Bank of America to Offer $100MM of Nonperforming MSRs

Bank of America (BofA) is ready to hit the market with a $100 million package of residential servicing rights backed mostly by nonperforming loans guaranteed by Freddie Mac, according to industry advisors familiar with the deal.

As a policy, BofA does not comment on its MSR transactions, but the bank has been a net seller of servicing rights for well over a year now.

At March 31, BofA serviced $1.69 trillion in mortgages, a 16% decline from the same period a year earlier. The bank had the largest decline in MSR contracts among the top ten servicers, according to figures compiled by National Mortgage News and the Quarterly Data Report.

It’s been a buyer’s market for MSRs since the housing crash of 2008, though the asset is considered highly undervalued, especially on rights created the past two years.