During the market disruption in March 2020, the value of mortgage servicing rights became temporarily disconnected from mortgage rates.

Large mortgage sellers and servicers faced severe margin calls, and it took several weeks for them to get the go-ahead from the Federal Housing Finance Agency to draw on their liquidity buffers.

It’s a scenario that large nonbanks are hoping not to repeat.

“The point of [FHFA] asking them to have that liquidity is to make them more resilient in a stressful environment. The point of building up liquidity is to be able to use it,” said Ed DeMarco, president details ⇒

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