// definition
MSR
Mortgage servicing right
Short definition
A contractual right to income from administering mortgage loans, in exchange for duties such as collecting payments and handling borrower accounts. It is an asset distinct from an MBS. Prepayment shortens servicing revenues, while delinquencies and defaults can increase processing costs. Its value depends on expected net servicing income.
risk atlas
Knowledge map
Intuition
The servicer owns a claim on service revenues, distinct from capital invested in the MBS.
Related analyses
Primary sources
- Federal Reserve: Mortgage Servicing Right Valuations Under StressNote of 4 June 2026: servicing income, prepayments and default costs.