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From Earlier: Newcastle Announces $44M Investment in Excess Mortgage Servicing Rights

Newcastle Investment Corp. (NYSE: NCT) announced yesterday that the Company has made its first investment in Excess Mortgage Servicing Rights. The Company invested $44 million to acquire a 65% interest in the Excess MSR of a $9.9 billion residential mortgage portfolio. Nationstar Mortgage LLC will be the servicer of the loans and will invest alongside Newcastle by acquiring the remaining 35% interest of the Excess MSR. Nationstar currently services over $100 billion in loans and is an active originator of residential mortgage loans.

Under the terms of this investment, to the extent that any loans in this portfolio are refinanced by Nationstar, the resulting mortgage servicing right will be included in the portfolio, subject to certain limitations. This should serve to significantly reduce the impact of prepayments on our investment. Newcastle will not have any servicing duties, advance obligations or liabilities associated with the portfolio.

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