PennyMac Financial Services, Inc. announced it has entered into a definitive agreement to acquire the subservicing business of Cenlar Capital Corporation (Cenlar), primarily consisting of subservicing contracts and mortgage servicing operations, in an all-cash transaction for an upfront purchase price of $172.5 million and up to $85 million of contingent consideration payable over three years. Based on Cenlar’s current portfolio, Pennymac is expected to add up to $740 billion in unpaid principal balance (UPB) of mortgage loan subservicing and 2 million loans to its servicing portfolio. This expansion will bring Pennymac’s total portfolio to over $1 trillion in UPB.
“We are thrilled to announce this transformative step in our company’s evolution, which is the culmination of a long and thoughtful process between our two organizations that began in the middle of last year,” said David Spector, Chairman and CEO at Pennymac. “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. Upon completion of this acquisition, Pennymac will become the second largest mortgage servicer overall 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. 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. Concurrently with closing, Cenlar will surrender its bank charter. Pennymac will acquire Cenlar’s subservicing business as a non-bank entity focused exclusively on mortgage subservicing and will methodically transition approximately 100 institutional clients while delivering enhanced levels of customer service and care to their borrowers.
“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.”
Spector continued, “This transaction aligns with our previously communicated strategic objective to expand our subservicing business. Servicing has always been a core competency of Pennymac’s balanced business model, including onboarding new clients from large portfolios. This acquisition allows Pennymac to bring the efficiency of SSE technology and its servicing platform to millions of additional customers at scale. We look forward to welcoming Cenlar’s talented employees to our industry-leading team, as I am confident that the combined strength of our platform, technology, and people will deliver exceptional results for years to come.”
