Quicken Loans Inc., based in Detroit, has purchased approximately $34 billion in mortgage servicing rights from Ally Bank.
The servicing pool is comprised of non-delinquent Freddie Mac and Fannie Mae-backed mortgages that have higher-than-market interest rates that could substantially benefit from refinancing.
The deal, expected to close in the second quarter after approvals from Fannie Mae and Freddie Mac, will increase Quicken Loans' servicing footprint.
In the last year, the company has quickly grown a $90 billion mortgage servicing portfolio, making it the nation's 17th largest servicer, according to the company. With the addition of the $34 billion in servicing from Ally Bank, the company is expected to grow to be a top-10 servicer by mid-2013.
The company also announced that it will continue to pursue servicing pools, while also growing its servicing portfolio organically through its mortgage origination business. In 2012, Quicken Loans originated a company record $70 billion in residential home mortgages, making it the nation's third largest mortgage lender.
"We have not been bashful in making the market aware of our interest in acquiring servicing rights," said Bill Emerson, CEO of Quicken Loans. "This transaction with Ally Bank allows us to purchase a well performing pool of loans, and will help grow our servicing footprint. This servicing pool will also create a large opportunity for Quicken Loans to refinance a substantial amount of these clients into significantly lower monthly payments."