What an FHFA Capital Recalibration Would Actually Do to Your MSR Mark
How will an FHFA capital recalibration impact Mortgage Servicing Rights (MSR) valuation marks? An FHFA capital recalibration under Executive Order 14393 will directly impact MSR marks by altering the regulatory capital costs of holding these assets and changing the valuation haircuts applied in financing arrangements. Depending on whether regulators implement meaningful, targeted, or delayed relief,…