteristics
- Sensitivity charts for key risk factors
Enhanced Retain-Release Extension
for MCT’s Best Execution Analysis
Our newest offering leverages the power of the MSRlive! for any agency approved lender, even if you aren’t actively growing your MSR portfolio. The Extension augments our state of the art Best Ex. Analysis to provide retained released decisions that:
- Are precisely calibrated to your internal costs and yield requirements.
- Adjust cash impact for MSR financing transactions.
- Adjust for the cash impact of a transaction by –
- Reflecting tax advantages of retention vs. release.
- Identifying breakeven point for cash for MSR transactions.
- Showing actual gain/loss in cash from different retention strategies or decisions about individual loans.
MSR Strategy, Consulting, & Networking Services
Mortgage Service Rights (MSR) clients have access to one-on-one strategy consulting with MCT specialists and are offered a robust network of subservicers and MSR financing institutions.
- MCT emphasizes education and training for all clients. Expanding capital markets knowledge leads to our mutual success.
- Assistance navigating the process of agency approvals and growth through the stages of building an MSR portfolio.
- Assistance identifying and evaluating sub-servicing options and strategy.
- Training on what servicing is, what drives the value, how the value is calculated, and other principles.
- Introduction to subservicers with special pricing and terms for MCT clients.
- Introduction to banks lending on Mortgage Servicing Rights assets.
MSR Services: Latest News & Educational Articles
In this issue we will determine the value and examine some risk scenarios with an actual MSR portfolio utilizing the ASE, consider some of the implications to managing MSR risk through hedging, and discuss how ASE can be used to gain a more precise and nuanced understanding of a portfolio’s underlying risks.
In this issue of Servicing Insights, we will describe our methodology of determining MSR values and quantifying and monitoring MSR risk. Our approach to modeling the different market interest rates is to statistically model a set of structural relationships between the interest rates, as well as other variables which cause them to change.
Join webinar to learn how to determine which MSRs to sell, how to evaluate bids you receive, and tips for negotiating a contract. Topics will also include expected challenges, purchase terms, and timing of the sale.
Many lenders need specialized guidance to value servicing portfolios for maximum profitability and risk management. This new group will be key in supporting existing MCT clients as they grow to larger accounts.
Director of MSR Services
Request a quick introductory call to learn more about our MSR Services.Schedule a Call