Content analysis
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H.S. freshman Avg
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New words:
absent, AG, Amherst, assisting, attention, BMO, buyer, Competing, complex, contingent, contractor, Conventional, Conversely, Cooper, critical, custodial, delay, delisted, deposit, depreciation, description, director, discourage, disruption, diversion, domestic, driver, duty, encouraging, exit, factual, fail, Fargo, fka, fluctuate, foregoing, FSB, group, hiring, inability, inducing, IRLC, JPM, knowingly, larger, locate, long, met, Montreal, moving, Nasdaq, onboarding, Parent, passthrough, pendency, permitted, Pierpont, precedent, prevent, prevented, proposal, proposed, proposing, qualify, receipt, recover, redirected, refrain, repricing, retrospective, retrospectively, Santander, soliciting, stockholder, Store, submission, successfully, Superior, surviving, tender, thereof, thereon, threatened, TIAA, timeframe, timeline, UBS, waived, wind, withdrawn, withholding
Removed:
accrued, administering, affirmative, allocation, application, ASU, balanced, calculating, clarify, combination, competitor, complementary, conducted, conform, consulting, coverage, deductibility, delivering, discontinued, distinct, ecosystem, effectively, efficiency, efficient, exist, Facilitation, falling, FASB, favorably, financially, fulfillment, growth, guidance, happy, healthy, holding, homeownership, improving, infrastructure, initiate, integrated, Interbank, intra, leading, leverage, lifecycle, localized, methodology, mission, mitigation, modification, modified, objective, open, optional, pandemic, partnering, platform, propel, reach, reclassified, Reform, responsive, retail, reviewing, robust, scale, securing, Simplifying, standard, strong, subservice, sustainable, Topic, ultimate, unison, upgrading, upward
Financial report summary
?Risks
- Our business relies on our financing arrangements to fund mortgage loans and otherwise operate our business. If one or more of such facilities are terminated other than in the ordinary course, we may be unable to find replacement financing at commercially favorable terms, or at all, which could be detrimental to our business.
- Our loan origination and servicing revenues are highly dependent on macroeconomic and U.S. residential real estate market conditions.
- We may be required to repurchase mortgage loans or indemnify investors if we breach representations and warranties.
- We have historically been subject to counterparty risk and may be unable to seek indemnity from, or require our correspondent counterparties or sellers to repurchase mortgage loans if they breach representations and warranties, which could cause us to suffer losses.
- We are required to make servicing advances that can be subject to delays in recovery or may not be recoverable in certain circumstances, which could adversely affect our business, financial condition, liquidity and results of operations.
- We have risks related to any Subservicer which could have a material adverse effect on our business, liquidity, financial condition and results of operation.
- Competition for mortgage assets may limit the availability of desirable originations, acquisitions and result in reduced risk-adjusted returns and adversely affect our business, financial condition, liquidity and results of operations.
- We may not be able to continue to grow our loan origination business or effectively manage significant increases in our loan production volume, both of which could negatively affect our reputation and business, financial condition and results of operations.
- Difficult conditions or disruptions in the MBS, mortgage, real estate and financial markets and the economy generally may adversely affect our business, financial condition, liquidity and results of operations.
- The industry in which we operate is highly competitive, and could become more competitive, which could adversely affect us.
- We depend on our ability to acquire loans and sell the resulting MBS in the secondary markets on favorable terms in our production activities. If our ability to acquire and sell is impaired, this could subject us to increased risk of loss.
- The success and growth of our production will depend, in part, upon our or any of our Subservicers’ ability to adapt to and implement technological changes.
- Our risk management efforts may not be effective.
- We could be harmed by misconduct or fraud that is difficult to detect.
- Cybersecurity risks, cyber incidents and technology failures may adversely affect our business by causing a disruption to our operations, an unauthorized use or disclosure of confidential or regulated data and information, and/or damage to our business relationships, all of which could negatively impact our business.
- We rely on our senior executive team and will require additional key personnel to grow our business, and the loss of key management members or key employees, or an inability to hire key personnel, could harm our business.
- The competitive job market creates a challenge and potential risk as we strive to attract and retain a highly skilled workforce.
- We could be adversely affected if we inadequately obtain, maintain, protect and enforce our intellectual property and proprietary rights, and we may encounter disputes from time to time relating to our use of the intellectual property of third parties.
- Our vendor relationships subject us to a variety of risks.
- Our failure to deal appropriately with various issues that may give rise to reputational risk, including legal and regulatory requirements, could cause harm to our business and adversely affect our business and financial condition and may negatively impact our reputation.
- Employment litigation and related unfavorable publicity could negatively affect our business.
- Initiating new business activities or strategies or significantly expanding existing business activities or strategies may expose us to new risks and will increase our cost of doing business.
- Certain of our material vendors have operations in India that could be adversely affected by changes in political or economic stability or by government policies.
- We may not be able to fully utilize our net operating loss, or NOL, and other tax carryforwards.
- The IRS could challenge the amount, timing and/or use of our NOL carryforwards.
- Possible changes in legislation could negatively affect our ability to use the tax benefits associated with our NOL carryforwards.
- Changes in tax laws may adversely affect us.
- The effects of the COVID-19 pandemic could adversely impact our business.
- Interest rate fluctuations could significantly decrease our results of operations and cash flows and the fair value of our assets.
- Hedging against interest rate exposure may materially and adversely affect our business, financial condition, liquidity and results of operations.
- A prolonged economic slowdown, recession or declining real estate values could materially and adversely affect us.
- We finance our assets with borrowings, which may materially and adversely affect the income derived from our assets.
- The value of our collateral may decrease, which could lead to our lenders initiating margin calls and requiring us to post additional collateral or repay a portion of our outstanding borrowings.
- Our operations are dependent on access to our financing arrangements, which are mostly uncommitted. If the lenders under these financing facilities terminate, or modify the terms of, these facilities, it could have a material adverse effect on our business, financial condition, results of operations and cash flows.
- Our financing agreements contain financial and restrictive covenants that could adversely affect our financial condition and our ability to operate our businesses.
- We may not be able to raise the debt or equity capital required to finance our assets and maintain or grow our businesses.
- We utilize derivative financial instruments, which could subject us to risk of loss.
- We operate in a highly regulated industry with continually changing federal, state and local laws and regulations.
- We may be subject to liability for potential violations of anti-predatory lending laws, which could adversely impact our results of operations, financial condition and business.
- The CFPB is active in its monitoring of the residential mortgage origination and servicing sectors. New or revised rules and regulations and more stringent enforcement of existing rules and regulations by the CFPB could result in increased compliance costs, enforcement actions, fines, penalties and the inherent reputational harm that results from such actions.
- The state regulatory agencies continue to be active in their supervision of the loan origination and servicing sectors and the results of these examinations may be detrimental to our business. New or revised rules and regulations and more stringent enforcement of existing rules and regulations by state regulatory agencies could result in increased compliance costs, enforcement actions, fines, penalties and the inherent reputational harm that results from such actions.
- Failure to comply with the GSEs, FHA, VA and USDA guidelines and changes in these guidelines or GSE and Ginnie Mae guarantees could adversely affect our business.
- We are highly dependent on the GSEs and Ginnie Mae and the FHFA, as the conservator of the GSEs, and any changes in these entities or their current roles could materially and adversely affect our business, liquidity, financial condition and results of operations.
- We are required to have various Agency approvals and state licenses in order to conduct our business and there is no assurance we will be able to maintain those Agency approvals or state licenses or that changes in Agency guidelines will not materially and adversely affect our business, financial condition and results of operations.
- If we are unable to comply with TRID rules, our business and operations could be materially and adversely affected.
- The conduct of mortgage brokers with whom we produce our wholesale mortgage loans could subject us to lawsuits, regulatory action, fines or penalties.
- Mortgage loan modification and refinance programs, future legislative action and other actions and changes may materially and adversely affect the value of, and the returns on, the assets in which we invest.
- Private legal proceedings alleging failures to comply with applicable laws or regulatory requirements, and related costs, could adversely affect our financial condition and results of operations.
- Residential mortgage foreclosure proceedings in certain states have been delayed due to lack of judicial resources and legislation.
- We may incur increased costs and related losses if a customer challenges the validity of a foreclosure action, if a court overturns a foreclosure or if a foreclosure subjects us to environmental liabilities.
- Regulatory agencies and consumer advocacy groups are becoming more aggressive in asserting claims that the practices of lenders and loan servicers result in a disparate impact on protected classes.
- Our acquisition of MSRs exposes us to significant risks.
- Our counterparties may terminate our servicing rights under which we conduct servicing activities.
- A significant increase in delinquencies for the loans serviced could have a material impact on our revenues, expenses and liquidity and on the valuation of our MSRs.
- Our inability to promptly foreclose upon defaulted mortgage loans could increase our cost of doing business and/or diminish our expected cash flows.
- A decline in the fair value of the real estate that we acquire, or that underlies the mortgage loans we own or service, may result in reduced risk-adjusted returns or losses.
- We may be adversely affected by concentration risks of various kinds that apply to our mortgage or MSR assets at any given time, as well as from unfavorable changes in the related geographic regions containing the properties that secure such assets.
- Many of our mortgage assets may be illiquid and we may not be able to adjust our portfolio in response to changes in economic and other conditions.
- Fair values of our MSRs are estimates and the realization of reduced values from our recorded estimates may materially and adversely affect our financial results and credit availability.
- We utilize analytical models and data in connection with the valuation of our assets, and any incorrect, misleading or incomplete information used in connection therewith would subject us to potential risks.
- We rely on internal models to manage risk and to make business decisions. Our business could be adversely affected if those models fail to produce reliable and/or valid results.
- We depend on the accuracy and completeness of information from and about borrowers, mortgage loans and the properties securing them, and any misrepresented information could adversely affect our business, financial condition and results of operations.
- We are a “controlled company” within the meaning of the rules of Nasdaq and the rules of the SEC and, as a result, qualify for, and rely on, exemptions from certain corporate governance requirements.
- Our Sponsor controls us and their interests may conflict with yours in the future.
- We have incurred, and will continue to incur, significantly increased costs and we became subject to additional regulations and requirements as a result of becoming a public company, and our management is, and will continue to be, required to devote substantial time to new compliance matters, which could lower our profits or make it more difficult to run our business.
- While we are no longer an “emerging growth company,” we are a “smaller reporting company” and we cannot be certain if the reduced disclosure requirements applicable to “smaller reporting companies” will make our common stock less attractive to investors.
- Failure to comply with requirements to design, implement and maintain effective internal controls could have a material adverse effect on our business and stock price.
- Our stock price may change significantly, and you may not be able to resell shares of our common stock at or above the price you paid or at all, and you could lose all or part of your investment as a result.
- You may be diluted by the future issuance of additional common stock in connection with our incentive plans, acquisitions or otherwise.
- Our board of directors is authorized to issue and designate shares of our preferred stock in additional series without stockholder approval.
- Our ability to raise capital in the future may be limited.
- As a holding company, we depend on the ability of our subsidiaries to transfer funds to us to meet our obligations, including to pay dividends.
- We may not pay cash dividends in the future.
- Future sales, or the perception of future sales, by us or our existing stockholders in the public market could cause the market price for our common stock to decline.
- Anti-takeover provisions in our organizational documents could delay or prevent a change of control.
- Our amended and restated certificate of incorporation provides, subject to limited exceptions, that the Court of Chancery of the State of Delaware will be the exclusive forum for substantially all disputes between us and our stockholders and the federal district courts will be the exclusive forum for Securities Act claims, which could limit our stockholders’ ability to bring a suit in a different judicial forum than they may otherwise choose for disputes with us or our directors, officers, team members or stockholders.