Rights to MSRs (Tables)

3 Months Ended

Mar. 31, 2019

Schedule of Assets, Liabilities, Servicing and Subservicing Fees Related to NRZ Agreements

The following table presents the assets and liabilities recorded on our unaudited consolidated balance sheets as well as the impacts to our unaudited consolidated statements of operations in connection with our NRZ agreements.



Balance Sheets	March 31, 2019			December 31, 2018
MSRs, at fair value	$	831,284		$	894,002
Due from NRZ
Sales and transfers of MSRs (1)	23,430			23,757
Advance funding, subservicing fees and reimbursable expenses	9,238			30,845
Due to NRZ	55,907			53,001
Financing liability - MSRs pledged, at fair value
Original Rights to MSRs Agreements	424,086			436,511
2017 Agreements and New RMSR Agreements (2)	119,932			138,854
PHH MSR Agreements	407,198			457,491
Financing liability - MSRs pledged, at fair value	$	951,216		$	1,032,856

	Three Months Ended March 31,
	2019			2018
Statements of Operations
Servicing fees collected on behalf of NRZ	$	155,847		$	127,017
Less: Subservicing fee retained by Ocwen	37,407			34,217
Net servicing fees remitted to NRZ	118,440			92,800

Less: Reduction (increase) in financing liability
Changes in fair value:
Original Rights to MSRs Agreements	121			116
2017 Agreements and New RMSR Agreements	(6,980		)	16,596
PHH MSR Agreements	33,096			—
	26,237			16,712
Runoff and settlement:
Original Rights to MSRs Agreements	9,035			18,852
2017 Agreements and New RMSR Agreements	23,320			35,695
PHH MSR Agreements	17,774			—
	50,129			54,547

Other	(1,882		)	(1,509		)

Interest expense	$	43,956		$	23,050


(1)	Balance represents the holdback of proceeds from PHH MSR sales and transfers to address indemnification claims and mortgage loan document deficiencies. These sales were executed by PHH prior to the acquisition date.


(2)	$105.8 million and $33.0 million is expected to be recognized as a reduction in the financing liability and interest expense for the years ended December 31, 2019 and 2020, respectively.

Schedule of Activity Related to Rights to Mortgage Servicing Rights



Financing Liability - MSRs Pledged	Original Rights to MSRs Agreements			2017 Agreements and New RMSR Agreements			PHH MSR Agreements			Total
Balance at December 31, 2018	$	436,511		$	138,854		$	457,491		$	1,032,856
Additions	—			—			577			577
Changes in fair value:
Original Rights to MSRs Agreements	(121		)	—			—			(121		)
2017 Agreements and New RMSR Agreements	—			6,980			—			6,980
PHH MSR Agreements	—			—			(33,096		)	(33,096		)
Runoff and settlement:
Original Rights to MSRs Agreements	(9,035		)	—			—			(9,035		)
2017 Agreements and New RMSR Agreements	—			(23,320		)	—			(23,320		)
PHH MSR Agreements	—			—			(17,774		)	(17,774		)
Calls (1):
Original Rights to MSRs Agreements	(3,269		)	—			—			(3,269		)
2017 Agreements and New RMSR Agreements	—			(2,582		)	—			(2,582		)
Balance at March 31, 2019	$	424,086		$	119,932		$	407,198		$	951,216



Financing Liability - MSRs Pledged	Original Rights to MSRs Agreements			2017 Agreements and New RMSR Agreements			Total
Balance at December 31, 2017	$	499,042		$	9,249		$	508,291
Receipt of lump-sum cash payments	—			279,586			279,586
Changes in fair value:
Original Rights to MSRs Agreements	(116		)	—			(116		)
2017 Agreements and New RMSR Agreements	—			(16,596		)	(16,596		)
Runoff and settlement:
Original Rights to MSRs Agreements	(18,852		)	—			(18,852		)
2017 Agreements and New RMSR Agreements	—			(35,695		)	(35,695		)
Calls (1):
Original Rights to MSRs Agreements	(420		)	—			(420		)
2017 Agreements and New RMSR Agreements	—			(274		)	(274		)
Balance at March 31, 2018	$	479,654		$	236,270		$	715,924


(1)	Represents the carrying value of MSRs in connection with call rights exercised by NRZ, for MSRs transferred to NRZ under the 2017 Agreements and New RMSR Agreements, or by Ocwen at NRZ’s direction, for MSRs underlying the Original Rights to MSRs Agreements. Ocwen derecognizes the MSRs and the related financing liability upon collapse of the securitization.