PennyMac Financial Services announced it has entered into a definitive agreement to acquire the subservicing business of Cenlar Capital Corporation in an all-cash transaction valued at an upfront $172.5 million, with up to $85 million in additional contingent consideration payable over three years.
The acquisition primarily includes subservicing contracts and mortgage servicing operations. Based on Cenlar’s current portfolio, Pennymac expects to add up to $740 billion in unpaid principal balance and approximately 2 million loans to its servicing portfolio. Following the transaction, Pennymac’s total servicing portfolio is projected to exceed $1 trillion in unpaid principal balance.
The deal is expected to close in the second half of 2026, subject to customary closing conditions and required regulatory approvals. At closing, Cenlar will surrender its bank charter. Pennymac will operate the acquired subservicing business as a non-bank entity focused exclusively on mortgage subservicing and plans to transition approximately 100 institutional clients while maintaining service levels for borrowers.
Pennymac said the acquisition aligns with its strategic objective of expanding its subservicing business and growing capital-light, fee-based revenue streams. The company expects the transaction to enhance scale and drive operational efficiencies through its servicing systems and technology platform.
Cenlar’s leadership said the combination will create a larger, technology-enabled subservicing platform serving institutional clients and millions of homeowners nationwide.
Santander US Capital Markets LLC is serving as exclusive financial advisor to Pennymac, with Goodwin Procter LLP acting as legal counsel. Houlihan Lokey Capital, Inc. is acting as financial advisor to Cenlar, and Sullivan & Cromwell LLP is serving as its legal counsel.
Founded in 2008, Pennymac is a specialty financial services firm focused on mortgage loan production and servicing, as well as managing investments related to the U.S. mortgage market. In 2025, the company produced $145 billion in newly originated loans and, as of December 31, 2025, serviced $734 billion in unpaid principal balance.
KEY QUOTES
“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. 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. 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.”
David Spector, Chairman and CEO, PennyMac Financial Services, Inc.
“Our team at Cenlar has been dedicated to building the nation’s leading subservicing organization, grounded in a deep commitment to our clients. 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.”
David Schneider, President and CEO, Cenlar Capital Corporation
