PennyMac Financial Services has agreed to buy the subservicing business of Cenlar Capital.
PennyMac said in a press release that it will pay $172.5 million in cash upfront, along with up to $85 million of performance-based payments, for subservicing contracts and mortgage servicing operations.
Based on Cenlar’s existing portfolio, Pennymac expects to add up to $740 billion in unpaid principal balance of mortgage loan subservicing and 2 million loans to its servicing portfolio.
The deal is expected to close in the second half of 2026. As part of the sale, Cenlar will surrender its bank charter.
“We have reached an agreement that represents a compelling value proposition for our stockholders, Cenlar’s institutional clients and their clients’ borrowers, as well as the many talented professionals joining Pennymac,” David Spector, Pennymac’s chairman and CEO, said in the release.
“With this transaction, we expect to realize powerful synergies that further reinforce our standing as the market’s most technologically advanced servicer,” Spector added.
Santander US Capital Markets and Goodwin Procter advised Pennymac. Houlihan Lokey Capital and Sullivan & Cromwell advised Cenlar.