Fannie Mae and Freddie Mac's regulator will require the new combined company to have "appropriate financial and operating safeguards." Their regulator specifically is requiring them to each maintain "strict counterparty risk concentration limits at 20%."

The pronouncement reinforces an absolute ceiling for the size of seller-servicers working with the two GSEs that have been in government conservatorships since 2008. The two enterprises buy, back and securitize a high percentage of the loans made in the United States.

"No market participant should have greater than 20% of Fannie or Freddie's servicing market in order to ensure the safety and soundness of the mortgage market and the overall economy," U.S. Federal Housing said in a press release. 

The companies' pro forma combined market share of owned servicing in the Fannie/Freddie market is around 13%, according to a report that Keefe, Bruyette & Woods released late Tuesday. When subservicing is included, the percentage could be closer to 20% or more.

"This suggests that while there is room for the combined entity to grow owned servicing, there might need to be an offset through reduced subservicing," Bose George and Frank Labetti, analysts at KBW, said in the report.

"Given the more modest profitability of subservicing, we expect no discernible earnings impact relative to our estimates," they added.

A BTIG research note published on Wednesday contained a similar estimate for Rocket and Mr. Cooper combined share, pegging it at no more than a 15% of the Fannie/Freddie market based on mortgage servicing rights they control.

"While it could put boundaries around longer-term growth, we don't think RKT gets valued with an unbounded growth trajectory in mind," Eric Hagen and Jake Katsikas, analysts at BTIG, said in commentary on the 20% requirement.

FHFA had not immediately responded to an inquiry related to whether the 20% requirement would include subservicing at deadline.

Fannie and Freddie's seller servicers generally must adhere to several counterparty requirements, some of which are coordinated with those of Ginnie Mae, a government corporation that guarantees many of the mortgage securitizations outside the GSE market.

Ginnie Mae also has shown concern with counterparty risk from time-to-time, notably flagging high concentrations of subservicers in 2016 and making an effort to expand the number of counterparties it had in this area.

Fannie and Freddie's regulator, which was formerly known as the Federal Housing Finance Agency prior to a rebranding, may be particularly careful about managing their risks now given that President Trump has hinted at plans for a new public listing of their shares.

Rocket announced plans to buy Mr. Cooper in an all-stock deal valued at $9.4 billion back in March. The acquirer also completed the acquisition of Redfin, a real estate brokerage, for $1.75 billion in July.

"We are pleased to have cleared FHFA's review in our pending acquisition of Mr. Cooper, which we expect to close in the fourth quarter," a Rocket Cos. spokesperson said in a statement emailed Wednesday.