CCM Parent Sells $750 Million in Senior Notes

CrossCountry Intermediate HoldCo, the direct parent of CrossCountry Mortgage (CCM), has priced an upsized offering of $750 million in senior notes due in 2031. This financial move is intended to refinance mortgage servicing rights (MSR) facilities that are tied to the company's ongoing growth plans. The offering's final amount was 50% higher than initially anticipated. The newly issued 7.75% senior notes will be structured as senior unsecured debt. These notes will be guaranteed by CCM itself and by any future wholly owned domestic restricted subsidiaries that also guarantee material corporate debt, according to a company statement made on Tuesday. The transaction is scheduled to be finalized on or about August 12, pending the satisfaction of standard closing conditions. The company has stated that it expects to utilize the net proceeds generated from this offering to reduce a portion of the outstanding amounts under CCM’s existing mortgage servicing rights line of credit. Additionally, the proceeds will cover related fees and expenses associated with the transaction. Previously, it was reported that CCM was planning to issue $500 million in senior unsecured notes, a plan that coincided with the approaching closure of Two Harbors Investment Corp.'s sale to CCM. Fitch Ratings has indicated that it expects to assign a rating of "BB-(EXP)" to this issuance. The funds from this offering are anticipated to be used to repay MSR-backed facilities that were drawn upon to finance the $1.26 billion acquisition of Two Harbors. This acquisition is set to significantly expand CCM's operations. The Two Harbors deal will add a substantial $159 billion servicing portfolio to CCM's existing $202 billion book as of the first quarter of the year, according to data from Inside Mortgage Finance. This strategic move is projected to elevate CCM's ranking among the largest mortgage servicers based on owned portfolios, moving it from the 15th position to the 8th. Fitch estimates that CCM's corporate leverage ratio will increase to 2.4x following the completion of the Two Harbors acquisition. This represents an increase from its leverage ratio of 1.2x recorded in the second quarter of 2026, and it is above Fitch's stated downgrade trigger of 1.5x. However, Fitch also noted that growth in retained earnings is expected to help reduce this leverage ratio back toward the company's medium-term target of 1.0x. The rating agency has warned that a negative rating action could occur if CCM is unable to reduce its corporate leverage to 1.5x or below within the established rating outlook horizon. The shift from secured to unsecured debt is viewed as a credit positive development, as it liberates collateral that was previously encumbered by secured debt obligations.