Mortgage Servicing Rights (Tables)

6 Months Ended

Jun. 30, 2020

Schedule of changes in the fair value of MSRs


	June 30,		December 31,
	2020		2019
Balance at beginning of year	$	41,470	$	64,728
Additions from servicing retained loan sales		1,753		2,491
Reductions from bulk sales		(21,002)		—
Other		—		22
Changes in fair value (1)		(21,942)		(25,771)
Fair value of MSRs at end of period	$	279	$	41,470

(1)

Changes in fair value are included within loss on mortgage servicing rights, net in the accompanying consolidated statements of operations and comprehensive (loss) earnings.

Schedule of the outstanding loans serviced by entity


	June 30,		December 31,
	2020		2019
Government insured	$	146,180	$	105,442
Conventional (1)		—		4,826,407
Total loans serviced (2)	$	146,180	$	4,931,849

(1)

In May 2020, the Company sold all of the conventional mortgage servicing for approximately $20.1 million, receiving $15.0 million in proceeds upon sale, with the remaining due upon transfer of the servicing and transfer of all trailing documents. The Company used the $15.0 million in proceeds from the MSR sale to pay off the MSR financing. (See Note 5.—Debt– MSR Financings)

(2)

At June 30, 2020 and December 31, 2019, no collateral was pledged as part of the MSR Financing. (See Note 5.—Debt– MSR Financings)

Schedule of hypothetical changes in the fair values of MSRs


	June 30,		December 31,
Mortgage Servicing Rights Sensitivity Analysis	2020		2019
Fair value of MSRs	$	279	$	41,470
Prepayment Speed:
Decrease in fair value from 10% adverse change		*		(1,850)
Decrease in fair value from 20% adverse change		*		(3,631)
Decrease in fair value from 30% adverse change		*		(5,325)
Discount Rate:
Decrease in fair value from 10% adverse change		*		(1,330)
Decrease in fair value from 20% adverse change		*		(2,579)
Decrease in fair value from 30% adverse change		*		(3,753)

*At June 30, 2020, the Company was in the process of selling the remaining GNMA servicing portfolio and the indicative bids support the carrying value.

Schedule of gain (loss) on mortgage servicing rights


	For the Three Months Ended				For the Six Months Ended
	June 30,				June 30,
	2020		2019		2020		2019
Change in fair value of mortgage servicing rights	$	(3,111)	$	(9,881)	$	(21,942)	$	(16,374)
(Loss) gain on sale of mortgage servicing rights		(5,332)		(6)		(4,811)		864
Loss on mortgage servicing rights, net	$	(8,443)	$	(9,887)	$	(26,753)	$	(15,510)

Schedule of components of servicing income


	For the Three Months Ended				For the Six Months Ended
	June 30,				June 30,
	2020			2019	2020		2019
Contractual servicing fees	$	2,061	$	3,891	$	5,109	$	8,080
Late and ancillary fees		26		38		65		92
Subservicing and other costs		(735)		(393)		(1,315)		(1,667)
Servicing fees, net	$	1,352	$	3,536	$	3,859	$	6,505