- BofA to use servicing system on first and second mortgages
- ‘This deal is important,’ SunTrust analysts tell investors
Black Knight Financial Services Inc., the mortgage-technology company backed by Thomas H. Lee Partners, jumped in New York trading after winning a deal with Bank of America Corp.
Black Knight rose $1.30, or 3.7 percent, to $36.80 at 4:02 p.m., extending its advance for the year to 11 percent. The company “signed an agreement with Bank of America to use our LoanSphere MSP Servicing System to service first and second mortgages,” Black Knight said in a regulatory filing Monday that didn’t disclose terms.
“This deal is important, in our view, as BofA was the largest of three major servicers not on Black Knight’s platform,” SunTrust Robinson Humphrey analysts wrote in a note, identifying the others as Citigroup Inc. and Nationstar Mortgage Holdings Inc. “While BofA has lost considerable share in recent years, it still represents 5 percent to 7 percent of the total market.”
The stock rally benefited investors including title insurer Fidelity National Financial Inc. and private-equity firm Thomas H. Lee Partners, which took the company public last year. Black Knight sells access to cloud platforms that handle every part of loan-making within a network that also includes brokers, appraisers and insurers.
Servicers collect payments from borrowers and pass them on to mortgage lenders or investors, minus fees, and handle foreclosures when borrowers don’t pay.