March 25, 2026

Recent Federal Reserve data from the Vice Chair of Supervision Michelle Bowman’s February 16, 2026, remarks shows a substantial change in mortgage servicing over the past fifteen (15) years. In 2008, banks serviced approximately 95% of mortgage balances. By 2023, that figure declined to roughly 45% (with servicing activity moving from depository institutions to nonbank mortgage companies). This aligns with broader industry developments as servicing activity continues to move toward nonbank institutions. This development illustrates the changes in who controls borrower relationships, loan performance, and long-term servicing revenue across the mortgage ecosystem.

A longer view of the data provides additional context for the pace of this movement. Data from the U.S. Government Accountability Office  shows that, from 2014 to 2024, the share of loans in Ginnie Mae, Fannie Mae, and Freddie Mac securities that were serviced by nonbanks increased from 27% to 66%.  Data from the Financial Stability Oversight Council (“FSOC”) states that nonbank servicers increased their share of Ginnie Mae servicing from 34% in 2014 to 83% in 2023. These increases across major segments of the mortgage market may reinforce the decline in bank servicing and capture how nonbank institutions expanded their role in servicing at scale during this period.

The drivers of this trend extend beyond market competition and tie to the regulatory and economic framework governing mortgage activity. Various post-financial crisis capital and compliance requirements increased the cost for banks to hold servicing assets. Simultaneously, nonbank servicers expanded to absorb that volume. Industry data shows that nonbank mortgage companies account for a significant share of agency servicing portfolios. According to the FSOC’s 2024 Report on Nonbank Mortgage Servicing, these firms include seven (7) of the ten (10) largest agency servicers and thirteen (13) of the twenty (20) largest as of 2023. The result is a mortgage servicing market that operates differently from the pre-2008 structure and continues to deviate from that previous structure. Now, regulators are evaluating the role of banks and nonbanks in the mortgage system.

https://www.federalreserve.gov/newsevents/speech/bowman20260216a.htm

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