Core Viewpoint - PHH Mortgage Corporation has entered into a strategic partnership with Finance of America Reverse to reposition its role in the reverse mortgage market, transitioning to a subservicer and asset manager while selling reverse mortgage servicing rights for estimated net proceeds of $100 to $110 million [1][5]. Group 1: Transaction Details - PHH will sell reverse mortgage servicing rights (MSRs) for approximately 40,000 Ginnie Mae home equity conversion mortgage (HECM) loans, with an unpaid principal balance of $9.6 billion as of September 30, 2025 [3]. - The transaction includes a three-year subservicing agreement where PHH will act as the subservicer for the sold reverse MSRs [3]. - FAR will acquire PHH's pipeline of reverse mortgage loans and is expected to take on some of PHH's US-based reverse originations employees [4]. Group 2: Financial Implications - The estimated net proceeds from the transaction are projected to be between $100 million and $110 million, subject to adjustments based on asset balances at closing [5]. - The transaction is anticipated to close in the first quarter of 2026, pending regulatory approval and customary closing conditions [5]. - The company plans to use the net proceeds to support growth, reduce debt, and explore a share repurchase program, with expectations that the transaction will be accretive to earnings over the term of the subservicing agreement [6]. Group 3: Strategic Benefits - The partnership with FAR establishes a significant subservicing relationship, simplifying the company's balance sheet by eliminating reverse HECM assets and HMBS liabilities [8]. - This strategic move allows the company to focus on markets and products with greater growth potential, including forward originations and the recently launched FlexIQ product suite [8]. - The transaction is expected to strengthen financial metrics such as liquidity and capital ratio [8].

Core Insights - A 68-year-old Texas woman lost her entire retirement savings of $487,000 to an online investment scam, which also affected her brother who lost $110,000 [1][2] - Cathy is now living on $2,000 a month from Social Security and has around $33,000 in debt, struggling to make ends meet despite her house being valued at approximately $400,000 [2][3] Financial Situation - Cathy took out her 401(k) and pension upon retirement, but the online investment group subsequently froze their accounts, resulting in total loss [2] - She has applied for jobs but has not found success, feeling easily replaceable after 36 years in sales [3] Advice from Financial Experts - The hosts of "The Ramsey Show" advised against reverse mortgages, labeling them as predatory financial products that could lead to loss of home equity [4] - They emphasized the importance of returning to work and being open about her situation to find new income opportunities, suggesting jobs at places like Starbucks, Walmart, and Target [4]