Homebuyers now getting more bang for their buck

GM. This is Mortgage Nuggets. Your place for mortgage news and trends, just the meat, no bun.

Here’s what I’ve got for you today

• Homebuyers now getting more bang for their buck

• American Portfolio and Town square announce merger

• Mr. Cooper acquires an investment firm

• Black Knight plans to shed Empower in bid to save $13 bln sale to ICE

1. Homebuyers now getting more bang for their buck

Last year, rising mortgage rates reduced the maximum home price a buyer could afford with a $3,000 payment by $305,000, but this trend has recently reversed.

As rates have decreased from a peak of 7%, buyers are now able to purchase larger homes with higher prices but at the same monthly cost.

The average home value associated with a $3,000 mortgage payment has increased by $60,000 since October 2022 and the home size has recovered by 84 square feet.

Cities such as Salt Lake City (365 square feet); Minneapolis (357); Memphis (346); and Denver (340) have seen the biggest increase in home size for a $3,000 payment.

2. Mr. Cooper to buy investment firm Roosevelt Management

Mr. Cooper has agreed to acquire Roosevelt Management Company, a private investment management firm based in New York, and affiliated company Rushmore Loan Management Services.

The why; This acquisition will provide Mr. Cooper with an asset management platform to raise third-party capital on an ongoing basis from institutional investors who seek exposure to MSRs and other mortgage assets

The financial terms of the deal were not disclosed, but according to Chris Marshall, Mr. Cooper's Vice Chairman and President, the cash outlay is not significant.

3. Black Knight to shed Empower?

Black Knight is putting its Empower loan origination software business up for sale to overcome antitrust concerns over its proposed acquisition by ICE.

The FTC has been scrutinizing the deal for months due to concerns that the pricing power gained by ICE in the mortgage data market could lead to higher costs for consumers.

Empower and ICE's Encompass unit are the top two vendors for loan origination software, jointly controlling over 60% of the market. The deal has received a "second request" from the FTC indicating heightened scrutiny.

4. American Portfolio and Town square announce merger

The mergers and acquisitions wave continues. American Portfolio and Town Square Mortgage, two privately held non-bank mortgage lenders, are merging their operations.

The combined lender will have a total of 36 state licenses, 35 branches, and 200 active loan officers. The financial terms of the deal were not disclosed.

The companies will keep their names and brands, but APMC will be the new legal entity. The merger will result in an increased lending footprint to better serve clients and bring a portfolio of expanded loan products..

5. More Nuggets

Some renters aren't getting a break from falling housing prices (Axios)

AmeriSave mortgage now offering personal loans (NMP)

Equifax cuts 10% of its employees and contractors in the fourth quarter. (Report)

☀️ See you on Wednesday!

💬 Quote: Cut too many corners, and you end up going in circles.

p.s. If you like this newsletter, your friends may too. Forward it to a friend, and let them know they can subscribe here. Written by Ian M.