The firm appears to be capitalizing upon some of its recent acquisitions. In 2023, it acquired $1.4 billion in consumer loans from Goldman Sachs while also closing a deal to purchase Sculptor Capital Management and its $33 billion in assets under management. The deal for Sculptor totaled $720 million, which was 14% more than Rithm’s original offer.
Around the same time, Rithm also struck a $720 million deal for Computershare Mortgage Services and its subsidiary, Specialized Loan Servicing, which brought $136 billion in unpaid principal balance (UPB) to Rithm’s servicing book.
Sculptor added another $1 billion in assets during the past year, according to the 2024 earnings report. And Newrez, which relied heavily on its servicing segment to post a profit a year earlier, saw significant growth in its origination business, which is now the fifth largest in the U.S., according to Inside Mortgage Finance (IMF). The lender posted pretax income of $1.1 billion last year, up from $732 million in 2023.
“We had another great year at Rithm, finishing strong with robust earnings, positive inflows and growth in each of our business segments,” Michael Nierenberg, the company’s chairman, CEO and president, said in a statement.
“Rithm delivered strong and consistent performance in each of its core businesses, creating value for investors and shareholders. We also completed our first full year with Sculptor and will continue to grow our world-class asset management business in 2025 through strategic partnerships.”
Newrez posted a 20% pretax return on its $5.6 billion in Q4 2024. The company now ranks No. 3 among the nation’s largest primary mortgage servicers, according to IMF, and its UPB jumped 32% year over year in the fourth quarter to reach $844 billion.
Newrez continues to do most of its origination business through the correspondent channel, but it has seen growth in the wholesale and consumer direct channels over the past four quarters. In total, its funded loan volume jumped from $8.9 billion in Q4 2023 to $17.3 billion in Q4 2024 — up 94%.
Newrez reported “continued momentum” for its home equity and non-QM loan products as originations were up 29% between the third and fourth quarters. Home equity loans comprise nearly half of its mortgage servicing rights (MSRs), with 21% of its portfolio having loan-to-value ratios of 50% or less.
The lender indicated it is in a good position to recapture much of its existing servicing business through investments in its brand and an “end-to-end digital experience.” It noted that more than 25% of its owned MSR portfolio has coupon rates above 5%. Its refinance recapture rate in 2024 — when including closed-end second-lien loans — was 52%, up from 41% two years earlier.
In a recent conversation on HousingWire’s PowerHouse podcast, Newrez President Baron Silverstein said the company was not ruling out further growth through M&A activity moving forward.
“We’re going to continue to look at all types of opportunities for us,” Silverstein said. “There’s no reason for us not to look at opportunities in the marketplace — whether it’s a servicing, origination or technology opportunity. We will look at each of those to the extent that we feel like it’s creative for our business.”
