Mike Weinbach: The only thing I’d add, to reiterate what Jay said, we lose more than we win. We bid almost all of them and we think we get to see almost everything that’s in the market because people know our ability to very quickly evaluate a portfolio against our return hurdles and come back with a price. So, yeah, we like that we continue to see everything. We’re going to remain disciplined. We’re going to be an active participant in the market. And, you know, even losing more than we win, it’s helped us be able to grow.
Jay Bray: And the last piece I would add is we do have sellers that consistently come to us directly because we’ve had a proven track record with them. We’ve been able to execute time and time again. And so there, obviously, we’re going to win those in most cases because we have a track record with that seller. So that’s one other element of the process.
Terry Ma: Got it. That’s helpful. And then I may have missed this, but on the servicing pre-tax for the quarter, you guys had some pretty good operating leverage. Was there anything one-timers sees knowing that? Now that we think about, I guess, maybe the margin going forward.
Kurt Johnson: No, there really wasn’t much in the way of one timers in servicing, particularly not from an expense standpoint. So I think you can — as Mike said, you can’t count on the operating leverage sort of being that robust on a go-forward basis, but I think, Jay pointed out, right, $100 billion of additions with less than 50 ads from a headcount perspective, I think the operating leverage continues to exist and you’ll see that play out on a go-forward basis.
Mike Weinbach: And the only thing I’d add is obviously there’s an element of rates there. So with higher rates CPRs were lower. If the environment had been different you might see what appears to be less operating leverage, but what underlies that regardless of rate is we’re continuing to invest in the platform, which has given us the capabilities that Jay talked about to bring on new loans without needing to add significant amounts of expense. So we feel great about the scalability of the platform. We’re going to continue to invest to realize it, but as I said up front, we expect to see continued operating leverage going forward.
Terry Ma: Great, thank you.
Operator: [Operator Instructions] And one moment as we move on to our next question. And our next question is going to be from the line of Eric Hagen with BTIG. Your line is open. Please go ahead.
Eric Hagen: Hey, thanks. Good morning. On the $50 billion of MSRs that you’re onboarding this quarter, can you share how you’re financing that? Is it all in cash or using any debt? Was it competitively bid? And any recapture expectations you might expect for that portfolio? And then a follow-up there, I mean is it right to assume that the amortization expense that you expect as you onboard that is sort of proportional to the amortization expense in the overall portfolio right now?
Kurt Johnson: Yeah, all good questions Eric. Look the $50 billion and I’m trying to remember all the questions now [because we were] [ph] a lot of components Eric. $50 billion was largely competitively bad. To Jay’s point there were a couple that probably came directly to us, but for the most part, it was competitively bad. I think, yes, you’ll see a pro rata amortization expense, but as Mike pointed out, a lot of that is interest rate dependent. So, if the rates stay kind of where they are in this higher range, I think you’ll definitely see sort of a pro-rata amortization. If they increase a little bit, or sorry, if they decrease a little bit, you’ll see that go up. I think you’ll see a corresponding increase in our DTC performance as well.
So again, the focus is on the balanced business model and we do think that these returns are really interest rate agnostic and that where you see a drop off in servicing because of a rate rally, you’ll see an increase in our DTC channel.
Eric Hagen: Yeah, okay, that’s helpful. Good discussion on this call. I mean, we’ve seen the investor base for MSRs evolve very considerably over the last couple of years. Do you feel like a more concentrated ownership of servicing from the non-bank community and mortgage rates contributes to higher volatility for the asset class? How do you think about your footprint in light of the ownership base?
Jay Bray : I mean, the short answer is no. From our standpoint, when you look at the buyers that are out there today, typically strong, well-capitalized. You’ve got the financial buyer segment, which we subservice for, and there are strong counterparties, good operators like a Mr. Cooper. And then you’ve got, if you look at someone like us, clearly we think our goal is to be the leader in the market, to continue to provide stable, consistent earnings, hit our returns, and, you know, have a fortress balance sheet. I mean, that’s the way we think about the business. To be a leader, you need those things. So no, we certainly don’t think that it’s introduced more volatility into the system.
