Mortgage Servicing Rights and Mortgage Servicing Liabilities

6 Months Ended

Jun. 30, 2025

Mortgage Servicing Rights and Mortgage Servicing Liabilities

Mortgage Servicing Rights and Mortgage Servicing Liabilities

Note 11—Mortgage Servicing Rights and Mortgage Servicing Liabilities

Mortgage Servicing Rights at Fair Value

The activity in MSRs is as follows:

	Quarter ended June 30,				Six months ended June 30,
	2025		2024		2025		2024
	(in thousands)
Balance at beginning of period	$	8,963,889	$	7,483,210	$	8,744,528	$	7,099,348
MSRs resulting from loan sales		814,538		541,207		1,464,887		953,727
Change in fair value due to:
Changes in inputs used in valuation model (1)		15,950		99,440		(189,539)		269,392
Other changes in fair value (2)		(263,128)		(200,779)		(488,627)		(399,389)
Total change in fair value		(247,178)		(101,339)		(678,166)		(129,997)
Balance at end of period	$	9,531,249	$	7,923,078	$	9,531,249	$	7,923,078
Unpaid principal balance of underlying loans at end of period					$	463,132,127	$	396,429,820
					June 30,		December 31,
					2025		2024
					(in thousands)
Fair value of mortgage servicing rights pledged to secure Assets sold under agreements to repurchase and Notes payable secured by mortgage servicing assets					$	9,350,647	$	8,609,388

(1) Principally reflects changes in annual total prepayment speed, pricing spread, per loan annual cost of servicing and UPB of underlying loan inputs.

(2) Represents changes due to realization of cash flows.

Mortgage Servicing Liabilities at Fair Value

The activity in MSLs is summarized below:

	Quarter ended June 30,				Six months ended June 30,
	2025		2024		2025		2024
	(in thousands)
Balance at beginning of period	$	1,651	$	1,732	$	1,683	$	1,805
Changes in fair value due to:
Changes in inputs used in valuation model (1)		21		15		26		(12)
Other changes in fair value (2)		(29)		(39)		(66)		(85)
Total change in fair value		(8)		(24)		(40)		(97)
Balance at end of period	$	1,643	$	1,708	$	1,643	$	1,708
Unpaid principal balance of underlying loans at end of period					$	18,177	$	21,197

(1) Principally reflects changes in annual total prepayment speed, pricing spread and per loan annual cost of servicing.

(2) Represents changes due to realization of cash flows.

Contractual servicing fees relating to MSRs and MSLs are recorded in Net loan servicing fees—Loan servicing fees—From non-affiliates on the Company’s consolidated statements of income; other fees relating to MSRs and MSLs are recorded in Net loan servicing fees—Loan servicing fees—Other on the Company’s consolidated statements of income. Such amounts are summarized below:

	Quarter ended June 30,				Six months ended June 30,
	2025		2024		2025		2024
	(in thousands)
Contractual servicing fees	$	435,517	$	375,040	$	853,204	$	733,066
Other fees:
Late charges		19,855		17,248		39,906		34,857
Other		4,060		3,149		7,539		5,789
	$	459,432	$	395,437	$	900,649	$	773,712