MT. LAUREL, N.J. – PHH Corp., the largest mortgage bank for credit unions, said falling mortgage rates inviting a new wave of refinancings forced a $353 million write-down of its mortgage servicing portfolio, resulting in a $148 million loss for the third quarter.
The company, which provides white label mortgage services for more than 1,000 credit unions, set the value of its mortgage servicing portfolio at $1.2 billion at Sept. 30, 21% less than at mid-year.
The losses in mortgage servicing reflects $361 million in market-related and credit-related negative fair value adjustments on the company’s mortgage servicing rights, driven primarily by lower mortgage rates and expectations of an extended period of low interest rates.
PHH closed $12.7 billion worth of mortgages in the third quarter, up 31% from the second quarter and up 1% from the same quarter last year.
For the first three quarters of the year PHH reported a $140 million loss, compared to a $133 million loss for the first nine months last year.
