MBS spreads to Treasuries continue to be fat at roughly 140 bps. But what if there’s a government debt default? Might the equation turn or will it be so ugly it won’t matter? Analysts are trying to make sense of it all.
Servicing valuations are starting to inch downward, but not dramatically. The good news: Investors still want the asset and prices are holding firm. One notable: More MSR owners are hedging the asset these days.
Mr. Cooper hopes to surpass the $1 trillion mark as a servicer/subservicer, an event that could happen by yearend if it keeps gobbling up portfolios. Meanwhile, there’s plenty of MSRs to buy.