Tax and Cash Implications of Excess Servicing

CWDL was asked to team up with Mortgage Capital Trading (MCT) on their latest whitepaper, Tax & Cash Implications of Creating Excess Servicing.

This whitepaper explains how excess servicing is created and the cash and tax consequences of retaining the excess mortgage servicing rights (MSRs). It also provides a review of how the global pandemic created an excess of MSRs, the definition of a “Down in Coupon” trade, and the tax treatment of “safe harbor” and excess servicing rights.