A Servicing Rights Purchase Agreement is the consummation of an agreement between the original lender of a mortgage and a company that specialize in servicing mortgages. How much are servicing rights generally worth? It depends on the value of the mortgage. The higher the mortgage balance, the more the servicing rights are worth. Recently, Citigroup Inc.’s residential lending unit sold servicing rights on 185,000 loans to American Home Mortgage Servicing Inc. for $1.5 billion.

Another responsibility of a mortgage servicer may be to work with the homeowner to modify the mortgage terms so the homeowner can make their payments and stay in their home. When the housing bubble burst in 2007, many servicing rights purchase agreements became less valuable. Going forward, servicing rights will maintain their value and thus the drafting of servicing rights purchase agreements will continue to be good business for real estate lawyers.

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