Finance category
Mortgage, loan, investing, tax, and money calculators.
Servicing Strip Value Calculator
When loans are sold, the originator often retains servicing rights — earning servicing fees over remaining life. This calculator values the strip.
Servicing strip value
$5,117,562
Annual fee income
$1,750,000
Multiple of annual fee
2.92
How the math works
Strip value = PV of future net servicing fees over WAL. Prepayment speeds shorten WAL and lower value.
MSR multiples: 4-6x for clean conforming book; 2-3x for subprime or high-risk. Trading desks mark MSR daily based on rate scenarios.
How to Use
- Enter UPB of servicing portfolio.
- Enter servicing fee rate.
- Enter weighted average life.
- Enter discount rate.
- Read strip value.
Frequently Asked Questions
What is MSR?
Mortgage Servicing Rights. Contractual right to collect servicing fees (25-50bps typical) over loan life. Traded as a separate asset from the loan itself.
How is it valued?
PV of future servicing fees minus servicing costs, adjusted for prepayment. Typically 3-6x annual fee for long-tenor loans. Prepayment risk lowers multiple dramatically.
Who buys MSR?
Non-bank servicers (Mr. Cooper, Rocket, Ocwen) buy MSR portfolios from originators. Large banks also trade MSR routinely. $5-50B deals common.
How do I benchmark this?
Benchmark against industry data from NCREIF, IREM, Yardi Matrix, CoStar, or RCA. Institutional operators also benchmark internally across their own portfolio to identify operating outliers. A single number means little; the trend and the peer comparison mean everything. Run quarterly benchmarks and note deviations that exceed 10% — those warrant investigation.
Related Calculators
More Finance Calculators
Browse all finance →AI Cost Calculator
Compare token costs across OpenAI, Anthropic, and Google AI models. Calculate monthly API spending for GPT-4o, Claude, Gemini, and more.
Tip Calculator
Calculate the perfect tip and split the bill between friends. Choose preset percentages or enter a custom tip amount.
Bill Splitter Calculator
Split an uneven restaurant bill by item, divide tax and tip proportionally, and see exactly who owes whom.
Discount Calculator
Calculate sale price, discount amount, stacked discounts, sales tax, and total savings for any markdown.
Gas Mileage Calculator
Calculate MPG or km/L, estimate trip fuel cost, and compare annual fuel expenses between two vehicles.
Sales Tax Calculator
Add sales tax to a price, reverse-calculate the pre-tax amount from a total, and estimate tax for multiple items on one receipt.
Keep exploring
Next steps in Finance
Previous calculator
Service Request Cost Calculator
Calculate per-ticket service cost and annual maintenance budget — tech labor, materials, and unit count.
Next calculator
Servicing Transfer Payment Change Calculator
Estimate payment changes after a mortgage servicing transfer, including escrow re-analysis and any cushion adjustment.