Inside Movement Mortgage’s MSR sales strategy

Due to ferocious investor demand, Movement Mortgage is opportunistically selling billions in mortgage servicing rights. And the South Carolina-based retail lender is using the cash proceeds to sharpen pricing for its roughly 1,400 producing loan officers.

But while improved pricing might help win deals in the short term, Movement isn’t retaining recapture rights on some MSR sales, HousingWire has learned.

Here’s our insider’s look at Movement’s MSR strategy.

HousingWire reported earlier this month that Movement sold a $5 billion MSR package to an unknown buyer on May 7 consisting of agency loans. Sources later provided HousingWire an email authored by company president Steve Smith that stated Movement executed a trade in May to sell $4.4 billion UPB of government MSRs to Freedom Mortgage.

It’s unclear if it’s the same trade. Movement did not respond to HousingWire’s request for comment. Freedom also did not comment on the transaction.

The email, sent to staffers on May 15, however, does provide insight into Movement’s origination and capital markets strategy.

Better pricing today

“Driven by heightened buyer demand, this sale strengthens our market presence and allows us to improve our Movement rate sheet for new transactions,” Smith wrote.

“Effective 05/13/2025, we made a 0.375 price improvement to most Movement FHA and VA products for purchase money loans over $200,000,” he told staff. “In conjunction with the sales process, we have been working with Aggregators to drive the most competitive rate sheet pricing they can offer.”

He added that Movement is providing LOs with better pricing from various sources, including “internal execution and aggregator rate sheets.”

He said the capital markets team determines the best execution for the loan, whether it’s an MBS sale with servicing retained, the agency cash window or aggregator whole loan sales.

Per Smith, under current market conditions, the following type of loans may be sold monthly in whole loan form to aggregators:

• Conventional and government programs if the loan amount is >$325,000 and the occupancy is primary residence (excluding HomeReady or Home-Possible);
• Conventional agency programs for second homes and investment properties;
• Conventional high balance agency loans with FICOs >700, as well as jumbo and non-QM loans

Recapture depends on the deal

Importantly, Movement did not retain solicitation rights to the $4.4 billion portfolio. While the company endeavors to retain recapture rights when possible, it’s not always the best deal available, Smith said.

“Recapture/solicitation terms are negotiated on a transaction-by-transaction basis,” he said. “Our preference is to retain servicing rights. However, there are times when pay-ups warrant releasing solicitation rights.”

Smith wrote that Movement began selling servicing again in 2023 as investor demand improved, but retained recapture rights for 86% of servicing sales in 2023 and 2024. The strategy has shifted a bit this year due to market forces.

Movement has “switched to selling servicing rights opportunistically to improve overall execution and to sharpen rate sheets,” he wrote.

Smith told loan officers that “this does NOT mean that you cannot retain your customer relationships and continue to serve these customers with mortgage financing needs should they reach out to you for assistance, nor does it mean that every loan will be sold servicing released or without recapture rights — use tools like MORE to stay connected.”

He added that eligible LOs would receive 2.5 basis points deposit at year end for sold loans.

The company will continue to evaluate bulk sale execution on conventional and government MSRs, he said. If demand remains strong, they’ll execute sales on a semi-annual basis.

This particular $4.4 billion MSR trade is scheduled to close June 30, with the transfer occurring Aug. 4.

The market’s hot, hot, hot

Movement’s MSR deal comes at a time when the market is hot, with lenders taking advantage of strong investor demand and historically high valuations.

“Multiples are at 25-year highs,” one industry executive recently told HousingWire. In the bulk MSR market, recent trades have ranged from 130 to 139 basis points—equivalent to a 5.2x to 5.56x multiple of servicing fees—according to MCT’s May report.

Industry executives estimate that a $4 billion MSR sale could generate roughly $40 million in upfront cash for a seller. In this environment, investors are eager to acquire high-yielding, stable assets that position them to recapture borrowers when mortgage rates decline and refinancing activity rebounds.

Flávia Furlan Nunes contributed reporting.