Rights to MSRs (Tables)

6 Months Ended

Jun. 30, 2019

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

The following tables present 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	June 30, 2019		December 31, 2018
MSRS, at fair value	$	756,810	$	894,002

Due from NRZ (Receivables)
Sales and transfers of MSRs (1)	$	25,575	$	23,757
Advance funding, subservicing fees and reimbursable expenses	15,102		30,845
	$	40,677	$	54,602

Due to NRZ (Other Liabilities)	$	46,956	$	53,001

Financing liability - MSRs pledged, at fair value
Original Rights to MSRs Agreements	$	412,909	$	436,511
2017 Agreements and New RMSR Agreements (2)	88,103		138,854
PMC MSR Agreements	343,901		457,491
	$	844,913	$	1,032,856



	Three Months Ended June 30,						Six Months Ended June 30,
	2019			2018			2019			2018
Statements of Operations
Servicing fees collected on behalf of NRZ	$	141,091		$	126,712		$	296,938		$	253,729
Less: Subservicing fee retained by Ocwen	35,905			34,444			73,312			68,661
Net servicing fees remitted to NRZ	105,186			92,268			223,626			185,068

Less: Reduction (increase) in financing liability
Changes in fair value:
Original Rights to MSRs Agreements	(1,671		)	(8,897		)	(1,550		)	(8,782		)
2017 Agreements and New RMSR Agreements	4,634			828			(2,346		)	17,424
PMC MSR Agreements	47,782			—			80,878			—
	50,745			(8,069		)	76,982			8,642
Runoff and settlement:
Original Rights to MSRs Agreements	11,412			15,991			20,447			34,843
2017 Agreements and New RMSR Agreements	26,062			33,971			49,382			69,666
PMC MSR Agreements	15,814			—			33,588			—
	53,288			49,962			103,417			104,509

Other	(1,777		)	(1,115		)	(3,658		)	(2,622		)

Interest expense	$	2,930		$	51,490		$	46,885		$	74,539


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


(2)	$104.9 million and $34.0 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			PMC MSR Agreements			Total
Balance at December 31, 2018	$	436,511		$	138,854		$	457,491		$	1,032,856
Additions	—			—			876			876
Changes in fair value:
Original Rights to MSRs Agreements	1,550			—			—			1,550
2017 Agreements and New RMSR Agreements	—			2,346			—			2,346
PMC MSR Agreements	—			—			(80,878		)	(80,878		)
Runoff and settlement:
Original Rights to MSRs Agreements	(20,447		)	—			—			(20,447		)
2017 Agreements and New RMSR Agreements	—			(49,382		)	—			(49,382		)
PMC MSR Agreements	—			—			(33,588		)	(33,588		)
Calls (1):
Original Rights to MSRs Agreements	(4,705		)	—			—			(4,705		)
2017 Agreements and New RMSR Agreements	—			(3,715		)	—			(3,715		)
Balance at June 30, 2019	$	412,909		$	88,103		$	343,901		$	844,913



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	8,782			—			8,782
2017 Agreements and New RMSR Agreements	—			(17,424		)	(17,424		)
Runoff and settlement:
Original Rights to MSRs Agreements	(34,843		)	—			(34,843		)
2017 Agreements and New RMSR Agreements	—			(69,666		)	(69,666		)
Calls (1):
Original Rights to MSRs Agreements	(1,319		)	—			(1,319		)
2017 Agreements and New RMSR Agreements	—			(788		)	(788		)
Balance at June 30, 2018	$	471,662		$	200,957		$	672,619


(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.