DBRS Releases Commentary on Agency Mortgage Servicing Rights

DBRS, Inc. (DBRS) released a commentary titled “Agency Mortgage Servicing Rights,” an overview of agency mortgage servicing right (MSR) transactions and related credit risks as well as of the DBRS methodologies that may be employed when rating these transactions.

Some servicers of agency loans (Fannie Mae, Freddie Mac and Ginnie Mae) have opted to issue debt secured by their MSR assets and the related excess servicing fee (ESF) cash flow. (Note: Freddie Mac does not currently permit the securitization of MSRs.) Although agency servicing rights cannot be sold or transferred without the approval of the agency, through an acknowledgment agreement, the agencies permit servicers to pledge their MSR and related ESF assets.

Notes:
The commentary is available at www.dbrs.com.

For more information on this asset class or on this industry, visit www.dbrs.com or contact us at info@dbrs.com.

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