“Having worked closely with the Cenlar team, 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.”
Spector said that upon completion of the acquisition, Pennymac will become the second-largest U.S. mortgage servicer and one of the largest subservicers in the U.S.
“Leveraging industry-leading SSE technology, this further strengthens Pennymac’s position as a partner of choice for institutional subservicing and is expected to drive the growth of capital-light, fee-based revenue streams at significant scale,” Spector added. “We operate a best-in-class platform with superior operational performance and efficiency. With this transaction, we expect to realize powerful synergies that further reinforce our standing as the market’s most technologically advanced servicer.”
The transaction is expected to close in the second half of 2026, subject to customary closing conditions, including required regulatory approvals.
“Our team at Cenlar has been dedicated to building the nation’s leading subservicing organization, grounded in a deep commitment to our clients,” said David Schneider, president and CEO at Cenlar. “By combining Cenlar’s market-leading expertise with a top lender and servicer like Pennymac, we are forming the strongest subservicing platform in the industry.
“I am incredibly proud of what the Cenlar team has achieved and look forward to this next chapter as we collectively deliver superior scale, technology and care to the millions of homeowners we serve.”
Concurrent with closing, Cenlar will surrender its bank charter. Pennymac will acquire Cenlar’s subservicing business as a nonbank entity focused exclusively on mortgage subservicing. It will methodically transition about 100 institutional clients while delivering enhanced levels of customer service to their borrowers.
Santander US Capital Markets LLC is acting as the exclusive financial adviser to Pennymac and Goodwin Procter LLP is acting as its legal counsel.
Houlihan Lokey Capital Inc. is acting as financial adviser to Cenlar and Sullivan & Cromwell LLP is acting as its legal counsel.
Kevin Ryan, Pennymac’s chief strategy officer, said in an exclusive interview with HousingWire that the deal has been in the works for the past nine months and was “consistent with the company’s strategic plan.”
“We’ve said that we really wanted to grow in the subservicing business. And there are a couple of reasons for that,” Ryan said. “It’s fee income, which will diversify our revenue sources and is less capital-intensive than other businesses we’re in. … We feel like we have made really good progress in being a servicer, treating the customers right, building great technology around servicing. And so, wouldn’t it be great if we could grow fee income but also put that servicing technology in the hands of more clients?”
Ryan said that Cenlar’s sophisticated, institutional customer base was attractive to the company and the value the deal would bring to its shareholders.
“This is actually the first M&A deal in the history of Pennymac, so we wanted it to be meaningful and really supercharge a strategic objective of ours,” he said.
Ryan also confirmed that Pennymac will onboard Cenlar’s employees as soon as the deal closes in the second half of this year, and it will set up separate Pennymac branches at Cenlar’s current physical locations.
“They will become Pennymac employees and drive our subservicing business, because our subservicing business is about to get materially bigger,” he said.
“I think the leaders of the industry going forward will have relatively large portfolios and will have operational excellence, and we feel very well positioned to be there. My sense is the industry will continue to consolidate around those who can bring really strong technological expertise and discipline and workflows to these customers.”
Servicing shakeup
Cenlar was the second-largest subservicing player in the U.S. at the end of September, with a $745 billion book, according to Inside Mortgage Finance (IMF). Pennymac said that Cenlar posted $459 million in subservicing revenue in 2025.
Meanwhile, Pennymac did not have a significant presence in the segment, ranking as the 23rd-largest U.S. subservicer, IMF data shows. But Pennymac reported an owned servicing portfolio of $697.7 billion at the end of 2025, up about 5% year over year and good for No. 4 nationally.
Servicing and subservicing drew renewed attention in March 2025 when Rocket Companies announced a $9.4 billion deal to acquire Mr. Cooper Group, the largest servicer in the country.
Since then, competitors have been recalibrating their positions. United Wholesale Mortgage (UWM) has already opted to move its portfolio away from Mr. Cooper. But part of it remains with Cenlar. UWM said loans currently subserviced by Cenlar will transition by the end of 2026, except those UWM elects not to retain, according to its third-quarter 2025 earnings call.
Another big move in the space was Bayview Asset Management‘s purchase of Guild Mortgage.
HousingWire reported in May 2025 that Cenlar was “in talks to sell,” but the company dismissed the claims as rumors. The following month, the company announced plans to shutter its facility in O’Fallon, Missouri, resulting in the termination of 93 employees.
Flávia Furlan Nunes contributed reporting to this story.
