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Velocity Financial Acquires Majority Interest in Century Health and Housing Capital.

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MANews-(C)2009-2021

California-based small balance investor loan provider Velocity Financial, Inc (NYSE: VEL) has acquired a majority stake in Century Health and Housing Capital, the company said.

Founded in 1992, Century is a licensed "Ginnie Mae" issuer/servicer that provides government-insured Federal Housing Administration mortgage financing for multifamily housing, senior housing and long-term care/assisted living facilities.

Century originates loans through its borrower-direct origination channel and services the loans through its in-house servicing platform, which enables the formation of long-term relationships with its clients and drives strong portfolio retention.

Century issued USD 158m in unpaid principal balance of loans for the 11 months ended November 30, 2021, and manages a servicing portfolio in excess of USD 500m in UPB.

The Century acquisition expands Velocity's commercial mortgage product offerings through growth in a new channel and the ability to offer new products to Velocity's broker network. The addition of Century is expected to be immediately accretive to Velocity's earnings with minimal impact to tangible book value.

The transaction also diversifies Velocity's revenue with fee-based origination and servicing income which generates strong returns on capital and is durable through market cycles, in addition to providing the opportunity for Century...

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