PHH Corp., which controls the nation's eighth largest servicer, is likely to take a $100 million writedown on the value of its mortgage servicing rights in the third quarter, according to a new research report from FBR Capital Markets.

"PHH has indicated that every 10 basis point change in primary rates will drive a decline in the fair value of the MSR of roughly $40 million," FBR says. "Estimating the exact write-down is nearly impossible, and we use $100 million for modeling purposes. Note that widening spreads and the flattening yield curve will likely drive a higher MSR write-down."

Subscribe Now

Access to a full range of industry content, analysis and expert commentary.

30-Day Free Trial

No credit card required. Access coverage of the securitization marketplace, including breaking news updated throughout the day.