Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2018 | Feb. 15, 2019 | Jun. 30, 2018 | |
Document And Entity Information | |||
Entity Registrant Name | New Residential Investment Corp. | ||
Entity Central Index Key | 1,556,593 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2018 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Shell Company | false | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Public Float | $ 4.7 | ||
Entity Common Stock, Shares Outstanding | 369,132,581 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2,018 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | |
Investments in: | |||
Excess mortgage servicing rights, at fair value | $ 447,860 | $ 1,173,713 | |
Excess mortgage servicing rights, equity method investees, at fair value | 147,964 | 171,765 | |
Mortgage servicing rights, at fair value | 2,884,100 | 1,735,504 | |
Mortgage servicing rights financing receivables, at fair value | 1,644,504 | 598,728 | |
Servicer advance investments, at fair value | [1] | 735,846 | 4,027,379 |
Real estate and other securities, available-for-sale | 11,636,581 | 8,071,140 | |
Residential mortgage loans, held-for-investment (includes $121,088 and $0 at fair value at December 31, 2018 and December 31, 2017, respectively) | [1] | 735,329 | 691,155 |
Residential mortgage loans, held-for-sale | 932,480 | 1,725,534 | |
Residential mortgage loans, held-for-sale, at fair value | 2,808,529 | 0 | |
Real estate owned | 113,410 | 128,295 | |
Residential mortgage loans subject to repurchase | 121,602 | 0 | |
Consumer loans, held-for-investment | [1] | 1,072,202 | 1,374,263 |
Consumer loans, equity method investees | 38,294 | 51,412 | |
Cash and cash equivalents | [1] | 251,058 | 295,798 |
Restricted cash | 164,020 | 150,252 | |
Servicer advances receivable | 3,277,796 | 675,593 | |
Trades receivable | 3,925,198 | 1,030,850 | |
Deferred tax asset, net | 65,832 | 0 | |
Other assets | 688,408 | 312,181 | |
Total assets | 31,691,013 | 22,213,562 | |
Liabilities | |||
Repurchase agreements | 15,553,969 | 8,662,139 | |
Notes and bonds payable (includes $117,048 and $0 at fair value at December 31, 2018 and December 31, 2017, respectively) | [1] | 7,102,266 | 7,084,391 |
Trades payable | 2,048,348 | 1,169,896 | |
Residential mortgage loans repurchase liability | 121,602 | 0 | |
Due to affiliates | 101,471 | 88,961 | |
Dividends payable | 184,552 | 153,681 | |
Deferred tax liability, net | 0 | 19,218 | |
Accrued expenses and other liabilities | [1] | 490,510 | 239,114 |
Total liabilities | 25,602,718 | 17,417,400 | |
Commitments and Contingencies | |||
Equity | |||
Common Stock, $0.01 par value, 2,000,000,000 shares authorized, 369,104,429 and 307,361,309 issued and outstanding at December 31, 2018 and December 31, 2017, respectively | 3,692 | 3,074 | |
Additional paid-in capital | 4,746,242 | 3,763,188 | |
Retained earnings | 830,713 | 559,476 | |
Accumulated other comprehensive income (loss) | 417,023 | 364,467 | |
Total New Residential stockholders’ equity | 5,997,670 | 4,690,205 | |
Noncontrolling interests in equity of consolidated subsidiaries | 90,625 | 105,957 | |
Total Equity | 6,088,295 | 4,796,162 | |
Total Liabilities And Equity | $ 31,691,013 | $ 22,213,562 | |
[1] | New Residential’s Consolidated Balance Sheets include the assets and liabilities of certain consolidated VIEs, Advance Purchaser LLC (the “Buyer”) (Note 6), the RPL Borrowers, Shellpoint Asset Funding Trust 2013-1 (“SAFT 2013-1”) and the Shelter retail mortgage origination joint ventures (“Shelter JVs”) (Note 8) and the Consumer Loan SPVs (Note 9), which primarily hold investments in Servicer Advance Investments, residential mortgage loans and consumer loans, respectively, financed with notes and bonds payable. The balance sheets of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs are included in Notes 6, 8 and 9, respectively. The creditors of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs do not have recourse to the general credit of New Residential and the assets of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs are not directly available to satisfy New Residential’s obligations. See Note 8 regarding deconsolidation of the RPL Borrowers during 2018. |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Residential mortgage loans, held-for-investment, fair value | $ 121,088 | $ 0 |
Notes and bonds payable, fair value | $ 117,048 | $ 0 |
Equity | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 2,000,000,000 | 2,000,000,000 |
Common stock, shares issued (in shares) | 369,104,429 | 307,361,309 |
Common stock, shares outstanding (in shares) | 369,104,429 | 307,361,309 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Statement [Abstract] | |||
Interest income | $ 1,664,223 | $ 1,519,679 | $ 1,076,735 |
Interest expense | 606,433 | 460,865 | 373,424 |
Net interest income | 1,057,790 | 1,058,814 | 703,311 |
Impairment | |||
Other-than-temporary impairment (OTTI) on securities | 30,017 | 10,334 | 10,264 |
Valuation and loss provision (reversal) on loans and real estate owned | 60,624 | 75,758 | 77,716 |
Total Impairment Charges | 90,641 | 86,092 | 87,980 |
Net interest income after impairment | 967,149 | 972,722 | 615,331 |
Servicing revenue, net | 528,595 | 424,349 | 118,169 |
Gain on sale of originated mortgage loans, net | 89,017 | 0 | 0 |
Other Income | |||
Change in fair value of investments in excess mortgage servicing rights | (58,656) | 4,322 | (7,297) |
Change in fair value of investments in excess mortgage servicing rights, equity method investees | 8,357 | 12,617 | 16,526 |
Change in fair value of investments in mortgage servicing rights financing receivables | 31,550 | 66,394 | 0 |
Change in fair value of servicer advance investments | (89,332) | 84,418 | (7,768) |
Change in fair value of investments in residential mortgage loans | 73,515 | 0 | 0 |
Gain on consumer loans investment | 0 | 0 | 9,943 |
Gain on remeasurement of consumer loans investment | 0 | 0 | 71,250 |
Gain (loss) on settlement of investments, net | 103,842 | 10,310 | (48,800) |
Earnings from investments in consumer loans, equity method investees | 10,803 | 25,617 | 0 |
Other income (loss), net | (124,336) | 4,108 | 28,483 |
Total Other Income | (44,257) | 207,786 | 62,337 |
Operating Expenses | |||
General and administrative expenses | 231,579 | 67,159 | 38,570 |
Management fee to affiliate | 62,594 | 55,634 | 41,610 |
Incentive compensation to affiliate | 94,900 | 81,373 | 42,197 |
Loan servicing expense | 43,547 | 52,330 | 44,001 |
Subservicing expense | 176,784 | 166,081 | 7,832 |
Total Operating Expenses | 609,404 | 422,577 | 174,210 |
Income (Loss) Before Income Taxes | 931,100 | 1,182,280 | 621,627 |
Income tax (benefit) expense | (73,431) | 167,628 | 38,911 |
Net Income (Loss) | 1,004,531 | 1,014,652 | 582,716 |
Noncontrolling Interests in Income of Consolidated Subsidiaries | 40,564 | 57,119 | 78,263 |
Net income (loss) attributable to common stockholders | $ 963,967 | $ 957,533 | $ 504,453 |
Net Income Per Share of Common Stock | |||
Basic (in dollars per share) | $ 2.82 | $ 3.17 | $ 2.12 |
Diluted (in dollars per share) | $ 2.81 | $ 3.15 | $ 2.12 |
Weighted Average Number of Shares of Common Stock Outstanding | |||
Basic (in shares) | 341,268,923 | 302,238,065 | 238,122,665 |
Diluted (in shares) | 343,137,361 | 304,381,388 | 238,486,772 |
Dividends declared per Share of Common Stock (in dollars per share) | $ 2 | $ 1.98 | $ 1.84 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Comprehensive income (loss), net of tax | |||
Net income | $ 1,004,531 | $ 1,014,652 | $ 582,716 |
Other comprehensive income (loss) | |||
Net unrealized (loss) gain on securities | (7,397) | 248,412 | 84,703 |
Reclassification of net realized (gain) loss on securities into earnings | 59,953 | (10,308) | 37,724 |
Total other comprehensive income (loss) | 52,556 | 238,104 | 122,427 |
Total comprehensive income | 1,057,087 | 1,252,756 | 705,143 |
Comprehensive income attributable to noncontrolling interests | 40,564 | 57,119 | 78,263 |
Comprehensive income attributable to common stockholders | $ 1,016,523 | $ 1,195,637 | $ 626,880 |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income | Total New Residential Stockholders’ Equity | Noncontrolling Interests in Equity of Consolidated Subsidiaries |
Balance, beginning (in shares) at Dec. 31, 2015 | 230,471,202 | ||||||
Balance, beginning at Dec. 31, 2015 | $ 2,986,580 | $ 2,304 | $ 2,640,893 | $ 148,800 | $ 3,936 | $ 2,795,933 | $ 190,647 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Dividends declared | (442,753) | (442,753) | (442,753) | ||||
SpringCastle Transaction | 110,438 | 110,438 | |||||
Capital distributions | (167,026) | (167,026) | |||||
Issuance of common stock (in shares) | 20,000,000 | ||||||
Issuance of common stock | 278,775 | $ 200 | 278,575 | 278,775 | |||
Option exercised (in shares) | 280,111 | ||||||
Option exercise | 0 | $ 3 | (3) | ||||
Director share grants | (3,280) | 965 | 965 | (4,245) | |||
Modified retrospective adjustment for the adoption of ASU No. 2014-11(in shares) | 21,804 | ||||||
Modified retrospective adjustment for the adoption of ASU No. 2014-11 | 300 | 300 | 300 | ||||
Comprehensive income (loss) | |||||||
Net income (loss) | 582,716 | 504,453 | 504,453 | 78,263 | |||
Net unrealized (loss) gain on securities | 84,703 | 84,703 | 84,703 | ||||
Reclassification of net realized (gain) loss on securities into earnings | 37,724 | 37,724 | 37,724 | ||||
Total comprehensive income | 705,143 | 626,880 | 78,263 | ||||
Balance, ending (in shares) at Dec. 31, 2016 | 250,773,117 | ||||||
Balance, ending at Dec. 31, 2016 | 3,468,177 | $ 2,507 | 2,920,730 | 210,500 | 126,363 | 3,260,100 | 208,077 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Dividends declared | (608,557) | (608,557) | (608,557) | ||||
Capital distributions | (84,196) | (84,196) | |||||
Issuance of common stock (in shares) | 56,545,787 | ||||||
Issuance of common stock | $ 834,529 | $ 566 | 833,963 | 834,529 | |||
Option exercised (in shares) | 0 | ||||||
Purchase of noncontrolling interests in the Buyer | $ (65,860) | 9,183 | 9,183 | (75,043) | |||
Other dilution | (1,386) | (1,386) | (1,386) | ||||
Director share grants (in shares) | 42,405 | ||||||
Director share grants | 699 | $ 1 | 698 | 699 | |||
Comprehensive income (loss) | |||||||
Net income (loss) | 1,014,652 | 957,533 | 957,533 | 57,119 | |||
Net unrealized (loss) gain on securities | 248,412 | 248,412 | 248,412 | ||||
Reclassification of net realized (gain) loss on securities into earnings | (10,308) | (10,308) | (10,308) | ||||
Total comprehensive income | 1,252,756 | 1,195,637 | 57,119 | ||||
Balance, ending (in shares) at Dec. 31, 2017 | 307,361,309 | ||||||
Balance, ending at Dec. 31, 2017 | 4,796,162 | $ 3,074 | 3,763,188 | 559,476 | 364,467 | 4,690,205 | 105,957 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Dividends declared | (692,730) | (692,730) | (692,730) | ||||
Capital distributions | (64,559) | (64,559) | |||||
Issuance of common stock (in shares) | 57,991,659 | ||||||
Issuance of common stock | $ 982,062 | $ 580 | 981,482 | 982,062 | |||
Option exercised (in shares) | 15,803,216 | 3,694,228 | |||||
Option exercise | $ 0 | $ 37 | (37) | ||||
Purchase of noncontrolling interests in the Buyer | 9,316 | 653 | 653 | 8,663 | |||
Other dilution | (63) | (63) | (63) | ||||
Director share grants (in shares) | 57,233 | ||||||
Director share grants | 1,020 | $ 1 | 1,019 | 1,020 | |||
Comprehensive income (loss) | |||||||
Net income (loss) | 1,004,531 | 963,967 | 963,967 | 40,564 | |||
Net unrealized (loss) gain on securities | (7,397) | (7,397) | (7,397) | ||||
Reclassification of net realized (gain) loss on securities into earnings | 59,953 | 59,953 | 59,953 | ||||
Total comprehensive income | 1,057,087 | 1,016,523 | 40,564 | ||||
Balance, ending (in shares) at Dec. 31, 2018 | 369,104,429 | ||||||
Balance, ending at Dec. 31, 2018 | $ 6,088,295 | $ 3,692 | $ 4,746,242 | $ 830,713 | $ 417,023 | $ 5,997,670 | $ 90,625 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash Flows From Operating Activities | |||
Net income | $ 1,004,531 | $ 1,014,652 | $ 582,716 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||
Change in fair value of investments in excess mortgage servicing rights | 58,656 | (4,322) | 7,297 |
Change in fair value of investments in excess mortgage servicer rights, equity method investees | (8,357) | (12,617) | (16,526) |
Change in fair value of investments in mortgage servicing rights financing receivables | (31,550) | (66,394) | 0 |
Change in fair value of servicer advance investments | 89,332 | (84,418) | 7,768 |
Change in fair value of residential mortgage loans, at fair value, and notes and bonds payable, at fair value | (72,624) | 0 | 0 |
(Gain) / loss on remeasurement of consumer loans investment | 0 | 0 | (71,250) |
(Gain) / loss on settlement of investments (net) | (103,842) | (10,310) | 48,800 |
(Gain) / loss on sale of originated mortgage loans (net) | (89,017) | 0 | 0 |
Earnings from investments consumer loans, equity method investees | (10,803) | (25,617) | 0 |
Unrealized (gain) / loss on derivative instruments | 113,558 | 2,190 | (5,774) |
Changes in fair value of contingent consideration | 1,581 | 0 | 0 |
Unrealized (gain) / loss on other ABS | (10,283) | (2,883) | 2,322 |
(Gain) / loss on transfer of loans to REO | (19,519) | (22,938) | (18,356) |
(Gain) / loss on transfer of loans to other assets | 1,977 | (488) | (2,938) |
(Gain) / loss on Excess MSR recapture agreements | (979) | (2,384) | (2,802) |
(Gain) / loss on Ocwen common stock | 10,860 | (5,346) | 0 |
Accretion and other amortization | (701,967) | (1,031,384) | (747,932) |
Other-than-temporary impairment | 30,017 | 10,334 | 10,264 |
Valuation and loss provision (reversal) on loans and real estate owned | 60,624 | 75,758 | 77,716 |
Non-cash portions of servicing revenue, net | 191,245 | 67,672 | (88,325) |
Non-cash directors’ compensation | 1,020 | 699 | 300 |
Deferred tax provision | (80,054) | 168,518 | 34,846 |
Changes in: | |||
Servicer advances receivable | 381,400 | (30,688) | (2,503) |
Other assets | (193,681) | (32,174) | 229,916 |
Due to affiliates | 12,510 | 41,613 | 23,563 |
Accrued expenses and other liabilities | 186,311 | 26,081 | 3,223 |
Other operating cash flows: | |||
Interest received from excess mortgage servicing rights | 45,947 | 79,612 | 152,589 |
Interest received from servicer advance investments | 33,821 | 168,595 | 185,204 |
Interest received from Non-Agency RMBS | 219,704 | 211,599 | 100,883 |
Interest received from residential mortgage loans, held-for-investment | 8,962 | 8,021 | 2,815 |
Interest received from PCD consumer loans, held-for-investment | 36,660 | 52,372 | 49,582 |
Distributions of earnings, equity method investees | 11,059 | 13,668 | 22,046 |
Purchases of residential mortgage loans, held-for-sale | (5,767,172) | (5,135,700) | (1,196,018) |
Origination of residential mortgage loans, held-for-sale | (3,385,868) | 0 | 0 |
Proceeds from sales of purchased and originated residential mortgage loans, held-for-sale | 6,546,613 | 3,514,108 | 1,109,876 |
Principal repayments from purchased residential mortgage loans, held-for-sale | 194,038 | 106,213 | 61,494 |
Net cash provided by (used in) operating activities | (1,229,114) | (899,718) | 560,796 |
Cash Flows From Investing Activities | |||
Acquisition of investments in excess mortgage servicing rights | (1,186,000) | ||
Acquisition of Shellpoint, net of cash acquired | (123,185) | 0 | 0 |
SpringCastle Transaction (Note 9), net of cash acquired | 0 | 0 | (55,523) |
Restricted cash acquired from SpringCastle Transaction | 0 | 0 | 74,604 |
Purchase of servicer advance investments | (2,306,043) | (12,168,519) | (15,266,816) |
Purchase of Non-Agency RMBS | (2,969,308) | (2,570,753) | (2,577,625) |
Purchase of derivatives | 0 | (2,350) | (8,292) |
Purchase of real estate owned and other assets | (33,377) | (38,127) | (14,097) |
Purchase of consumer loans | 0 | 0 | (176,107) |
Purchase of investment in consumer loans, equity method investees | (308,050) | (470,344) | 0 |
Purchase of commercial real estate, equity method investees | (75,000) | 0 | 0 |
Draws on revolving consumer loans | (63,971) | (56,321) | (49,289) |
Payments for settlement of derivatives | (172,152) | (164,025) | (84,587) |
Return of investments in excess mortgage servicing rights | 53,055 | 172,395 | 175,243 |
Return of investments in equity method investments | 300,056 | 393,722 | 0 |
Principal repayments from servicer advance investments | 2,421,334 | 13,820,019 | 17,158,395 |
Principal repayments from Agency RMBS | 111,202 | 107,666 | 95,030 |
Principal repayments from Non-Agency RMBS | 939,690 | 815,451 | 726,176 |
Principal repayments from residential mortgage loans | 147,403 | 94,807 | 38,700 |
Proceeds from sale of residential mortgage loans | 25,511 | 13,313 | 11,176 |
Principal repayments from consumer loans | 311,222 | 401,403 | 301,876 |
Proceeds from sale of excess mortgage servicing rights | 5,776 | 0 | 0 |
Proceeds from sale of Agency RMBS | 7,528,490 | 8,880,766 | 6,594,868 |
Proceeds from sale of Non-Agency RMBS | 86,443 | 182,384 | 261,489 |
Proceeds from settlement of derivatives | 242,422 | 126,319 | 55,851 |
Proceeds from sale of real estate owned | 140,301 | 86,241 | 71,570 |
Net cash provided by (used in) investing activities | (5,171,090) | (1,777,579) | (182,583) |
Cash Flows From Financing Activities | |||
Repayments of repurchase agreements | (93,214,286) | (54,289,124) | (29,866,052) |
Margin deposits under repurchase agreements and derivatives | (1,934,868) | (1,056,408) | (487,072) |
Repayments of notes and bonds payable | (9,892,659) | (8,971,523) | (10,843,732) |
Payment of deferred financing fees | (12,498) | (6,610) | (37,908) |
Common stock dividends paid | (661,859) | (570,232) | (433,414) |
Borrowings under repurchase agreements | 99,662,678 | 57,762,563 | 31,015,797 |
Return of margin deposits under repurchase agreements and derivatives | 1,733,387 | 1,058,791 | 486,050 |
Borrowings under notes and bonds payable | 9,770,909 | 8,057,720 | 9,719,242 |
Issuance of common stock | 983,149 | 835,465 | 279,600 |
Costs related to issuance of common stock | (1,087) | (936) | (825) |
Noncontrolling interest in equity of consolidated subsidiaries - contributions | 0 | 0 | 0 |
Noncontrolling interest in equity of consolidated subsidiaries - distributions | (64,559) | (84,196) | (97,560) |
Purchase of noncontrolling interests in the Buyer | 925 | (65,860) | (3,280) |
Net cash provided by (used in) financing activities | 6,369,232 | 2,669,650 | (269,154) |
Net (Decrease) Increase in Cash, Cash Equivalents, and Restricted Cash | (30,972) | (7,647) | 109,059 |
Cash, Cash Equivalents, and Restricted Cash, Beginning of Period | 446,050 | 453,697 | 344,638 |
Cash, Cash Equivalents, and Restricted Cash, End of Period | 415,078 | 446,050 | 453,697 |
Supplemental Disclosure of Cash Flow Information | |||
Cash paid during the period for interest | 564,722 | 442,287 | 350,028 |
Cash paid during the period for income taxes | 5,012 | 5,021 | 1,109 |
Supplemental Schedule of Non-Cash Investing and Financing Activities | |||
Dividends declared but not paid | 184,552 | 153,681 | 115,356 |
Transfer from residential mortgage loans to real estate owned and other assets | 109,527 | 141,968 | 249,497 |
Transfer from residential mortgage loans, held-for-investment to residential mortgage loans, held-for-sale | 23,080 | 23,080 | 316,199 |
Non-cash distributions to noncontrolling interest | 0 | 0 | 69,466 |
Real estate securities retained from loan securitizations | 900,491 | 403,270 | 165,782 |
Residential mortgage loans subject to repurchase | 121,602 | 0 | 0 |
Remeasurement of Consumer Loan Companies noncontrolling interest | 0 | 0 | 110,438 |
Ocwen transaction - excess mortgage servicing rights | 638,567 | 71,982 | 0 |
Ocwen transaction - servicer advance investments | 3,175,891 | 481,220 | 0 |
Ocwen transaction - mortgage servicing rights financing receivables, at fair value | 1,017,993 | 64,450 | 0 |
Excess MSRs | |||
Cash Flows From Investing Activities | |||
Acquisition of investments in excess mortgage servicing rights | 0 | 0 | (2,146) |
Proceeds from sale of excess mortgage servicing rights | 19,064 | 13,505 | 0 |
Mortgage Servicing Rights and Servicer Advances | |||
Cash Flows From Investing Activities | |||
Acquisition of investments in excess mortgage servicing rights | (1,194,467) | (1,661,608) | (526,653) |
Supplemental Schedule of Non-Cash Investing and Financing Activities | |||
Purchase price holdback | (697) | 40,854 | 90,058 |
Agency Residential Mortgage Backed Securities | |||
Cash Flows From Investing Activities | |||
Purchase of Agency RMBS | (10,200,299) | (9,165,868) | (6,812,258) |
Mortgage-backed Securities, Issued by Private Enterprises | |||
Cash Flows From Investing Activities | |||
Purchase of residential mortgage loans | (85,778) | (609,627) | (191,081) |
Loans and Finance Receivables | |||
Cash Flows From Investing Activities | |||
Proceeds from sale of excess mortgage servicing rights | 7,472 | 0 | 0 |
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises | |||
Supplemental Schedule of Non-Cash Investing and Financing Activities | |||
Purchase of Agency and Non-Agency RMBS, settled after year end | 2,048,348 | 1,169,896 | 1,381,968 |
Sale of investments, primarily Agency RMBS, settled after year end | 3,925,198 | 1,030,850 | 1,687,788 |
Consumer Loans | |||
Other operating cash flows: | |||
Distributions of earnings, equity method investees | 6,176 | 6,240 | 0 |
Excess MSRs Investees | |||
Cash Flows From Investing Activities | |||
Return of investments in equity method investments | 21,099 | 21,972 | 16,913 |
Consumer Loan Companies | |||
Supplemental Schedule of Non-Cash Investing and Financing Activities | |||
Non-cash distributions from Consumer Loan Companies | 0 | 0 | 25 |
Non-cash distributions from LoanCo | 0 | 0 | 25 |
LoanCo | |||
Supplemental Schedule of Non-Cash Investing and Financing Activities | |||
Non-cash distributions from Consumer Loan Companies | 25,739 | 44,587 | 0 |
Non-cash distributions from LoanCo | 25,739 | 44,587 | 0 |
Shellpoint Acquisition | |||
Supplemental Schedule of Non-Cash Investing and Financing Activities | |||
Purchase price holdback | 8,173 | 0 | 0 |
Shellpoint Acquisition contingent consideration | $ 39,300 | $ 0 | $ 0 |
ORGANIZATION
ORGANIZATION | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION | ORGANIZATION New Residential Investment Corp. (together with its subsidiaries, “New Residential”) is a Delaware corporation that was formed as a limited liability company in September 2011 for the purpose of making real estate related investments and commenced operations on December 8, 2011. New Residential is an independent publicly traded real estate investment trust (“REIT”) primarily focused on investing in residential mortgage related assets. New Residential is listed on the New York Stock Exchange (“NYSE”) under the symbol “NRZ.” New Residential has elected and intends to qualify to be taxed as a REIT for U.S. federal income tax purposes. As such, New Residential will generally not be subject to U.S. federal corporate income tax on that portion of its net income that is distributed to stockholders if it distributes at least 90% of its REIT taxable income to its stockholders by prescribed dates and complies with various other requirements. See Note 17 regarding New Residential’s taxable REIT subsidiaries. New Residential has entered into a management agreement (the “Management Agreement”) with FIG LLC (the “Manager”), an affiliate of Fortress Investment Group LLC (“Fortress”), pursuant to which the Manager provides a management team and other professionals who are responsible for implementing New Residential’s business strategy, subject to the supervision of New Residential’s board of directors. For its services, the Manager is entitled to management fees and incentive compensation, both defined in, and in accordance with the terms of, the Management Agreement. The Manager also manages investment funds that until June 2018, indirectly owned a majority of the outstanding common stock of OneMain Holdings, Inc. (formerly Springleaf Holdings, Inc.) (together with its subsidiaries, “OneMain”), former managing member of the Consumer Loan Companies (Note 9). The Manager also manages investment funds that until August 2, 2018, indirectly owned approximately 40.5% of the outstanding interests in Nationstar Mortgage LLC (“Nationstar”), a leading residential mortgage servicer. As of December 31, 2018 , such ownership of the outstanding interests in Nationstar, through ownership of its parent, WMIH Corp., was 0.0% . As of December 31, 2018 , New Residential conducted its business through the following segments: (i) Servicing and Originations, (ii) Residential Securities and Loans, (iii) Consumer Loans and (iv) Corporate. Approximately 2.4 million shares of New Residential’s common stock were held by Fortress, through its affiliates, as of December 31, 2018 . In addition, Fortress, through its affiliates, held options relating to approximately 6.9 million shares of New Residential’s common stock as of December 31, 2018 . Acquisition of Shellpoint Partners LLC On November 29, 2017, NRM Acquisition LLC (the “Shellpoint Purchaser”), a Delaware limited liability company and a wholly owned subsidiary of New Residential, entered into a Securities Purchase Agreement (the “Shellpoint SPA”) to acquire Shellpoint Partners LLC, a Delaware limited liability company (“Shellpoint”). On July 3, 2018, the Shellpoint Purchaser acquired 100% of the outstanding equity interests of Shellpoint for a cash purchase price of $212.3 million (the “Shellpoint Acquisition”). As additional consideration for the Shellpoint Acquisition, the Shellpoint Purchaser may make up to three cash earnout payments, which will be calculated following each of the first three anniversaries of the Shellpoint closing as a percentage of the amount by which the pre-tax income of certain of Shellpoint’s businesses exceeds certain specified thresholds, up to an aggregate maximum amount of $60.0 million (the “Shellpoint Earnout Payments”). The Shellpoint Earnout Payments are classified as contingent consideration recorded at fair value at the acquisition date and included in the total consideration transferred for the Shellpoint Acquisition. The contingent consideration will be subsequently measured at fair value on a quarterly basis with changes in fair value recorded in other income. Shellpoint is a vertically integrated mortgage platform with established origination and servicing capabilities and provides New Residential with in-house servicing, asset origination and recapture capabilities. The results of Shellpoint’s operations have been included in the Company’s consolidated statements of income for the twelve months ended December 31, 2018 from the date of the acquisition and represent $177.4 million and $26.8 million of revenue and net income, respectively. The acquisition date fair value of the consideration transferred includes $212.3 million in cash consideration, $39.3 million in contingent consideration and $173.9 million in effective settlement of preexisting relationships. The total consideration is summarized as follows: Total Consideration Amount Cash Consideration $ 212.3 Earnout Payment (A) 39.3 Effective Settlement of Preexisting Relationships (B) 173.9 Total Consideration $ 425.5 (A) The range of outcomes for this contingent consideration is from $0 to $60.0 million , dependent on the performance of Shellpoint. New Residential derived a fair value of the contingent consideration payment in three years of $39.3 million . This amount excludes contingent payments to the long-term employee incentive plans that require continuing employment and are recognized as compensation expense within General and Administrative expenses in the post-acquisition consolidated financial statements separate from New Residential’s acquisition of assets and assumption of liabilities in the business combination. As of December 31, 2018 , the contingent consideration had a fair value of $40.8 million . (B) Represents the effective settlement of preexisting relationships between New Residential and Shellpoint including 1) MSR acquisitions, 2) a note payable and 3) operating accounts receivable and payable existing prior to the acquisition date. The effective settlement of these preexisting relationships had no impact to New Residential’s consolidated statements of income. New Residential has performed an allocation of the total consideration of $425.5 million to Shellpoint’s assets and liabilities, as set forth below. The final amount and allocation of total consideration reflects certain measurement period adjustments identified during the fourth quarter of 2018 , including the effect on earnings that would have been recorded during the third quarter of 2018 had the accounting been completed at the acquisition date. Such measurement period adjustments included 1) a decrease of $3.5 million in the amount of contingent consideration based upon finalization of the internal valuation 2) a decrease of $6.4 million to consideration transferred for the effective settlement of existing relationships 3) an increase of $14.1 million to the fair value of identifiable intangible assets based upon receipt of the final valuation report from a third-party valuation firm and 4) an increase of $0.3 million to other assets due to a decrease in the fair value discount on certain servicing advance receivables. These measurement period adjustments results in a corresponding decrease to goodwill in the amount of $24.3 million . Total Consideration ($ in millions) $ 425.5 Assets Cash and cash equivalents $ 79.2 Restricted cash 9.9 Residential mortgage loans, held-for-sale, at fair value 488.2 Mortgage servicing rights, at fair value (A) 286.6 Residential mortgage loans, held-for-investment, at fair value 125.3 Residential mortgage loans subject to repurchase 121.4 Intangible assets (B) 18.4 Other assets 81.5 Total Assets Acquired $ 1,210.5 Liabilities Repurchase agreements $ 439.6 Notes and bonds payable 20.7 Mortgage-backed securities issued, at fair value 120.7 Residential mortgage loans repurchase liability 121.4 Excess spread financing, at fair value 48.3 Accrued expenses and other liabilities 50.6 Total Liabilities Assumed $ 801.3 Noncontrolling Interest $ 8.3 Net Assets $ 400.9 Goodwill $ 24.6 (A) Includes $135.3 million of Ginnie Mae MSRs where New Residential acquired the rights to the economic value of the servicing rights from Shellpoint prior to the acquisition date. (B) Includes intangible assets in the form of mortgage origination and servicing licenses, internally developed software and a tradename. New Residential determined that mortgage origination and servicing licenses have an indefinite useful life and will be evaluated for impairment given no legal, regulatory, contractual, competitive or economic factors that would limit the useful life. Internally developed software and tradenames will be amortized over finite useful lives of five years and six months, respectively, based on the expected software development timeline and New Residential’s determination of the time to change a tradename with limited value. The goodwill of $24.6 million primarily includes the synergies and benefits expected to result from combining operations with Shellpoint and adding in-house servicing, asset origination and recapture capabilities. The full amount of goodwill for tax purposes of $24.6 million is expected to be deductible. New Residential will assess the goodwill annually on October 1 and in interim periods in case of events or circumstances make it more likely than not that an impairment may have occurred. Based on New Residential’s assessment performed, there were no indicators of impairment as of December 31, 2018 . Certain transactions were recognized separately from New Residential’s acquisition of assets and assumption of liabilities in the business combination. These separately recognized transactions include 1) contingent payments to Shellpoint’s employees and 2) effective settlement of preexisting relationships discussed above. Unaudited Supplemental Pro Forma Financial Information — The following table presents unaudited pro forma combined Servicing and Originations Revenue, which is comprised of 1) servicing revenue, net and 2) gain on sale of originated mortgage loans, net, and Income Before Income Taxes for the years ended December 31, 2018 and 2017 prepared as if the Shellpoint Acquisition had been consummated on January 1, 2017. December 31, 2018 2017 Pro Forma Servicing and Originations Revenue $ 766,997 $ 749,031 Income Before Income Taxes 948,086 1,197,485 The unaudited supplemental pro forma financial information has not been adjusted for transactions other than the Shellpoint Acquisition, or for the conforming of accounting policies. The unaudited supplemental pro forma financial information does not include any anticipated synergies or other anticipated benefits of the Shellpoint Acquisition and, accordingly, the unaudited supplemental pro forma financial information is not necessarily indicative of either future results of operations or results that might have been achieved had the Shellpoint Acquisition occurred on January 1, 2017. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Accounting — The accompanying consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles (“GAAP’’). The consolidated financial statements include the accounts of New Residential and its consolidated subsidiaries. All significant intercompany transactions and balances have been eliminated. New Residential consolidates those entities in which it has control over significant operating, financial and investing decisions of the entity, as well as those entities deemed to be variable interest entities (“VIEs”) in which New Residential is determined to be the primary beneficiary. For entities over which New Residential exercises significant influence, but which do not meet the requirements for consolidation, New Residential uses the equity method of accounting whereby it records its share of the underlying income of such entities. Distributions from equity method investees are classified in the Statements of Cash Flows based on the cumulative earnings approach, where all distributions up to cumulative earnings are classified as distributions of earnings. VIEs are defined as entities in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. A VIE is required to be consolidated only by its primary beneficiary, which is defined as the party who has the power to direct the activities of a VIE that most significantly impact its economic performance and who has the obligation to absorb losses or the right to receive benefits from the VIE that could be potentially significant to the VIE. To assess whether New Residential has the power to direct the activities of a VIE that most significantly impact the VIE’s economic performance, New Residential considers all the facts and circumstances, including its role in establishing the VIE and its ongoing rights and responsibilities. This assessment includes, first, identifying the activities that most significantly impact the VIE’s economic performance; and second, identifying which party, if any, has power over those activities. To assess whether New Residential has the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE, New Residential considers all of its economic interests and applies judgment in determining whether these interests, in the aggregate, are considered potentially significant to the VIE. In July 2018, as a result of our acquisition of Shellpoint Partners LLC (“Shellpoint”), New Residential consolidates Shellpoint Asset Funding Trust 2013-1 (“SAFT 2013-1”) and the Shelter retail mortgage origination joint ventures (“Shelter JVs”). A wholly owned subsidiary of Shellpoint, New Penn, was deemed to be the primary beneficiary of the SAFT 2013-1 securitization entity as a result of its ability to direct activities that most significantly impact the economic performance of the entity in its role as servicer and its ownership of subordinate retained interests. A wholly owned subsidiary of Shellpoint, Shelter Mortgage Company LLC (“Shelter”) is a mortgage originator specializing in retail origination. Shelter operates its business through a series of joint ventures and was deemed to be the primary beneficiary of the joint ventures as a result of its ability to direct activities that most significantly impact the economic performance of the entities and its ownership of a significant equity investment. New Residential’s investments in Non-Agency RMBS (Note 7) are variable interests. New Residential monitors these investments and analyzes the potential need to consolidate the related securitization entities pursuant to the VIE consolidation requirements. New Residential has not consolidated the securitization entities that issued its Non-Agency RMBS. This determination is based, in part, on New Residential’s assessment that it does not have the power to direct the activities that most significantly impact the economic performance of these entities, such as through ownership of a majority of the currently controlling class. In addition, New Residential is not obligated to provide, and has not provided, any financial support to these entities. Noncontrolling interests represent the ownership interests in certain consolidated subsidiaries held by entities or persons other than New Residential. These interests are related to noncontrolling interests in consolidated entities that hold New Residential’s Servicer Advance Investments (Note 6), Shelter (Note 8) and Consumer Loans (Note 9). Risks and Uncertainties — In the normal course of business, New Residential encounters primarily two significant types of economic risk: credit and market. Credit risk is the risk of default on New Residential’s investments that results from a borrower’s or counterparty’s inability or unwillingness to make contractually required payments. Market risk reflects changes in the value of investments due to changes in prepayment rates, interest rates, spreads or other market factors, including risks that impact the value of the collateral underlying New Residential’s investments. New Residential believes that the carrying values of its investments are reasonable taking into consideration these risks along with estimated prepayments, financings, collateral values, payment histories, and other information. Furthermore, for each of the periods presented, a significant portion of New Residential’s assets are dependent on its servicers’ and subservicers’ ability to perform their obligations servicing the loans underlying New Residential’s Excess MSRs, MSRs, MSR Financing Receivables, Servicer Advance Investments, Non-Agency RMBS and loans. If a servicer is terminated, New Residential’s right to receive its portion of the cash flows related to interests in servicing related assets may also be terminated. Additionally, New Residential is subject to significant tax risks. If New Residential were to fail to qualify as a REIT in any taxable year, New Residential would be subject to U.S. federal corporate income tax (including any applicable alternative minimum tax), which could be material. Unless entitled to relief under certain statutory provisions, New Residential would also be disqualified from treatment as a REIT for the four taxable years following the year during which qualification is lost. Use of Estimates — The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Comprehensive Income — Comprehensive income is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances, excluding those resulting from investments by and distributions to owners. For New Residential’s purposes, comprehensive income represents net income, as presented in the Consolidated Statements of Income, adjusted for unrealized gains or losses on securities available for sale. INCOME RECOGNITION Investments in Excess Mortgage Servicing Rights — Excess MSRs are aggregated into pools as applicable; each pool of Excess MSRs is accounted for in the aggregate. Interest income for Excess MSRs is accreted into interest income on an effective yield or “interest” method, based upon the expected excess mortgage servicing amount through the expected life of the underlying mortgages. Changes to expected cash flows result in a cumulative retrospective adjustment, which will be recorded in the period in which the change in expected cash flows occurs. Under the retrospective method, the interest income recognized for a reporting period is measured as the difference between the amortized cost basis at the end of the period and the amortized cost basis at the beginning of the period, plus any cash received during the period. The amortized cost basis is calculated as the present value of estimated future cash flows using an effective yield, which is the yield that equates all past actual and current estimated future cash flows to the initial investment. In addition, New Residential’s policy is to recognize interest income only on its Excess MSRs in existing eligible underlying mortgages. The difference between the fair value of Excess MSRs and their amortized cost basis is recorded as “Change in fair value of investments in excess mortgage servicing rights.” Fair value is generally determined by discounting the expected future cash flows using discount rates that incorporate the market risks and liquidity premium specific to the Excess MSRs, and therefore may differ from their effective yields. Investments in MSRs — MSRs are aggregated into pools as applicable; each pool of MSRs is accounted for in the aggregate. Income from MSRs is recorded in “Servicing revenue, net” and is comprised of three components: (i) income receivable from the MSRs, less (ii) amortization of the basis of the MSRs, plus or minus (iii) the mark-to-market on the MSRs. Amortization of the basis of the MSRs is based on the remaining UPB of the residential mortgage loans underlying the MSRs relative to their UPB at acquisition. Fair value is generally determined by discounting the expected future cash flows using discount rates that incorporate the market risks and liquidity premium specific to the MSRs. Investments in MSR Financing Receivables — In certain cases, New Residential has legally purchased MSRs or the right to the economic interest in MSRs; however, New Residential has determined that the purchase agreement would not be treated as a sale under GAAP. Therefore, rather than recording an investment in MSRs, New Residential has recorded an investment in mortgage servicing rights financing receivables. Income from this investment (net of subservicing fees) is recorded as interest income, and New Residential has elected to measure the investment at fair value, with changes in fair value flowing through change in fair value of investments in mortgage servicing rights financing receivables in the Consolidated Statements of Income. Servicer Advance Investments — New Residential accounts for its Servicer Advance Investments similarly to its investments in Excess MSRs. Interest income for Servicer Advance Investments is accreted into interest income on an effective yield or “interest” method, based upon the expected aggregate cash flows of the Servicer Advance Investments, including the basic fee component of the related MSR (but excluding any Excess MSR component) through the expected life of the underlying mortgages, net of a portion of the basic fee component of the MSR that New Residential remits to the servicer as compensation for the servicer’s servicing activities. Changes to expected cash flows result in a cumulative retrospective adjustment, which will be recorded in the period in which the change in expected cash flows occurs. Refer to “—Investments in Excess Mortgage Servicing Rights” for a description of the retrospective method. Fair value is generally determined by discounting the expected future cash flows using discount rates that incorporate the market risks and liquidity premium specific to the Servicer Advance Investments, and therefore may differ from their effective yields. Investments in Real Estate and Other Securities — Discounts or premiums are accreted into interest income on an effective yield or “interest” method, based upon a comparison of actual and expected cash flows, through the expected maturity date of the security. For securities acquired at a discount for credit quality (i.e., where it is probable at acquisition that New Residential will not collect all contractually required interest and principal repayments), the difference between contractual cash flows and expected cash flows at acquisition is not accreted (non-accretable difference). For these securities, the excess of expected cash flows over the carrying value (accretable yield) is recognized as interest income on an effective yield basis. Depending on the nature of the investment, changes to expected cash flows may result in a prospective change to yield or a retrospective change which would include a catch up adjustment. Deferred fees and costs, if any, are recognized as an adjustment to the interest income over the terms of the securities using the interest method. Upon settlement of securities, the specific identification method is used to determine the excess (or deficiency) of net proceeds over the net carrying value of such security recognized as a realized gain (or loss) in the period of settlement. Investments in Residential Mortgage Loans, REO and Consumer Loans — New Residential evaluates the credit quality of its loans, as of the acquisition date, for evidence of credit quality deterioration. Loans with evidence of credit deterioration since their origination, and where it is probable that New Residential will not collect all contractually required principal and interest payments, are Purchased Credit Deteriorated (“PCD”) loans. At acquisition, New Residential aggregates PCD loans into pools based on common risk characteristics and the aggregated loans are accounted for as if each pool were a single loan with a single composite interest rate and an aggregate expectation of cash flows. The excess of the total cash flows (both principal and interest) expected to be collected over the carrying value of the PCD loans is referred to as the accretable yield. This amount is not reported on New Residential’s Consolidated Balance Sheets but is accreted into interest income at a level rate of return over the remaining estimated life of the pool of loans. Loans where New Residential expects to collect all contractually required principal and interest payments are considered performing loans. Interest income on performing loans is accrued and recognized as interest income at their effective yield, which includes contractual interest and the amortization of purchase price discount or premium and deferred fees or expenses, and considers anticipated prepayment rates. Loans acquired with the intent to sell and loans not acquired with the intent to sell that New Residential decides to sell are classified as held-for-sale. Loans held-for-sale are measured at the lower of cost or fair value, with valuation changes recorded in impairment. Purchase price discounts or premiums are deferred in a contra loan account until the related loan is sold. The deferred discounts or premiums are an adjustment to the basis of the loan and are included in the quarterly determination of the lower of cost or fair value adjustments and/or the gain or loss recognized at the time of sale. Residential mortgage loans, held-for-sale, at fair value are originated or acquired loans for which New Residential has elected to account for at fair value. Accordingly, we estimate the fair value of the residential mortgage loans, held-for-sale, at fair value at each reporting date and reflect the change in the fair value in the Consolidated Statements of Income. For originated residential mortgage loans measured at fair value, we report the change in the fair value within gain on sale of originated mortgage loans, net in the consolidated statements of income. Fair value is generally determined using a market approach by utilizing either: (i) the fair value of securities backed by similar mortgage loans, adjusted for certain factors to approximate the fair value of a whole mortgage loan, (ii) current commitments to purchase loans or (iii) recent observable market trades for similar loans, adjusted for credit risk and other individual loan characteristics. For acquired residential mortgage loans measured at fair value, we report the change in the fair value within change in fair value of investments in residential mortgage loans in the consolidated statements of income. Fair value is generally determined by discounting the expected future cash flows using inputs such as default rates, prepayment speeds and discount rates. Interest earned on residential mortgage loans measured at fair value are reported in other income. Real estate owned (“REO”) assets are those individual properties acquired by New Residential or where New Residential receives the property in satisfaction of a debt (e.g., by taking legal title or physical possession). New Residential measures REO assets at the lower of cost or fair value, with valuation changes recorded in other income or impairment, as applicable. Impairment of Securities — Securities are considered to be impaired when it is probable that New Residential will be unable to collect all principal or interest when due according to the contractual terms of the original agreements, or for securities purchased at a discount for credit quality or that represent retained beneficial interests in securitizations, when New Residential determines that it is probable that it will be unable to collect as anticipated. The evaluation of a security’s estimated cash flows includes the following, as applicable: (i) review of the credit of the issuer or borrower, (ii) review of the credit rating of the security, (iii) review of the key terms of the security or underlying loans, (iv) review of the performance of the underlying loans, including debt service coverage and loan to value ratios, (v) analysis of the value of the underlying loans, (vi) analysis of the effect of local, industry and broader economic factors, and (vii) analysis of historical and anticipated trends in defaults, loss severities and prepayments for similar securities or underlying loans. New Residential must record a write down if it has the intent to sell a given security in an unrealized loss position, or if it is more likely than not that it will be required to sell such a security. Upon determination of impairment, New Residential records a direct write down for securities based on the estimated fair value of the security or underlying collateral using a discounted cash flow analysis or based on an observable market value. Subsequent to a determination of impairment, and a related write down, income on securities is accrued on an effective yield method from the new carrying value to the related expected cash flows, with cash received treated as a reduction of basis. Impairment of Loans — To the extent that they are classified as held-for-investment, New Residential must periodically evaluate each of these loans or loan pools for possible impairment. Impairment is indicated when it is deemed probable that New Residential will be unable to collect all amounts due according to the contractual terms of the loan, or for PCD loans, when it is deemed probable that New Residential will be unable to collect as anticipated. Upon determination of impairment, New Residential establishes an allowance for loan losses with a corresponding charge to earnings. Performing loans are aggregated into pools for the evaluation of impairment based on like characteristics, such as loan type and acquisition date. Pools of loans are evaluated based on criteria such as an analysis of borrower performance, credit ratings of borrowers, loan to value ratios, the estimated value of the underlying collateral, if any, the key terms of the loans and historical and anticipated trends in defaults and loss severities for the type and seasoning of loans being evaluated. This information is used to estimate provisions for estimated unidentified incurred losses on pools of loans. Significant judgment is required in determining impairment and in estimating the resulting loss allowance. For PCD loans, New Residential estimates the total cash flows expected to be collected over the remaining life of each pool. Probable decreases in expected cash flows trigger the recognition of impairment. Impairments are recognized through the provision for loans and an increase in the allowance for loan losses. Probable and significant increases in expected cash flows would first reverse any previously recorded allowance for loan losses with any remaining increases recognized prospectively as a yield adjustment over the remaining estimated lives of the underlying loans. A loan is determined to be past due when a monthly payment is due and unpaid for 30 days or more. Loans, other than PCD loans, are placed on nonaccrual status and considered non-performing when full payment of principal and interest is in doubt, which generally occurs when principal or interest is 120 days or more past due unless the loan is both well secured and in the process of collection. A loan may be returned to accrual status when repayment is reasonably assured and there has been demonstrated performance under the terms of the loan or, if applicable, the terms of the restructured loan. New Residential’s ability to recognize interest income on nonaccrual loans as cash interest payments are received rather than as a reduction of the carrying value of the loans is based on the recorded loan balance being deemed fully collectible. Loans held-for-sale are subject to the nonaccrual policy described above, however, as loans held-for-sale are recognized at the lower of cost or fair value, New Residential’s allowance for loan losses and charge-off policies do not apply to these loans. Accretion and Other Amortization — As reflected on the consolidated statements of cash flows, this item is comprised of the following: Year Ended December 31, 2018 2017 2016 Accretion of servicer advances receivable discount and servicer advance investments $ 214,876 $ 542,983 $ 364,350 Accretion of excess mortgage servicing rights income 44,440 103,053 150,141 Accretion of net discount on securities and loans (A) 452,500 398,213 253,243 Amortization of deferred financing costs (7,795 ) (12,076 ) (18,326 ) Amortization of discount on notes and bonds payable (2,054 ) (789 ) (1,476 ) $ 701,967 $ 1,031,384 $ 747,932 (A) Includes accretion of the accretable yield on PCD loans. Other Income (Loss), Net — This item is comprised of the following: Year Ended December 31, 2018 2017 2016 Unrealized gain (loss) on derivative instruments $ (113,558 ) $ (2,190 ) $ 5,774 Unrealized gain (loss) on other ABS 10,283 2,883 (2,322 ) Unrealized gain (loss) on notes and bonds payable (684 ) — — Unrealized gain (loss) on contingent consideration (1,581 ) — — Gain (loss) on transfer of loans to REO 19,519 22,938 18,356 Gain (loss) on transfer of loans to other assets (1,977 ) 488 2,938 Gain (loss) on Excess MSR recapture agreements 979 2,384 2,802 Gain (loss) on Ocwen common stock (10,860 ) 5,346 — Other income (loss) (26,457 ) (27,741 ) 935 $ (124,336 ) $ 4,108 $ 28,483 Gain (Loss) on Settlement of Investments, Net — This item is comprised of the following: Year Ended December 31, 2018 2017 2016 Gain (loss) on sale of real estate securities, net $ (29,936 ) $ 20,642 $ (27,460 ) Gain (loss) on sale of acquired residential mortgage loans, net (7,677 ) 39,731 12,142 Gain (loss) on settlement of derivatives 54,867 (39,214 ) (27,491 ) Gain (loss) on liquidated residential mortgage loans 5,023 (10,201 ) (1,810 ) Gain (loss) on sale of REO (12,424 ) (9,215 ) 4,690 Gains reclassified from change in fair value of investments in excess MSRs and servicer advance investments 113,002 11,320 — Other gains (losses) (19,013 ) (2,753 ) (8,871 ) $ 103,842 $ 10,310 $ (48,800 ) EXPENSE RECOGNITION Interest Expense — New Residential finances certain investments using floating rate repurchase agreements and loans. Interest is expensed as incurred. General and Administrative Expenses, Loan Servicing Expense and Subservicing Expense — General and administrative expense primarily include employee compensation, legal fees, audit fees, insurance premiums, and other costs, as well as loan servicing and subservicing expenses, and are expensed as incurred. General and Administrative Expenses is comprised of the following: Year Ended December 31, 2018 2017 2016 Compensation and benefits expense $ 109,870 $ — $ 663 Legal and professional expense 45,234 40,182 23,983 Loan origination expense 16,050 — — Occupancy expense 8,868 — — Other (A) 51,557 26,977 13,924 $ 231,579 $ 67,159 $ 38,570 (A) Represents miscellaneous general and administrative expenses. Management Fee and Incentive Compensation to Affiliate — These represent amounts due to the Manager pursuant to the Management Agreement. For further information on the Management Agreement, see Note 15. BALANCE SHEET MEASUREMENT Investments in Servicing Related Assets — Servicing related assets consist of New Residential’s Excess MSRs, MSRs, MSR Financing Receivables, and Servicer Advance Investments. Upon acquisition, New Residential has elected to record each of such investments at fair value. New Residential elected to record its investments at fair value in order to provide users of the financial statements with better information regarding the effects of prepayment risk and other market factors on servicing related assets. Under this election, New Residential records a valuation adjustment on its investments in servicing related assets on a quarterly basis to recognize the changes in fair value in net income as described in “Income Recognition — Investments in Excess Mortgage Servicing Rights,” “Income Recognition — Investments in MSRs” and “Income Recognition — Servicer Advance Investments.” The Company recognizes MSRs created through the sale of loans it originates. Under the accounting guidance for transfers and servicing, the Company initially measures a mortgage servicing asset that qualifies for separate recognition at fair value on the date of transfer. Investments in Real Estate and Other Securities — New Residential has classified its investments in real estate and other securities as available for sale. Securities available for sale are carried at market value with the net unrealized gains or losses reported as a separate component of accumulated other comprehensive income, to the extent impairment losses are considered temporary. At disposition, the net realized gain or loss is determined on the basis of the amortized cost of the specific investments and is included in earnings. Unrealized losses on securities are charged to earnings if they reflect a decline in value that is other-than-temporary. Investments in Residential Mortgage Loans and Consumer Loans — Loans for which New Residential has the intent and ability to hold for the foreseeable future, or until maturity or payoff, are classified as held-for-investment. Performing loans held-for-investment are presented at the aggregate unpaid principal balance adjusted for any unamortized premium or discount, deferred fees or expenses, an allowance for loan losses, charge-offs and write-down for impaired loans. PCD loans held-for-investment are initially recorded at their purchase price at acquisition and are subsequently measured net of any allowance for loan losses. To the extent that the loans are classified as held-for-investment, New Residential periodically evaluates such loans for possible impairment as described in “—Impairment of Loans.” Loans which New Residential does not have the intent or the ability to hold into the foreseeable future are considered held-for-sale and are either carried at (i) the lower of their amortized cost basis or fair value or (ii) fair value where elected. New Residential discontinues the accretion of discounts or amortization of premiums on loans if they are reclassified from held-for-investment to held-for-sale. Mortgage Loan Repurchases — New Penn, as an approved issuer of Ginnie Mae MBS, originates, sells and securitizes government-insured residential mortgage loans into Ginnie Mae guaranteed securitizations and New Penn retains the right to service the underlying residential mortgage loans. As the servicer, New Penn, holds an option to repurchase delinquent loans from the securitization at its discretion (the “Ginnie Mae Buy-Back Option”). In accordance with the accounting guidance in ASC 860, New Penn recognizes any delinquent loans subject to the Ginnie Mae Buy-Back Option and an offsetting repurchase liability on its balance sheet regardless of whether New Penn executes its option to repurchase. Cash and Cash Equivalents and Restricted Cash — New Residential considers all highly liquid short-term investments with maturities of 90 days or less when purchased to be cash equivalents. Substantially all amounts on deposit with major financial institutions exceed insured limits. As of December 31, 2018 and 2017 , New Residential held: (i) $60.0 million and $62.4 million , respectively, of restricted cash related to the financing of servicer advances that has been pledged to the note holders for interest and fees payable, (ii) $1.9 million and $9.9 million , respectively, of restricted cash related to financing requirements of the corporate notes secured by Excess MSRs (Note 11), (iii) $4.1 million and $3.3 million , respectively, of restricted cash related to Ginnie Mae Excess MSRs, (iv) $37.6 million and $46.1 million , respectively, of restricted cash related to the financing of consumer loans, and (v) $60.4 million and $28.6 million , respectively, of restricted cash related to MSRs. Derivatives — New Residential has entered into various economic hedges, as further described in Note 10, that are marked to fair value on a periodic basis through “—Other Income.” Income Taxes — New Residential operates so as to qualify as a REIT under the requirements of the Internal Revenue Code of 1986, as amended. Requirements for qualification as a REIT include various restrictions on ownership of New Residential’s stock, requirements concerning distribution of taxable income and certain restrictions on the nature of assets and sources of income. A REIT must distribute at least 90% of its taxable income to its stockholders (subject to certain adjustments). Distributions may extend until timely filing of New Residential’s tax return in the subsequent taxable year. Qualifying distributions of taxable income are deductible by a REIT in computing taxable income. Certain activities of New Residential are conducted through taxable REIT subsidiaries (“TRSs”) and therefore are subject to federal and state income taxes. Accordingly, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases upon the change in tax status. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. New Residential recognizes tax benefits for uncertain tax positions only if it is more likely than not that the position is sustainable based on its technical merits. Interest and penalties on uncertain tax positions are included as a component of the provision for income taxes on the consolidated statements of operations. Other Assets and Other Liabilities — Other assets and liabilities are comprised of the following: Other Assets Accrued Expenses and Other Liabilities December 31, December 31, 2018 2017 2018 2017 Margin receivable, net (A) $ 145,857 $ 53,150 Interest payable $ 49,352 $ 28,821 Other receivables 23,723 10,635 Accounts payable 75,591 73,017 Principal and interest receivable 76,015 48,373 Derivative liabilities (Note 10) 29,389 697 Receivable from government agency (B) 20,795 41,429 Due to servicers 95,419 24,571 Call rights 290 327 MSRs purchase price holdback 100,593 101,290 Derivative assets (Note 10) 10,893 2,423 Excess spread financing, at fair value 39,304 — Servicing fee receivables 105,563 60,520 Contingent Consideration 40,842 — Ginnie Mae EBO servicer advances receivable, net (C) 2,750 8,916 Reserve for sales recourse 5,880 — Due from servicers 95,261 38,601 Other liabilities 54,140 10,718 Goodwill 24,645 — $ 490,510 $ 239,114 Intangible assets 18,708 — Ocwen common stock, at fair value 7,778 19,259 Prepaid expenses 29,165 7,308 Equity investment (D) 74,323 — Other assets 52,642 21,240 |
SEGMENT REPORTING
SEGMENT REPORTING | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | SEGMENT REPORTING New Residential conducts its business through the following segments: (i) Servicing and Originations, (ii) Residential Securities and Loans, (iii) Consumer Loans and (iv) Corporate. The corporate segment consists primarily of (i) general and administrative expenses, (ii) the management fees and incentive compensation related to the Management Agreement and (iii) corporate cash and related interest income. Securities owned by New Residential (Note 7) that are collateralized by servicer advances and consumer loans are included in the Servicing and Originations and Consumer Loans segments, respectively. Secured corporate loans effectively collateralized by Excess MSRs are included in the Servicing and Originations segment. During the third quarter of 2018, New Residential changed the composition of its reportable segments primarily to reflect the (i) aggregation of the similar MSR, Excess MSR and Servicer Advance segments as the new Servicing and Originations segment and (ii) incorporation of the Shellpoint Acquisition. Segment information for prior periods has been reclassified to reflect this change. Summary financial data on New Residential’s segments is given below, together with a reconciliation to the same data for New Residential as a whole: Residential Securities and Loans Servicing and Originations Real Estate Securities Residential Mortgage Loans Consumer Loans Corporate Total Year Ended December 31, 2018 Interest income $ 723,965 $ 573,539 $ 158,892 $ 206,321 $ 1,506 $ 1,664,223 Interest expense 242,345 240,615 80,910 42,563 — 606,433 Net interest income 481,620 332,924 77,982 163,758 1,506 1,057,790 Impairment — 30,017 12,061 48,563 — 90,641 Servicing revenue, net 528,595 — — — — 528,595 Gain on sale of originated mortgage loans, net 89,017 — — — — 89,017 Other income (loss) 12,654 (72,926 ) 16,456 9,965 (10,406 ) (44,257 ) Operating expenses 360,889 1,554 32,424 35,230 179,307 609,404 Income (Loss) Before Income Taxes 750,997 228,427 49,953 89,930 (188,207 ) 931,100 Income tax (benefit) expense (8,364 ) — (65,279 ) 212 — (73,431 ) Net Income (Loss) $ 759,361 $ 228,427 $ 115,232 $ 89,718 $ (188,207 ) $ 1,004,531 Noncontrolling interests in income (loss) of consolidated subsidiaries $ 3,577 $ — $ — $ 36,987 $ — $ 40,564 Net income (loss) attributable to common stockholders $ 755,784 $ 228,427 $ 115,232 $ 52,731 $ (188,207 ) $ 963,967 Residential Securities and Loans Servicing and Originations Real Estate Securities Residential Mortgage Loans Consumer Loans Corporate Total December 31, 2018 Investments $ 6,738,923 $ 11,636,581 $ 3,832,701 $ 1,110,496 $ — $ 23,318,701 Cash and cash equivalents 236,871 49 927 8,279 4,932 251,058 Restricted cash 126,401 — — 37,619 — 164,020 Other assets 3,510,192 4,080,202 131,282 64,802 146,111 7,932,589 Goodwill 24,645 — — — — 24,645 Total assets $ 10,637,032 $ 15,716,832 $ 3,964,910 $ 1,221,196 $ 151,043 $ 31,691,013 Debt $ 6,815,112 $ 11,615,364 $ 3,191,859 $ 1,033,900 $ — $ 22,656,235 Other liabilities 520,215 2,111,868 8,916 13,572 291,912 2,946,483 Total liabilities 7,335,327 13,727,232 3,200,775 1,047,472 291,912 25,602,718 Total equity 3,301,705 1,989,600 764,135 173,724 (140,869 ) 6,088,295 Noncontrolling interests in equity of consolidated subsidiaries 60,064 — — 30,561 — 90,625 Total New Residential stockholders’ equity $ 3,241,641 $ 1,989,600 $ 764,135 $ 143,163 $ (140,869 ) $ 5,997,670 Investments in equity method investees $ 147,964 $ — $ — $ 38,294 $ — $ 186,258 Residential Securities and Loans Servicing and Originations Real Estate Securities Residential Mortgage Loans Consumer Loans Corporate Total Year Ended December 31, 2017 Interest income $ 713,413 $ 431,706 $ 110,087 $ 263,844 $ 629 $ 1,519,679 Interest expense 233,587 122,997 51,473 52,808 — 460,865 Net interest income (expense) 479,826 308,709 58,614 211,036 629 1,058,814 Impairment — 10,334 12,593 63,165 — 86,092 Servicing revenue, net 424,349 — — — — 424,349 Gain on sale of originated mortgage loans, net — — — — — — Other income (loss) 174,561 (16,371 ) 16,175 28,075 5,346 207,786 Operating expenses 186,330 1,471 31,529 43,552 159,695 422,577 Income (Loss) Before Income Taxes 892,406 280,533 30,667 132,394 (153,720 ) 1,182,280 Income tax (benefit) expense 166,186 — 1,272 170 — 167,628 Net Income (Loss) $ 726,220 $ 280,533 $ 29,395 $ 132,224 $ (153,720 ) $ 1,014,652 Noncontrolling interests in income (loss) of consolidated subsidiaries $ 11,227 $ — $ — $ 45,892 $ — $ 57,119 Net income (loss) attributable to common stockholders $ 714,993 $ 280,533 $ 29,395 $ 86,332 $ (153,720 ) $ 957,533 Residential Securities and Loans Servicing and Originations Real Estate Securities Residential Mortgage Loans Consumer Loans Corporate Total December 31, 2017 Investments $ 7,707,089 $ 8,071,140 $ 2,544,984 $ 1,425,675 $ — $ 19,748,888 Cash and cash equivalents 183,306 38,728 15,483 40,687 17,594 295,798 Restricted cash 104,123 — — 46,129 — 150,252 Other assets 747,997 1,098,921 113,035 28,621 30,050 2,018,624 Goodwill — — — — — — Total assets $ 8,742,515 $ 9,208,789 $ 2,673,502 $ 1,541,112 $ 47,644 $ 22,213,562 Debt $ 5,771,369 $ 6,534,300 $ 2,108,007 $ 1,332,854 $ — $ 15,746,530 Other liabilities 189,840 1,200,905 23,917 6,596 249,612 1,670,870 Total liabilities 5,961,209 7,735,205 2,131,924 1,339,450 249,612 17,417,400 Total equity 2,781,306 1,473,584 541,578 201,662 (201,968 ) 4,796,162 Noncontrolling interests in equity of consolidated subsidiaries 71,491 — — 34,466 — 105,957 Total New Residential stockholders’ equity $ 2,709,815 $ 1,473,584 $ 541,578 $ 167,196 $ (201,968 ) $ 4,690,205 Investments in equity method investees $ 171,765 $ — $ — $ 51,412 $ — $ 223,177 Residential Securities and Loans Servicing and Originations Real Estate Securities Residential Mortgage Loans Consumer Loans Corporate Total Year Ended December 31, 2016 Interest income $ 519,950 $ 265,862 $ 56,249 $ 232,750 $ 1,924 $ 1,076,735 Interest expense 244,039 49,283 25,675 54,427 — 373,424 Net interest income (expense) 275,911 216,579 30,574 178,323 1,924 703,311 Impairment — 10,264 23,870 53,846 — 87,980 Servicing revenue, net 118,169 — — — — 118,169 Gain on sale of originated mortgage loans, net — — — — — — Other income (loss) 6,774 (47,747 ) 26,779 76,518 13 62,337 Operating expenses 15,676 1,480 14,961 39,466 102,627 174,210 Income (Loss) Before Income Taxes 385,178 157,088 18,522 161,529 (100,690 ) 621,627 Income tax (benefit) expense 36,719 — 2,117 75 — 38,911 Net Income (Loss) $ 348,459 $ 157,088 $ 16,405 $ 161,454 $ (100,690 ) $ 582,716 Noncontrolling interests in income of consolidated subsidiaries $ 40,136 $ — $ — $ 38,127 $ — $ 78,263 Net income (loss) attributable to common stockholders $ 308,323 $ 157,088 $ 16,405 $ 123,327 $ (100,690 ) $ 504,453 |
INVESTMENTS IN EXCESS MORTGAGE
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS | 12 Months Ended |
Dec. 31, 2018 | |
Transfers and Servicing [Abstract] | |
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS | INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS The following table presents activity related to the carrying value of New Residential’s direct investments in Excess MSRs: Servicer Nationstar SLS (A) Ocwen (B) Total Balance as of December 31, 2016 $ 611,293 $ 3,935 $ 784,227 $ 1,399,455 Purchases — — (71,982 ) (71,982 ) Interest income — — — — Other income 46,393 (191 ) 56,851 103,053 Proceeds from repayments 2,384 — 1,993 4,377 Proceeds from sales (120,485 ) (1,400 ) (130,122 ) (252,007 ) Change in fair value (13,505 ) — — (13,505 ) Ocwen Transaction (Note 5) 6,153 569 (2,400 ) 4,322 Balance as of December 31, 2017 532,233 2,913 638,567 1,173,713 Purchases — — — — Interest income 44,386 54 — 44,440 Other income 6,444 — 40,417 46,861 Proceeds from repayments (100,215 ) (632 ) (26,946 ) (127,793 ) Proceeds from sales (19,084 ) — — (19,084 ) Change in fair value (18,436 ) 197 (40,417 ) (58,656 ) Ocwen Transaction (Note 5) — — (611,621 ) (611,621 ) Balance as of December 31, 2018 $ 445,328 $ 2,532 $ — $ 447,860 (A) Specialized Loan Servicing LLC (“SLS”). (B) Ocwen Loan Servicing LLC, a subsidiary of Ocwen Financial Corporation (together with its subsidiaries, including Ocwen Loan Servicing LLC, “Ocwen”), services the loans underlying the Excess MSRs and Servicer Advance Investments. In January 2018, New Residential entered into the new Ocwen Agreements as described in Note 5. Subsequent to the New Ocwen Agreements, the Excess MSRs serviced by Ocwen became reclassified, as described in Note 5. Nationstar, SLS, or Ocwen, as applicable, perform all of the servicing and advancing functions, and retain the ancillary income, servicing obligations and liabilities as the servicer of the underlying loans in the portfolio. New Residential has entered into a “recapture agreement” with respect to each of the Excess MSR investments serviced by Nationstar and SLS. Under such arrangements, New Residential is generally entitled to a pro rata interest in the Excess MSRs on any initial or subsequent refinancing by Nationstar of a loan in the original portfolio. These recapture agreements do not apply to New Residential’s Servicer Advance Investments (Note 6). New Residential elected to record its investments in Excess MSRs at fair value pursuant to the fair value option for financial instruments in order to provide users of the financial statements with better information regarding the effects of prepayment risk and other market factors on the Excess MSRs. The following is a summary of New Residential’s direct investments in Excess MSRs: December 31, 2018 UPB of Underlying Mortgages Interest in Excess MSR Weighted Average Life Years (A) Amortized Cost Basis (B) Carrying Value (C) New Residential (D) Fortress-managed funds Nationstar Agency Original and Recaptured Pools $ 52,368,290 32.5% - 66.7% (53.3%) 0.0% - 40.0% 20.0% - 35.0% 5.6 $ 203,675 $ 226,452 Recapture Agreements — 32.5% - 66.7% (53.3%) 0.0% - 40.0% 20.0% - 35.0% 12.8 15,122 30,935 52,368,290 6.1 218,797 257,387 Non-Agency (E) Nationstar and SLS Serviced: Original and Recaptured Pools $ 54,058,073 33.3% - 100.0% (59.4%) 0.0% - 50.0% 0.0% - 33.3% 5.8 $ 138,314 $ 172,712 Recapture Agreements — 33.3% - 100.0% (59.4%) 0.0% - 50.0% 0.0% - 33.3% 12.8 4,216 17,761 54,058,073 6.0 142,530 190,473 Total $ 106,426,363 6.1 $ 361,327 $ 447,860 December 31, 2017 UPB of Underlying Mortgages Interest in Excess MSR Weighted Average Life Years (A) Amortized Cost Basis (B) Carrying Value (C) New Residential (D) Fortress-managed funds Nationstar Agency Original and Recaptured Pools $ 63,839,281 32.5% - 66.7% (53.5%) 0.0% - 40.0% 20.0% - 35.0% 5.8 $ 249,003 $ 280,033 Recapture Agreements — 32.5% - 66.7% (53.5%) 0.0% - 40.0% 20.0% - 35.0% 11.4 18,944 44,603 63,839,281 6.2 267,947 324,636 Non-Agency (E) Nationstar and SLS Serviced: Original and Recaptured Pools $ 64,146,430 33.3% - 100.0% (59.6%) 0.0% - 50.0% 0.0% - 33.3% 5.4 $ 154,938 $ 190,696 Recapture Agreements — 33.3% - 100.0% (59.6%) 0.0% - 50.0% 0.0% - 33.3% 11.3 7,489 19,814 Ocwen Serviced Pools 89,135,588 100.0% —% —% 6.5 598,149 638,567 153,282,018 6.4 760,576 849,077 Total $ 217,121,299 6.4 $ 1,028,523 $ 1,173,713 (A) Weighted Average Life represents the weighted average expected timing of the receipt of expected cash flows for this investment. (B) The amortized cost basis of the recapture agreements is determined based on the relative fair values of the recapture agreements and related Excess MSRs at the time they were acquired. (C) Carrying Value represents the fair value of the pools or recapture agreements, as applicable. (D) Amounts in parentheses represent weighted averages. (E) New Residential also invested in related Servicer Advance Investments, including the basic fee component of the related MSR as of December 31, 2018 and 2017 (Note 6) on $40.1 billion and $139.5 billion UPB, respectively, underlying these Excess MSRs. Changes in fair value recorded in other income is comprised of the following: Year Ended December 31, 2018 2017 2016 Original and Recaptured Pools $ (50,030 ) $ (5,630 ) $ (11,221 ) Recapture Agreements (8,626 ) 9,952 3,924 $ (58,656 ) $ 4,322 $ (7,297 ) As of December 31, 2018 and 2017 , weighted average discount rates of 8.8% and 8.9% , respectively, were used to value New Residential’s investments in Excess MSRs (directly and through equity method investees). New Residential entered into investments in joint ventures (“Excess MSR joint ventures”) jointly controlled by New Residential and Fortress-managed funds investing in Excess MSRs. New Residential elected to record these investments at fair value pursuant to the fair value option for financial instruments to provide users of the financial statements with better information regarding the effects of prepayment risk and other market factors. The following tables summarize the financial results of the Excess MSR joint ventures, accounted for as equity method investees, held by New Residential: December 31, 2018 2017 Excess MSR assets $ 269,203 $ 321,197 Other assets 27,411 22,333 Other liabilities (687 ) — Equity $ 295,927 $ 343,530 New Residential’s investment $ 147,964 $ 171,765 New Residential’s ownership 50.0 % 50.0 % Year Ended December 31, 2018 2017 2016 Interest income $ 26,363 $ 27,450 $ 36,502 Other income (loss) (9,649 ) (2,149 ) (3,359 ) Expenses — (68 ) (91 ) Net income $ 16,714 $ 25,233 $ 33,052 New Residential’s investments in equity method investees changed during the years ended December 31, 2018 and 2017 as follows: 2018 2017 Balance at beginning of period $ 171,765 $ 194,788 Contributions to equity method investees — — Distributions of earnings from equity method investees (11,059 ) (13,668 ) Distributions of capital from equity method investees (21,099 ) (21,972 ) Change in fair value of investments in equity method investees 8,357 12,617 Balance at end of period $ 147,964 $ 171,765 The following is a summary of New Residential’s Excess MSR investments made through equity method investees: December 31, 2018 Unpaid Principal Balance Investee Interest in Excess MSR (A) New Residential Interest in Investees Amortized Cost Basis (B) Carrying Value (C) Weighted Average Life (Years) (D) Agency Original and Recaptured Pools $ 41,707,963 66.7% 50.0% $ 178,560 $ 228,779 5.5 Recapture Agreements — 66.7% 50.0% 19,701 40,424 12.7 Total $ 41,707,963 $ 198,261 $ 269,203 6.2 December 31, 2017 Unpaid Principal Balance Investee Interest in Excess MSR (A) New Residential Interest in Investees Amortized Cost Basis (B) Carrying Value (C) Weighted Average Life (Years) (D) Agency Original and Recaptured Pools $ 50,501,054 66.7% 50.0% $ 209,924 $ 271,785 5.7 Recapture Agreements — 66.7% 50.0% 23,571 49,412 11.4 $ 50,501,054 $ 233,495 $ 321,197 6.3 (A) The remaining interests are held by Nationstar. (B) Represents the amortized cost basis of the equity method investees in which New Residential holds a 50% interest. The amortized cost basis of the recapture agreements is determined based on the relative fair values of the recapture agreements and related Excess MSRs at the time they were acquired. (C) Represents the carrying value of the Excess MSRs held in equity method investees, in which New Residential holds a 50% interest. Carrying value represents the fair value of the pools or recapture agreements, as applicable. (D) The weighted average life represents the weighted average expected timing of the receipt of cash flows of each investment. See Note 11 regarding the financing of Excess MSRs. INVESTMENTS IN MORTGAGE SERVICING RIGHTS AND MORTGAGE SERVICING RIGHTS FINANCING RECEIVABLES Mortgage Servicing Rights In 2016, a subsidiary of New Residential, New Residential Mortgage LLC (“NRM”), became a licensed or otherwise eligible mortgage servicer. NRM is presently licensed or otherwise eligible to hold MSRs in all states within the United States and the District of Columbia. Additionally, NRM has received approval from the FHA to hold MSRs associated with FHA-insured mortgage loans, from the Federal National Mortgage Association (“Fannie Mae”) to hold MSRs associated with loans owned by Fannie Mae, and from the Federal Home Loan Mortgage Corporation (“Freddie Mac”) to hold MSRs associated with loans owned by Freddie Mac. Fannie Mae and Freddie Mac are collectively referred to as the Government Sponsored Enterprises (“GSEs”). As an approved Fannie Mae Servicer, Freddie Mac Servicer and FHA-approved mortgagee, NRM is required to conduct aspects of its operations in accordance with applicable policies and guidelines published by FHA, Fannie Mae and Freddie Mac in order to maintain those approvals. NRM engages third party licensed mortgage servicers as subservicers to perform the operational servicing duties in connection with some of the MSRs it acquires, in exchange for a subservicing fee which is recorded as “Subservicing expense” on New Residential’s Consolidated Statements of Income. As of December 31, 2018 , these subservicers include Nationstar, Ocwen, Ditech Financial LLC (“Ditech,” a subsidiary of Ditech Holding Corporation) , PHH Corporation (together with its subsidiaries, including PHH Mortgage Corporation, “PHH”), LoanCare, LLC (“LoanCare”), and Flagstar Bank, FSB (“Flagstar”), which subservice 24.4% , 22.7% , 20.9% , 10.9% , 1.6% , and 0.6% of the underlying UPB of the related mortgages, respectively (includes both Mortgage Servicing Rights and Mortgage Servicing Rights Financing Receivables). New Residential has entered into recapture agreements with respect to each of its MSR investments subserviced by Ditech, Flagstar, and Nationstar. Under the recapture agreements, New Residential is generally entitled to the MSRs on any initial or subsequent refinancing by Ditech, Flagstar, or Nationstar of a loan in the original portfolios. Shellpoint On November 29, 2017, concurrently with the Shellpoint Purchaser’s entry into the Shellpoint SPA with Shellpoint, NRM entered into (i) a Bulk Agreement for the Purchase and Sale of Mortgage Servicing Rights (the “Shellpoint MSR Purchase Agreement”) with New Penn, a Delaware limited liability company and a wholly owned subsidiary of Shellpoint, pursuant to which NRM has agreed to purchase from New Penn the mortgage servicing rights relating to a portfolio of Fannie Mae and Freddie Mac mortgage loans having an aggregate UPB of approximately $7.8 billion for a purchase price of approximately $81.0 million (the “Shellpoint MSR Purchase”), which closed on January 16, 2018, and (ii) a Subservicing Agreement (the “Shellpoint Subservicing Agreement”) with New Penn, pursuant to which New Penn has agreed to subservice Fannie Mae and Freddie Mac mortgage loans for which NRM has acquired the right to service such loans. Under the Shellpoint Subservicing Agreement, New Penn is entitled to certain monthly and other servicing compensation, and both NRM and New Penn may terminate the Shellpoint Subservicing Agreement, subject to certain specified terms, notice periods and other requirements. During the first and second quarters of 2018, New Residential entered into several transactions with New Penn to acquire the rights to the economic value of the servicing rights related to MSRs owned by New Penn with respect to certain mortgage loans guaranteed by Ginnie Mae, together with existing servicer advances and the obligation to fund future servicer advances. New Residential acquired these economic rights related to approximately $11.4 billion UPB of Ginnie Mae guaranteed residential mortgage loans serviced by New Penn for an aggregate purchase price of $139.1 million (the “Ginnie Mae MSRs”). As a result of New Penn continuing to own the MSRs and remaining the named servicer of the Ginnie Mae guaranteed residential mortgage loans, although the rights to the economic value of the MSRs were legally sold, solely for accounting purposes, New Residential determined that each purchase agreement would not be treated as a sale under GAAP and accounted for as Mortgage Servicing Rights Financing Receivable. As a result of the Shellpoint Acquisition completed on July 3, 2018, New Residential, through its wholly owned subsidiary, New Penn, owns the Ginnie Mae MSRs and now accounts for these assets as Mortgage Servicing Rights rather than Mortgage Servicing Rights Financing Receivable as disclosed in the first and second quarters of 2018. New Penn, as an approved issuer of Ginnie Mae MBS, originates, sells and securitizes government-insured residential mortgage loans into Ginnie Mae guaranteed securitizations and New Penn retains the right to service the underlying residential mortgage loans. As the servicer, New Penn, holds the Ginnie Mae Buy-Back Option to repurchase delinquent loans from the securitization at its discretion. In accordance with the accounting guidance in ASC No. 860, New Penn recognizes any delinquent loans subject to the Ginnie Mae Buy-Back Option and an offsetting repurchase liability on its balance sheet regardless of whether New Penn executes its option to repurchase. As of December 31, 2018 , New Residential holds approximately $121.6 million in Residential mortgage loans subject to repurchase and Residential mortgage loans repurchase liability on its Consolidated Balance Sheets. During the year ended December 31, 2018 , New Residential, through its wholly owned subsidiaries, completed the following MSR acquisitions accounted for as Mortgage Servicing Rights: Date of Acquisition Collateral Type (A) UPB (in billions) Purchase Price (in millions) January 16, 2018 Agency $ 11.5 $ 101.5 January 16, 2018 Agency 7.8 81.0 February 28, 2018 Agency 3.3 33.5 March 28, 2018 Agency & Ginnie Mae 8.1 96.6 May 1, 2018 Ginnie Mae 4.6 36.2 May 25, 2018 Agency 2.1 26.3 May 31, 2018 Agency & Ginnie Mae 6.1 79.9 June 1, 2018 Ginnie Mae 0.5 6.1 June 4, 2018 Agency 2.1 19.3 June 28, 2018 Ginnie Mae 4.7 66.5 August 31, 2018 Agency & Ginnie Mae 18.5 220.5 September 28, 2018 Agency 1.1 13.6 September 28, 2018 Agency 10.1 126.4 November 8, 2018 Ginnie Mae 0.1 1.5 December 31, 2018 Agency & Ginnie Mae 7.0 81.4 December 31, 2018 Agency 9.8 135.7 Various (B) Agency 5.6 60.0 Total $ 103.0 $ 1,186.0 (A) “Agency” represents Fannie Mae and Freddie Mac MSRs. (B) Represents Flow MSR acquisitions primarily from Ditech and Shellpoint for the year ended December 31, 2018 . New Residential records its investments in MSRs at fair value at acquisition and has elected to subsequently measure at fair value pursuant to the fair value measurement method. Servicing revenue, net recognized by New Residential related to its investments in MSRs was comprised of the following: Year Ended December 31, 2018 2017 2016 Servicing fee revenue $ 589,546 $ 412,971 $ 29,168 Ancillary and other fees 130,294 79,050 676 Servicing fee revenue and fees 719,840 492,021 29,844 Amortization of servicing rights (A) (256,915 ) (223,167 ) (15,354 ) Change in valuation inputs and assumptions (B) (C) 68,587 155,495 103,679 (Gain)/loss on sales (D) (2,917 ) — — Servicing revenue, net $ 528,595 $ 424,349 $ 118,169 (A) Includes $1.2 million , $0.0 million and $0.0 million of amortization to Excess spread financing for the years ended December 31, 2018 , 2017 , and 2016 , respectively. (B) Change in valuation inputs and assumptions includes changes in inputs or assumptions used in the valuation model and other changes due to the realization of expected cash flows. (C) Includes $7.4 million , $0.0 million and $0.0 million of fair value adjustment to Excess spread financing for the years ended December 31, 2018 , 2017 , and 2016 , respectively. (D) Represents the realization of unrealized gain/(loss) as a result of sales. The following table presents activity related to the carrying value of New Residential’s investments in MSRs: Balance as of December 31, 2016 $ 659,483 Purchases 1,143,693 Amortization of servicing rights (A) (223,167 ) Change in valuation inputs and assumptions (B) 155,495 Balance as of December 31, 2017 $ 1,735,504 Purchases 1,042,933 Transfer In (C) 124,652 Shellpoint Acquisition (D) (E) 151,312 Originations (F) 35,311 Proceeds from sales (5,776 ) Amortization of servicing rights (A) (258,068 ) Change in valuation inputs and assumptions (B) 61,149 (Gain)/loss on sales (G) (2,917 ) Balance as of December 31, 2018 $ 2,884,100 (A) Based on the ratio of the current UPB of the underlying residential mortgage loans relative to the original UPB of the underlying residential mortgage loans. (B) Change in valuation inputs and assumptions includes changes in inputs or assumptions used in the valuation model and other changes due to the realization of expected cash flows. (C) Represents Ginnie Mae MSRs previously accounted for as Mortgage Servicing Rights Financing Receivable. (D) Represents MSRs acquired through New Residential’s acquisition of Shellpoint Partners LLC. (E) Includes $48.3 million of MSRs legally sold by New Penn treated as a secured borrowing as it did not meet the criteria for sale treatment. New Residential elected to record the excess spread financing liability at fair value pursuant to the fair value option. (F) Represents MSRs retained on the sale of originated mortgage loans. (G) Represents the realization of unrealized gain/(loss) as a result of sales. The following is a summary of New Residential’s investments in MSRs as of December 31, 2018 and 2017 : UPB of Underlying Mortgages Weighted Average Life (Years) (A) Amortized Cost Basis Carrying Value (B) 2018 Agency (C) $ 226,295,778 6.4 $ 2,189,039 $ 2,506,676 Non-Agency 2,143,212 6.6 19,982 22,438 Ginnie Mae 30,023,713 7.4 357,673 354,986 Total $ 258,462,703 6.5 $ 2,566,694 $ 2,884,100 2017 Agency $ 172,392,496 6.3 $ 1,476,330 $ 1,735,504 Non-Agency 61,654 5.6 — — Total $ 172,454,150 6.3 $ 1,476,330 $ 1,735,504 (A) Weighted Average Life represents the weighted average expected timing of the receipt of expected cash flows for this investment. (B) Carrying Value represents fair value. As of December 31, 2018 and 2017 , weighted average discount rates of 8.7% and 9.1% , respectively, were used to value New Residential’s investments in MSRs. (C) Represents Fannie Mae and Freddie Mac MSRs. Mortgage Servicing Rights Financing Receivable In certain cases, New Residential has legally purchased MSRs or the right to the economic interest in MSRs; however, New Residential has determined that each purchase agreement would not be treated as a sale under GAAP. Therefore, rather than recording an investment in MSRs, New Residential has recorded an investment in mortgage servicing rights financing receivables. Income from this investment (net of subservicing fees) is recorded as interest income, and New Residential has elected to measure the investment at fair value, with changes in fair value flowing through change in fair value of investments in mortgage servicing rights financing receivables in the Consolidated Statements of Income. PHH Transaction As a result of the length of the initial term of the related subservicing agreement between NRM and PHH, although the MSRs were legally sold, solely for accounting purposes, New Residential determined that substantially all of the risks and rewards inherent in owning the MSRs had not been transferred to NRM, and that the purchase agreement would not be treated as a sale under GAAP. New Residential has entered into a recapture agreement with respect to each of its MSR investments subserviced by PHH. Under the recapture agreement, New Residential is generally entitled to the MSRs on any initial or subsequent refinancing by PHH of a loan in the original portfolio. Ocwen Transaction As of December 31, 2018 , MSRs representing approximately $36.1 billion UPB of underlying loans have been transferred pursuant to the Ocwen Transaction, including $20.6 billion transferred to New Penn during the fourth quarter of 2018. Economics related to the remaining MSRs subject to the Ocwen Transaction were transferred pursuant to the New Ocwen Agreements (described below). Through December 31, 2018 , $334.2 million of related lump sum payments have been made by New Residential to Ocwen. Upon such transfer, or subsequent to the New Ocwen Agreements (described below), any interests already held by New Residential are reclassified (from Excess MSRs or Servicer Advance Investments) to become part of the basis of the MSR financing receivables or servicer advances receivable, as appropriate, held by NRM. As a result of the length of the initial term of the related subservicing agreement between NRM and Ocwen, although the MSRs transferred pursuant to the Ocwen Transaction were legally sold, solely for accounting purposes, New Residential determined that substantially all of the risks and rewards inherent in owning the MSRs had not been transferred to NRM, and that the purchase agreement would not be treated as a sale under GAAP. In July 2017, New Residential and Ocwen entered into the Ocwen Transaction. While New Residential continues the process of obtaining the third party consents necessary to transfer the related MSRs to New Residential’s subsidiary, NRM, Ocwen and New Residential have entered into new agreements, which have accelerated the implementation of certain parts of the Ocwen Transaction in order to achieve its intent sooner. These new agreements are described in further detail below. On January 18, 2018, New Residential entered into a new agreement regarding the rights to MSRs (the “New Ocwen RMSR Agreement”) including a servicing addendum thereto (the “Ocwen Servicing Addendum”), Amendment No. 1 to Transfer Agreement (the “New Ocwen Transfer Agreement”) and a Brokerage Services Agreement (the “Ocwen Brokerage Services Agreement” and, collectively, the “New Ocwen Agreements”) with Ocwen. The New Ocwen Agreements modify and supplement the arrangements among the parties set forth in the Original Ocwen Agreements, the Ocwen Master Agreement, the Ocwen Transfer Agreement, and the Ocwen Subservicing Agreement (together with the Original Ocwen Agreements, the Ocwen Master Agreement, and the Ocwen Transfer Agreement, the “Existing Ocwen Agreements”). NRM made a lump-sum “Fee Restructuring Payment” of $279.6 million to Ocwen on January 18, 2018, the date of the New Ocwen RMSR Agreement, with respect to such Existing Ocwen Subject MSRs. Under the Existing Ocwen Agreements, Ocwen sold and transferred to New Residential certain “Rights to MSRs” and other assets related to mortgage servicing rights for loans with an unpaid principal balance of approximately $86.8 billion as of the opening balances in January 2018 (the “Existing Ocwen Subject MSRs”). Pursuant to the New Ocwen Agreements, Ocwen will continue to service the mortgage loans related to the Existing Ocwen Subject MSRs until the necessary third party consents are obtained in order to transfer the Existing Ocwen Subject MSRs in accordance with the New Ocwen Agreements. The New Ocwen RMSR Agreement provides, among other things: • the Existing Ocwen Subject MSRs will remain in the parties’ ownership structure under the Existing Ocwen Agreements while they continue to seek third party consents to transfer Ocwen’s remaining rights to the Existing Ocwen Subject MSRs to New Residential or any permitted assignee of New Residential; • Ocwen will continue to service the related mortgage loans pursuant to the terms of the Ocwen Servicing Addendum until the transfer of the Existing Ocwen Subject MSRs; • under the arrangements contemplated by the New Ocwen RMSR Agreement, Ocwen will receive substantially identical compensation for servicing the related mortgage loans underlying the Existing Ocwen Subject MSRs that it would receive if the Existing Ocwen Subject MSRs had been transferred to NRM as named servicer and Ocwen subserviced such mortgage loans for NRM as named servicer; • in the event that the required third party consents are not obtained with respect to any Existing Ocwen Subject MSRs by certain dates specified in the New Ocwen RMSR Agreement, in accordance with the process set forth in the New Ocwen RMSR Agreement, the Rights to MSRs (as defined in the Existing Ocwen Agreements) related to such Existing Ocwen Subject MSRs could either: (i) remain subject to the New Ocwen RMSR Agreement at the option of New Residential, (ii) if New Residential does not opt for the New Ocwen RMSR Agreement to remain in place with respect to certain Existing Ocwen Subject MSRs, Ocwen may acquire such Existing Ocwen Subject MSRs at a price determined in accordance with the terms of the New Ocwen RMSR Agreement, or (iii) if Ocwen does not acquire such Existing Ocwen Subject MSRs, be sold to a third party in accordance with the terms of the New Ocwen RMSR Agreement, as determined pursuant to the terms of the New Ocwen RMSR Agreement; • New Residential agreed to waive any rights New Residential may have had under the Existing Ocwen Agreements to replace Ocwen as named servicer with respect to the Existing Ocwen Subject MSRs based on Ocwen’s residential servicer rating agency related downgrades; and • Ocwen will offer refinancing opportunities to borrowers and New Residential is entitled to the MSRs on any initial or subsequent refinancing by Ocwen of a loan in the original portfolio. Pursuant to the Ocwen Servicing Addendum, Ocwen will service the mortgage loans related to the Existing Ocwen Subject MSRs. In consideration of servicing such mortgage loans, Ocwen will receive a servicing fee based on the unpaid principal balance as of the first of each month as set forth in the Ocwen Servicing Addendum. The initial term of the Ocwen Servicing Addendum is for the five years following July 23, 2017. At any time during the initial term, New Residential may terminate the Ocwen Servicing Addendum for convenience, subject to Ocwen’s right to receive a termination fee calculated in accordance with the Ocwen Servicing Addendum and specified notice. Following the initial term, (i) New Residential may extend the term of the Ocwen Servicing Addendum for additional three-month periods by delivering written notice to Ocwen of its desire to extend such contract thirty days prior to the end of such three -month period and (ii) the Ocwen Servicing Addendum may be terminated by Ocwen on an annual basis. In addition, New Residential and Ocwen will have the right to terminate the Ocwen Servicing Addendum for cause if certain conditions specified in the Ocwen Servicing Addendum occur. If the Ocwen Servicing Addendum is terminated or not renewed in accordance with these provisions, New Residential will have the right to direct the transfer of servicing to a third party, subject to Ocwen’s option to purchase the Existing Ocwen Subject MSRs and related assets in certain cases. To the extent that servicing of the loans cannot be transferred in accordance with these provisions, the Ocwen Servicing Addendum will remain in place with respect to the servicing of any remaining loans. Pursuant to the Ocwen Brokerage Services Agreement, Ocwen will engage NRZ Brokerage to perform brokerage and marketing services for all REO properties serviced by Ocwen pursuant to the Subject Servicing Agreements as defined in the New Ocwen RMSR Agreement. Such REO properties are subject to the Altisource Brokerage Agreement and Altisource Letter Agreement. Interest income from investments in mortgage servicing rights financing receivables was comprised of the following: Year Ended December 31, 2018 Year Ended December 31, 2017 Servicing fee revenue $ 705,812 $ 94,945 Ancillary and other fees 146,829 17,313 Less: subservicing expense (251,184 ) (33,686 ) Interest income, investments in mortgage servicing rights financing receivables $ 601,457 $ 78,572 Change in fair value of investments in mortgage servicing rights financing receivables was comprised of the following: Year Ended December 31, 2018 Year Ended December 31, 2017 Amortization of servicing rights $ (197,703 ) $ (43,190 ) Change in valuation inputs and assumptions (A) 230,036 109,584 (Gain)/loss on sales (B) (783 ) — Change in fair value of investments in mortgage servicing rights financing receivables $ 31,550 $ 66,394 (A) Change in valuation inputs and assumptions includes changes in inputs or assumptions used in the valuation model and other changes due to the realization of expected cash flows. (B) Represents the realization of unrealized gain/(loss) as a result of sales. The following table presents activity related to the carrying value of New Residential’s investments in mortgage servicing rights financing receivables: Balance as of December 31, 2016 $ — Purchases 467,884 Ocwen Transaction 64,450 Amortization of servicing rights (A) (43,190 ) Change in valuation inputs and assumptions (B) 109,584 Balance as of December 31, 2017 $ 598,728 Purchases 128,357 Transfer Out (C) (124,652 ) New Ocwen Agreements 1,017,993 Proceeds from sales (7,472 ) Amortization of servicing rights (A) (197,703 ) Change in valuation inputs and assumptions (B) 230,036 (Gain)/loss on sales (D) (783 ) Balance as of December 31, 2018 $ 1,644,504 (A) Based on the ratio of the current UPB of the underlying residential mortgage loans relative to the original UPB of the underlying residential mortgage loans. (B) Change in valuation inputs and assumptions includes changes in inputs or assumptions used in the valuation model and other changes due to the realization of expected cash flows. (C) Represents Ginnie Mae MSRs owned by New Penn accounted for as Mortgage Servicing Rights as a result of the Shellpoint Acquisition. (D) Represents the realization of unrealized gain/(loss) as a result of sales. The following is a summary of New Residential’s investments in mortgage servicing rights financing receivables: UPB of Underlying Mortgages Weighted Average Life (Years) (A) Amortized Cost Basis Carrying Value (B) December 31, 2018 Agency $ 42,265,547 5.9 $ 366,946 $ 434,110 Non-Agency 88,251,018 7.2 936,792 1,210,394 Total $ 130,516,565 6.8 $ 1,303,738 $ 1,644,504 December 31, 2017 Agency $ 49,498,415 5.9 $ 428,657 $ 476,206 Non-Agency 14,846,478 5.6 60,487 122,522 Total $ 64,344,893 5.8 $ 489,144 $ 598,728 (A) Weighted Average Life represents the weighted average expected timing of the receipt of expected cash flows for this investment. (B) Carrying Value represents fair value. As of December 31, 2018 and 2017 , weighted average discount rates of 10.3% and 9.4% , respectively, were used to value New Residential’s investments in mortgage servicing rights financing receivables. The table below summarizes the geographic distribution of the underlying residential mortgage loans of the investments in MSRs and mortgage servicing rights financing receivables: Percentage of Total Outstanding Unpaid Principal Amount State Concentration December 31, 2018 December 31, 2017 California 21.7 % 19.0 % New York 7.8 % 6.3 % Florida 6.9 % 6.0 % Texas 5.3 % 5.7 % New Jersey 5.0 % 5.2 % Illinois 3.7 % 4.1 % Massachusetts 3.5 % 3.8 % Maryland 3.4 % 2.8 % Pennsylvania 3.1 % 3.3 % Virginia 3.1 % 3.1 % Other U.S. 36.5 % 40.7 % 100.0 % 100.0 % Geographic concentrations of investments expose New Residential to the risk of economic downturns within the relevant states. Any such downturn in a state where New Residential holds significant investments could affect the underlying borrower’s ability to make mortgage payments and therefore could have a meaningful, negative impact on the MSRs. Mortgage Subservicing New Penn performs servicing of residential mortgage loans for third parties under subservicing agreements. Mortgage subservicing does not meet the criteria to be recognized as a servicing right asset and, therefore, is not recognized on New Residential’s consolidated balance sheets. The UPB of residential mortgage loans subserviced f |
INVESTMENTS IN MORTGAGE SERVICI
INVESTMENTS IN MORTGAGE SERVICING RIGHTS AND MORTGAGE SERVICING RIGHTS FINANCING RECEIVABLES | 12 Months Ended |
Dec. 31, 2018 | |
Transfers and Servicing [Abstract] | |
INVESTMENTS IN MORTGAGE SERVICING RIGHTS AND MORTGAGE SERVICING RIGHTS FINANCING RECEIVABLES | INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS The following table presents activity related to the carrying value of New Residential’s direct investments in Excess MSRs: Servicer Nationstar SLS (A) Ocwen (B) Total Balance as of December 31, 2016 $ 611,293 $ 3,935 $ 784,227 $ 1,399,455 Purchases — — (71,982 ) (71,982 ) Interest income — — — — Other income 46,393 (191 ) 56,851 103,053 Proceeds from repayments 2,384 — 1,993 4,377 Proceeds from sales (120,485 ) (1,400 ) (130,122 ) (252,007 ) Change in fair value (13,505 ) — — (13,505 ) Ocwen Transaction (Note 5) 6,153 569 (2,400 ) 4,322 Balance as of December 31, 2017 532,233 2,913 638,567 1,173,713 Purchases — — — — Interest income 44,386 54 — 44,440 Other income 6,444 — 40,417 46,861 Proceeds from repayments (100,215 ) (632 ) (26,946 ) (127,793 ) Proceeds from sales (19,084 ) — — (19,084 ) Change in fair value (18,436 ) 197 (40,417 ) (58,656 ) Ocwen Transaction (Note 5) — — (611,621 ) (611,621 ) Balance as of December 31, 2018 $ 445,328 $ 2,532 $ — $ 447,860 (A) Specialized Loan Servicing LLC (“SLS”). (B) Ocwen Loan Servicing LLC, a subsidiary of Ocwen Financial Corporation (together with its subsidiaries, including Ocwen Loan Servicing LLC, “Ocwen”), services the loans underlying the Excess MSRs and Servicer Advance Investments. In January 2018, New Residential entered into the new Ocwen Agreements as described in Note 5. Subsequent to the New Ocwen Agreements, the Excess MSRs serviced by Ocwen became reclassified, as described in Note 5. Nationstar, SLS, or Ocwen, as applicable, perform all of the servicing and advancing functions, and retain the ancillary income, servicing obligations and liabilities as the servicer of the underlying loans in the portfolio. New Residential has entered into a “recapture agreement” with respect to each of the Excess MSR investments serviced by Nationstar and SLS. Under such arrangements, New Residential is generally entitled to a pro rata interest in the Excess MSRs on any initial or subsequent refinancing by Nationstar of a loan in the original portfolio. These recapture agreements do not apply to New Residential’s Servicer Advance Investments (Note 6). New Residential elected to record its investments in Excess MSRs at fair value pursuant to the fair value option for financial instruments in order to provide users of the financial statements with better information regarding the effects of prepayment risk and other market factors on the Excess MSRs. The following is a summary of New Residential’s direct investments in Excess MSRs: December 31, 2018 UPB of Underlying Mortgages Interest in Excess MSR Weighted Average Life Years (A) Amortized Cost Basis (B) Carrying Value (C) New Residential (D) Fortress-managed funds Nationstar Agency Original and Recaptured Pools $ 52,368,290 32.5% - 66.7% (53.3%) 0.0% - 40.0% 20.0% - 35.0% 5.6 $ 203,675 $ 226,452 Recapture Agreements — 32.5% - 66.7% (53.3%) 0.0% - 40.0% 20.0% - 35.0% 12.8 15,122 30,935 52,368,290 6.1 218,797 257,387 Non-Agency (E) Nationstar and SLS Serviced: Original and Recaptured Pools $ 54,058,073 33.3% - 100.0% (59.4%) 0.0% - 50.0% 0.0% - 33.3% 5.8 $ 138,314 $ 172,712 Recapture Agreements — 33.3% - 100.0% (59.4%) 0.0% - 50.0% 0.0% - 33.3% 12.8 4,216 17,761 54,058,073 6.0 142,530 190,473 Total $ 106,426,363 6.1 $ 361,327 $ 447,860 December 31, 2017 UPB of Underlying Mortgages Interest in Excess MSR Weighted Average Life Years (A) Amortized Cost Basis (B) Carrying Value (C) New Residential (D) Fortress-managed funds Nationstar Agency Original and Recaptured Pools $ 63,839,281 32.5% - 66.7% (53.5%) 0.0% - 40.0% 20.0% - 35.0% 5.8 $ 249,003 $ 280,033 Recapture Agreements — 32.5% - 66.7% (53.5%) 0.0% - 40.0% 20.0% - 35.0% 11.4 18,944 44,603 63,839,281 6.2 267,947 324,636 Non-Agency (E) Nationstar and SLS Serviced: Original and Recaptured Pools $ 64,146,430 33.3% - 100.0% (59.6%) 0.0% - 50.0% 0.0% - 33.3% 5.4 $ 154,938 $ 190,696 Recapture Agreements — 33.3% - 100.0% (59.6%) 0.0% - 50.0% 0.0% - 33.3% 11.3 7,489 19,814 Ocwen Serviced Pools 89,135,588 100.0% —% —% 6.5 598,149 638,567 153,282,018 6.4 760,576 849,077 Total $ 217,121,299 6.4 $ 1,028,523 $ 1,173,713 (A) Weighted Average Life represents the weighted average expected timing of the receipt of expected cash flows for this investment. (B) The amortized cost basis of the recapture agreements is determined based on the relative fair values of the recapture agreements and related Excess MSRs at the time they were acquired. (C) Carrying Value represents the fair value of the pools or recapture agreements, as applicable. (D) Amounts in parentheses represent weighted averages. (E) New Residential also invested in related Servicer Advance Investments, including the basic fee component of the related MSR as of December 31, 2018 and 2017 (Note 6) on $40.1 billion and $139.5 billion UPB, respectively, underlying these Excess MSRs. Changes in fair value recorded in other income is comprised of the following: Year Ended December 31, 2018 2017 2016 Original and Recaptured Pools $ (50,030 ) $ (5,630 ) $ (11,221 ) Recapture Agreements (8,626 ) 9,952 3,924 $ (58,656 ) $ 4,322 $ (7,297 ) As of December 31, 2018 and 2017 , weighted average discount rates of 8.8% and 8.9% , respectively, were used to value New Residential’s investments in Excess MSRs (directly and through equity method investees). New Residential entered into investments in joint ventures (“Excess MSR joint ventures”) jointly controlled by New Residential and Fortress-managed funds investing in Excess MSRs. New Residential elected to record these investments at fair value pursuant to the fair value option for financial instruments to provide users of the financial statements with better information regarding the effects of prepayment risk and other market factors. The following tables summarize the financial results of the Excess MSR joint ventures, accounted for as equity method investees, held by New Residential: December 31, 2018 2017 Excess MSR assets $ 269,203 $ 321,197 Other assets 27,411 22,333 Other liabilities (687 ) — Equity $ 295,927 $ 343,530 New Residential’s investment $ 147,964 $ 171,765 New Residential’s ownership 50.0 % 50.0 % Year Ended December 31, 2018 2017 2016 Interest income $ 26,363 $ 27,450 $ 36,502 Other income (loss) (9,649 ) (2,149 ) (3,359 ) Expenses — (68 ) (91 ) Net income $ 16,714 $ 25,233 $ 33,052 New Residential’s investments in equity method investees changed during the years ended December 31, 2018 and 2017 as follows: 2018 2017 Balance at beginning of period $ 171,765 $ 194,788 Contributions to equity method investees — — Distributions of earnings from equity method investees (11,059 ) (13,668 ) Distributions of capital from equity method investees (21,099 ) (21,972 ) Change in fair value of investments in equity method investees 8,357 12,617 Balance at end of period $ 147,964 $ 171,765 The following is a summary of New Residential’s Excess MSR investments made through equity method investees: December 31, 2018 Unpaid Principal Balance Investee Interest in Excess MSR (A) New Residential Interest in Investees Amortized Cost Basis (B) Carrying Value (C) Weighted Average Life (Years) (D) Agency Original and Recaptured Pools $ 41,707,963 66.7% 50.0% $ 178,560 $ 228,779 5.5 Recapture Agreements — 66.7% 50.0% 19,701 40,424 12.7 Total $ 41,707,963 $ 198,261 $ 269,203 6.2 December 31, 2017 Unpaid Principal Balance Investee Interest in Excess MSR (A) New Residential Interest in Investees Amortized Cost Basis (B) Carrying Value (C) Weighted Average Life (Years) (D) Agency Original and Recaptured Pools $ 50,501,054 66.7% 50.0% $ 209,924 $ 271,785 5.7 Recapture Agreements — 66.7% 50.0% 23,571 49,412 11.4 $ 50,501,054 $ 233,495 $ 321,197 6.3 (A) The remaining interests are held by Nationstar. (B) Represents the amortized cost basis of the equity method investees in which New Residential holds a 50% interest. The amortized cost basis of the recapture agreements is determined based on the relative fair values of the recapture agreements and related Excess MSRs at the time they were acquired. (C) Represents the carrying value of the Excess MSRs held in equity method investees, in which New Residential holds a 50% interest. Carrying value represents the fair value of the pools or recapture agreements, as applicable. (D) The weighted average life represents the weighted average expected timing of the receipt of cash flows of each investment. See Note 11 regarding the financing of Excess MSRs. INVESTMENTS IN MORTGAGE SERVICING RIGHTS AND MORTGAGE SERVICING RIGHTS FINANCING RECEIVABLES Mortgage Servicing Rights In 2016, a subsidiary of New Residential, New Residential Mortgage LLC (“NRM”), became a licensed or otherwise eligible mortgage servicer. NRM is presently licensed or otherwise eligible to hold MSRs in all states within the United States and the District of Columbia. Additionally, NRM has received approval from the FHA to hold MSRs associated with FHA-insured mortgage loans, from the Federal National Mortgage Association (“Fannie Mae”) to hold MSRs associated with loans owned by Fannie Mae, and from the Federal Home Loan Mortgage Corporation (“Freddie Mac”) to hold MSRs associated with loans owned by Freddie Mac. Fannie Mae and Freddie Mac are collectively referred to as the Government Sponsored Enterprises (“GSEs”). As an approved Fannie Mae Servicer, Freddie Mac Servicer and FHA-approved mortgagee, NRM is required to conduct aspects of its operations in accordance with applicable policies and guidelines published by FHA, Fannie Mae and Freddie Mac in order to maintain those approvals. NRM engages third party licensed mortgage servicers as subservicers to perform the operational servicing duties in connection with some of the MSRs it acquires, in exchange for a subservicing fee which is recorded as “Subservicing expense” on New Residential’s Consolidated Statements of Income. As of December 31, 2018 , these subservicers include Nationstar, Ocwen, Ditech Financial LLC (“Ditech,” a subsidiary of Ditech Holding Corporation) , PHH Corporation (together with its subsidiaries, including PHH Mortgage Corporation, “PHH”), LoanCare, LLC (“LoanCare”), and Flagstar Bank, FSB (“Flagstar”), which subservice 24.4% , 22.7% , 20.9% , 10.9% , 1.6% , and 0.6% of the underlying UPB of the related mortgages, respectively (includes both Mortgage Servicing Rights and Mortgage Servicing Rights Financing Receivables). New Residential has entered into recapture agreements with respect to each of its MSR investments subserviced by Ditech, Flagstar, and Nationstar. Under the recapture agreements, New Residential is generally entitled to the MSRs on any initial or subsequent refinancing by Ditech, Flagstar, or Nationstar of a loan in the original portfolios. Shellpoint On November 29, 2017, concurrently with the Shellpoint Purchaser’s entry into the Shellpoint SPA with Shellpoint, NRM entered into (i) a Bulk Agreement for the Purchase and Sale of Mortgage Servicing Rights (the “Shellpoint MSR Purchase Agreement”) with New Penn, a Delaware limited liability company and a wholly owned subsidiary of Shellpoint, pursuant to which NRM has agreed to purchase from New Penn the mortgage servicing rights relating to a portfolio of Fannie Mae and Freddie Mac mortgage loans having an aggregate UPB of approximately $7.8 billion for a purchase price of approximately $81.0 million (the “Shellpoint MSR Purchase”), which closed on January 16, 2018, and (ii) a Subservicing Agreement (the “Shellpoint Subservicing Agreement”) with New Penn, pursuant to which New Penn has agreed to subservice Fannie Mae and Freddie Mac mortgage loans for which NRM has acquired the right to service such loans. Under the Shellpoint Subservicing Agreement, New Penn is entitled to certain monthly and other servicing compensation, and both NRM and New Penn may terminate the Shellpoint Subservicing Agreement, subject to certain specified terms, notice periods and other requirements. During the first and second quarters of 2018, New Residential entered into several transactions with New Penn to acquire the rights to the economic value of the servicing rights related to MSRs owned by New Penn with respect to certain mortgage loans guaranteed by Ginnie Mae, together with existing servicer advances and the obligation to fund future servicer advances. New Residential acquired these economic rights related to approximately $11.4 billion UPB of Ginnie Mae guaranteed residential mortgage loans serviced by New Penn for an aggregate purchase price of $139.1 million (the “Ginnie Mae MSRs”). As a result of New Penn continuing to own the MSRs and remaining the named servicer of the Ginnie Mae guaranteed residential mortgage loans, although the rights to the economic value of the MSRs were legally sold, solely for accounting purposes, New Residential determined that each purchase agreement would not be treated as a sale under GAAP and accounted for as Mortgage Servicing Rights Financing Receivable. As a result of the Shellpoint Acquisition completed on July 3, 2018, New Residential, through its wholly owned subsidiary, New Penn, owns the Ginnie Mae MSRs and now accounts for these assets as Mortgage Servicing Rights rather than Mortgage Servicing Rights Financing Receivable as disclosed in the first and second quarters of 2018. New Penn, as an approved issuer of Ginnie Mae MBS, originates, sells and securitizes government-insured residential mortgage loans into Ginnie Mae guaranteed securitizations and New Penn retains the right to service the underlying residential mortgage loans. As the servicer, New Penn, holds the Ginnie Mae Buy-Back Option to repurchase delinquent loans from the securitization at its discretion. In accordance with the accounting guidance in ASC No. 860, New Penn recognizes any delinquent loans subject to the Ginnie Mae Buy-Back Option and an offsetting repurchase liability on its balance sheet regardless of whether New Penn executes its option to repurchase. As of December 31, 2018 , New Residential holds approximately $121.6 million in Residential mortgage loans subject to repurchase and Residential mortgage loans repurchase liability on its Consolidated Balance Sheets. During the year ended December 31, 2018 , New Residential, through its wholly owned subsidiaries, completed the following MSR acquisitions accounted for as Mortgage Servicing Rights: Date of Acquisition Collateral Type (A) UPB (in billions) Purchase Price (in millions) January 16, 2018 Agency $ 11.5 $ 101.5 January 16, 2018 Agency 7.8 81.0 February 28, 2018 Agency 3.3 33.5 March 28, 2018 Agency & Ginnie Mae 8.1 96.6 May 1, 2018 Ginnie Mae 4.6 36.2 May 25, 2018 Agency 2.1 26.3 May 31, 2018 Agency & Ginnie Mae 6.1 79.9 June 1, 2018 Ginnie Mae 0.5 6.1 June 4, 2018 Agency 2.1 19.3 June 28, 2018 Ginnie Mae 4.7 66.5 August 31, 2018 Agency & Ginnie Mae 18.5 220.5 September 28, 2018 Agency 1.1 13.6 September 28, 2018 Agency 10.1 126.4 November 8, 2018 Ginnie Mae 0.1 1.5 December 31, 2018 Agency & Ginnie Mae 7.0 81.4 December 31, 2018 Agency 9.8 135.7 Various (B) Agency 5.6 60.0 Total $ 103.0 $ 1,186.0 (A) “Agency” represents Fannie Mae and Freddie Mac MSRs. (B) Represents Flow MSR acquisitions primarily from Ditech and Shellpoint for the year ended December 31, 2018 . New Residential records its investments in MSRs at fair value at acquisition and has elected to subsequently measure at fair value pursuant to the fair value measurement method. Servicing revenue, net recognized by New Residential related to its investments in MSRs was comprised of the following: Year Ended December 31, 2018 2017 2016 Servicing fee revenue $ 589,546 $ 412,971 $ 29,168 Ancillary and other fees 130,294 79,050 676 Servicing fee revenue and fees 719,840 492,021 29,844 Amortization of servicing rights (A) (256,915 ) (223,167 ) (15,354 ) Change in valuation inputs and assumptions (B) (C) 68,587 155,495 103,679 (Gain)/loss on sales (D) (2,917 ) — — Servicing revenue, net $ 528,595 $ 424,349 $ 118,169 (A) Includes $1.2 million , $0.0 million and $0.0 million of amortization to Excess spread financing for the years ended December 31, 2018 , 2017 , and 2016 , respectively. (B) Change in valuation inputs and assumptions includes changes in inputs or assumptions used in the valuation model and other changes due to the realization of expected cash flows. (C) Includes $7.4 million , $0.0 million and $0.0 million of fair value adjustment to Excess spread financing for the years ended December 31, 2018 , 2017 , and 2016 , respectively. (D) Represents the realization of unrealized gain/(loss) as a result of sales. The following table presents activity related to the carrying value of New Residential’s investments in MSRs: Balance as of December 31, 2016 $ 659,483 Purchases 1,143,693 Amortization of servicing rights (A) (223,167 ) Change in valuation inputs and assumptions (B) 155,495 Balance as of December 31, 2017 $ 1,735,504 Purchases 1,042,933 Transfer In (C) 124,652 Shellpoint Acquisition (D) (E) 151,312 Originations (F) 35,311 Proceeds from sales (5,776 ) Amortization of servicing rights (A) (258,068 ) Change in valuation inputs and assumptions (B) 61,149 (Gain)/loss on sales (G) (2,917 ) Balance as of December 31, 2018 $ 2,884,100 (A) Based on the ratio of the current UPB of the underlying residential mortgage loans relative to the original UPB of the underlying residential mortgage loans. (B) Change in valuation inputs and assumptions includes changes in inputs or assumptions used in the valuation model and other changes due to the realization of expected cash flows. (C) Represents Ginnie Mae MSRs previously accounted for as Mortgage Servicing Rights Financing Receivable. (D) Represents MSRs acquired through New Residential’s acquisition of Shellpoint Partners LLC. (E) Includes $48.3 million of MSRs legally sold by New Penn treated as a secured borrowing as it did not meet the criteria for sale treatment. New Residential elected to record the excess spread financing liability at fair value pursuant to the fair value option. (F) Represents MSRs retained on the sale of originated mortgage loans. (G) Represents the realization of unrealized gain/(loss) as a result of sales. The following is a summary of New Residential’s investments in MSRs as of December 31, 2018 and 2017 : UPB of Underlying Mortgages Weighted Average Life (Years) (A) Amortized Cost Basis Carrying Value (B) 2018 Agency (C) $ 226,295,778 6.4 $ 2,189,039 $ 2,506,676 Non-Agency 2,143,212 6.6 19,982 22,438 Ginnie Mae 30,023,713 7.4 357,673 354,986 Total $ 258,462,703 6.5 $ 2,566,694 $ 2,884,100 2017 Agency $ 172,392,496 6.3 $ 1,476,330 $ 1,735,504 Non-Agency 61,654 5.6 — — Total $ 172,454,150 6.3 $ 1,476,330 $ 1,735,504 (A) Weighted Average Life represents the weighted average expected timing of the receipt of expected cash flows for this investment. (B) Carrying Value represents fair value. As of December 31, 2018 and 2017 , weighted average discount rates of 8.7% and 9.1% , respectively, were used to value New Residential’s investments in MSRs. (C) Represents Fannie Mae and Freddie Mac MSRs. Mortgage Servicing Rights Financing Receivable In certain cases, New Residential has legally purchased MSRs or the right to the economic interest in MSRs; however, New Residential has determined that each purchase agreement would not be treated as a sale under GAAP. Therefore, rather than recording an investment in MSRs, New Residential has recorded an investment in mortgage servicing rights financing receivables. Income from this investment (net of subservicing fees) is recorded as interest income, and New Residential has elected to measure the investment at fair value, with changes in fair value flowing through change in fair value of investments in mortgage servicing rights financing receivables in the Consolidated Statements of Income. PHH Transaction As a result of the length of the initial term of the related subservicing agreement between NRM and PHH, although the MSRs were legally sold, solely for accounting purposes, New Residential determined that substantially all of the risks and rewards inherent in owning the MSRs had not been transferred to NRM, and that the purchase agreement would not be treated as a sale under GAAP. New Residential has entered into a recapture agreement with respect to each of its MSR investments subserviced by PHH. Under the recapture agreement, New Residential is generally entitled to the MSRs on any initial or subsequent refinancing by PHH of a loan in the original portfolio. Ocwen Transaction As of December 31, 2018 , MSRs representing approximately $36.1 billion UPB of underlying loans have been transferred pursuant to the Ocwen Transaction, including $20.6 billion transferred to New Penn during the fourth quarter of 2018. Economics related to the remaining MSRs subject to the Ocwen Transaction were transferred pursuant to the New Ocwen Agreements (described below). Through December 31, 2018 , $334.2 million of related lump sum payments have been made by New Residential to Ocwen. Upon such transfer, or subsequent to the New Ocwen Agreements (described below), any interests already held by New Residential are reclassified (from Excess MSRs or Servicer Advance Investments) to become part of the basis of the MSR financing receivables or servicer advances receivable, as appropriate, held by NRM. As a result of the length of the initial term of the related subservicing agreement between NRM and Ocwen, although the MSRs transferred pursuant to the Ocwen Transaction were legally sold, solely for accounting purposes, New Residential determined that substantially all of the risks and rewards inherent in owning the MSRs had not been transferred to NRM, and that the purchase agreement would not be treated as a sale under GAAP. In July 2017, New Residential and Ocwen entered into the Ocwen Transaction. While New Residential continues the process of obtaining the third party consents necessary to transfer the related MSRs to New Residential’s subsidiary, NRM, Ocwen and New Residential have entered into new agreements, which have accelerated the implementation of certain parts of the Ocwen Transaction in order to achieve its intent sooner. These new agreements are described in further detail below. On January 18, 2018, New Residential entered into a new agreement regarding the rights to MSRs (the “New Ocwen RMSR Agreement”) including a servicing addendum thereto (the “Ocwen Servicing Addendum”), Amendment No. 1 to Transfer Agreement (the “New Ocwen Transfer Agreement”) and a Brokerage Services Agreement (the “Ocwen Brokerage Services Agreement” and, collectively, the “New Ocwen Agreements”) with Ocwen. The New Ocwen Agreements modify and supplement the arrangements among the parties set forth in the Original Ocwen Agreements, the Ocwen Master Agreement, the Ocwen Transfer Agreement, and the Ocwen Subservicing Agreement (together with the Original Ocwen Agreements, the Ocwen Master Agreement, and the Ocwen Transfer Agreement, the “Existing Ocwen Agreements”). NRM made a lump-sum “Fee Restructuring Payment” of $279.6 million to Ocwen on January 18, 2018, the date of the New Ocwen RMSR Agreement, with respect to such Existing Ocwen Subject MSRs. Under the Existing Ocwen Agreements, Ocwen sold and transferred to New Residential certain “Rights to MSRs” and other assets related to mortgage servicing rights for loans with an unpaid principal balance of approximately $86.8 billion as of the opening balances in January 2018 (the “Existing Ocwen Subject MSRs”). Pursuant to the New Ocwen Agreements, Ocwen will continue to service the mortgage loans related to the Existing Ocwen Subject MSRs until the necessary third party consents are obtained in order to transfer the Existing Ocwen Subject MSRs in accordance with the New Ocwen Agreements. The New Ocwen RMSR Agreement provides, among other things: • the Existing Ocwen Subject MSRs will remain in the parties’ ownership structure under the Existing Ocwen Agreements while they continue to seek third party consents to transfer Ocwen’s remaining rights to the Existing Ocwen Subject MSRs to New Residential or any permitted assignee of New Residential; • Ocwen will continue to service the related mortgage loans pursuant to the terms of the Ocwen Servicing Addendum until the transfer of the Existing Ocwen Subject MSRs; • under the arrangements contemplated by the New Ocwen RMSR Agreement, Ocwen will receive substantially identical compensation for servicing the related mortgage loans underlying the Existing Ocwen Subject MSRs that it would receive if the Existing Ocwen Subject MSRs had been transferred to NRM as named servicer and Ocwen subserviced such mortgage loans for NRM as named servicer; • in the event that the required third party consents are not obtained with respect to any Existing Ocwen Subject MSRs by certain dates specified in the New Ocwen RMSR Agreement, in accordance with the process set forth in the New Ocwen RMSR Agreement, the Rights to MSRs (as defined in the Existing Ocwen Agreements) related to such Existing Ocwen Subject MSRs could either: (i) remain subject to the New Ocwen RMSR Agreement at the option of New Residential, (ii) if New Residential does not opt for the New Ocwen RMSR Agreement to remain in place with respect to certain Existing Ocwen Subject MSRs, Ocwen may acquire such Existing Ocwen Subject MSRs at a price determined in accordance with the terms of the New Ocwen RMSR Agreement, or (iii) if Ocwen does not acquire such Existing Ocwen Subject MSRs, be sold to a third party in accordance with the terms of the New Ocwen RMSR Agreement, as determined pursuant to the terms of the New Ocwen RMSR Agreement; • New Residential agreed to waive any rights New Residential may have had under the Existing Ocwen Agreements to replace Ocwen as named servicer with respect to the Existing Ocwen Subject MSRs based on Ocwen’s residential servicer rating agency related downgrades; and • Ocwen will offer refinancing opportunities to borrowers and New Residential is entitled to the MSRs on any initial or subsequent refinancing by Ocwen of a loan in the original portfolio. Pursuant to the Ocwen Servicing Addendum, Ocwen will service the mortgage loans related to the Existing Ocwen Subject MSRs. In consideration of servicing such mortgage loans, Ocwen will receive a servicing fee based on the unpaid principal balance as of the first of each month as set forth in the Ocwen Servicing Addendum. The initial term of the Ocwen Servicing Addendum is for the five years following July 23, 2017. At any time during the initial term, New Residential may terminate the Ocwen Servicing Addendum for convenience, subject to Ocwen’s right to receive a termination fee calculated in accordance with the Ocwen Servicing Addendum and specified notice. Following the initial term, (i) New Residential may extend the term of the Ocwen Servicing Addendum for additional three-month periods by delivering written notice to Ocwen of its desire to extend such contract thirty days prior to the end of such three -month period and (ii) the Ocwen Servicing Addendum may be terminated by Ocwen on an annual basis. In addition, New Residential and Ocwen will have the right to terminate the Ocwen Servicing Addendum for cause if certain conditions specified in the Ocwen Servicing Addendum occur. If the Ocwen Servicing Addendum is terminated or not renewed in accordance with these provisions, New Residential will have the right to direct the transfer of servicing to a third party, subject to Ocwen’s option to purchase the Existing Ocwen Subject MSRs and related assets in certain cases. To the extent that servicing of the loans cannot be transferred in accordance with these provisions, the Ocwen Servicing Addendum will remain in place with respect to the servicing of any remaining loans. Pursuant to the Ocwen Brokerage Services Agreement, Ocwen will engage NRZ Brokerage to perform brokerage and marketing services for all REO properties serviced by Ocwen pursuant to the Subject Servicing Agreements as defined in the New Ocwen RMSR Agreement. Such REO properties are subject to the Altisource Brokerage Agreement and Altisource Letter Agreement. Interest income from investments in mortgage servicing rights financing receivables was comprised of the following: Year Ended December 31, 2018 Year Ended December 31, 2017 Servicing fee revenue $ 705,812 $ 94,945 Ancillary and other fees 146,829 17,313 Less: subservicing expense (251,184 ) (33,686 ) Interest income, investments in mortgage servicing rights financing receivables $ 601,457 $ 78,572 Change in fair value of investments in mortgage servicing rights financing receivables was comprised of the following: Year Ended December 31, 2018 Year Ended December 31, 2017 Amortization of servicing rights $ (197,703 ) $ (43,190 ) Change in valuation inputs and assumptions (A) 230,036 109,584 (Gain)/loss on sales (B) (783 ) — Change in fair value of investments in mortgage servicing rights financing receivables $ 31,550 $ 66,394 (A) Change in valuation inputs and assumptions includes changes in inputs or assumptions used in the valuation model and other changes due to the realization of expected cash flows. (B) Represents the realization of unrealized gain/(loss) as a result of sales. The following table presents activity related to the carrying value of New Residential’s investments in mortgage servicing rights financing receivables: Balance as of December 31, 2016 $ — Purchases 467,884 Ocwen Transaction 64,450 Amortization of servicing rights (A) (43,190 ) Change in valuation inputs and assumptions (B) 109,584 Balance as of December 31, 2017 $ 598,728 Purchases 128,357 Transfer Out (C) (124,652 ) New Ocwen Agreements 1,017,993 Proceeds from sales (7,472 ) Amortization of servicing rights (A) (197,703 ) Change in valuation inputs and assumptions (B) 230,036 (Gain)/loss on sales (D) (783 ) Balance as of December 31, 2018 $ 1,644,504 (A) Based on the ratio of the current UPB of the underlying residential mortgage loans relative to the original UPB of the underlying residential mortgage loans. (B) Change in valuation inputs and assumptions includes changes in inputs or assumptions used in the valuation model and other changes due to the realization of expected cash flows. (C) Represents Ginnie Mae MSRs owned by New Penn accounted for as Mortgage Servicing Rights as a result of the Shellpoint Acquisition. (D) Represents the realization of unrealized gain/(loss) as a result of sales. The following is a summary of New Residential’s investments in mortgage servicing rights financing receivables: UPB of Underlying Mortgages Weighted Average Life (Years) (A) Amortized Cost Basis Carrying Value (B) December 31, 2018 Agency $ 42,265,547 5.9 $ 366,946 $ 434,110 Non-Agency 88,251,018 7.2 936,792 1,210,394 Total $ 130,516,565 6.8 $ 1,303,738 $ 1,644,504 December 31, 2017 Agency $ 49,498,415 5.9 $ 428,657 $ 476,206 Non-Agency 14,846,478 5.6 60,487 122,522 Total $ 64,344,893 5.8 $ 489,144 $ 598,728 (A) Weighted Average Life represents the weighted average expected timing of the receipt of expected cash flows for this investment. (B) Carrying Value represents fair value. As of December 31, 2018 and 2017 , weighted average discount rates of 10.3% and 9.4% , respectively, were used to value New Residential’s investments in mortgage servicing rights financing receivables. The table below summarizes the geographic distribution of the underlying residential mortgage loans of the investments in MSRs and mortgage servicing rights financing receivables: Percentage of Total Outstanding Unpaid Principal Amount State Concentration December 31, 2018 December 31, 2017 California 21.7 % 19.0 % New York 7.8 % 6.3 % Florida 6.9 % 6.0 % Texas 5.3 % 5.7 % New Jersey 5.0 % 5.2 % Illinois 3.7 % 4.1 % Massachusetts 3.5 % 3.8 % Maryland 3.4 % 2.8 % Pennsylvania 3.1 % 3.3 % Virginia 3.1 % 3.1 % Other U.S. 36.5 % 40.7 % 100.0 % 100.0 % Geographic concentrations of investments expose New Residential to the risk of economic downturns within the relevant states. Any such downturn in a state where New Residential holds significant investments could affect the underlying borrower’s ability to make mortgage payments and therefore could have a meaningful, negative impact on the MSRs. Mortgage Subservicing New Penn performs servicing of residential mortgage loans for third parties under subservicing agreements. Mortgage subservicing does not meet the criteria to be recognized as a servicing right asset and, therefore, is not recognized on New Residential’s consolidated balance sheets. The UPB of residential mortgage loans subserviced f |
SERVICER ADVANCE INVESTMENTS
SERVICER ADVANCE INVESTMENTS | 12 Months Ended |
Dec. 31, 2018 | |
Investments, All Other Investments [Abstract] | |
SERVICER ADVANCE INVESTMENTS | SERVICER ADVANCE INVESTMENTS All of New Residential’s Servicer Advance Investments are comprised of outstanding servicer advances, the requirement to purchase all future servicer advances made with respect to a specified pool of residential mortgage loans, and the basic fee component of the related MSR. New Residential elected to record its Servicer Advance Investments, including the right to the basic fee component of the related MSRs, at fair value pursuant to the fair value option for financial instruments to provide users of the financial statements with better information regarding the effects of market factors. A taxable wholly-owned subsidiary of New Residential is the managing member of the Buyer and owned an approximately 73.2% interest in the Buyer as of December 31, 2018 . New Residential determined that the Buyer should be evaluated for consolidation under the VIE model rather than the voting interest entity model as the equity holders as a group do not have the right to direct activities that most significantly impact the entity’s economic performance. Under the VIE model, New Residential’s consolidated subsidiary, as the managing member, has both 1) the power to direct the activities of the Buyer and 2) a significant variable interest through its equity investment and, therefore, meets the primary beneficiary criterion and continues to consolidate the Buyer. As of December 31, 2018 , noncontrolling third-party co-investors, owning the remaining interest in the Buyer, have funded capital commitments to the Buyer of $389.6 million and New Residential has funded capital commitments to the Buyer of $312.7 million . The Buyer may call capital up to the commitment amount on unfunded commitments and recall capital to the extent the Buyer makes a distribution to the co-investors, including New Residential. As of December 31, 2018 , the noncontrolling third-party co-investors and New Residential had previously funded their commitments, however the Buyer may recall $322.6 million and $291.1 million of capital distributed to the third-party co-investors and New Residential, respectively. Neither the third-party co-investors nor New Residential is obligated to fund amounts in excess of their respective capital commitments, regardless of the capital requirements of the Buyer. The Buyer has purchased servicer advances from Nationstar, is required to purchase all future servicer advances made with respect to this portfolio of loans from Nationstar, and receives cash flows from advance recoveries and the basic fee component of the related MSRs, net of compensation paid back to Nationstar in consideration of Nationstar’s servicing activities. The compensation paid to Nationstar as of December 31, 2018 was approximately 9.2% of the basic fee component of the related MSRs plus a performance fee that represents a portion (up to 100% ) of the cash flows in excess of those required for the Buyer to obtain a specified return on its equity. New Residential also acquired a portion of the call rights related to this portfolio of loans. In December 2014, New Residential agreed to acquire (the “SLS Transaction”) 50% of the Excess MSRs and all of the servicer advances and related basic fee portion of the MSR, and a portion of the call rights related to a portfolio of residential mortgage loans which is serviced by SLS. Fortress-managed funds acquired the other 50% of the Excess MSRs. SLS services the loans in exchange for a servicing fee of 10.75 basis points (“bps”) and an incentive fee (the “SLS Incentive Fee”) which is based on the ratio of the outstanding servicer advances to the UPB of the underlying loans. In April 2015, New Residential acquired Servicer Advance Investments and Excess MSRs in connection with the acquisition of HLSS. Through January 1, 2018, Ocwen serviced the underlying loans in exchange for a servicing fee of 12% times the servicing fee collections of the underlying loans, which as of December 31, 2017 and December 31, 2016 was equal to 6.1 bps and 5.9 bps times the UPB of the underlying loans, respectively, and an incentive fee which was reduced by LIBOR plus 2.75% per annum of the amount, if any, of servicer advances outstanding in excess of a defined target. In July 2017, New Residential entered into the Ocwen Transaction as described in Note 5. Subsequent to the Ocwen Transaction, the Servicer Advance Investments (including the related basic fee portion of the MSR) formerly serviced by Ocwen became reclassified, as described in Note 5, as the underlying MSRs are transferred to NRM. The following is a summary of New Residential’s Servicer Advance Investments, including the right to the basic fee component of the related MSRs: Amortized Cost Basis Carrying Value (A) Weighted Average Discount Rate Weighted Average Yield Weighted Average Life (Years) (B) Change in Fair Value Recorded in Other Income for Year then Ended December 31, 2018 Servicer Advance Investments $ 721,801 $ 735,846 5.9 % 5.8 % 5.7 $ (89,332 ) December 31, 2017 Servicer Advance Investments $ 3,924,003 $ 4,027,379 6.8 % 7.3 % 5.1 $ 84,418 (A) Carrying value represents the fair value of the Servicer Advance Investments, including the basic fee component of the related MSRs. (B) Weighted Average Life represents the weighted average expected timing of the receipt of expected net cash flows for this investment. The following is additional information regarding the Servicer Advance Investments and related financing: Loan-to-Value (“LTV”) (A) Cost of Funds (C) UPB of Underlying Residential Mortgage Loans Outstanding Servicer Advances Servicer Advances to UPB of Underlying Residential Mortgage Loans Face Amount of Notes and Bonds Payable Gross Net (B) Gross Net December 31, 2018 Servicer Advance Investments (D) $ 40,096,998 $ 620,050 1.5 % $ 574,117 88.3 % 87.2 % 3.7 % 3.1 % December 31, 2017 Servicer Advance Investments (D) $ 139,460,371 $ 3,581,876 2.6 % $ 3,461,718 93.2 % 92.0 % 3.3 % 3.0 % (A) Based on outstanding servicer advances, excluding purchased but unsettled servicer advances. (B) Ratio of face amount of borrowings to par amount of servicer advance collateral, net of any general reserve. (C) Annualized measure of the cost associated with borrowings. Gross Cost of Funds primarily includes interest expense and facility fees. Net Cost of Funds excludes facility fees. (D) The following types of advances are included in the Servicer Advance Investments: December 31, 2018 2017 Principal and interest advances $ 108,317 $ 909,133 Escrow advances (taxes and insurance advances) 238,349 1,636,381 Foreclosure advances 273,384 1,036,362 Total $ 620,050 $ 3,581,876 Interest income recognized by New Residential related to its Servicer Advance Investments was comprised of the following: Year Ended December 31, 2018 2017 2016 Interest income, gross of amounts attributable to servicer compensation $ 83,807 $ 871,506 $ 922,006 Amounts attributable to base servicer compensation (8,491 ) (227,585 ) (127,631 ) Amounts attributable to incentive servicer compensation (25,098 ) (115,565 ) (430,025 ) Interest income from Servicer Advance Investments $ 50,218 $ 528,356 $ 364,350 New Residential has determined that the Buyer is a VIE. The following table presents information on the assets and liabilities related to this consolidated VIE. As of December 31, 2018 2017 Assets Servicer advance investments, at fair value $ 713,239 $ 1,002,102 Cash and cash equivalents 29,833 40,929 All other assets 10,223 13,011 Total assets (A) $ 753,295 $ 1,056,042 Liabilities Notes and bonds payable $ 556,340 $ 789,979 All other liabilities 2,442 3,308 Total liabilities (A) $ 558,782 $ 793,287 (A) The creditors of the Buyer do not have recourse to the general credit of New Residential and the assets of the Buyer are not directly available to satisfy New Residential’s obligations. Others’ interests in the equity of the Buyer is computed as follows: December 31, 2018 2017 Total Advance Purchaser LLC equity $ 194,513 $ 262,755 Others’ ownership interest 26.8 % 27.2 % Others’ interest in equity of consolidated subsidiary $ 52,066 $ 71,491 Others’ interests in the Buyer’s net income (loss) is computed as follows: Year Ended December 31, 2018 2017 2016 Net Advance Purchaser LLC income $ 7,209 $ 23,604 $ 72,159 Others’ ownership interest as a percent of total (A) 27.4 % 47.6 % 55.6 % Others’ interest in net income of consolidated subsidiaries $ 1,978 $ 11,227 $ 40,136 (A) As a result, New Residential owned 72.6% , 52.4% and 44.4% of the Buyer, on average during the years ended December 31, 2018 , 2017 and 2016 , respectively. See Note 11 regarding the financing of Servicer Advance Investments. |
INVESTMENTS IN REAL ESTATE AND
INVESTMENTS IN REAL ESTATE AND OTHER SECURITIES | 12 Months Ended |
Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
INVESTMENTS IN REAL ESTATE AND OTHER SECURITIES | INVESTMENTS IN REAL ESTATE AND OTHER SECURITIES “Agency” residential mortgage backed securities (“RMBS”) are RMBS issued by a government sponsored enterprise, such as Fannie Mae or Freddie Mac. “Non-Agency” RMBS are issued by either public trusts or private label securitization entities. Activities related to New Residential’s investments in real estate and other securities were as follows: Year Ended December 31, 2018 Year Ended December 31, 2017 (in millions) (in millions) Treasury Agency Non-Agency Treasury Agency Non-Agency Purchases Face $ — $ 11,006.7 $ 9,194.8 $ 1,552.0 $ 7,135.2 $ 7,606.5 Purchase Price — 11,121.6 3,854.4 1,545.3 7,367.8 3,053.0 Sales Face $ 862.0 $ 9,485.0 $ 115.0 $ 690.0 $ 7,310.7 $ 235.1 Amortized Cost 858.0 9,590.6 87.7 687.2 7,536.6 164.3 Sale Price 849.8 9,569.2 86.4 686.7 7,539.6 182.4 Gain (Loss) on Sale (8.2 ) (21.4 ) (1.3 ) (0.5 ) 3.0 18.0 As of December 31, 2018 , New Residential had sold and purchased $3.9 billion and $2.0 billion face amount of Agency RMBS for $3.9 billion and $2.0 billion , respectively, which had not yet been settled. These unsettled sales and purchases were recorded on the balance sheet on trade date as Trades Receivable and Trades Payable. New Residential has exercised its call rights with respect to Non-Agency RMBS trusts and purchased performing and non-performing residential mortgage loans and REO contained in such trusts prior to their termination. In certain cases, New Residential sold portions of the purchased loans through securitizations, and retained bonds issued by such securitizations. In addition, New Residential received par on the securities issued by the called trusts which it owned prior to such trusts’ termination. Refer to Note 8 for further details on these transactions. The following is a summary of New Residential’s real estate and other securities, all of which are classified as available-for-sale and are, therefore, reported at fair value with changes in fair value recorded in other comprehensive income, except for securities that are other-than-temporarily impaired and except for securities which New Residential elected to carry at fair value and record changes to valuation through the income statement. Gross Unrealized Weighted Average Asset Type Outstanding Face Amount Amortized Cost Basis Gains Losses Carrying Value (A) Number of Securities Rating (B) Coupon (C) Yield Life (Years) (D) Principal Subordination (E) December 31, 2018 Agency RMBS (F)(G) $ 2,613,395 $ 2,657,917 $ 7,744 $ (43 ) $ 2,665,618 31 AAA 4.01 % 3.70 % 8.1 N/A Non-Agency RMBS (H) (I) 19,539,450 8,554,511 517,861 (101,409 ) 8,970,963 897 B+ 3.40 % 5.63 % 6.9 12.4 % Total/Weighted Average $ 22,152,845 $ 11,212,428 $ 525,605 $ (101,452 ) $ 11,636,581 928 BB+ 3.53 % 5.17 % 7.2 December 31, 2017 Treasury $ 862,000 $ 858,028 $ — $ (5,294 ) $ 852,734 3 AAA 2.21 % 2.27 % 8.1 N/A Agency RMBS (F)(G) 1,203,629 1,247,093 1,176 (4,652 ) 1,243,617 98 AAA 3.49 % 2.83 % 7.0 N/A Non-Agency RMBS (H) (I) 12,757,357 5,599,644 423,504 (48,359 ) 5,974,789 751 CCC- 2.27 % 5.66 % 7.7 8.5 % Total/Weighted Average $ 14,822,986 $ 7,704,765 $ 424,680 $ (58,305 ) $ 8,071,140 852 B+ 2.44 % 4.83 % 7.6 (A) Fair value, which is equal to carrying value for all securities. See Note 12 regarding the estimation of fair value. (B) Represents the weighted average of the ratings of all securities in each asset type, expressed as an S&P equivalent rating. This excludes the ratings of the collateral underlying 252 bonds with a carrying value of $722.1 million which either have never been rated or for which rating information is no longer provided. For each security rated by multiple rating agencies, the lowest rating is used. New Residential used an implied AAA rating for the Agency RMBS. Ratings provided were determined by third party rating agencies, and represent the most recent credit ratings available as of the reporting date and may not be current. (C) Excludes residual bonds, and certain other Non-Agency bonds, with a carrying value of $299.7 million and $1.9 million , respectively, for which no coupon payment is expected. (D) The weighted average life is based on the timing of expected principal reduction on the assets. (E) Percentage of the amortized cost basis of securities that is subordinate to New Residential’s investments, excluding fair value option securities. (F) Includes securities issued or guaranteed by U.S. Government agencies such as Fannie Mae or Freddie Mac. (G) The total outstanding face amount was $2.6 billion and $1.1 billion for fixed rate securities and $0.0 billion and $0.1 billion for floating rate securities as of December 31, 2018 and 2017 , respectively. (H) The total outstanding face amount was $3.8 billion (including $1.5 billion of residual and fair value option notional amount) and $1.3 billion (including $0.7 billion of residual and fair value option notional amount) for fixed rate securities and $15.7 billion (including $7.4 billion of residual and fair value option notional amount) and $11.5 billion (including $4.5 billion of residual and fair value option notional amount) for floating rate securities as of December 31, 2018 and 2017 , respectively. (I) Includes (i) interest-only securities and servicing strips (fair value option securities) which New Residential elected to carry at fair value and record changes to valuation through the income statement, (ii) bonds backed by MSRs, (iii) bonds backed by consumer loans and (iv) corporate debt. Gross Unrealized Weighted Average Asset Type Outstanding Face Amount Amortized Cost Basis Gains Losses Carrying Value Number of Securities Rating Coupon Yield Life (Years) Principal Subordination December 31, 2018 Corporate debt $ 85,000 $ 85,000 $ — $ (12,325 ) $ 72,675 1 B- 8.25 % 8.25 % 6.3 N/A Consumer loan bonds 56,846 57,480 33 (7,075 ) 50,438 6 B 5.50 % 20.26 % 1.6 N/A MSR bond 228,000 228,000 — (400 ) 227,600 2 BBB- 5.24 % 4.89 % 8.8 N/A Fair Value Option Securities Interest-only Securities 6,832,353 259,725 23,694 (13,025 ) 270,394 79 AA+ 1.38 % 6.58 % 3.0 N/A Servicing Strips 975,048 8,588 1,720 (198 ) 10,110 31 N/A 0.21 % 13.23 % 6.0 N/A December 31, 2017 Consumer loan bonds $ 29,690 $ 29,780 $ 971 $ (528 ) $ 30,223 3 N/A N/A 17.17 % 1.5 N/A Fair Value Option Securities Interest-only Securities 4,475,794 205,740 10,407 (9,887 ) 206,260 49 AA- 1.51 % 5.33 % 3.2 N/A Servicing Strips 450,974 4,958 1,613 (225 ) 6,346 20 N/A 0.27 % 21.62 % 6.7 N/A Unrealized losses that are considered other-than-temporary and are attributable to credit losses are recognized currently in earnings. During the year ended December 31, 2018 , New Residential recorded OTTI charges of $30.0 million with respect to real estate securities. During the year ended December 31, 2017 , New Residential recorded OTTI of $10.3 million . During the year ended December 31, 2016 , New Residential recorded OTTI of $10.3 million . Any remaining unrealized losses on New Residential’s securities were primarily the result of changes in market factors, rather than issue-specific credit impairment. New Residential performed analyses in relation to such securities, using its best estimate of their cash flows, which support its belief that the carrying values of such securities were fully recoverable over their expected holding period. New Residential has no intent to sell, and is not more likely than not to be required to sell, these securities. The following table summarizes New Residential’s securities in an unrealized loss position as of December 31, 2018 . Amortized Cost Basis Weighted Average Securities in an Unrealized Loss Position Outstanding Face Amount Before Impairment Other-Than- Temporary Impairment (A) After Impairment Gross Unrealized Losses Carrying Value Number of Securities Rating (B) Coupon Yield Life (Years) Less than 12 Months $ 4,843,505 $ 1,996,349 $ (5,996 ) $ 1,990,353 $ (67,215 ) $ 1,923,138 181 CCC+ 3.46 % 5.02 % 6.3 12 or More Months 1,411,991 450,391 (831 ) 449,560 (34,237 ) 415,323 76 BB- 1.90 % 6.66 % 5.3 Total/Weighted Average $ 6,255,496 $ 2,446,740 $ (6,827 ) $ 2,439,913 $ (101,452 ) $ 2,338,461 257 B- 3.17 % 5.32 % 6.1 (A) This amount represents OTTI recorded on securities that are in an unrealized loss position as of December 31, 2018 . (B) The weighted average rating of securities in an unrealized loss position for less than 12 months excludes the rating of 40 bonds which either have never been rated or for which rating information is no longer provided. The weighted average rating of securities in an unrealized loss position for 12 or more months excludes the rating of 19 bonds which either have never been rated or for which rating information is no longer provided. New Residential performed an assessment of all of its debt securities that are in an unrealized loss position (an unrealized loss position exists when a security’s amortized cost basis, excluding the effect of OTTI, exceeds its fair value) and determined the following: December 31, 2018 Gross Unrealized Losses Fair Value Amortized Cost Basis After Impairment Credit (A) Non-Credit (B) Securities New Residential intends to sell $ — $ — $ — $ — Securities New Residential is more likely than not to be required to sell — — — N/A Securities New Residential has no intent to sell and is not more likely than not to be required to sell: Credit impaired securities 1,155,566 1,204,729 (6,827 ) (49,163 ) Non-credit impaired securities 1,182,895 1,235,184 — (52,289 ) Total debt securities in an unrealized loss position $ 2,338,461 $ 2,439,913 $ (6,827 ) $ (101,452 ) (A) This amount is required to be recorded as OTTI through earnings. In measuring the portion of credit losses, New Residential estimates the expected cash flow for each of the securities. This evaluation includes a review of the credit status and the performance of the collateral supporting those securities, including the credit of the issuer, key terms of the securities and the effect of local, industry and broader economic trends. Significant inputs in estimating the cash flows include New Residential’s expectations of prepayment rates, default rates and loss severities. Credit losses are measured as the decline in the present value of the expected future cash flows discounted at the investment’s effective interest rate. (B) This amount represents unrealized losses on securities that are due to non-credit factors and recorded through other comprehensive income. The following table summarizes the activity related to credit losses on debt securities: Year Ended December 31, 2018 2017 Beginning balance of credit losses on debt securities for which a portion of an OTTI was recognized in other comprehensive income $ 23,821 $ 15,495 Increases to credit losses on securities for which an OTTI was previously recognized and a portion of an OTTI was recognized in other comprehensive income 16,924 3,903 Additions for credit losses on securities for which an OTTI was not previously recognized 13,093 6,431 Reductions for securities for which the amount previously recognized in other comprehensive income was recognized in earnings because the entity intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis — — Reduction for credit losses on securities for which no OTTI was recognized in other comprehensive income at the current measurement date — — Reduction for securities sold during the period (1,035 ) (2,008 ) Ending balance of credit losses on debt securities for which a portion of an OTTI was recognized in other comprehensive income $ 52,803 $ 23,821 The table below summarizes the geographic distribution of the collateral securing New Residential’s Non-Agency RMBS: December 31, 2018 2017 Geographic Location (A) Outstanding Face Amount Percentage of Total Outstanding Outstanding Face Amount Percentage of Total Outstanding Western U.S. $ 7,318,616 37.7 % $ 4,882,136 38.4 % Southeastern U.S. 4,613,314 23.8 % 3,005,519 23.6 % Northeastern U.S. 3,829,725 19.7 % 2,555,514 20.1 % Midwestern U.S. 2,063,263 10.6 % 1,337,980 10.5 % Southwestern U.S. 1,321,853 6.8 % 927,647 7.3 % Other (B) 250,833 1.4 % 18,871 0.1 % $ 19,397,604 100.0 % $ 12,727,667 100.0 % (A) Excludes $56.8 million and $29.7 million face amount of bonds backed by consumer loans and $85.0 million and $0.0 million face amount of bonds backed by corporate debt as of December 31, 2018 and December 31, 2017 , respectively. (B) Represents collateral for which New Residential was unable to obtain geographic information. New Residential evaluates the credit quality of its real estate securities, as of the acquisition date, for evidence of credit quality deterioration. As a result, New Residential identified a population of real estate securities for which it was determined that it was probable that New Residential would be unable to collect all contractually required payments. For securities acquired during the year ended December 31, 2018 , excluding residual and fair value option securities, the face amount of these real estate securities was $1,723.6 million , with total expected cash flows of $1,546.6 million and a fair value of $1,148.7 million on the dates that New Residential purchased the respective securities. For those securities acquired during the year ended December 31, 2017 , excluding residual and fair value option securities, the face amount was $3,148.3 million , the total expected cash flows were $2,699.7 million and the fair value was $1,836.1 million on the dates that New Residential purchased the respective securities. The following is the outstanding face amount and carrying value for securities, for which, as of the acquisition date, it was probable that New Residential would be unable to collect all contractually required payments, excluding residual and fair value option securities: Outstanding Face Amount Carrying Value December 31, 2018 $ 6,385,306 $ 4,217,242 December 31, 2017 5,364,847 3,493,723 The following is a summary of the changes in accretable yield for these securities: Year Ended December 31, 2018 2017 Beginning Balance $ 2,000,266 $ 1,200,125 Additions 397,934 863,681 Accretion (290,014 ) (215,018 ) Reclassifications from (to) non-accretable difference 156,070 218,675 Disposals (18,273 ) (67,197 ) Ending Balance $ 2,245,983 $ 2,000,266 See Note 11 regarding the financing of real estate securities. |
INVESTMENTS IN RESIDENTIAL MORT
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS | 12 Months Ended |
Dec. 31, 2018 | |
Receivables [Abstract] | |
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS | INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS New Residential accumulated its residential mortgage loan portfolio through various bulk acquisitions and the execution of call rights. As a result of the Shellpoint Acquisition, New Residential, through its wholly owned subsidiary, New Penn, originates residential mortgage loans for sale and securitization to third parties and generally retains the servicing rights on the underlying loans. Loans are accounted for based on New Residential’s strategy for the loan, and on whether the loan was credit-impaired at the date of acquisition. New Residential accounts for loans based on the following categories: • Loans Held-for-Investment (which may include PCD Loans) • Loans Held-for-Investment, at fair value • Loans Held-for-Sale, at lower of cost or fair value • Loans Held-for-Sale, at fair value • Real Estate Owned (“REO”) The following table presents certain information regarding New Residential’s residential mortgage loans outstanding by loan type, excluding REO: December 31, 2018 Outstanding Face Amount Carrying Loan Weighted Average Yield Weighted Average Life (Years) (A) Floating Rate Loans as a % of Face Amount LTV Ratio (B) Weighted Avg. Delinquency (C) Weighted Average FICO (D) Loan Type Performing Loans (G) (J) $ 636,874 $ 591,264 8,424 8.0 % 4.8 20.3 % 77.7 % 8.9 % 649 Purchased Credit Deteriorated Loans (H) 191,497 144,065 1,556 7.6 % 3.1 16.4 % 84.6 % 71.5 % 596 Total Residential Mortgage Loans, held-for-investment $ 828,371 $ 735,329 9,980 7.9 % 4.4 19.4 % 79.3 % 23.3 % 637 Reverse Mortgage Loans (E) (F) $ 13,807 $ 6,557 37 8.1 % 4.8 10.6 % 142.5 % 67.8 % N/A Performing Loans (G) (I) 408,724 413,883 7,144 4.4 % 3.9 56.6 % 61.3 % 9.0 % 670 Non-Performing Loans (H) (I) 621,700 512,040 5,029 5.5 % 3.0 14.9 % 88.1 % 72.6 % 588 Total Residential Mortgage Loans, held-for-sale $ 1,044,231 $ 932,480 12,210 5.1 % 3.4 31.2 % 78.3 % 47.6 % 621 Acquired Loans 2,295,340 2,153,269 12,873 4.5 % 8.0 7.7 % 75.7 % 14.0 % 626 Originated Loans 638,173 655,260 2,307 5.2 % 28.5 96.3 % 80.0 % 3.8 % 714 Total Residential Mortgage Loans, held-for-sale, at fair value (K) $ 2,933,513 $ 2,808,529 15,180 4.6 % 12.5 27.0 % 76.6 % 11.8 % 645 December 31, 2017 Loan Type Performing Loans (G) $ 557,381 $ 507,615 8,876 8.0 % 5.5 22.1 % 76.4 % 8.7 % 649 Purchased Credit Deteriorated Loans (H) 249,254 183,540 2,142 7.2 % 3.1 14.7 % 84.2 % 75.8 % 597 Total Residential Mortgage Loans, held-for-investment $ 806,635 $ 691,155 11,018 7.7 % 4.8 19.8 % 78.8 % 29.4 % 633 Reverse Mortgage Loans (E) (F) $ 16,755 $ 6,870 48 7.5 % 4.5 15.9 % 141.2 % 77.8 % N/A Performing Loans (G) (I) 1,044,116 1,071,371 15,464 4.0 % 4.8 10.2 % 53.2 % 7.0 % 654 Non-Performing Loans (H) (I) 846,181 647,293 5,597 5.6 % 4.3 18.7 % 94.4 % 63.3 % 581 Total Residential Mortgage Loans, held-for-sale $ 1,907,052 $ 1,725,534 21,109 4.8 % 4.6 14.0 % 72.2 % 32.6 % 622 (A) The weighted average life is based on the expected timing of the receipt of cash flows. (B) LTV refers to the ratio comparing the loan’s unpaid principal balance to the value of the collateral property. (C) Represents the percentage of the total principal balance that is 60+ days delinquent. (D) The weighted average FICO score is based on the weighted average of information updated and provided by the loan servicer on a monthly basis. (E) Represents a 70% participation interest that New Residential holds in a portfolio of reverse mortgage loans. Nationstar holds the other 30% interest and services the loans. The average loan balance outstanding based on total UPB was $0.5 million and $0.5 million at December 31, 2018 and 2017 , respectively. Approximately 54.9% and 54.3% of these loans have reached a termination event at December 31, 2018 and 2017 , respectively. As a result of the termination event, each such loan has matured and the borrower can no longer make draws on these loans. (F) FICO scores are not used in determining how much a borrower can access via a reverse mortgage loan. (G) Performing loans are generally placed on nonaccrual status when principal or interest is 120 days or more past due. (H) Includes loans with evidence of credit deterioration since origination where it is probable that New Residential will not collect all contractually required principal and interest payments. As of December 31, 2018 , New Residential has placed Non-Performing Loans, held-for-sale on nonaccrual status, except as described in (J) below. (I) Includes $24.3 million and $51.9 million UPB of Ginnie Mae EBO performing and non-performing loans as of December 31, 2018 , respectively, on accrual status as contractual cash flows are guaranteed by the FHA. As of December 31, 2017 , these amounts were $33.7 million and $66.5 million , respectively. (J) Includes $122.3 million UPB of non-agency mortgage loans underlying the SAFT 2013-1 securitization, which are carried at fair value based on New Residential’s election of the fair value option. Interest earned on loans measured at fair value are reported in other income. (K) New Residential elected the fair value option to measure these loans at fair value on a recurring basis. Interest earned on loans measured at fair value are reported in interest income. New Residential generally considers the delinquency status, loan-to-value ratios, and geographic area of residential mortgage loans as its credit quality indicators. Delinquency status is a primary credit quality indicator as loans that are more than 60 days past due provide an early warning of borrowers who may be experiencing financial difficulties. Current LTV ratio is an indicator of the potential loss severity in the event of default. Finally, the geographic distribution of the loan collateral also provides insight as to the credit quality of the portfolio, as factors such as the regional economy, home price changes and specific events will affect credit quality. The table below summarizes the geographic distribution of the underlying residential mortgage loans: Percentage of Total Outstanding Unpaid Principal Amount December 31, State Concentration 2018 2017 California 16.7 % 9.1 % New York 11.7 % 12.8 % Florida 8.8 % 8.2 % New Jersey 5.3 % 5.2 % Texas 4.7 % 6.6 % Illinois 4.0 % 3.9 % Maryland 3.6 % 2.7 % Pennsylvania 3.1 % 3.4 % Massachusetts 3.1 % 2.7 % Washington 1.5 % 1.7 % Other U.S. 37.5 % 43.7 % 100.0 % 100.0 % See Note 11 regarding the financing of residential mortgage loans and related assets. Call Rights New Residential has executed calls with respect to certain Non-Agency RMBS trusts and purchased performing and non-performing residential mortgage loans and REO assets contained in such trusts prior to their termination. In certain cases, New Residential sold portions of the purchased loans through securitizations, and retained bonds issued by such securitizations. In addition, New Residential received par on the securities issued by the called trusts which it owned prior to such trusts’ termination. For the year ended December 31, 2018 , New Residential executed calls on a total of 88 trusts and recognized $97.8 million of interest income on securities held in the collapsed trusts and $50.1 million of loss on securitizations accounted for as sales. Performing Loans The following table provides past due information regarding New Residential’s Performing Loans, which is an important indicator of credit quality and the establishment of the allowance for loan losses: December 31, 2018 Days Past Due Delinquency Status (A) Current 83.3 % 30-59 7.4 % 60-89 2.2 % 90-119 (B) 0.8 % 120+ (C) 6.3 % 100.0 % (A) Represents the percentage of the total principal balance that corresponds to loans that are in each delinquency status. (B) Includes loans 90-119 days past due and still accruing interest because they are generally placed on nonaccrual status at 120 days or more past due. (C) Represents nonaccrual loans. Activities related to the carrying value of residential mortgage loans held-for-investment were as follows: Performing Loans Balance at December 31, 2016 $ — Purchases/additional fundings 550,742 Proceeds from repayments (50,562 ) Accretion of loan discount (premium) and other amortization (A) 8,101 Provision for loan losses (646 ) Transfer of loans to other assets (B) — Transfer of loans to real estate owned (20 ) Balance at December 31, 2017 $ 507,615 Shellpoint Acquisition 125,350 Purchases/additional fundings 55,993 Proceeds from repayments (106,236 ) Accretion of loan discount (premium) and other amortization (A) 15,773 Provision for loan losses (1,028 ) Transfer of loans to other assets (B) — Transfer of loans to real estate owned (5,131 ) Transfers of loans to held for sale (1,555 ) Fair value adjustment 472 Balance at December 31, 2018 $ 591,253 (A) Includes accelerated accretion of discount on loans paid in full and on loans transferred to other assets. (B) Represents loans for which foreclosure has been completed and for which New Residential has made, or intends to make, a claim with the governmental agency that has guaranteed the loans that are now recognized as claims receivable in Other Assets (Note 2). Activities related to the valuation and loss provision on reverse mortgage loans and allowance for loan losses on performing loans held-for-investment were as follows: Performing Loans Balance at December 31, 2016 $ — Provision for loan losses (A) 646 Charge-offs (B) (450 ) Balance at December 31, 2017 $ 196 Provision for loan losses (A) 1,028 Charge-offs (B) (1,224 ) Balance at December 31, 2018 $ — (A) Based on an analysis of collective borrower performance, credit ratings of borrowers, loan-to-value ratios, estimated value of the underlying collateral, key terms of the loans and historical and anticipated trends in defaults and loss severities at a pool level. (B) Loans, other than PCD loans, are generally charged off or charged down to the net realizable value of the collateral (i.e., fair value less costs to sell), with an offset to the allowance for loan losses, when available information confirms that loans are uncollectible. Purchased Credit Deteriorated Loans New Residential determined at acquisition that the PCD loans acquired would be aggregated into pools based on common risk characteristics (FICO score, delinquency status, collateral type, loan-to-value ratio). Loans aggregated into pools are accounted for as if each pool were a single loan with a single composite interest rate and an aggregate expectation of cash flows, including consideration of involuntary prepayments. Activities related to the carrying value of PCD loans held-for-investment were as follows: Balance at December 31, 2016 $ 190,761 Purchases/additional fundings 58,884 Sales — Proceeds from repayments (32,455 ) Accretion of loan discount and other amortization 20,217 (Allowance) reversal for loan losses (A) (1,488 ) Transfer of loans to real estate owned (29,299 ) Transfer of loans to held-for-sale (23,080 ) Balance at December 31, 2017 $ 183,540 Purchases/additional fundings 29,785 Sales — Proceeds from repayments (38,276 ) Accretion of loan discount and other amortization 24,124 (Allowance) reversal for loan losses — Transfer of loans to real estate owned (28,060 ) Transfer of loans to held-for-sale (27,048 ) Balance at December 31, 2018 $ 144,065 (A) An allowance represents the present value of cash flows expected at acquisition that are no longer expected to be collected. A reversal results from an increase to expected cash flows that reverses a prior allowance. The following is the contractually required payments receivable, cash flows expected to be collected, and fair value at acquisition date for PCD loans acquired during the year ended December 31, 2018 : Contractually Required Payments Receivable Cash Flows Expected to be Collected Fair Value As of Acquisition Date 65,902 45,429 29,785 The following is the unpaid principal balance and carrying value for loans, for which, as of the acquisition date, it was probable that New Residential would be unable to collect all contractually required payments: Unpaid Principal Balance Carrying Value December 31, 2018 $ 191,497 $ 144,065 December 31, 2017 249,254 183,540 The following is a summary of the changes in accretable yield for these loans: Balance at December 31, 2016 $ 23,688 Additions 21,860 Accretion (20,217 ) Reclassifications from non-accretable difference (A) 66,751 Disposals (B) (3,451 ) Transfer of loans to held-for-sale (C) — Balance at December 31, 2017 $ 88,631 Additions 15,644 Accretion (24,124 ) Reclassifications from non-accretable difference (A) 5,493 Disposals (B) (7,257 ) Transfer of loans to held-for-sale (C) (9,755 ) Balance at December 31, 2018 $ 68,632 (A) Represents a probable and significant increase in cash flows previously expected to be uncollectible. (B) Includes sales of loans or foreclosures, which result in removal of the loan from the PCD loan pool at its carrying amount. (C) Represents loans not initially acquired with the intent to sell for which New Residential determined that it no longer has the intent to hold for the foreseeable future, or until maturity or payoff. Loans Held-for-Sale, at Lower of Cost or Fair Value Activities related to the carrying value of loans held-for-sale were as follows: Balance at December 31, 2016 $ 696,665 Purchases (A) 5,135,700 Transfer of loans from held-for-investment (B) 23,080 Sales (3,901,161 ) Transfer of loans to other assets (C) (17,487 ) Transfer of loans to real estate owned (71,756 ) Proceeds from repayments (125,987 ) Valuation (provision) reversal on loans (D) (13,520 ) Balance at December 31, 2017 $ 1,725,534 Purchases (A) 3,653,608 Transfer of loans from held-for-investment (B) 28,603 Sales (4,205,375 ) Transfer of loans to other assets (C) (9,811 ) Transfer of loans to real estate owned (54,114 ) Proceeds from repayments (195,797 ) Valuation (provision) reversal on loans (D) (10,168 ) Balance at December 31, 2018 $ 932,480 (A) Represents loans acquired with the intent to sell. (B) Represents loans not initially acquired with the intent to sell for which New Residential determined that it no longer has the intent to hold for the foreseeable future, or until maturity or payoff. (C) Represents loans for which foreclosure has been completed and for which New Residential has made, or intends to make, a claim with the governmental agency that has guaranteed the loans that are now recognized as claims receivable in Other Assets (Note 2). (D) Represents the fair value adjustments to loans upon transfer to held-for-sale and provision recorded on certain purchased held-for-sale loans, including an aggregate of $59.2 million and $30.1 million of provision related to the call transactions executed during the years ended December 31, 2018 and 2017 , respectively. Loans Held-for-Sale, at Fair Value Activities related to the carrying value of originated loans held-for-sale, at fair value were as follows: Balance at December 31, 2017 $ — Shellpoint acquisition 488,233 Originations 3,439,574 Sales (3,269,689 ) Proceeds from repayments (6,348 ) Change in fair value 3,490 Balance at December 31, 2018 $ 655,260 Activities related to the carrying value of acquired loans held-for-sale, at fair value were as follows: Balance at December 31, 2017 $ — Purchases 2,088,638 Sales — Proceeds from repayments (3,963 ) Transfer of loans to real estate owned (753 ) Change in fair value 69,347 Balance at December 31, 2018 $ 2,153,269 Gain on Sale of Originated Mortgage Loans, Net New Penn, a wholly owned subsidiary of New Residential, originates conventional, government-insured and nonconforming residential mortgage loans for sale and securitization. The GSEs or Ginnie Mae guarantee conventional and government insured mortgage securitizations and mortgage investors issue nonconforming private label mortgage securitizations while New Penn generally retains the right to service the underlying residential mortgage loans. In connection with the transfer of loans to the GSEs or mortgage investors, New Residential reports gain on sale of originated mortgage loans, net in its Consolidated Statements of Income. Gain on sale of originated mortgage loans, net is summarized below: Gain on loans originated and sold (A) $ 38,415 Gain (loss) on settlement of mortgage loan origination derivative instruments (B) 1,234 MSRs retained on transfer of loans (C) 35,311 Other (D) 14,057 Gain on sale of originated mortgage loans, net $ 89,017 (A) Includes loan origination fees and direct loan origination costs. Other indirect costs related to loan origination are included within general and administrative expenses. (B) Represents settlement of forward securities delivery commitments utilized as an economic hedge for mortgage loans not included within forward loan sale commitments. (C) Represents the initial fair value of the capitalized mortgage servicing rights upon loan sales with servicing retained. (D) Includes fees for services associated with the loan origination process. Real estate owned (REO) New Residential recognizes REO assets at the completion of the foreclosure process or upon execution of a deed in lieu of foreclosure with the borrower. REO assets are managed for prompt sale and disposition at the best possible economic value. Real Estate Owned Balance at December 31, 2016 $ 59,591 Purchases 38,127 Transfer of loans to real estate owned 124,013 Sales (A) (95,456 ) Valuation provision on REO 2,020 Balance at December 31, 2017 $ 128,295 Purchases 33,377 Transfer of loans to real estate owned 107,577 Sales (A) (152,725 ) Valuation (provision) reversal on REO (3,114 ) Balance at December 31, 2018 $ 113,410 (A) Recognized when control of the property has transferred to the buyer. As of December 31, 2018 , New Residential had residential mortgage loans that were in the process of foreclosure with an unpaid principal balance of $273.5 million . In addition, New Residential has recognized $20.8 million in unpaid claims receivable from FHA on Ginnie Mae EBO loans and reverse mortgage loans for which foreclosure has been completed and for which New Residential has made, or intends to make, a claim. Variable Interest Entities During the second quarter of 2017, New Residential formed entities (the “RPL Borrowers”) that issued securitized debt collateralized by reperforming residential mortgage loans. New Residential determined that the RPL Borrowers should be evaluated for consolidation under the VIE model rather than the voting interest entity model as the equity holders as a group lack the characteristics of a controlling financial interest. Under the VIE model, New Residential’s consolidated subsidiaries had both 1) the power to direct the most significant activities of the RPL Borrowers and 2) significant variable interests in each of the RPL Borrowers, through their control of the related optional redemption feature and their ownership of certain notes issued by the RPL Borrowers and, therefore, met the primary beneficiary criterion and consolidated the RPL Borrowers. On April 3, 2018, New Residential executed a Trust Termination Agreement in order to terminate the RPL Borrowers and redeem the underlying residential mortgage loans. As a result of the termination, New Residential liquidated the RPL Borrowers. A wholly owned subsidiary of New Penn, Shelter, is a mortgage originator specializing in retail origination. Shelter operates its business through a series of joint ventures and was deemed to be the primary beneficiary of the joint ventures as a result of its ability to direct activities that most significantly impact the economic performance of the entities and its ownership of a significant equity investment. The following table presents information on the assets and liabilities of the Shelter JVs: As of December 31, 2018 Assets Cash and cash equivalents $ 17,346 Property and equipment, net 137 Intangible assets, net 70 Prepaid expenses and other assets 411 Total assets $ 17,964 Liabilities Accounts payable and accrued expenses $ 1,315 Reserve for sales recourse 967 Total liabilities $ 2,282 Noncontrolling Interests Noncontrolling interests in the equity of the Shelter JVs is computed as follows: December 31, 2018 Total consolidated equity of JVs $ 15,682 Noncontrolling ownership interest 51.0 % Noncontrolling equity interest in consolidated JVs $ 7,998 Total consolidated net income of JVs $ 3,135 Noncontrolling ownership interest in net income 51.0 % Noncontrolling interest in net income of consolidated JVs $ 1,599 As described in “Call Rights” above, New Residential has issued securitizations which were treated as sales under GAAP. New Residential has no obligation to repurchase any loans from these securitizations and its exposure to loss is limited to the carrying amount of its retained interests in the securitization entities. These securitizations are conducted through variable interest entities, of which New Residential is not the primary beneficiary. Additionally, New Penn, a wholly owned subsidiary of New Residential, was deemed to be the primary beneficiary of the SAFT 2013-1 securitization entity as a result of its ability to direct activities that most significantly impact the economic performance of the entity in its role as servicer and its ownership of subordinate retained interests. The following table summarizes certain characteristics of the underlying residential mortgage loans, and related financing, in these securitizations as of December 31, 2018 : Residential mortgage loan UPB $ 7,818,221 Weighted average delinquency (A) 1.97 % Net credit losses for the year ended December 31, 2018 $ 9,101 Face amount of debt held by third parties (B) $ 6,783,187 Carrying value of bonds retained by New Residential (C) $ 1,206,402 Cash flows received by New Residential on these bonds for the year ended December 31, 2018 $ 178,301 (A) Represents the percentage of the UPB that is 60 + days delinquent. (B) Excludes bonds retained by New Residential. (C) Includes bonds retained pursuant to required risk retention regulations. |
INVESTMENTS IN CONSUMER LOANS
INVESTMENTS IN CONSUMER LOANS | 12 Months Ended |
Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
INVESTMENTS IN CONSUMER LOANS | INVESTMENTS IN CONSUMER LOANS New Residential, through limited liability companies (together, the “Consumer Loan Companies”), has a co-investment in a portfolio of consumer loans. The portfolio includes personal unsecured loans and personal homeowner loans. OneMain is the servicer of the loans and provides all servicing and advancing functions for the portfolio. As of December 31, 2018 , New Residential owns 53.5% of the limited liability company interests in, and consolidates, the Consumer Loan Companies. New Residential also purchased consumer loans from a third party (“Consumer Loan Seller”). These loans are not held in the Consumer Loan Companies and have been designated as performing consumer loans, held-for-investment. In addition, see “Equity Method Investees” below. The following table summarizes the investment in consumer loans, held-for-investment held by New Residential: Unpaid Principal Balance Interest in Consumer Loans Carrying Value Weighted Average Coupon Weighted Average Expected Life (Years) (A) Weighted Average Delinquency (B) December 31, 2018 Consumer Loan Companies Performing Loans $ 815,341 53.5 % $ 856,563 18.8 % 3.6 5.4 % Purchased Credit Deteriorated Loans (C) 221,910 53.5 % 182,917 16.0 % 3.4 11.6 % Other - Performing Loans 35,326 100.0 % 32,722 14.2 % 0.8 5.6 % Total Consumer Loans, held-for-investment $ 1,072,577 $ 1,072,202 18.1 % 3.5 6.7 % December 31, 2017 Consumer Loan Companies Performing Loans $ 1,005,570 53.5 % $ 1,052,561 18.7 % 3.7 6.0 % Purchased Credit Deteriorated Loans (C) 282,540 53.5 % 236,449 16.2 % 3.3 12.5 % Other - Performing Loans 89,682 100.0 % 85,253 14.1 % 1.0 4.5 % Total Consumer Loans, held-for-investment $ 1,377,792 $ 1,374,263 17.9 % 3.5 7.3 % (A) Represents the weighted average expected timing of the receipt of expected cash flows for this investment. (B) Represents the percentage of the total unpaid principal balance that is 30+ days delinquent. Delinquency status is the primary credit quality indicator as it provides early warning of borrowers who may be experiencing financial difficulties. (C) Includes loans with evidence of credit deterioration since origination where it is probable that New Residential will not collect all contractually required principal and interest payments, which are accounted for as PCD loans. See Note 11 regarding the financing of consumer loans. Performing Loans The following table provides past due information regarding New Residential’s performing consumer loans, held-for-investment, which is an important indicator of credit quality and the establishment of the allowance for loan losses: December 31, 2018 Days Past Due Delinquency Status (A) Current 94.7 % 30-59 2.0 % 60-89 1.3 % 90-119 (B) 0.8 % 120+ (B) (C) 1.2 % 100.0 % (A) Represents the percentage of the total unpaid principal balance that corresponds to loans that are in each delinquency status. (B) Includes loans more than 90 days past due and still accruing interest. (C) Interest is accrued up to the date of charge-off at 180 days past due. Activities related to the carrying value of performing consumer loans, held-for-investment were as follows: Performing Loans Balance at December 31, 2016 $ 1,482,954 Purchases — Additional fundings (A) 56,321 Proceeds from repayments (329,843 ) Accretion of loan discount and premium amortization, net 4,891 Gross charge-offs (73,842 ) Additions to the allowance for loan losses, net (2,667 ) Balance at December 31, 2017 $ 1,137,814 Purchases Additional fundings (A) 63,971 Proceeds from repayments (257,182 ) Accretion of loan discount and premium amortization, net 1,940 Gross charge-offs (56,870 ) Additions to the allowance for loan losses, net (388 ) Balance at December 31, 2018 $ 889,285 (A) Represents draws on consumer loans with revolving privileges. Activities related to the allowance for loan losses on performing consumer loans, held-for-investment were as follows: Collectively Evaluated (A) Individually Impaired (B) Total Balance at December 31, 2016 $ 2,441 $ 997 $ 3,438 Provision for loan losses 65,059 679 65,738 Net charge-offs (C) (63,071 ) — (63,071 ) Balance at December 31, 2017 $ 4,429 $ 1,676 $ 6,105 Provision (reversal) for loan losses 47,839 388 48,227 Net charge-offs (C) (49,664 ) — (49,664 ) Balance at December 31, 2018 $ 2,604 $ 2,064 $ 4,668 (A) Represents smaller-balance homogeneous loans that are not individually considered impaired and are evaluated based on an analysis of collective borrower performance, key terms of the loans and historical and anticipated trends in defaults and loss severities, and consideration of the unamortized acquisition discount. (B) Represents consumer loan modifications considered to be troubled debt restructurings (“TDRs”) as they provide concessions to borrowers, primarily in the form of interest rate reductions, who are experiencing financial difficulty. As of December 31, 2018 , there are $14.2 million in UPB and $12.6 million in carrying value of consumer loans classified as TDRs. (C) Consumer loans, other than PCD loans, are charged off when available information confirms that loans are uncollectible, which is generally when they become 180 days past due. Charge-offs are presented net of $9.0 million and $10.8 million in recoveries of previously charged-off UPB in 2018 and 2017 , respectively. Purchased Credit Deteriorated Loans A portion of the consumer loans are considered PCD loans. Activities related to the carrying value of PCD consumer loans, held-for-investment were as follows: Balance at December 31, 2016 $ 316,532 (Allowance) reversal for loan losses (A) 3,013 Proceeds from repayments (123,932 ) Accretion of loan discount and other amortization 40,836 Balance at December 31, 2017 $ 236,449 (Allowance) reversal for loan losses (A) (31 ) Proceeds from repayments (90,700 ) Accretion of loan discount and other amortization 37,199 Balance at December 31, 2018 $ 182,917 (A) An allowance represents the present value of cash flows expected at acquisition that are no longer expected to be collected. A reversal results from an increase to expected cash flows that reverses a prior allowance. The following is the unpaid principal balance and carrying value for consumer loans, for which, as of the acquisition date, it was probable that New Residential would be unable to collect all contractually required payments: Unpaid Principal Balance Carrying Value December 31, 2018 $ 221,910 $ 182,917 December 31, 2017 282,540 236,449 The following is a summary of the changes in accretable yield for these loans: Balance at December 31, 2016 $ 167,928 Accretion (40,836 ) Reclassifications from (to) non-accretable difference (A) 5,199 Balance at December 31, 2017 $ 132,291 Accretion (37,199 ) Reclassifications from (to) non-accretable difference (A) 31,426 Balance at December 31, 2018 $ 126,518 (A) Represents a probable and significant increase in cash flows previously expected to be uncollectible. Noncontrolling Interests Others’ interests in the equity of the Consumer Loan Companies is computed as follows: December 31, 2018 2017 Total Consumer Loan Companies equity $ 66,105 $ 74,071 Others’ ownership interest 46.5 % 46.5 % Others’ interests in equity of consolidated subsidiary $ 30,561 $ 34,466 Others’ interests in the Consumer Loan Companies’ net income (loss) is computed as follows: Year Ended December 31, 2018 2017 Net Consumer Loan Companies income (loss) $ 79,539 $ 98,692 Others’ ownership interest as a percent of total 46.5 % 46.5 % Others’ interest in net income (loss) of consolidated subsidiaries $ 36,987 $ 45,892 Variable Interest Entities The Consumer Loan Companies consolidate certain entities that issued securitized debt collateralized by the consumer loans (the “Consumer Loan SPVs”). New Residential determined that the Consumer Loan SPVs should be evaluated for consolidation under the VIE model rather than the voting interest entity model as the equity holders, individually and as a group, lack the characteristics of a controlling financial interest. Under the VIE model, New Residential’s consolidated subsidiaries, the Consumer Loan Companies (Note 9), have both 1) the power to direct the most significant activities of the Consumer Loan SPVs and 2) significant variable interests in each of the Consumer Loan SPVs, through their control of the related optional redemption feature and their ownership of certain notes issued by the Consumer Loan SPVs and, therefore, meet the primary beneficiary criterion and consolidate the Consumer Loan SPVs. As of December 31, 2018 2017 Assets Consumer loans, held-for-investment $ 1,039,480 $ 1,289,010 Restricted cash 10,186 11,563 Accrued interest receivable 15,627 19,360 Total assets (A) $ 1,065,293 $ 1,319,933 Liabilities Notes and bonds payable (B) $ 1,030,096 $ 1,284,436 Accounts payable and accrued expenses 3,814 4,007 Total liabilities (A) $ 1,033,910 $ 1,288,443 (A) The creditors of the Consumer Loan SPVs do not have recourse to the general credit of New Residential, and the assets of the Consumer Loan SPVs are not directly available to satisfy New Residential’s obligations. (B) Includes $121.0 million face amount of bonds retained by New Residential issued by these VIEs. Equity Method Investees In February 2017, New Residential completed a co-investment, through a newly formed entity, PF LoanCo Funding LLC (“LoanCo”), to purchase up to $5.0 billion worth of newly originated consumer loans from Consumer Loan Seller over a two year term. New Residential, along with three co-investors, each acquired 25% membership interests in LoanCo. New Residential accounts for its investment in LoanCo pursuant to the equity method of accounting because it can exercise significant influence over LoanCo but the requirements for consolidation are not met. New Residential’s investment in LoanCo is recorded as Investment in Consumer Loans, Equity Method Investees. LoanCo has elected to account for its investments in consumer loans at fair value. New Residential does not receive information from LoanCo Funding LLC in sufficient time to record its equity method ownership at the end of each month. Accordingly, New Residential records the activity on a one month lag, and reviews the current month’s information when it becomes available to determine if an adjustment needs to be recorded. To date, this one month lag has not caused a material impact to the quarterly financial statement closing process. In addition, New Residential and the LoanCo co-investors agreed to purchase warrants to purchase up to 177.7 million shares of Series F convertible preferred stock in the Consumer Loan Seller’s parent company (“ParentCo”), which were valued at approximately $75.0 million in the aggregate as of February 2017, through a newly formed entity, PF WarrantCo Holdings, LP (“WarrantCo”). New Residential acquired a 23.57% interest in WarrantCo, the remaining interest being acquired by three co-investors. WarrantCo has agreed to purchase a pro rata portion of the warrants each time LoanCo closes on a portion of its consumer loan purchase agreement from Consumer Loan Seller. The holder of the warrants has the option to purchase an equivalent number of shares of Series F convertible preferred stock in ParentCo at a price of $0.01 per share. WarrantCo is vested in the warrants to purchase an aggregate of 117.8 million Series F convertible preferred stock in ParentCo as of November 30, 2018 , and New Residential and LoanCo co-investors are vested in the warrants to purchase an aggregate of 30.0 million Series F convertible preferred stock in ParentCo as of November 30, 2018 . The Series F convertible preferred stock holders have the right to convert such preferred stock to common stock at any time, are entitled to the number of votes equal to the number of shares of common stock into which such shares of convertible preferred stock could be converted, and will have liquidation rights in the event of liquidation. New Residential accounts for its investment in WarrantCo pursuant to the equity method of accounting because it can exercise significant influence over WarrantCo but the requirements for consolidation are not met. New Residential’s investment in WarrantCo is recorded as Investment in Consumer Loans, Equity Method Investees. WarrantCo has elected to account for its investments in warrants at fair value. New Residential has elected to record WarrantCo’s activity on a one month lag and to date this one month lag has not caused a material impact to New Residential’s consolidated financial statements. The following tables summarize the investment in LoanCo and WarrantCo held by New Residential: December 31, 2018 (A) December 31, 2017 Consumer loans, at fair value $ 231,560 $ 178,422 Warrants, at fair value 103,067 80,746 Other assets 25,971 46,342 Warehouse financing (182,065 ) (117,944 ) Other liabilities (1,142 ) (13,059 ) Equity $ 177,391 $ 174,507 Undistributed retained earnings $ — $ — New Residential’s investment $ 42,875 $ 42,473 New Residential’s ownership 24.2 % 24.3 % Year Ended December 31, 2018 (A) Interest income $ 42,920 Interest expense (12,258 ) Change in fair value of consumer loans and warrants 17,491 Gain on sale of consumer loans (B) 2,697 Other expenses (7,257 ) Net income $ 43,593 New Residential’s equity in net income $ 10,803 New Residential’s ownership 24.8 % (A) Data as of, and for the periods ended, November 30, 2018 , as a result of the one month reporting lag. (B) During the year ended December 31, 2018 , LoanCo sold, through securitizations which were treated as sales for accounting purposes, $1.2 billion in UPB of consumer loans. LoanCo retained $103.0 million of residual interests in the securitizations and distributed them to the LoanCo co-investors, including New Residential. The following is a summary of LoanCo’s consumer loan investments: Unpaid Principal Balance Interest in Consumer Loans Carrying Value Weighted Average Coupon Weighted Average Expected Life (Years) (A) Weighted Average Delinquency (B) December 31, 2018 (C) $ 231,560 25.0 % $ 231,560 14.2 % 1.3 0.4 % (A) Represents the weighted average expected timing of the receipt of expected cash flows for this investment. (B) Represents the percentage of the total unpaid principal balance that is 30+ days delinquent. Delinquency status is the primary credit quality indicator as it provides early warning of borrowers who may be experiencing financial difficulties. (C) Data as of November 30, 2018 as a result of the one month reporting lag. New Residential’s investment in LoanCo and WarrantCo changed as follows: Balance at December 31, 2017 $ 51,412 Contributions to equity method investees 308,050 Distributions of earnings from equity method investees (6,176 ) Distributions of capital from equity method investees (325,795 ) Earnings from investments in consumer loans, equity method investees 10,803 Balance at December 31, 2018 $ 38,294 |
DERIVATIVES
DERIVATIVES | 12 Months Ended |
Dec. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVES | DERIVATIVES New Residential uses interest rate swaps and interest rate caps as economic hedges to hedge a portion of its interest rate risk exposure. Interest rate risk is sensitive to many factors, including governmental monetary and tax policies, domestic and international economic and political considerations, as well as other factors. New Residential’s credit risk with respect to economic hedges is the risk of default on New Residential’s investments that results from a borrower’s or counterparty’s inability or unwillingness to make contractually required payments. As of December 31, 2018 , New Residential held to-be-announced forward contract positions (“TBAs”) which was entered into as an economic hedge in order to mitigate New Residential’s interest rate risk on certain specified mortgage backed securities and any amounts or obligations owed by or to New Residential are subject to the right of set-off with the TBA counterparty. As part of executing these trades, New Residential has entered into agreements with its TBA counterparties that govern the transactions for the TBA purchases or sales made, including margin maintenance, payment and transfer, events of default, settlements, and various other provisions. New Residential has fulfilled all obligations and requirements entered into under these agreements. In addition, as of December 31, 2018 , New Residential held interest rate lock commitments (“IRLCs”), which represent a commitment to a particular interest rate provided the borrower is able to close the loan within a specified period, and forward loan sale and securities delivery commitments, which represent a commitment to sell specific mortgage loans at prices which are fixed as of the forward commitment date. New Residential enters into forward loan sale and securities delivery commitments in order to hedge the exposure related to IRLCs and mortgage loans that are not covered by mortgage loan sale commitments. New Residential’s derivatives are recorded at fair value on the Consolidated Balance Sheets as follows: December 31, Balance Sheet Location 2018 2017 Derivative assets Interest Rate Caps Other assets $ 3 $ 2,423 Interest Rate Lock Commitments Other assets 10,851 — Forward Loan Sale Commitments Other assets 39 — $ 10,893 $ 2,423 Derivative liabilities Interest Rate Swaps (A) Accrued expenses and other liabilities $ 5,245 $ — Interest Rate Lock Commitments Accrued expenses and other liabilities 223 — TBAs Accrued expenses and other liabilities 23,921 697 $ 29,389 $ 697 (A) Net of $106.1 million of related variation margin accounts as of December 31, 2018 . As of December 31, 2017 , no variation margin accounts existed. The following table summarizes notional amounts related to derivatives: December 31, 2018 2017 Interest Rate Caps (A) $ 50,000 $ 772,500 Interest Rate Swaps (B) 4,725,000 — Interest Rate Lock Commitments 823,187 — Forward Loan Sale Commitments 30,274 — TBAs, short position (C) 5,904,300 3,101,100 TBAs, long position (C) 5,067,200 — 1,014,000 (A) As of December 31, 2018 , caps LIBOR at 4.00% for $50.0 million of notional. The weighted average maturity of the interest rate caps as of December 31, 2018 was 23 months. (B) Receive LIBOR and pay a fixed rate. The weighted average maturity of the interest rate swaps was 52 months and the weighted average fixed pay rate was 3.21% as of December 31, 2018 . There were no interest rate swaps outstanding at December 31, 2017 . (C) Represents the notional amount of Agency RMBS, classified as derivatives. The following table summarizes all income (losses) recorded in relation to derivatives: Year Ended December 31, 2018 2017 2016 Other income (loss), net (A) Interest Rate Caps $ 431 $ 323 $ 688 Interest Rate Swaps (108,098 ) (720 ) 5,500 Unrealized gains(losses) on Interest Rate Lock Commitments 23 — — Forward Loan Sale Commitments (283 ) — — TBAs (5,631 ) (1,793 ) (414 ) (113,558 ) (2,190 ) 5,774 Gain (loss) on settlement of investments, net Interest Rate Caps $ (603 ) $ (1,911 ) $ (4,754 ) Interest Rate Swaps 65,823 6,921 (4,810 ) TBAs (B) (10,353 ) (44,224 ) (17,927 ) 54,867 (39,214 ) (27,491 ) Total income (losses) $ (58,691 ) $ (41,404 ) $ (21,717 ) (A) Represents unrealized gains (losses). (B) Excludes $1.2 million in loss on settlement included within gain on sale of originated mortgage loans, net (Note 8). |
DEBT OBLIGATIONS
DEBT OBLIGATIONS | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
DEBT OBLIGATIONS | DEBT OBLIGATIONS The following table presents certain information regarding New Residential’s debt obligations: December 31, 2018 December 31, 2017 Collateral Debt Obligations/Collateral Outstanding Face Amount Carrying Value (A) Final Stated Maturity (B) Weighted Average Funding Cost Weighted Average Life (Years) Outstanding Face Amortized Cost Basis Carrying Value Weighted Average Life (Years) Carrying Value (A) Repurchase Agreements (C) Agency RMBS (D) $ 4,346,070 $ 4,346,070 Jan-19 to Feb-19 2.66 % 0.1 $ 4,462,104 $ 4,492,912 $ 4,533,921 2.1 $ 1,974,164 Non-Agency RMBS (E) 7,434,950 7,434,785 Jan-19 to Aug-19 3.54 % 0.1 17,057,929 8,459,512 8,877,653 7.0 4,720,290 Residential Mortgage Loans (F) 3,679,239 3,678,246 Feb-19 to Dec-20 4.24 % 0.6 4,498,036 4,222,366 4,218,615 11.9 1,849,004 Real Estate Owned (G) (H) 94,897 94,868 Feb-19 to Dec-20 4.38 % 0.8 N/A N/A 116,381 N/A 118,681 Total Repurchase Agreements 15,555,156 15,553,969 3.46 % 0.3 8,662,139 Notes and Bonds Payable Excess MSRs (I) 297,759 297,563 Feb-20 to Jul-22 5.15 % 2.7 119,363,054 372,901 470,498 5.7 483,978 MSRs (J) 2,368,885 2,360,856 Feb-19 to Jul-24 4.32 % 2.8 365,610,961 3,496,265 4,241,604 6.7 1,157,179 Servicer Advances (K) 3,386,234 3,382,455 Mar-19 to Dec-21 3.52 % 1.7 3,824,237 3,999,597 4,013,642 1.5 4,060,156 Residential Mortgage Loans (L) 122,816 122,465 Jan-19 to Jul-43 3.74 % 7.6 130,399 127,021 124,593 7.8 137,196 Consumer Loans (M) 939,735 936,447 Dec-21 to Mar-24 3.41 % 2.8 1,072,431 1,076,725 1,072,056 3.5 1,242,756 Receivable from government agency (L) 2,480 2,480 Jan-19 4.54 % 0.1 N/A N/A 1,736 N/A 3,126 Total Notes and Bonds Payable 7,117,909 7,102,266 3.84 % 2.4 7,084,391 Total/Weighted Average $ 22,673,065 $ 22,656,235 3.58 % 0.9 $ 15,746,530 (A) Net of deferred financing costs. (B) All debt obligations with a stated maturity through the date of issuance were refinanced, extended or repaid. (C) These repurchase agreements had approximately $38.8 million of associated accrued interest payable as of December 31, 2018 . (D) All of the Agency RMBS repurchase agreements have a fixed rate. Collateral amounts include approximately $3.9 billion of related trade and other receivables. (E) $7,193.4 million face amount of the Non-Agency RMBS repurchase agreements have LIBOR-based floating interest rates while the remaining $241.5 million face amount of the Non-Agency RMBS repurchase agreements have a fixed rate. This includes repurchase agreements of $163.6 million on retained servicer advance and consumer loan bonds. (F) All of these repurchase agreements have LIBOR-based floating interest rates. (G) All of these repurchase agreements have LIBOR-based floating interest rates. (H) Includes financing collateralized by receivables including claims from FHA on Ginnie Mae EBO loans for which foreclosure has been completed and for which New Residential has made or intends to make a claim on the FHA guarantee. (I) Includes $197.8 million of corporate loans which bear interest equal to the sum of (i) a floating rate index equal to one-month LIBOR and (ii) a margin of 3.00% , and includes $100.0 million of corporate loans which bear interest equal to the sum of (i) a floating rate index equal to one-month LIBOR and (ii) a margin of 2.50% . The outstanding face amount of the collateral represents the UPB of the residential mortgage loans underlying the interests in MSRs that secure these notes. (J) Includes: $645.3 million of MSR notes which bear interest equal to the sum of (i) a floating rate index equal to one-month LIBOR and (ii) a margin ranging from 2.25% to 2.75% , and $1,723.6 million of public notes with fixed interest rates ranging from 3.55% to 4.62% . The outstanding face amount of the collateral represents the UPB of the residential mortgage loans underlying the MSRs and mortgage servicing rights financing receivables that secure these notes. (K) $2.9 billion face amount of the notes have a fixed rate while the remaining notes bear interest equal to the sum of (i) a floating rate index equal to one-month LIBOR or a cost of funds rate, as applicable, and (ii) a margin ranging from 2.0% to 2.2% . Collateral includes Servicer Advance Investments, as well as servicer advances receivable related to the mortgage servicing rights and mortgage servicing rights financing receivables owned by NRM. (L) Represents: (i) a $7.7 million note payable to Nationstar that bears interest equal to one-month LIBOR plus 2.88% , and (ii) $117.0 million fair value of SAFT 2013-1 mortgage-backed securities issued with fixed interest rates ranging from 3.50% to 3.76% (see Note 12 for details). (M) Includes the SpringCastle debt, which is comprised of the following classes of asset-backed notes held by third parties: $671.0 million UPB of Class A notes with a coupon of 3.05% and a stated maturity date in November 2023; $210.8 million UPB of Class B notes with a coupon of 4.10% and a stated maturity date in March 2024; $18.3 million UPB of Class C-1 notes with a coupon of 5.63% and a stated maturity date in March 2024; $18.3 million UPB of Class C-2 notes with a coupon of 5.63% and a stated maturity date in March 2024. Also includes a $21.3 million face amount note which bears interest equal to 4.00% . As of December 31, 2018 , New Residential had no outstanding repurchase agreements where the amount at risk with any individual counterparty or group of related counterparties exceeded 10% of New Residential’s stockholders' equity. The amount at risk under repurchase agreements is defined as the excess of carrying amount (or market value, if higher than the carrying amount) of the securities or other assets sold under agreement to repurchase, including accrued interest plus any cash or other assets on deposit to secure the repurchase obligation, over the amount of the repurchase liability (adjusted for accrued interest). General Certain of the debt obligations included above are obligations of New Residential’s consolidated subsidiaries, which own the related collateral. In some cases, such collateral is not available to other creditors of New Residential. New Residential has margin exposure on $15.6 billion of repurchase agreements as of December 31, 2018 . To the extent that the value of the collateral underlying these repurchase agreements declines, New Residential may be required to post margin, which could significantly impact its liquidity. Activities related to the carrying value of New Residential’s debt obligations were as follows: Excess MSRs MSRs Servicer Advances (A) Real Estate Securities Residential Mortgage Loans and REO Consumer Loans Total Balance at December 31, 2016 $ 729,145 $ — $ 5,549,872 $ 4,419,002 $ 783,006 $ 1,700,211 $ 13,181,236 Repurchase Agreements: Borrowings — — — 55,233,007 2,529,556 — 57,762,563 Repayments — — — (52,957,555 ) (1,334,952 ) — (54,292,507 ) Capitalized deferred financing costs, net of amortization — — — — 1,449 — 1,449 Notes and Bonds Payable: Borrowings 1,400,354 1,172,058 5,344,985 — 140,323 — 8,057,720 Repayments (1,650,409 ) (13,973 ) (6,838,862 ) — (11,375 ) (456,904 ) (8,971,523 ) Discount on borrowings, net of amortization — — (147 ) — — (700 ) (847 ) Capitalized deferred financing costs, net of amortization 4,888 (906 ) 4,308 — — 149 8,439 Balance at December 31, 2017 $ 483,978 $ 1,157,179 $ 4,060,156 $ 6,694,454 $ 2,108,007 $ 1,242,756 $ 15,746,530 Repurchase Agreements: Shellpoint Acquisition — — — 1,957 437,675 — 439,632 Borrowings — — — 90,996,778 8,665,900 — 99,662,678 Repayments — — — (85,912,169 ) (7,298,734 ) — (93,210,903 ) Capitalized deferred financing costs, net of amortization — — — (165 ) 589 — 424 Notes and Bonds Payable: Shellpoint Acquisition — 20,731 — — 120,702 — 141,433 Borrowings 350,787 4,212,855 5,207,084 — 183 — 9,770,909 Repayments (537,227 ) (3,022,785 ) (5,887,384 ) — (136,947 ) (308,316 ) (9,892,659 ) Discount on borrowings, net of amortization — — 41 — — 1,633 1,674 Unrealized loss on notes, fair value — — — — 684 — 684 Capitalized deferred financing costs, net of amortization 25 (7,124 ) 2,558 — — 374 (4,167 ) Balance at December 31, 2018 $ 297,563 $ 2,360,856 $ 3,382,455 $ 11,780,855 $ 3,898,059 $ 936,447 $ 22,656,235 (A) New Residential net settles daily borrowings and repayments of the Notes and Bonds Payable on its servicer advances. Maturities New Residential’s debt obligations as of December 31, 2018 had contractual maturities as follows: Year Nonrecourse Recourse Total 2019 $ 879,241 $ 16,124,611 $ 17,003,852 2020 771,582 181,854 953,436 2021 1,758,663 736,368 2,495,031 2022 — 197,759 197,759 2023 671,013 487,323 1,158,336 2024 and thereafter 364,770 499,881 864,651 $ 4,445,269 $ 18,227,796 $ 22,673,065 Borrowing Capacity The following table represents New Residential’s borrowing capacity as of December 31, 2018 : Debt Obligations/ Collateral Borrowing Capacity Balance Outstanding Available Financing Repurchase Agreements Residential mortgage loans and REO $ 5,575,197 $ 3,774,136 $ 1,801,061 Non-Agency RMBS 250,000 241,535 8,465 Notes and Bonds Payable Excess MSRs 150,000 100,000 50,000 MSRs 990,000 645,319 344,681 Servicer advances (A) 1,678,541 1,372,576 305,965 Consumer loans 150,000 21,303 128,697 $ 8,793,738 $ 6,154,869 $ 2,638,869 (A) New Residential’s unused borrowing capacity is available if New Residential has additional eligible collateral to pledge and meets other borrowing conditions as set forth in the applicable agreements, including any applicable advance rate. New Residential pays a 0.1% fee on the unused borrowing capacity. Excludes borrowing capacity and outstanding debt for retained Non-Agency bonds collateralized by servicer advances with a current face amount of $86.3 million . Certain of the debt obligations are subject to customary loan covenants and event of default provisions, including event of default provisions triggered by certain specified declines in New Residential’s equity or a failure to maintain a specified tangible net worth, liquidity, or indebtedness to tangible net worth ratio. New Residential was in compliance with all of its debt covenants as of December 31, 2018 . |
FAIR VALUE MEASUREMENT
FAIR VALUE MEASUREMENT | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENT | FAIR VALUE MEASUREMENT U.S. GAAP requires the categorization of fair value measurement into three broad levels which form a hierarchy based on the transparency of inputs to the valuation. Level 1 - Quoted prices in active markets for identical instruments. Level 2 - Valuations based principally on other observable market parameters, including: • Quoted prices in active markets for similar instruments, • Quoted prices in less active or inactive markets for identical or similar instruments, • Other observable inputs (such as interest rates, yield curves, volatilities, prepayment rates, loss severities, credit risks and default rates), and • Market corroborated inputs (derived principally from or corroborated by observable market data). Level 3 - Valuations based significantly on unobservable inputs. New Residential follows this hierarchy for its fair value measurements. The classifications are based on the lowest level of input that is significant to the fair value measurement. The carrying values and fair values of New Residential’s assets and liabilities recorded at fair value on a recurring basis, as well as other financial instruments for which fair value is disclosed, as of December 31, 2018 were as follows: Fair Value Principal Balance or Notional Amount Carrying Value Level 1 Level 2 Level 3 Total Assets: Investments in: Excess mortgage servicing rights, at fair value (A) $ 106,426,363 $ 447,860 $ — $ — $ 447,860 $ 447,860 Excess mortgage servicing rights, equity method investees, at fair value (A) 41,707,963 147,964 — — 147,964 147,964 Mortgage servicing rights, at fair value (A) 258,462,703 2,884,100 — — 2,884,100 2,884,100 Mortgage servicing rights financing receivables, at fair value (A) 130,516,565 1,644,504 — — 1,644,504 1,644,504 Servicer advance investments, at fair value 620,050 735,846 — — 735,846 735,846 Real estate and other securities, available-for-sale 22,152,845 11,636,581 — 2,665,618 8,970,963 11,636,581 Residential mortgage loans, held-for-investment 706,111 614,241 — — 625,321 625,321 Residential mortgage loans, held-for-sale 1,043,550 932,480 — — 958,970 958,970 Residential mortgage loans, held-for-sale, at fair value (B) 2,934,727 2,808,529 — 213,882 2,594,647 2,808,529 Residential mortgage loans, held-for-investment, at fair value (C) 122,260 121,088 — — 121,088 121,088 Residential mortgage loans subject to repurchase 121,602 121,602 — 121,602 — 121,602 Consumer loans, held-for-investment 1,072,577 1,072,202 — — 1,054,820 1,054,820 Derivative assets 840,179 10,893 — 42 10,851 10,893 Cash and cash equivalents 251,058 251,058 251,058 — — 251,058 Restricted cash 164,020 164,020 164,020 — — 164,020 Other assets (D) 16,991 7,778 — 9,213 16,991 $ 23,609,959 $ 422,856 $ 3,001,144 $ 20,206,147 $ 23,630,147 Liabilities: Repurchase agreements $ 15,555,156 $ 15,553,969 $ — $ 15,555,156 $ — $ 15,555,156 Notes and bonds payable (E) 7,117,909 7,102,266 — — 7,076,400 7,076,400 Residential mortgage loans repurchase liability 121,602 121,602 — 121,602 — 121,602 Derivative liabilities 15,759,782 29,389 — 29,166 223 29,389 Excess spread financing 3,492,587 39,304 — — 39,304 39,304 Contingent consideration N/A 40,842 — — 40,842 40,842 $ 22,887,372 $ — $ 15,705,924 $ 7,156,769 $ 22,862,693 (A) The notional amount represents the total unpaid principal balance of the residential mortgage loans underlying the MSRs, MSR financing receivables, and Excess MSRs. New Residential does not receive an excess mortgage servicing amount on non-performing loans in Agency portfolios. (B) Includes $88.7 million in fair value of loans that are 90 days or more past due. (C) Includes $0.4 million in fair value of loans that are 90 days or more past due. (D) Excludes the indirect equity investment in a commercial redevelopment project that is accounted for at fair value on a recurring basis based on the NAV of New Residential’s investment. The investment had a fair value of $74.3 million as of December 31, 2018 . (E) Includes the SAFT 2013-1 mortgage-backed securities issued for which the fair value option for financial instruments was elected and resulted in a fair value of $117.0 million as of December 31, 2018 . The carrying values and fair values of New Residential’s assets and liabilities recorded at fair value on a recurring basis, as well as other financial instruments for which fair value is disclosed, as of December 31, 2017 were as follows: Fair Value Principal Balance or Notional Amount Carrying Value Level 1 Level 2 Level 3 Total Assets Investments in: Excess mortgage servicing rights, at fair value (A) $ 217,121,299 $ 1,173,713 $ — $ — $ 1,173,713 $ 1,173,713 Excess mortgage servicing rights, equity method investees, at fair value (A) 50,501,054 171,765 — — 171,765 171,765 Mortgage servicing rights, at fair value (A) 172,454,150 1,735,504 — — 1,735,504 1,735,504 Mortgage servicing rights financing receivables, at fair value (A) 64,344,893 598,728 — — 598,728 598,728 Servicer advance investments, at fair value 3,581,876 4,027,379 — — 4,027,379 4,027,379 Real estate and other securities, available-for-sale 14,822,986 8,071,140 — 2,096,351 5,974,789 8,071,140 Residential mortgage loans, held-for-investment 806,635 691,155 — — 694,692 694,692 Residential mortgage loans, held-for-sale 1,907,052 1,725,534 — — 1,794,210 1,794,210 Consumer loans, held-for-investment 1,377,792 1,374,263 — — 1,379,746 1,379,746 Derivative assets 772,500 2,423 — 2,423 — 2,423 Cash and cash equivalents 295,798 295,798 295,798 — — 295,798 Restricted cash 150,252 150,252 150,252 — — 150,252 Other assets 1,788,354 28,802 19,259 — 9,543 28,802 $ 20,046,456 $ 465,309 $ 2,098,774 $ 17,560,069 $ 20,124,152 Liabilities Repurchase agreements $ 8,663,747 $ 8,662,139 $ — $ 8,663,747 $ — $ 8,663,747 Notes and bonds payable 7,097,223 7,084,391 — — 7,109,803 7,109,803 Derivative liabilities 4,115,100 697 — 697 — 697 $ 15,747,227 $ — $ 8,664,444 $ 7,109,803 $ 15,774,247 (A) The notional amount represents the total unpaid principal balance of the residential mortgage loans underlying the MSRs and Excess MSRs. New Residential does not receive an excess mortgage servicing amount on non-performing loans in Agency portfolios. New Residential has various processes and controls in place to ensure that fair value is reasonably estimated. With respect to the broker and pricing service quotations, to ensure these quotes represent a reasonable estimate of fair value, New Residential’s quarterly procedures include a comparison to quotations from different sources, outputs generated from its internal pricing models and transactions New Residential has completed with respect to these or similar assets or liabilities, as well as on its knowledge and experience of these markets. With respect to fair value estimates generated based on New Residential’s internal pricing models, New Residential corroborates the inputs and outputs of the internal pricing models by comparing them to available independent third party market parameters, where available, and models for reasonableness. New Residential believes its valuation methods and the assumptions used are appropriate and consistent with other market participants. Fair value measurements categorized within Level 3 are sensitive to changes in the assumptions or methodology used to determine fair value and such changes could result in a significant increase or decrease in the fair value. New Residential’s assets measured at fair value on a recurring basis using Level 3 inputs changed as follows: Level 3 Excess MSRs (A) Excess MSRs in Equity Method Investees (A)(B) Agency Non-Agency MSRs (A) Mortgage Servicing Rights Financing Receivables (A) Servicer Advance Investments Non-Agency RMBS Derivatives (C) Residential Mortgage Loans Total Balance at December 31, 2016 $ 381,757 $ 1,017,698 $ 194,788 $ 659,483 $ — $ 5,706,593 $ 3,543,560 $ — $ — $ 11,503,879 Transfers (D) Transfers from Level 3 — — — — — — — — — — Transfers to Level 3 — — — — — — — — — — Gains (losses) included in net income Included in other-than-temporary impairment on securities (E) — — — — — — (10,334 ) — — (10,334 ) Included in change in fair value of investments in excess mortgage servicing rights (E) (3,037 ) 7,359 — — — — — — — 4,322 Included in change in fair value of investments in excess mortgage servicing rights, equity method investees (E) — — 12,617 — — — — — — 12,617 Included in servicing revenue, net (F) — — — (67,672 ) — — — — — (67,672 ) Included in change in fair value of investments in mortgage servicing rights financing receivables (E) — — — — 66,394 — — — — 66,394 Included in change in fair value of servicer advance investments — — — — — 84,418 — — — 84,418 Included in gain (loss) on settlement of investments, net — — — — — 9,327 18,050 — — 27,377 Included in other income (loss), net (E) 2,150 2,227 — — — — 2,883 — — 7,260 Gains (losses) included in other comprehensive income (G) — — — — — — 244,608 — — 244,608 Interest income 28,351 74,702 — — — 528,356 333,297 — — 964,706 Purchases, sales, repayments and transfers Purchases — — — 1,143,693 467,884 12,168,519 3,052,965 — — 16,833,061 Proceeds from sales (13,505 ) — — — — — (182,325 ) — — (195,830 ) Proceeds from repayments (71,080 ) (180,927 ) (35,640 ) — — (13,988,614 ) (1,027,915 ) — — (15,304,176 ) Ocwen Transaction (Note 5) — (71,982 ) — — 64,450 (481,220 ) — — — (488,752 ) Balance at December 31, 2017 $ 324,636 $ 849,077 $ 171,765 $ 1,735,504 $ 598,728 $ 4,027,379 $ 5,974,789 $ — $ — $ 13,681,878 Transfers (D) Transfers from Level 3 — — — — — — — — — — Transfers to Level 3 — — — — — — — — — — Shellpoint Acquisition (Note 1) — — — 275,964 (124,652 ) — — 10,604 179,644 341,560 Gains (losses) included in net income Included in other-than-temporary impairment on securities (E) — — — — — — (24,940 ) — — (24,940 ) Included in change in fair value of investments in excess mortgage servicing rights (E) (18,099 ) (40,557 ) — — — — — — — (58,656 ) Included in change in fair value of investments in excess mortgage servicing rights, equity method investees (E) — — 8,357 — — — — — — 8,357 Included in servicing revenue, net (F) — — — (199,836 ) — — — — — (199,836 ) Included in change in fair value of investments in mortgage servicing rights financing receivables (E) — — — — 31,550 — — — — 31,550 Included in change in fair value of servicer advance investments — — — — — (89,332 ) — — — (89,332 ) Included in gain (loss) on settlement of investments, net — 40,417 — — — 72,585 (1,288 ) — — 111,714 Included in other income (loss), net (E) 6,137 307 — — — — 10,283 24 (175 ) 16,576 Gains (losses) included in other comprehensive income (G) — — — — — — 31,031 — — 31,031 Interest income 21,936 22,504 — — — 50,218 377,018 — — 471,676 Purchases, sales and repayments Purchases — — — 1,042,933 128,357 2,332,989 3,854,439 — — 7,358,718 Proceeds from sales (19,084 ) — — (5,776 ) (7,472 ) — (86,448 ) — — (118,780 ) Proceeds from repayments (58,139 ) (69,654 ) (32,158 ) — — (2,455,155 ) (1,163,921 ) — (2,111 ) (3,781,138 ) Originations — — — 35,311 — — — — — 35,311 Ocwen Transaction (Note 5) — (611,621 ) — — 1,017,993 (3,202,838 ) — — — (2,796,466 ) Balance at December 31, 2018 $ 257,387 $ 190,473 $ 147,964 $ 2,884,100 $ 1,644,504 $ 735,846 $ 8,970,963 $ 10,628 $ 177,358 $ 15,019,223 (A) Includes the recapture agreement for each respective pool, as applicable. (B) Amounts represent New Residential’s portion of the Excess MSRs held by the respective joint ventures in which New Residential has a 50% interest. (C) For the purpose of this table, the IRLC asset and liability positions are shown net. (D) Transfers are assumed to occur at the beginning of the respective period. (E) The gains (losses) recorded in earnings during the period are attributable to the change in unrealized gains (losses) relating to Level 3 assets still held at the reporting dates and realized gains (losses) recorded during the period. (F) The components of Servicing revenue, net are disclosed in Note 5. (G) These gains (losses) were included in net unrealized gain (loss) on securities in the Consolidated Statements of Comprehensive Income. New Residential’s liabilities measured at fair value on a recurring basis using Level 3 inputs changed as follows: Level 3 Excess Spread Financing Mortgage-Backed Securities Issued Contingent Consideration Total Balance at December 31, 2017 $ — $ — $ — $ — Transfers (A) Transfers from Level 3 — — — — Transfers to Level 3 — — — — Shellpoint Acquisition (Note 1) 48,262 120,702 39,262 208,226 Gains (losses) included in net income Included in other-than-temporary impairment on securities (B) — — — — Included in change in fair value of investments in excess mortgage servicing rights — — — — Included in change in fair value of investments in excess mortgage servicing rights, equity method investees (B) — — — — Included in servicing revenue, net (C) (8,591 ) — — (8,591 ) Included in change in fair value of investments in notes receivable - rights to MSRs — — — — Included in change in fair value of servicer advance investments — — — — Included in gain (loss) on settlement of investments, net — — — — Included in other income (B) — 684 1,580 2,264 Gains (losses) included in other comprehensive income, net of tax (D) — — — — Interest income — — — — Purchases, sales and repayments Purchases — — — — Proceeds from sales — — — — Proceeds from repayments — (4,338 ) — (4,338 ) Other (367 ) — — (367 ) Ocwen Transaction — — — — Balance at December 31, 2018 $ 39,304 $ 117,048 $ 40,842 $ 197,194 (A) Transfers are assumed to occur at the beginning of the respective period. (B) The gains (losses) recorded in earnings during the period are attributable to the change in unrealized gains (losses) relating to Level 3 assets still held at the reporting dates and realized gains (losses) recorded during the period. (C) The components of Servicing revenue, net are disclosed in Note 5. (D) These gains (losses) were included in net unrealized gain (loss) on securities in the Consolidated Statements of Comprehensive Income. Investments in Excess MSRs, Excess MSRs Equity Method Investees, MSRs and MSR Financing Receivables Valuation Fair value estimates of New Residential’s investments in MSRs and Excess MSRs were based on internal pricing models. The valuation technique is based on discounted cash flows. Significant inputs used in the valuations included expectations of prepayment rates, delinquency rates, recapture rates, the mortgage servicing amount or excess mortgage servicing amount of the underlying residential mortgage loans, as applicable, and discount rates that market participants would use in determining the fair values of mortgage servicing rights on similar pools of residential mortgage loans. In addition, for investments in MSRs, significant inputs included the market-level estimated cost of servicing. In order to evaluate the reasonableness of its fair value determinations, New Residential engages an independent valuation firm to separately measure the fair value of its investments in MSRs and Excess MSRs. The independent valuation firm determines an estimated fair value range of each pool based on its own models and issues a “fairness opinion” with this range. New Residential compares the range included in the opinion to the value generated by its internal models. To date, New Residential has not made any significant valuation adjustments as a result of these fairness opinions. Significant increases (decreases) in the discount rates, prepayment or delinquency rates, or costs of servicing, in isolation would result in a significantly lower (higher) fair value measurement, whereas significant increases (decreases) in the recapture rates or mortgage servicing amount or excess mortgage servicing amount, as applicable, in isolation would result in a significantly higher (lower) fair value measurement. Generally, a change in the delinquency rate assumption is accompanied by a directionally similar change in the assumption used for the prepayment rate. The following tables summarize certain information regarding the weighted average inputs used: December 31, 2018 Significant Inputs (A) Prepayment Rate (B) Delinquency (C) Recapture Rate (D) Mortgage Servicing Amount (E) Collateral Weighted Average Maturity Years (F) Excess MSRs Directly Held (Note 4) Agency Original Pools 9.8 % 2.5 % 26.3 % 21 21 Recaptured Pools 8.0 % 2.1 % 23.6 % 22 24 Recapture Agreement 7.9 % 2.2 % 24.8 % 22 — 9.1 % 2.4 % 25.4 % 21 22 Non-Agency (G) Nationstar and SLS Serviced: Original Pools 10.4 % N/A 15.4 % 15 24 Recaptured Pools 8.0 % N/A 19.9 % 23 24 Recapture Agreement 7.9 % N/A 19.8 % 20 — 9.9 % N/A 16.3 % 16 24 Total/Weighted Average--Excess MSRs Directly Held 9.4 % 2.4 % 21.5 % 19 23 Excess MSRs Held through Equity Method Investees (Note 4) Agency Original Pools 10.9 % 3.9 % 29.6 % 19 20 Recaptured Pools 8.5 % 2.6 % 28.8 % 23 23 Recapture Agreement 8.6 % 2.7 % 30.4 % 23 — Total/Weighted Average--Excess MSRs Held through Investees 9.6 % 3.2 % 29.4 % 21 21 Total/Weighted Average--Excess MSRs All Pools 9.5 % 2.7 % 24.5 % 20 22 MSRs Agency (H) Mortgage Servicing Rights (I) 9.4 % 1.0 % 22.2 % 26 22 Mortgage Servicing Rights Financing Receivables (I) 9.5 % 0.9 % 14.7 % 27 20 Non-Agency Mortgage Servicing Rights 13.2 % 0.9 % 10.0 % 25 25 Mortgage Servicing Rights Financing Receivables (I) 8.2 % 17.2 % 5.0 % 45 26 Ginnie Mae Mortgage Servicing Rights (J) 11.2 % 3.9 % 24.2 % 33 27 December 31, 2017 Significant Inputs (A) Prepayment Rate (B) Delinquency (C) Recapture Rate (D) Mortgage Servicing Amount (E) Collateral Weighted Average Maturity Years (F) Excess MSRs Directly Held (Note 4) Agency Original Pools 9.7 % 3.0 % 31.6 % 21 23 Recaptured Pools 7.1 % 4.4 % 23.1 % 22 24 Recapture Agreement 7.1 % 4.3 % 26.2 % 21 — 8.8 % 3.5 % 29.1 % 21 23 Non-Agency (G) Nationstar and SLS Serviced: Original Pools 12.2 % N/A 15.4 % 15 24 Recaptured Pools 6.9 % N/A 19.8 % 22 24 Recapture Agreement 6.9 % N/A 19.7 % 20 — Ocwen Serviced Pools 8.8 % N/A — % 14 26 9.4 % N/A 4.0 % 15 26 Total/Weighted Average--Excess MSRs Directly Held 9.2 % 3.5 % 10.9 % 16 25 Excess MSRs Held through Equity Method Investees (Note 4) Agency Original Pools 11.3 % 5.0 % 34.8 % 19 22 Recaptured Pools 7.3 % 4.7 % 24.3 % 23 24 Recapture Agreement 7.3 % 4.7 % 24.2 % 23 — Total/Weighted Average--Excess MSRs Held through Investees 9.3 % 4.8 % 29.5 % 21 23 Total/Weighted Average--Excess MSRs All Pools 9.2 % 3.8 % 14.9 % 17 25 MSRs Agency Mortgage Servicing Rights (I) 10.5 % 0.9 % 25.4 % 27 21 Mortgage Servicing Rights Financing Receivables (I) 10.3 % 0.9 % 14.8 % 27 20 Non-Agency Mortgage Servicing Rights Financing Receivables (I) 10.0 % 10.9 % — % 34 22 (A) Weighted by fair value of the portfolio. (B) Projected annualized weighted average lifetime voluntary and involuntary prepayment rate using a prepayment vector. (C) Projected percentage of residential mortgage loans in the pool for which the borrower will miss its mortgage payments. (D) Percentage of voluntarily prepaid loans that are expected to be refinanced by the related servicer or subservicer, as applicable. (E) Weighted average total mortgage servicing amount, in excess of the basic fee as applicable, measured in bps. As of December 31, 2018 and 2017 , weighted average costs of subservicing of $7.30 and $7.23 , respectively, per loan per month was used to value the Fannie Mae and Freddie Mac MSRs, including MSR Financing Receivables. Weighted average costs of subservicing of $11.45 and $12.45 , respectively, per loan per month was used to value the non-agency MSRs, including MSR Financing Receivables. As of December 31, 2018 , a weighted average cost of subservicing of $10.06 per loan per month was used to value the Ginnie Mae MSRs. (F) Weighted average maturity of the underlying residential mortgage loans in the pool. (G) For certain pools, the Excess MSR will be paid on the total UPB of the mortgage portfolio (including both performing and delinquent loans until REO). For these pools, no delinquency assumption is used. (H) Represents Fannie Mae and Freddie Mac MSRs. (I) For certain pools, recapture rate represents the expected recapture rate with the successor subservicer appointed by NRM. (J) Includes valuation of the related Excess spread financing (Note 5). With respect to valuing the Ocwen-serviced mortgage servicing rights financing receivables, which include a significant servicer advances receivable component, the cost of financing servicer advances receivable is assumed to be LIBOR plus 0.9% . As of December 31, 2018 and 2017 , weighted average discount rates of 8.8% and 8.9% , respectively, were used to value New Residential’s investments in Excess MSRs (directly and through equity method investees). As of December 31, 2018 and 2017 , weighted average discount rates of 8.7% and 9.1% were used to value New Residential’s investments in MSRs, respectively. As of December 31, 2018 and 2017 , weighted average discount rates of 10.3% and 9.4% , respectively, were used to value New Residential’s investments in MSR financing receivables. All of the assumptions listed have some degree of market observability, based on New Residential’s knowledge of the market, relationships with market participants, and use of common market data sources. New Residential uses assumptions that generate its best estimate of future cash flows for each investment in MSRs and Excess MSRs. When valuing investments in MSRs and Excess MSRs, New Residential uses the following criteria to determine the significant inputs: • Prepayment Rate: Prepayment rate projections are in the form of a “vector” that varies over the expected life of the pool. The prepayment vector specifies the percentage of the collateral balance that is expected to prepay voluntarily (i.e., pay off) and involuntarily (i.e., default) at each point in the future. The prepayment vector is based on assumptions that reflect macroeconomic conditions like home price appreciation, current level of interest rates as well as loan level factors such as the borrower’s interest rate, FICO score, loan-to-value ratio, debt-to-income ratio, vintage on a loan level basis. New Residential considers historical prepayment experience associated with the collateral when determining this vector and also reviews industry research on the prepayment experience of similar loan pools. This data is obtained from remittance reports, market data services and other market sources. • Delinquency Rates: For existing mortgage pools, delinquency rates are based on the recent pool-specific experience of loans that missed their latest mortgage payments. Delinquency rate projections are in the form of a “vector” that varies over the expected life of the pool. The delinquency vector specifies the percentage of the unpaid principal balance that is expected to be delinquent each month. The delinquency vector is based on assumptions that reflect macroeconomic conditions, the historical delinquency rates for the pools and the underlying borrower characteristics such as the FICO score and loan-to-value ratio. For the recapture agreements and recaptured loans, delinquency rates are based on the experience of similar loan pools originated by New Residential’s servicers and subservicers, and delinquency experience over the past year. New Residential believes this time period provides a reasonable sample for projecting future delinquency rates while taking into account current market conditions. Additional consideration is given to loans that are expected to become 30 or more days delinquent. • Recapture Rates: Recapture rates are based on actual average recapture rates experienced by New Residential’s servicers and subservicers on similar residential mortgage loan pools. Generally, New Residential looks to three to six months’ worth of actual recapture rates, which it believes provides a reasonable sample for projecting future recapture rates while taking into account current market conditions. Recapture rate projections are in the form of a “vector” that varies over the expected life of the pool. The recapture vector specifies the percentage of the refinanced loans that have been recaptured within the pool by the servicer or subservicer. The recapture vector takes into account the nature and timeline of the relationship between the borrowers in the pool and the servicer or subservicer, the customer retention programs offered by the servicer or subservicer and the historical recapture rates. • Mortgage Servicing Amount or Excess Mortgage Servicing Amount: For existing mortgage pools, mortgage servicing amount and excess mortgage servicing amount projections are based on the actual total mortgage servicing amount, in excess of a base fee as applicable. For loans expected to be refinanced by the related servicer or subservicer and subject to a recapture agreement, New Residential considers the mortgage servicing amount or excess mortgage servicing amount on loans recently originated by the related servicer over the past three months and other general market considerations. New Residential believes this time period provides a reasonable sample for projecting future mortgage servicing amounts and excess mortgage servicing amounts while taking into account current market conditions. • Discount Rate: The discount rates used by New Residential are derived from market data on pricing of mortgage servicing rights backed by similar collateral. • Cost of subservicing: The costs of subservicing used by New Residential are based on available market data for various loan types and delinquency statuses. New Residential uses different prepayment and delinquency assumptions in valuing the MSRs and Excess MSRs relating to the original loan pools, the recapture agreements and the MSRs and Excess MSRs relating to recaptured loans. The prepayment rate and delinquency rate assumptions differ because of differences in the collateral characteristics, refinance potential and expected borrower behavior for original loans and loans which have been refinanced. The assumptions for recapture and discount rates when valuing investments in MSRs and Excess MSRs and recapture agreements are based on historical recapture experience and market pricing. Servicer Advance Investments Valuation New Residential uses internal pricing models to estimate the future cash flows related to the Servicer Advance Investments that incorporate significant unobservable inputs and include assumptions that are inherently subjective and imprecise. New Residential’s estimations of future cash flows include the combined cash flows of all of the components that comprise the Servicer Advance Investments: existing advances, the requirement to purchase future advances, the recovery of advances and the right to the basic fee component of the related MSR. The factors that most significantly impact the fair value include (i) the rate at which the servicer advance balance changes over the term of the investment, (ii) the UPB of the underlying loans with respect to which New Residential has the obligation to make advances and owns the basic fee component of the related MSR which, in turn, is driven by prepayment rates and (iii) the percentage of delinquent loans with respect to which New Residential owns the basic fee component of the related MSR. The valuation technique is based on discounted cash flows. Significant inputs used in the valuations included the assumptions used to establish the aforementioned cash flows and discount rates that market participants would use in determining the fair values of Servicer Advance Investments. In order to evaluate the reasonableness of its fair value determinations, New Residential engages an independent valuation firm to separately measure the fair value of its Servicer Advance Investments. The independent valuation firm determines an estimated fair value range based on its own models and issues a “fairness opinion” with this range. New Residential compares the range included in the opinion to the value generated by its internal models. To date, New Residential has not made any significant valuation adjustments as a result of these fairness opinions. Significant increases (decreases) in the advance balance-to-UPB ratio, prepayment rate, delinquency rate, or discount rate, in isolation, would result in a significantly lower (higher) fair value measurement. Generally, a change in the delinquency rate assumption is accompanied by a directionally similar change in the assumption used for the advance balance-to-UPB ratio. The following table summarizes certain information regarding the inputs used in valuing the Servicer Advance Investments, including the basic fee component of the related MSRs: Significant Inputs Weighted Average Outstanding Servicer Advances to UPB of Underlying Residential Mortgage Loans Prepayment Rate (A) Delinquency Mortgage Servicing Amount (B) Discount Rate Collateral Weighted Average Maturity (Years) (C) December 31, 2018 1.4 % 10.9 % 17.7 % 19.6 bps 5.9 % 23.4 December 31, 2017 1.7 % 10.0 % 13.8 % 18.2 bps 6.8 % 25.6 (A) Projected annual weighted average lifetime voluntary and involuntary prepayment rate using a prepayment vector. (B) Mortgage servicing amount is net of 9.6 bps and 12.5 bps which represent the amounts New Residential paid its servicers as a monthly servicing fee as of December 31, 2018 and 2017 , respectively. (C) Weighted average maturity of the underlying residential mortgage loans in the pool. The valuation of the Servicer Advance Investments also takes into account the performance fee paid to the servicer, which in the case of the Buyer is based on its equity returns and therefore is impacted by relevant financing assumptions such as loan-to-value ratio and interest rate as well as advance-to-UPB ratio. All of the assumptions listed have some degree of market observability, based on New Residential’s knowledge of the market, relationships with market participants, and use of common market data sources. The prepayment rate, the delinquency rate and the advance-to-UPB ratio projections are in the form of “curves” or “vectors” that vary over the expected life of the underlying mortgages and related servicer advances. New Residential uses assumptions that generate its best estimate of future cash flows for each Servicer Advance Investment, including the basic fee component of the related MSR. When valuing Servicer Advance Investments, New Residential uses the following criteria to determine the significant inputs: • Servicer advance balance: Servicer advance balance projections are in the form of a “vector” that varies over the expected life of the residential mortgage loan pool. The servicer advance balance projection is based on assumptions that reflect factors such as the borrower’s expected delinquency status, the rate at which delinquent borrowers re-perform or become current again, servicer modification offer and acceptance rates, liquidation timelines and the servicers’ stop advance and clawback policies. • Prepayment Rate: Prepayment rate projections are in the form of a “vector” that varies over the expected life of the pool. The prepayment vector specifies the percentage of the collateral balance that is expected to prepay voluntarily (i.e., pay off) and involuntarily (i.e., default) at each point in the future. The prepayment vector is based on assumptions that reflect macroeconomic conditions and factors such as the borrower’s FICO score, loan-to-value ratio, debt-to-income ratio, and vintage on a loan level basis. New Residential considers collateral-specific prepayment experience when determining this vector. • Delinquency Rates: For existing mortgage pools, delinquency rates are based on the recent pool-specific experience of loans that missed recent mortgage payment(s) as well as loan- and borrower-specific characteristics such as the borrower’s FICO score, the loan-to-value ratio, debt-to-income ratio, occupancy status, loan documentation, payment history and previous loan modifications. New Residential believes the time period utilized provides a reasonable sample for projecting future delinquency rates while taking into account current market conditions. • Mortgage Servicing Amount: Mortgage servicing amounts are contractually determined on a pool-by-pool basis. New Residential projects the weighted average mortgage servicing amount based on its projections for prepayment rates. • LIBOR: The performance-based incentive fees on Nationstar-serviced Servicer Advance Investments portfolios are driven by LIBOR-based factors. The LIBOR curves used are widely used by market participants as reference rates for many financial instruments. • Discount Rate: T |
EQUITY AND EARNINGS PER SHARE
EQUITY AND EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
EQUITY AND EARNINGS PER SHARE | EQUITY AND EARNINGS PER SHARE Equity and Dividends New Residential’s certificate of incorporation authorizes 2,000,000,000 shares of common stock, par value $0.01 per share, and 100,000,000 shares of preferred stock, par value $0.01 per share. In August 2016, New Residential issued 20.0 million shares of its common stock in a public offering at a price to the public of $14.20 per share for net proceeds of approximately $278.8 million . To compensate the Manager for its successful efforts in raising capital for New Residential, in connection with this offering, New Residential granted options to the Manager relating to 2.0 million shares of New Residential’s common stock at the public offering price, which had a fair value of approximately $2.3 million as of the grant date. The assumptions used in valuing the options were: a 1.45% risk-free rate, a 11.80% dividend yield, 27.57% volatility and a 10 -year term. In February 2017, New Residential issued 56.5 million shares of its common stock in a public offering at a price to the public of $15.00 per share for net proceeds of approximately $834.5 million . One of New Residential’s executive officers participated in this offering and purchased 18,600 shares at the public offering price. To compensate the Manager for its successful efforts in raising capital for New Residential, in connection with this offering, New Residential granted options to the Manager relating to 5.7 million shares of New Residential’s common stock at the public offering price, which had a fair value of approximately $8.1 million as of the grant date. The assumptions used in valuing the options were: a 2.38% risk-free rate, a 10.82% dividend yield, 28.64% volatility and a 10 -year term. In January 2018, New Residential issued 28.8 million shares of its common stock in a public offering at a price to the public of $17.10 per share for net proceeds of approximately $482.3 million . To compensate the Manager for its successful efforts in raising capital for New Residential, in connection with this offering, New Residential granted options to the Manager relating to 2.9 million shares of New Residential’s common stock at the public offering price, which had a fair value of approximately $3.8 million as of the grant date. The assumptions used in valuing the options were: a 2.58% risk-free rate, a 9.86% dividend yield, 23.16% volatility and a 10 -year term. On July 30, 2018, New Residential entered into a Distribution Agreement to sell shares of its common stock, par value $0.01 per share (the “ATM Shares”), having an aggregate offering price of up to $500.0 million , from time to time, through an “at-the-market” equity offering program (the “ATM Program”). During the year ended December 31, 2018 , New Residential sold 0.5 million ATM Shares for aggregate proceeds of $9.1 million . In connection with the shares sold under the ATM program, New Residential granted options to the Manager relating to 0.05 million shares of New Residential’s common stock at the offering prices, which had fair value of approximately $0.1 million as of the grant dates. In November 2018, New Residential issued 28.8 million shares of its common stock in a public offering at a price to the public of $17.32 per share for net proceeds of approximately $489.2 million . To compensate the Manager for its successful efforts in raising capital for New Residential, in connection with this offering, New Residential granted options to the Manager relating to 2.9 million shares of New Residential’s common stock at the public offering price, which had a fair value of approximately $3.8 million as of the grant date. The assumptions used in valuing the options were: a 3.25% risk-free rate, a 8.61% dividend yield, 17.50% volatility and a 10 -year term. Common dividends have been declared as follows: Per Share Declaration Date Payment Date Quarterly Dividend Total Amounts Distributed (millions) March 22, 2016 April 2016 0.46 106.0 June 27, 2016 July 2016 0.46 106.0 September 23, 2016 October 2016 0.46 115.4 December 16, 2016 January 2017 0.46 115.4 January 26, 2017 April 2017 0.48 147.5 June 21, 2017 July 2017 0.50 153.7 September 22, 2017 October 2017 0.50 153.7 December 18, 2017 January 2018 0.50 153.7 March 22, 2018 April 2018 0.50 168.1 June 21, 2018 July 2018 0.50 169.9 September 20, 2018 October 2018 0.50 170.2 December 20, 2018 January 2019 0.50 184.6 Approximately 2.4 million shares of New Residential’s common stock were held by Fortress, through its affiliates, and its principals at December 31, 2018 . Option Plan New Residential has a Nonqualified Stock Option and Incentive Award Plan, as amended (the “Plan”) which provides for the grant of equity-based awards, including restricted stock, options, stock appreciation rights, performance awards, tandem awards and other equity-based and non-equity based awards, in each case to the Manager, and to the directors, officers, employees, service providers, consultants and advisor of the Manager who perform services for New Residential, and to New Residential’s directors, officers, service providers, consultants and advisors. New Residential initially reserved 15,000,000 shares of its common stock for issuance under the Plan; on the first day of each fiscal year beginning during the 10 -year term of the Plan in and after calendar year 2014, that number will be increased by a number of shares of New Residential’s common stock equal to 10% of the number of shares of common stock newly issued by New Residential during the immediately preceding fiscal year (and, in the case of fiscal year 2013, after the effective date of the Plan). No adjustment was made on January 1, 2014. Increases of 5,799,166 , 5,654,578 , 2,000,000 and 8,543,539 were made on January 1, 2019 , 2018 , 2017 and 2016 , respectively. New Residential’s board of directors may also determine to issue options to the Manager that are not subject to the Plan, provided that the number of shares underlying any options granted to the Manager in connection with capital raising efforts would not exceed 10% of the shares sold in such offering and would be subject to NYSE rules. Upon exercise, all options will be settled in an amount of cash equal to the excess of the fair market value of a share of common stock on the date of exercise over the exercise price per share unless advance approval is made to settle options in shares of common stock. Upon joining the board, non-employee directors were, in accordance with the Plan, granted options relating to an aggregate of 6,000 shares of common stock. The fair value of such options was not material at the date of grant. New Residential’s outstanding options were summarized as follows: December 31, 2018 2017 Held by the Manager 6,961,222 16,387,480 Issued to the Manager and subsequently assigned to certain of the Manager’s employees 1,530,916 2,108,708 Issued to the independent directors 6,000 6,000 Total 8,498,138 18,502,188 The following table summarizes New Residential’s outstanding options as of December 31, 2018 . The last sales price on the New York Stock Exchange for New Residential’s common stock in the year ended December 31, 2018 was $14.21 per share. Recipient Date of Grant/ Exercise (A) Number of Unexercised Options Options Exercisable as of December 31, 2018 Weighted Average Exercise Price (B) Intrinsic Value of Exercisable Options as of December 31, 2018 (millions) Directors Various 6,000 6,000 $ 13.99 $ — Manager (C) 2012 — — — — Manager (C) 2013 — — — — Manager (C) 2014 — — — — Manager (C) 2015 — — — — Manager (C) 2016 533,334 200,000 13.70 0.1 Manager (C) 2017 2,638,804 1,130,917 14.50 — Manager (C) 2018 5,320,000 581,215 17.12 — Outstanding 8,498,138 1,918,132 (A) Options expire on the tenth anniversary from date of grant. (B) The exercise prices are subject to adjustment in connection with return of capital dividends. A portion of New Residential’s 2017 dividends was deemed to be a return of capital and the exercise prices were adjusted accordingly. (C) The Manager assigned certain of its options to its employees as follows: Date of Grant to Manager Range of Exercise Prices Total Unexercised Inception to Date 2016 $13.70 400,000 2017 $14.50 1,130,916 Total 1,530,916 The following table summarizes activity in New Residential’s outstanding options: Amount Weighted Average Exercise Price December 31, 2016 outstanding options 13,196,610 Options granted 5,654,578 $ 14.50 Options exercised (A) — $ — Options expired unexercised (349,000 ) December 31, 2017 outstanding options 18,502,188 Options granted 5,799,166 $ 17.23 Options exercised (15,803,216 ) $ 14.30 Options expired unexercised — December 31, 2018 outstanding options 8,498,138 See table above (A) The 15.8 million options that were exercised in 2018 had an intrinsic value of approximately $68.9 million at the date of exercise. Income and Earnings Per Share New Residential is required to present both basic and diluted earnings per share (“EPS”). Basic EPS is calculated by dividing net income by the weighted average number of shares of common stock outstanding. Diluted EPS is computed by dividing net income by the weighted average number of shares of common stock outstanding plus the additional dilutive effect, if any, of common stock equivalents during each period. New Residential’s common stock equivalents are its outstanding options. During the years ended December 31, 2018 , 2017 and 2016 , based on the treasury stock method, New Residential had 1,868,438 , 364,107 and 2,167,796 dilutive common stock equivalents, respectively, outstanding. Noncontrolling Interests Noncontrolling interests is comprised of the interests held by third parties in consolidated entities that hold New Residential’s Servicer Advance Investments (Note 6), Shelter JVs (Note 8) and Consumer Loans (Note 9). |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Litigation – New Residential is or may become, from time to time, involved in various disputes, litigation and regulatory inquiry and investigation matters that arise in the ordinary course of business. Given the inherent unpredictability of these types of proceedings, it is possible that future adverse outcomes could have a material adverse effect on its business, financial position or results of operations. New Residential is not aware of any unasserted claims that it believes are material and probable of assertion where the risk of loss is expected to be reasonably possible. New Residential is, from time to time, subject to inquiries by government entities. New Residential currently does not believe any of these inquiries would result in a material adverse effect on New Residential’s business. Indemnifications – In the normal course of business, New Residential and its subsidiaries enter into contracts that contain a variety of representations and warranties and that provide general indemnifications. New Residential’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against New Residential that have not yet occurred. However, based on its experience, New Residential expects the risk of material loss to be remote. Capital Commitments — As of December 31, 2018 , New Residential had outstanding capital commitments related to investments in the following investment types (also refer to Note 5 for MSR investment commitments and to Note 18 for additional capital commitments entered into subsequent to December 31, 2018 , if any): MSRs and servicer advances — New Residential and, in some cases, third-party co-investors agreed to purchase future servicer advances related to certain Non-Agency mortgage loans. In addition, New Residential’s subsidiary, NRM, is generally obligated to fund future servicer advances related to the loans it is obligated to service. The actual amount of future advances purchased will be based on: (a) the credit and prepayment performance of the underlying loans, (b) the amount of advances recoverable prior to liquidation of the related collateral and (c) the percentage of the loans with respect to which no additional advance obligations are made. The actual amount of future advances is subject to significant uncertainty. See Notes 5 and 6 for information on New Residential’s investments in MSRs and Servicer Advance Investments, respectively. Mortgage Origination Reserves — New Penn, a wholly owned subsidiary of New Residential, originates conventional, government-insured and nonconforming residential mortgage loans for sale and securitization. The GSEs or Ginnie Mae guarantee conventional and government insured mortgage securitizations and mortgage investors issue nonconforming private label mortgage securitizations while New Penn generally retains the right to service the underlying residential mortgage loans. In connection with the transfer of loans to the GSEs or mortgage investors, New Penn makes representations and warranties regarding certain attributes of the loans and, subsequent to the sale, if it is determined that a sold loan is in breach of these representations and warranties, New Penn generally has an obligation to cure the breach. If New Penn is unable to cure the breach, the purchaser may require New Penn to repurchase the loan. In addition, for Ginnie Mae guaranteed securitizations, New Penn holds the Ginnie Mae Buy-Back Option to repurchase delinquent loans from the securitization at its discretion. While New Penn is not obligated to repurchase the delinquent loans, New Penn generally executes its option to repurchase that will result in an economic benefit. As of December 31, 2018 , New Residential’s estimated liability associated with representations and warranties and Ginnie Mae repurchases was $5.9 million and $121.6 million , respectively. See Notes 5 and 8 for information on New Residential’s Ginnie Mae Buy-Back Option and mortgage origination, respectively. Mortgage Origination Unfunded Commitments — As of December 31, 2018 , New Penn was committed to fund approximately $823.2 million of mortgage loans and had forward loan sale commitments of $30.3 million . The forward sales are expected to close during the first quarter of 2019. Residential Mortgage Loans — As part of its investment in residential mortgage loans, New Residential may be required to outlay capital. These capital outflows primarily consist of advance escrow and tax payments, residential maintenance and property disposition fees. The actual amount of these outflows is subject to significant uncertainty. See Note 8 for information on New Residential’s investments in residential mortgage loans. Consumer Loans — The Consumer Loan Companies have invested in loans with an aggregate of $389.2 million of unfunded and available revolving credit privileges as of December 31, 2018 . However, under the terms of these loans, requests for draws may be denied and unfunded availability may be terminated at New Residential’s discretion. Leases — New Residential, through its wholly owned subsidiary, Shellpoint, has leases on office space expiring through 2025. Future commitments under non-cancelable leases are approximately $26.5 million . Environmental Costs — As a residential real estate owner, through its REO, New Residential is subject to potential environmental costs. At December 31, 2018 , New Residential is not aware of any environmental concerns that would have a material adverse effect on its consolidated financial position or results of operations. Debt Covenants — New Residential’s debt obligations contain various customary loan covenants (Note 11). Certain Tax-Related Covenants — If New Residential is treated as a successor to Drive Shack under applicable U.S. federal income tax rules, and if Drive Shack failed to qualify as a REIT for a taxable year ending on or before December 31, 2014, New Residential could be prohibited from electing to be a REIT. Accordingly, in the separation and distribution agreement executed in connection with New Residential’s spin-off from Drive Shack, Drive Shack (i) represented that it had no knowledge of any fact or circumstance that would cause New Residential to fail to qualify as a REIT, (ii) covenanted to use commercially reasonable efforts to cooperate with New Residential as necessary to enable New Residential to qualify for taxation as a REIT and receive customary legal opinions concerning REIT status, including providing information and representations to New Residential and its tax counsel with respect to the composition of Drive Shack’s income and assets, the composition of its stockholders, and its operation as a REIT; and (iii) covenanted to use its reasonable best efforts to maintain its REIT status for each of Drive Shack’s taxable years ending on or before December 31, 2014 (unless Drive Shack obtains an opinion from a nationally recognized tax counsel or a private letter ruling from the U.S. Internal Revenue Service (“IRS”) to the effect that Drive Shack’s failure to maintain its REIT status will not cause New Residential to fail to qualify as a REIT under the successor REIT rule referred to above). Additionally, New Residential covenanted to use its reasonable best efforts to qualify for taxation as a REIT for its taxable year ended December 31, 2013. |
TRANSACTIONS WITH AFFILIATES AN
TRANSACTIONS WITH AFFILIATES AND AFFILIATED ENTITIES | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
TRANSACTIONS WITH AFFILIATES AND AFFILIATED ENTITIES | TRANSACTIONS WITH AFFILIATES AND AFFILIATED ENTITIES New Residential is party to a Management Agreement with its Manager which provides for automatically renewing one -year terms subject to certain termination rights. The Manager’s performance is reviewed annually and the Management Agreement may be terminated by New Residential by payment of a termination fee, as defined in the Management Agreement, equal to the amount of management fees earned by the Manager during the 12 consecutive calendar months immediately preceding the termination, upon the affirmative vote of at least two-thirds of the independent directors, or by a majority vote of the holders of common stock. If the Management Agreement is terminated, the Manager may require New Residential to purchase from the Manager the right of the Manager to receive the Incentive Compensation. In exchange therefor, New Residential would be obligated to pay the Manager a cash purchase price equal to the amount of the Incentive Compensation that would be paid to the Manager if all of New Residential’s assets were sold for cash at their then current fair market value (taking into account, among other things, expected future performance of the underlying investments). Pursuant to the Management Agreement, the Manager, under the supervision of New Residential’s board of directors, formulates investment strategies, arranges for the acquisition of assets and associated financing, monitors the performance of New Residential’s assets and provides certain advisory, administrative and managerial services in connection with the operations of New Residential. The Manager is entitled to receive a management fee in an amount equal to 1.5% per annum of New Residential’s gross equity calculated and payable monthly in arrears in cash. Gross equity is generally (i) the equity transferred by Drive Shack Inc. (“Drive Shack”), formerly Newcastle Investment Corp., which was the sole stockholder of New Residential until the spin-off of New Residential completed on May 15, 2013, (ii) plus total net proceeds from stock offerings, plus certain capital contributions to subsidiaries, less capital distributions and repurchases of common stock. In addition, the Manager is entitled to receive annual incentive compensation in an amount equal to the product of (A) 25% of the dollar amount by which (1) (a) New Residential’s funds from operations before the incentive compensation, excluding funds from operations from investments in the Consumer Loan Companies and any unrealized gains or losses from mark-to-market valuation changes on investments and debt (and any deferred tax impact thereof), per share of common stock, plus (b) earnings (or losses) from the Consumer Loan Companies computed on a level-yield basis (such that the loans are treated as if they qualified as loans acquired with a discount for credit quality as set forth in ASC No. 310-30, as such codification was in effect on June 30, 2013) as if the Consumer Loan Companies had been acquired at their GAAP basis on May 15, 2013, plus earnings (or losses) from equity method investees invested in Excess MSRs as if such equity method investees had not made a fair value election, plus gains (or losses) from debt restructuring and gains (or losses) from sales of property, and plus non-routine items, minus amortization of non-routine items, in each case per share of common stock, exceed (2) an amount equal to (a) the weighted average of the book value per share of the equity transferred by Drive Shack on the date of the spin-off and the prices per share of New Residential’s common stock in any offerings (adjusted for prior capital dividends or capital distributions) multiplied by (b) a simple interest rate of 10% per annum, multiplied by (B) the weighted average number of shares of common stock outstanding. “Funds from operations” means net income (computed in accordance with GAAP), excluding gains (or losses) from debt restructuring and gains (or losses) from sales of property, plus depreciation on real estate assets, and after adjustments for unconsolidated partnerships and joint ventures. Funds from operations will be computed on an unconsolidated basis. The computation of funds from operations may be adjusted at the direction of New Residential’s independent directors based on changes in, or certain applications of, GAAP. Funds from operations is determined from the date of the spin-off and without regard to Drive Shack’s prior performance. In addition to the management fee and incentive compensation, New Residential is responsible for reimbursing the Manager for certain expenses paid by the Manager on behalf of New Residential. Due to affiliates is comprised of the following amounts: December 31, 2018 2017 Management fees $ 5,779 $ 4,734 Incentive compensation 94,900 81,373 Expense reimbursements and other 792 2,854 Total $ 101,471 $ 88,961 Affiliate expenses and fees were comprised of: Year Ended December 31, 2018 2017 2016 Management fees $ 62,594 $ 55,634 $ 41,610 Incentive compensation 94,900 81,373 42,197 Expense reimbursements (A) 500 500 500 Total $ 157,994 $ 137,507 $ 84,307 (A) Included in General and Administrative Expenses in the Consolidated Statements of Income. See Note 4 regarding co-investments with Fortress-managed funds. |
RECLASSIFICATION FROM ACCUMULAT
RECLASSIFICATION FROM ACCUMULATED OTHER COMPREHENSIVE INCOME INTO NET INCOME | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
RECLASSIFICATION FROM ACCUMULATED OTHER COMPREHENSIVE INCOME INTO NET INCOME | RECLASSIFICATION FROM ACCUMULATED OTHER COMPREHENSIVE INCOME INTO NET INCOME The following table summarizes the amounts reclassified out of accumulated other comprehensive income into net income: Accumulated Other Comprehensive Income Components Statement of Income Location Year Ended December 31, 2018 2017 2016 Reclassification of net realized (gain) loss on securities into earnings Gain (loss) on settlement of investments, net $ 29,936 $ (20,642 ) $ 27,460 Reclassification of net realized (gain) loss on securities into earnings Other-than-temporary impairment on securities 30,017 10,334 10,264 Total reclassifications $ 59,953 $ (10,308 ) $ 37,724 New Residential did not allocate any income tax expense or benefit to any component of other comprehensive income for any period presented as no taxable subsidiary generated other comprehensive income. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES Income tax (benefit) expense consists of the following: Year Ended December 31, 2018 2017 2016 Current: Federal $ 6,146 $ (1,250 ) $ 3,813 State and Local 477 360 252 Total Current Income Tax Expense (Benefit) 6,623 (890 ) 4,065 Deferred: Federal (68,907 ) 148,997 33,999 State and Local (11,147 ) 19,521 847 Total Deferred Income Tax Expense (Benefit) (80,054 ) 168,518 34,846 Total Income Tax (Benefit) Expense $ (73,431 ) $ 167,628 $ 38,911 New Residential intends to qualify as a REIT for each of its tax years through December 31, 2018 . A REIT is generally not subject to U.S. federal corporate income tax on that portion of its income that is distributed to stockholders if it distributes at least 90% of its REIT taxable income to its stockholders by prescribed dates and complies with various other requirements. New Residential operates various securitization vehicles and has made certain investments, particularly its investments in MSRs (Note 5), Servicer Advance Investments (Note 6) and REO (Note 8), through TRSs that are subject to regular corporate income taxes which have been provided for in the provision for income taxes, as applicable. The increase in the benefit for income taxes for the year ended December 31, 2018 is primarily due to the release of valuation allowances on deferred tax assets and increase in other deferred tax benefits attributable to New Residential’s TRSs. The increase in the provision for income taxes for the year ended December 31, 2017 is primarily due to the use of deferred tax assets and an increase in net income attributable to New Residential’s TRSs. The difference between New Residential’s reported provision for income taxes and the U.S. federal statutory rate of 21% is as follows: December 31, 2018 2017 2016 Provision at the statutory rate 21.00 % 35.00 % 35.00 % Non-taxable REIT income (25.44 )% (21.72 )% (28.22 )% State and local taxes (1.19 )% 1.76 % 0.18 % Change in valuation allowance (2.31 )% 0.85 % 0.67 % Change in federal tax rate — % (0.92 )% — % Other (0.30 )% (0.17 )% (0.48 )% Total provision (8.24 )% 14.80 % 7.15 % The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liability are presented below: December 31, 2018 2017 Deferred tax assets: Net operating losses and tax credit carryforwards (B) $ 41,713 $ 20,682 Interest accruals not currently deductible for tax purposes — 2,628 Basis differences for REO and other assets 8,453 8,034 Unrealized mark to market 36,758 — Other 3,087 2,279 Total deferred tax assets 90,011 33,623 Less valuation allowance — (12,404 ) Net deferred tax assets $ 90,011 $ 21,219 Deferred tax liabilities: Basis difference for partnership and other investments $ (24,179 ) $ (3,873 ) Interest accruals not currently includible in income for tax purposes — (6,979 ) Unrealized mark to market — (29,585 ) Total deferred tax (liability) $ (24,179 ) $ (40,437 ) Net deferred tax assets (liability) $ 65,832 $ (19,218 ) (A) As of December 31, 2018 , New Residential’s TRSs had approximately $131.3 million of net operating loss carryforwards for federal and state income tax purposes which may be available to offset future taxable income, if and when it arises. Approximately, $131.3 million of these federal and state net operating loss carryforwards will begin to expire in 2034. The utilization of the net operating loss carryforwards to reduce future income taxes will depend on the TRSs ability to generate sufficient taxable income prior to the expiration of the carryforward period. In assessing the realizability of deferred tax assets, New Residential considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which temporary differences become deductible. Due to the Shellpoint Acquisition and other asset acquisitions in 2018, and an internal restructuring of New Residential’s TRSs during the year ended December 31, 2018 , New Residential released a valuation allowance related to certain net operating losses and loan loss reserves related to its TRSs as New Residential believes that it is more likely than not that these deferred tax assets will be realized. The following table summarizes the change in the deferred tax asset valuation allowance: Valuation allowance at December 31, 2016 $ 10,054 Increase related to net operating losses and loan loss reserves 4,720 Decrease related to changes in tax rates (3,845 ) Other increase (decrease) 1,475 Valuation allowance at December 31, 2017 12,404 Increase related to net operating losses and loan loss reserves 18,769 Decrease related to changes in tax rates — Other increase (decrease) (31,173 ) Valuation allowance at December 31, 2018 $ — New Residential and its TRSs file income tax returns with the U.S. federal government and various state and local jurisdictions. Generally, New Residential is no longer subject to tax examinations by tax authorities for tax years ended prior to December 31, 2015 . New Residential recognizes tax benefits for uncertain tax positions only if it is more likely than not that the position is sustainable based on its technical merits. Interest and penalties on uncertain tax positions are included as a component of the provision for income taxes on the consolidated statements of operations. As of December 31, 2018 , New Residential has no material uncertainties to be recognized. New Residential does not believe that it is reasonably possible that the total amount of unrecognized tax benefits will significantly change within 12 months of the reporting date. Common stock distributions were taxable as follows: Year Dividends per Share Ordinary Income Long-term Capital Gain Return of Capital 2018 (A) $ 1.60 78.03 % 1.03 % 20.94 % 2017 (B) 1.94 66.64 % 7.83 % 25.53 % 2016 1.38 96.13 % 3.87 % — % (A) The entire $0.50 per share dividend declared in December 2018 and paid in January 2019 is treated as received by stockholders in 2019 . (B) The entire $0.50 per share dividend declared in December 2017 and paid in January 2018 is treated as received by stockholders in 2018 . |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2018 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS These financial statements include a discussion of material events that have occurred subsequent to December 31, 2018 (referred to as “subsequent events”) through the issuance of these consolidated financial statements. Events subsequent to that date have not been considered in these financial statements. Corporate Activities On December 20, 2018 , New Residential’s board of directors declared a fourth quarter 2018 dividend of $0.50 per common share or $184.6 million , which was paid on January 25, 2019 to stockholders of record as of December 31, 2018 . |
SUMMARY QUARTERLY CONSOLIDATED
SUMMARY QUARTERLY CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
SUMMARY OF QUARTERLY CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED) | SUMMARY QUARTERLY CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED) The following is an unaudited summary information on New Residential’s quarterly operations. 2018 Quarter Ended Year Ended December 31 March 31 June 30 September 30 December 31 Interest income $ 383,573 $ 403,805 $ 425,524 $ 451,321 $ 1,664,223 Interest expense 124,387 133,916 162,806 185,324 606,433 Net interest income 259,186 269,889 262,718 265,997 1,057,790 Impairment Other-than-temporary impairment (OTTI) on securities 6,670 12,631 3,889 6,827 30,017 Valuation and loss provision (reversal) on loans and real estate owned 19,007 3,658 5,471 32,488 60,624 25,677 16,289 9,360 39,315 90,641 Net interest income after impairment 233,509 253,600 253,358 226,682 967,149 Servicing revenue, net 217,236 146,193 175,355 (10,189 ) 528,595 Gain on sale of originated mortgage loans, net — — 45,732 43,285 89,017 Other income (loss) (A) 264,524 (96,812 ) (83,298 ) (128,671 ) (44,257 ) Operating Expenses 107,817 119,753 192,107 189,727 609,404 Income Before Income Taxes 607,452 183,228 199,040 (58,620 ) 931,100 Income tax (benefit) expense (6,912 ) (2,608 ) 3,563 (67,474 ) (73,431 ) Net Income $ 614,364 $ 185,836 $ 195,477 $ 8,854 $ 1,004,531 Noncontrolling Interests in Income of Consolidated Subsidiaries $ 10,111 $ 11,078 $ 10,869 $ 8,506 $ 40,564 Net Income Attributable to Common Stockholders $ 604,253 $ 174,758 $ 184,608 $ 348 $ 963,967 Net Income Per Share of Common Stock Basic $ 1.83 $ 0.52 $ 0.54 $ — $ 2.82 Diluted $ 1.81 $ 0.51 $ 0.54 $ — $ 2.81 Weighted Average Number of Shares of Common Stock Outstanding Basic 330,384,856 336,311,253 340,044,440 358,044,646 341,268,923 Diluted 333,380,436 339,538,503 340,868,403 358,509,094 343,137,361 Dividends Declared per Share of Common Stock $ 0.50 $ 0.50 $ 0.50 $ 0.50 $ 2.00 2017 Quarter Ended Year Ended December 31 March 31 June 30 September 30 December 31 Interest income $ 292,538 $ 471,952 $ 397,722 $ 357,467 $ 1,519,679 Interest expense 98,229 115,157 125,278 122,201 460,865 Net interest income 194,309 356,795 272,444 235,266 1,058,814 Impairment Other-than-temporary impairment (OTTI) on securities 2,112 5,115 1,509 1,598 10,334 Valuation and loss provision (reversal) on loans and real estate owned 17,910 20,771 26,700 10,377 75,758 20,022 25,886 28,209 11,975 86,092 Net interest income after impairment 174,287 330,909 244,235 223,291 972,722 Servicing revenue, net 40,602 170,851 58,014 154,882 424,349 Other (loss) income (A) (3,694 ) 57,847 87,145 66,488 207,786 Operating Expenses 68,441 139,360 117,060 97,716 422,577 Income Before Income Taxes 142,754 420,247 272,334 346,945 1,182,280 Income tax expense 5,596 82,844 32,613 46,575 167,628 Net Income $ 137,158 $ 337,403 $ 239,721 $ 300,370 $ 1,014,652 Noncontrolling Interests in Income of Consolidated Subsidiaries $ 15,780 $ 15,671 $ 13,600 $ 12,068 $ 57,119 Net Income Attributable to Common Stockholders $ 121,378 $ 321,732 $ 226,121 $ 288,302 $ 957,533 Net Income Per Share of Common Stock Basic $ 0.42 $ 1.05 $ 0.74 $ 0.94 $ 3.17 Diluted $ 0.42 $ 1.04 $ 0.73 $ 0.93 $ 3.15 Weighted Average Number of Shares of Common Stock Outstanding Basic 286,600,324 307,344,874 307,361,309 307,361,309 302,238,065 Diluted 288,241,188 309,392,512 309,207,345 310,388,102 304,381,388 Dividends Declared per Share of Common Stock $ 0.48 $ 0.50 $ 0.50 $ 0.50 $ 1.98 (A) Earnings from investments in equity method investees is included in other income. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Accounting | The accompanying consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles (“GAAP’’). The consolidated financial statements include the accounts of New Residential and its consolidated subsidiaries. All significant intercompany transactions and balances have been eliminated. |
Consolidation, Variable Interest Entities | New Residential consolidates those entities in which it has control over significant operating, financial and investing decisions of the entity, as well as those entities deemed to be variable interest entities (“VIEs”) in which New Residential is determined to be the primary beneficiary. For entities over which New Residential exercises significant influence, but which do not meet the requirements for consolidation, New Residential uses the equity method of accounting whereby it records its share of the underlying income of such entities. Distributions from equity method investees are classified in the Statements of Cash Flows based on the cumulative earnings approach, where all distributions up to cumulative earnings are classified as distributions of earnings. VIEs are defined as entities in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. A VIE is required to be consolidated only by its primary beneficiary, which is defined as the party who has the power to direct the activities of a VIE that most significantly impact its economic performance and who has the obligation to absorb losses or the right to receive benefits from the VIE that could be potentially significant to the VIE. To assess whether New Residential has the power to direct the activities of a VIE that most significantly impact the VIE’s economic performance, New Residential considers all the facts and circumstances, including its role in establishing the VIE and its ongoing rights and responsibilities. This assessment includes, first, identifying the activities that most significantly impact the VIE’s economic performance; and second, identifying which party, if any, has power over those activities. To assess whether New Residential has the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE, New Residential considers all of its economic interests and applies judgment in determining whether these interests, in the aggregate, are considered potentially significant to the VIE. In July 2018, as a result of our acquisition of Shellpoint Partners LLC (“Shellpoint”), New Residential consolidates Shellpoint Asset Funding Trust 2013-1 (“SAFT 2013-1”) and the Shelter retail mortgage origination joint ventures (“Shelter JVs”). A wholly owned subsidiary of Shellpoint, New Penn, was deemed to be the primary beneficiary of the SAFT 2013-1 securitization entity as a result of its ability to direct activities that most significantly impact the economic performance of the entity in its role as servicer and its ownership of subordinate retained interests. A wholly owned subsidiary of Shellpoint, Shelter Mortgage Company LLC (“Shelter”) is a mortgage originator specializing in retail origination. Shelter operates its business through a series of joint ventures and was deemed to be the primary beneficiary of the joint ventures as a result of its ability to direct activities that most significantly impact the economic performance of the entities and its ownership of a significant equity investment. New Residential’s investments in Non-Agency RMBS (Note 7) are variable interests. New Residential monitors these investments and analyzes the potential need to consolidate the related securitization entities pursuant to the VIE consolidation requirements. New Residential has not consolidated the securitization entities that issued its Non-Agency RMBS. This determination is based, in part, on New Residential’s assessment that it does not have the power to direct the activities that most significantly impact the economic performance of these entities, such as through ownership of a majority of the currently controlling class. In addition, New Residential is not obligated to provide, and has not provided, any financial support to these entities. Noncontrolling interests represent the ownership interests in certain consolidated subsidiaries held by entities or persons other than New Residential. These interests are related to noncontrolling interests in consolidated entities that hold New Residential’s Servicer Advance Investments (Note 6), Shelter (Note 8) and Consumer Loans (Note 9). |
Risks and Uncertainties | In the normal course of business, New Residential encounters primarily two significant types of economic risk: credit and market. Credit risk is the risk of default on New Residential’s investments that results from a borrower’s or counterparty’s inability or unwillingness to make contractually required payments. Market risk reflects changes in the value of investments due to changes in prepayment rates, interest rates, spreads or other market factors, including risks that impact the value of the collateral underlying New Residential’s investments. New Residential believes that the carrying values of its investments are reasonable taking into consideration these risks along with estimated prepayments, financings, collateral values, payment histories, and other information. Furthermore, for each of the periods presented, a significant portion of New Residential’s assets are dependent on its servicers’ and subservicers’ ability to perform their obligations servicing the loans underlying New Residential’s Excess MSRs, MSRs, MSR Financing Receivables, Servicer Advance Investments, Non-Agency RMBS and loans. If a servicer is terminated, New Residential’s right to receive its portion of the cash flows related to interests in servicing related assets may also be terminated. |
Income Tax Uncertainties | Additionally, New Residential is subject to significant tax risks. If New Residential were to fail to qualify as a REIT in any taxable year, New Residential would be subject to U.S. federal corporate income tax (including any applicable alternative minimum tax), which could be material. Unless entitled to relief under certain statutory provisions, New Residential would also be disqualified from treatment as a REIT for the four taxable years following the year during which qualification is lost. |
Use of Estimates | The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. |
Comprehensive Income | Comprehensive income is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances, excluding those resulting from investments by and distributions to owners. For New Residential’s purposes, comprehensive income represents net income, as presented in the Consolidated Statements of Income, adjusted for unrealized gains or losses on securities available for sale. |
Income Recognition - Investments in Excess Mortgage Servicing Rights | Excess MSRs are aggregated into pools as applicable; each pool of Excess MSRs is accounted for in the aggregate. Interest income for Excess MSRs is accreted into interest income on an effective yield or “interest” method, based upon the expected excess mortgage servicing amount through the expected life of the underlying mortgages. Changes to expected cash flows result in a cumulative retrospective adjustment, which will be recorded in the period in which the change in expected cash flows occurs. Under the retrospective method, the interest income recognized for a reporting period is measured as the difference between the amortized cost basis at the end of the period and the amortized cost basis at the beginning of the period, plus any cash received during the period. The amortized cost basis is calculated as the present value of estimated future cash flows using an effective yield, which is the yield that equates all past actual and current estimated future cash flows to the initial investment. In addition, New Residential’s policy is to recognize interest income only on its Excess MSRs in existing eligible underlying mortgages. The difference between the fair value of Excess MSRs and their amortized cost basis is recorded as “Change in fair value of investments in excess mortgage servicing rights.” Fair value is generally determined by discounting the expected future cash flows using discount rates that incorporate the market risks and liquidity premium specific to the Excess MSRs, and therefore may differ from their effective yields. |
Income Recognition - Investments in MSRs | MSRs are aggregated into pools as applicable; each pool of MSRs is accounted for in the aggregate. Income from MSRs is recorded in “Servicing revenue, net” and is comprised of three components: (i) income receivable from the MSRs, less (ii) amortization of the basis of the MSRs, plus or minus (iii) the mark-to-market on the MSRs. Amortization of the basis of the MSRs is based on the remaining UPB of the residential mortgage loans underlying the MSRs relative to their UPB at acquisition. Fair value is generally determined by discounting the expected future cash flows using discount rates that incorporate the market risks and liquidity premium specific to the MSRs. |
Income Recognition - Investments in MSR Financing Receivables | In certain cases, New Residential has legally purchased MSRs or the right to the economic interest in MSRs; however, New Residential has determined that the purchase agreement would not be treated as a sale under GAAP. Therefore, rather than recording an investment in MSRs, New Residential has recorded an investment in mortgage servicing rights financing receivables. Income from this investment (net of subservicing fees) is recorded as interest income, and New Residential has elected to measure the investment at fair value, with changes in fair value flowing through change in fair value of investments in mortgage servicing rights financing receivables in the Consolidated Statements of Income. |
Income Recognition - Servicer Advance Investments | New Residential accounts for its Servicer Advance Investments similarly to its investments in Excess MSRs. Interest income for Servicer Advance Investments is accreted into interest income on an effective yield or “interest” method, based upon the expected aggregate cash flows of the Servicer Advance Investments, including the basic fee component of the related MSR (but excluding any Excess MSR component) through the expected life of the underlying mortgages, net of a portion of the basic fee component of the MSR that New Residential remits to the servicer as compensation for the servicer’s servicing activities. Changes to expected cash flows result in a cumulative retrospective adjustment, which will be recorded in the period in which the change in expected cash flows occurs. Refer to “—Investments in Excess Mortgage Servicing Rights” for a description of the retrospective method. Fair value is generally determined by discounting the expected future cash flows using discount rates that incorporate the market risks and liquidity premium specific to the Servicer Advance Investments, and therefore may differ from their effective yields. |
Income Recognition - Investments in Real Estate and Other Securities | Discounts or premiums are accreted into interest income on an effective yield or “interest” method, based upon a comparison of actual and expected cash flows, through the expected maturity date of the security. For securities acquired at a discount for credit quality (i.e., where it is probable at acquisition that New Residential will not collect all contractually required interest and principal repayments), the difference between contractual cash flows and expected cash flows at acquisition is not accreted (non-accretable difference). For these securities, the excess of expected cash flows over the carrying value (accretable yield) is recognized as interest income on an effective yield basis. Depending on the nature of the investment, changes to expected cash flows may result in a prospective change to yield or a retrospective change which would include a catch up adjustment. Deferred fees and costs, if any, are recognized as an adjustment to the interest income over the terms of the securities using the interest method. Upon settlement of securities, the specific identification method is used to determine the excess (or deficiency) of net proceeds over the net carrying value of such security recognized as a realized gain (or loss) in the period of settlement. |
Income Recognition - Investments in Residential Mortgage Loans, REO and Consumer Loans | New Residential evaluates the credit quality of its loans, as of the acquisition date, for evidence of credit quality deterioration. Loans with evidence of credit deterioration since their origination, and where it is probable that New Residential will not collect all contractually required principal and interest payments, are Purchased Credit Deteriorated (“PCD”) loans. At acquisition, New Residential aggregates PCD loans into pools based on common risk characteristics and the aggregated loans are accounted for as if each pool were a single loan with a single composite interest rate and an aggregate expectation of cash flows. The excess of the total cash flows (both principal and interest) expected to be collected over the carrying value of the PCD loans is referred to as the accretable yield. This amount is not reported on New Residential’s Consolidated Balance Sheets but is accreted into interest income at a level rate of return over the remaining estimated life of the pool of loans. Loans where New Residential expects to collect all contractually required principal and interest payments are considered performing loans. Interest income on performing loans is accrued and recognized as interest income at their effective yield, which includes contractual interest and the amortization of purchase price discount or premium and deferred fees or expenses, and considers anticipated prepayment rates. Loans acquired with the intent to sell and loans not acquired with the intent to sell that New Residential decides to sell are classified as held-for-sale. Loans held-for-sale are measured at the lower of cost or fair value, with valuation changes recorded in impairment. Purchase price discounts or premiums are deferred in a contra loan account until the related loan is sold. The deferred discounts or premiums are an adjustment to the basis of the loan and are included in the quarterly determination of the lower of cost or fair value adjustments and/or the gain or loss recognized at the time of sale. Residential mortgage loans, held-for-sale, at fair value are originated or acquired loans for which New Residential has elected to account for at fair value. Accordingly, we estimate the fair value of the residential mortgage loans, held-for-sale, at fair value at each reporting date and reflect the change in the fair value in the Consolidated Statements of Income. For originated residential mortgage loans measured at fair value, we report the change in the fair value within gain on sale of originated mortgage loans, net in the consolidated statements of income. Fair value is generally determined using a market approach by utilizing either: (i) the fair value of securities backed by similar mortgage loans, adjusted for certain factors to approximate the fair value of a whole mortgage loan, (ii) current commitments to purchase loans or (iii) recent observable market trades for similar loans, adjusted for credit risk and other individual loan characteristics. For acquired residential mortgage loans measured at fair value, we report the change in the fair value within change in fair value of investments in residential mortgage loans in the consolidated statements of income. Fair value is generally determined by discounting the expected future cash flows using inputs such as default rates, prepayment speeds and discount rates. Interest earned on residential mortgage loans measured at fair value are reported in other income. Real estate owned (“REO”) assets are those individual properties acquired by New Residential or where New Residential receives the property in satisfaction of a debt (e.g., by taking legal title or physical possession). New Residential measures REO assets at the lower of cost or fair value, with valuation changes recorded in other income or impairment, as applicable. |
Impairment of Securities and Impairment of Loans | Impairment of Securities — Securities are considered to be impaired when it is probable that New Residential will be unable to collect all principal or interest when due according to the contractual terms of the original agreements, or for securities purchased at a discount for credit quality or that represent retained beneficial interests in securitizations, when New Residential determines that it is probable that it will be unable to collect as anticipated. The evaluation of a security’s estimated cash flows includes the following, as applicable: (i) review of the credit of the issuer or borrower, (ii) review of the credit rating of the security, (iii) review of the key terms of the security or underlying loans, (iv) review of the performance of the underlying loans, including debt service coverage and loan to value ratios, (v) analysis of the value of the underlying loans, (vi) analysis of the effect of local, industry and broader economic factors, and (vii) analysis of historical and anticipated trends in defaults, loss severities and prepayments for similar securities or underlying loans. New Residential must record a write down if it has the intent to sell a given security in an unrealized loss position, or if it is more likely than not that it will be required to sell such a security. Upon determination of impairment, New Residential records a direct write down for securities based on the estimated fair value of the security or underlying collateral using a discounted cash flow analysis or based on an observable market value. Subsequent to a determination of impairment, and a related write down, income on securities is accrued on an effective yield method from the new carrying value to the related expected cash flows, with cash received treated as a reduction of basis. Impairment of Loans — To the extent that they are classified as held-for-investment, New Residential must periodically evaluate each of these loans or loan pools for possible impairment. Impairment is indicated when it is deemed probable that New Residential will be unable to collect all amounts due according to the contractual terms of the loan, or for PCD loans, when it is deemed probable that New Residential will be unable to collect as anticipated. Upon determination of impairment, New Residential establishes an allowance for loan losses with a corresponding charge to earnings. Performing loans are aggregated into pools for the evaluation of impairment based on like characteristics, such as loan type and acquisition date. Pools of loans are evaluated based on criteria such as an analysis of borrower performance, credit ratings of borrowers, loan to value ratios, the estimated value of the underlying collateral, if any, the key terms of the loans and historical and anticipated trends in defaults and loss severities for the type and seasoning of loans being evaluated. This information is used to estimate provisions for estimated unidentified incurred losses on pools of loans. Significant judgment is required in determining impairment and in estimating the resulting loss allowance. For PCD loans, New Residential estimates the total cash flows expected to be collected over the remaining life of each pool. Probable decreases in expected cash flows trigger the recognition of impairment. Impairments are recognized through the provision for loans and an increase in the allowance for loan losses. Probable and significant increases in expected cash flows would first reverse any previously recorded allowance for loan losses with any remaining increases recognized prospectively as a yield adjustment over the remaining estimated lives of the underlying loans. A loan is determined to be past due when a monthly payment is due and unpaid for 30 days or more. Loans, other than PCD loans, are placed on nonaccrual status and considered non-performing when full payment of principal and interest is in doubt, which generally occurs when principal or interest is 120 days or more past due unless the loan is both well secured and in the process of collection. A loan may be returned to accrual status when repayment is reasonably assured and there has been demonstrated performance under the terms of the loan or, if applicable, the terms of the restructured loan. New Residential’s ability to recognize interest income on nonaccrual loans as cash interest payments are received rather than as a reduction of the carrying value of the loans is based on the recorded loan balance being deemed fully collectible. Loans held-for-sale are subject to the nonaccrual policy described above, however, as loans held-for-sale are recognized at the lower of cost or fair value, New Residential’s allowance for loan losses and charge-off policies do not apply to these loans. |
Expense Recognition - Interest Expense | New Residential finances certain investments using floating rate repurchase agreements and loans. Interest is expensed as incurred. |
Expense Recognition - General and Administrative Expenses, Loan Servicing Expense and Subservicing Expense | General and administrative expense primarily include employee compensation, legal fees, audit fees, insurance premiums, and other costs, as well as loan servicing and subservicing expenses, and are expensed as incurred. |
Expense Recognition - Management Fee and Incentive Compensation to Affiliate | These represent amounts due to the Manager pursuant to the Management Agreement. |
Balance Sheet Measurement - Investments in Servicing Related Assets | Servicing related assets consist of New Residential’s Excess MSRs, MSRs, MSR Financing Receivables, and Servicer Advance Investments. Upon acquisition, New Residential has elected to record each of such investments at fair value. New Residential elected to record its investments at fair value in order to provide users of the financial statements with better information regarding the effects of prepayment risk and other market factors on servicing related assets. Under this election, New Residential records a valuation adjustment on its investments in servicing related assets on a quarterly basis to recognize the changes in fair value in net income as described in “Income Recognition — Investments in Excess Mortgage Servicing Rights,” “Income Recognition — Investments in MSRs” and “Income Recognition — Servicer Advance Investments.” The Company recognizes MSRs created through the sale of loans it originates. Under the accounting guidance for transfers and servicing, the Company initially measures a mortgage servicing asset that qualifies for separate recognition at fair value on the date of transfer. |
Balance Sheet Measurement - Investments in Real Estate and Other Securities, Residential Mortgage Loans and Consumer Loans | Investments in Real Estate and Other Securities — New Residential has classified its investments in real estate and other securities as available for sale. Securities available for sale are carried at market value with the net unrealized gains or losses reported as a separate component of accumulated other comprehensive income, to the extent impairment losses are considered temporary. At disposition, the net realized gain or loss is determined on the basis of the amortized cost of the specific investments and is included in earnings. Unrealized losses on securities are charged to earnings if they reflect a decline in value that is other-than-temporary. Investments in Residential Mortgage Loans and Consumer Loans — Loans for which New Residential has the intent and ability to hold for the foreseeable future, or until maturity or payoff, are classified as held-for-investment. Performing loans held-for-investment are presented at the aggregate unpaid principal balance adjusted for any unamortized premium or discount, deferred fees or expenses, an allowance for loan losses, charge-offs and write-down for impaired loans. PCD loans held-for-investment are initially recorded at their purchase price at acquisition and are subsequently measured net of any allowance for loan losses. To the extent that the loans are classified as held-for-investment, New Residential periodically evaluates such loans for possible impairment as described in “—Impairment of Loans.” Loans which New Residential does not have the intent or the ability to hold into the foreseeable future are considered held-for-sale and are either carried at (i) the lower of their amortized cost basis or fair value or (ii) fair value where elected. New Residential discontinues the accretion of discounts or amortization of premiums on loans if they are reclassified from held-for-investment to held-for-sale. |
Balance Sheet Measurement - Mortgage Loan Repurchases | Mortgage Loan Repurchases — New Penn, as an approved issuer of Ginnie Mae MBS, originates, sells and securitizes government-insured residential mortgage loans into Ginnie Mae guaranteed securitizations and New Penn retains the right to service the underlying residential mortgage loans. As the servicer, New Penn, holds an option to repurchase delinquent loans from the securitization at its discretion (the “Ginnie Mae Buy-Back Option”). In accordance with the accounting guidance in ASC 860, New Penn recognizes any delinquent loans subject to the Ginnie Mae Buy-Back Option and an offsetting repurchase liability on its balance sheet regardless of whether New Penn executes its option to repurchase. |
Balance Sheet Measurement - Cash and Cash Equivalents and Restricted Cash | New Residential considers all highly liquid short-term investments with maturities of 90 days or less when purchased to be cash equivalents. Substantially all amounts on deposit with major financial institutions exceed insured limits. |
Balance Sheet Measurement - Derivatives | New Residential has entered into various economic hedges, as further described in Note 10, that are marked to fair value on a periodic basis through “—Other Income.” |
Balance Sheet Measurement - Income Taxes | New Residential operates so as to qualify as a REIT under the requirements of the Internal Revenue Code of 1986, as amended. Requirements for qualification as a REIT include various restrictions on ownership of New Residential’s stock, requirements concerning distribution of taxable income and certain restrictions on the nature of assets and sources of income. A REIT must distribute at least 90% of its taxable income to its stockholders (subject to certain adjustments). Distributions may extend until timely filing of New Residential’s tax return in the subsequent taxable year. Qualifying distributions of taxable income are deductible by a REIT in computing taxable income. Certain activities of New Residential are conducted through taxable REIT subsidiaries (“TRSs”) and therefore are subject to federal and state income taxes. Accordingly, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases upon the change in tax status. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. New Residential recognizes tax benefits for uncertain tax positions only if it is more likely than not that the position is sustainable based on its technical merits. Interest and penalties on uncertain tax positions are included as a component of the provision for income taxes on the consolidated statements of operations. |
Balance Sheet Measurement - Servicer Advances Receivable | Represents servicer advances due to New Residential’s servicer subsidiary, NRM (Note 5). The servicer advances receivable purchased in conjunction with MSRs are recorded with purchase discounts. Subsequent advances are recorded at cost, subject to impairment. Any related purchase discounts are accreted into servicing revenue, net (MSRs) or interest income (MSR financing receivables) on a straight-line basis over the estimated weighted average life of the advances. |
Balance Sheet Measurement - Goodwill | As a result of the Shellpoint Acquisition, New Residential recorded goodwill for the consideration transferred in excess of the fair value of the net identifiable assets acquired. New Residential performs an annual assessment of goodwill on October 1 and in interim periods in case of events or circumstances that make it more likely than not that an impairment may have occurred. |
Balance Sheet Measurement - Intangible Assets | As a result of the Shellpoint Acquisition, New Residential identified intangible assets in the form of licenses and tradename. New Residential recorded the intangible assets at fair value at the acquisition date and will amortize the value of the tradename into expense over the expected useful life. |
Balance Sheet Measurement - Repurchase Agreements and Notes and Bonds Payable | New Residential’s repurchase agreements are generally short-term debt that expire within one year . Such agreements and notes and bonds payable are carried at their contractual amounts, as specified by each repurchase or financing agreement, and generally treated as collateralized financing transactions. |
Balance Sheet Measurement - Mortgage Origination Reserves | New Penn, a wholly owned subsidiary of New Residential, originates conventional, government-insured and nonconforming residential mortgage loans for sale and securitization. In connection with the transfer of loans to the GSEs or mortgage investors, New Penn makes representations and warranties regarding certain attributes of the loans and, subsequent to the sale, if it is determined that a sold loan is in breach of these representations and warranties, New Penn generally has an obligation to cure the breach. If New Penn is unable to cure the breach, the purchaser may require New Penn to repurchase the loan. New Residential records a reserve for sales recourse at the time of sale to cover all potential recourse obligations based on the outstanding balance of mortgage loans subject to recourse as well as historical and estimated future loss rates. New Residential evaluates the ongoing adequacy of the reserve based on actual experience and changing circumstances, making adjustments to the reserve as deemed necessary. |
Recent Accounting Pronouncements | In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenues from Contracts with Customers (Topic 606) . The standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In effect, companies are required to exercise further judgment and make more estimates prospectively. These may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. ASU No. 2014-09 was effective for New Residential in the first quarter of 2018. New Residential has evaluated the new guidance and determined that interest income, gains and losses on financial instruments and income from servicing residential mortgage loans are outside the scope of ASC No. 606. For income from servicing residential mortgage loans, New Residential considered that the FASB Transition Resource Group members generally agreed that an entity should look to ASC No. 860, Transfers and Servicing, to determine the appropriate accounting for these fees and ASC No. 606 contains a scope exception for contracts that fall under ASC No. 860. In addition, NRM determined that ancillary income generated from services for mortgage loans and REO properties represent servicing fees due to a servicer, through contractual terms, that would no longer be received by a servicer if the owners of the serviced loans were to exercise their authority to shift the servicing to another servicer and, therefore, similarly fall under ASC No. 860. Finally, New Residential determined that fee income on residential mortgage loan originations is outside the scope of ASC No. 606 as it continues to be accounted for in accordance with ASC No. 948. As a result, the adoption of ASU No. 2014-09 did not have a material impact on its consolidated financial statements. In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments - Overall (Subtopic 825-10) - Recognition and Measurement of Financial Assets and Financial Liabilities. The standard: (i) requires that certain equity investments be measured at fair value, and modifies the assessment of impairment for certain other equity investments, (ii) changes certain disclosure requirements related to the fair value of financial instruments measured at amortized cost, (iii) changes certain disclosure requirements related to liabilities measured at fair value, (iv) requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset, and (v) clarifies that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets. ASU No. 2016-01 was effective for New Residential in the first quarter of 2018. The adoption of ASU No. 2016-01 resulted in the fair valuation of an equity investment on its consolidated balance sheet where New Residential did not have significant influence on its consolidated balance sheet and did not have a material impact on its consolidated statement of income. In February 2016, the FASB issued ASU No. 2016-02, Leases . The standard requires that lessees recognize a right-of-use asset and corresponding lease liability on the balance sheet for most leases. The guidance applied by a lessor under ASU No. 2016-02 is substantially similar to existing GAAP. ASU No. 2016-02 is effective for New Residential in the first quarter of 2019. Early adoption is permitted upon issuance. An entity should apply ASU No. 2016-02 by means of a modified retrospective transition method for all leases existing at, or entered into after, the date of initial application. The adoption of ASU No. 2016-02 did not have a material impact on the consolidated financial statements, and the amount of New Residential future lease commitments has been deemed as immaterial (see Note 14 for details). In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326) - Measurement of Credit Losses on Financial Instruments . The standard requires that a financial asset measured at amortized cost basis be presented at the net amount expected to be collected, net of an allowance for all expected (rather than incurred) credit losses. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. The standard also changes the accounting for purchased credit deteriorated assets and available-for-sale securities, which will require the recognition of credit losses through a valuation allowance when fair value is less than amortized cost, regardless of whether the impairment is considered to be other-than-temporary. ASU No. 2016-13 is effective for New Residential in the first quarter of 2020, and early adoption was permitted beginning in 2019. An entity should apply ASU No. 2016-13 by means of a cumulative-effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption. New Residential is currently evaluating the new guidance to determine the impact it may have on its consolidated financial statements, which at the date of adoption is expected to increase the allowance for credit losses with a resulting negative adjustment to retained earnings. In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740) - Intra-Entity Transfers of Assets Other Than Inventory . The standard requires recognition of the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. ASU No. 2016-16 was effective for New Residential in the first quarter of 2018. The adoption of ASU No. 2016-16 did not have a material impact on its consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-04, Simplifying the Test for Goodwill Impairment (Topic 805) . The standard simplifies the accounting for goodwill impairment for all entities by requiring impairment charges to be based on the first step in the current two-step impairment test. Under the new guidance, an impairment charge, if triggered, is calculated as the difference between a reporting unit’s carrying value and fair value, but it is limited to the carrying value of goodwill. ASU No. 2017-04 is effective for New Residential in the first quarter of 2020 and early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The adoption of ASU No. 2017-04 is not expected to have a material impact on its consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820) . The standard: (i) adds incremental requirements for entities to disclose (a) the amount of total gains or losses for the period recognized in other comprehensive income that is attributable to fair value changes in assets and liabilities held as of the balance sheet date and categorized within Level 3 of the fair value hierarchy, (b) the range and weighted average used to develop significant unobservable inputs and (c) how the weighted average was calculated for fair value measurements categorized within Level 3 of the fair value hierarchy and (ii) eliminates disclosure requirements for (a) transfers between Level 1 and Level 2 and (b) valuation processes for Level 3 fair value measurements. ASU No. 2018-13 is effective for New Residential in the first quarter of 2020 and early adoption is permitted for interim or annual periods beginning with the third quarter of 2018. The adoption of ASU No. 2018-13 is not expected to have a material impact on its consolidated financial statements. |
ORGANIZATION (Tables)
ORGANIZATION (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Total Consideration | The total consideration is summarized as follows: Total Consideration Amount Cash Consideration $ 212.3 Earnout Payment (A) 39.3 Effective Settlement of Preexisting Relationships (B) 173.9 Total Consideration $ 425.5 (A) The range of outcomes for this contingent consideration is from $0 to $60.0 million , dependent on the performance of Shellpoint. New Residential derived a fair value of the contingent consideration payment in three years of $39.3 million . This amount excludes contingent payments to the long-term employee incentive plans that require continuing employment and are recognized as compensation expense within General and Administrative expenses in the post-acquisition consolidated financial statements separate from New Residential’s acquisition of assets and assumption of liabilities in the business combination. As of December 31, 2018 , the contingent consideration had a fair value of $40.8 million . (B) Represents the effective settlement of preexisting relationships between New Residential and Shellpoint including 1) MSR acquisitions, 2) a note payable and 3) operating accounts receivable and payable existing prior to the acquisition date. The effective settlement of these preexisting relationships had no impact to New Residential’s consolidated statements of income. New Residential has performed an allocation of the total consideration of $425.5 million to Shellpoint’s assets and liabilities, as set forth below. The final amount and allocation of total consideration reflects certain measurement period adjustments identified during the fourth quarter of 2018 , including the effect on earnings that would have been recorded during the third quarter of 2018 had the accounting been completed at the acquisition date. Such measurement period adjustments included 1) a decrease of $3.5 million in the amount of contingent consideration based upon finalization of the internal valuation 2) a decrease of $6.4 million to consideration transferred for the effective settlement of existing relationships 3) an increase of $14.1 million to the fair value of identifiable intangible assets based upon receipt of the final valuation report from a third-party valuation firm and 4) an increase of $0.3 million to other assets due to a decrease in the fair value discount on certain servicing advance receivables. These measurement period adjustments results in a corresponding decrease to goodwill in the amount of $24.3 million . Total Consideration ($ in millions) $ 425.5 Assets Cash and cash equivalents $ 79.2 Restricted cash 9.9 Residential mortgage loans, held-for-sale, at fair value 488.2 Mortgage servicing rights, at fair value (A) 286.6 Residential mortgage loans, held-for-investment, at fair value 125.3 Residential mortgage loans subject to repurchase 121.4 Intangible assets (B) 18.4 Other assets 81.5 Total Assets Acquired $ 1,210.5 Liabilities Repurchase agreements $ 439.6 Notes and bonds payable 20.7 Mortgage-backed securities issued, at fair value 120.7 Residential mortgage loans repurchase liability 121.4 Excess spread financing, at fair value 48.3 Accrued expenses and other liabilities 50.6 Total Liabilities Assumed $ 801.3 Noncontrolling Interest $ 8.3 Net Assets $ 400.9 Goodwill $ 24.6 (A) Includes $135.3 million of Ginnie Mae MSRs where New Residential acquired the rights to the economic value of the servicing rights from Shellpoint prior to the acquisition date. (B) Includes intangible assets in the form of mortgage origination and servicing licenses, internally developed software and a tradename. New Residential determined that mortgage origination and servicing licenses have an indefinite useful life and will be evaluated for impairment given no legal, regulatory, contractual, competitive or economic factors that would limit the useful life. Internally developed software and tradenames will be amortized over finite useful lives of five years and six months, respectively, based on the expected software development timeline and New Residential’s determination of the time to change a tradename with limited value. |
Summary of Pro Forma Financial Information | The following table presents unaudited pro forma combined Servicing and Originations Revenue, which is comprised of 1) servicing revenue, net and 2) gain on sale of originated mortgage loans, net, and Income Before Income Taxes for the years ended December 31, 2018 and 2017 prepared as if the Shellpoint Acquisition had been consummated on January 1, 2017. December 31, 2018 2017 Pro Forma Servicing and Originations Revenue $ 766,997 $ 749,031 Income Before Income Taxes 948,086 1,197,485 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Schedule of Accretion and Other Amortization | Accretion and Other Amortization — As reflected on the consolidated statements of cash flows, this item is comprised of the following: Year Ended December 31, 2018 2017 2016 Accretion of servicer advances receivable discount and servicer advance investments $ 214,876 $ 542,983 $ 364,350 Accretion of excess mortgage servicing rights income 44,440 103,053 150,141 Accretion of net discount on securities and loans (A) 452,500 398,213 253,243 Amortization of deferred financing costs (7,795 ) (12,076 ) (18,326 ) Amortization of discount on notes and bonds payable (2,054 ) (789 ) (1,476 ) $ 701,967 $ 1,031,384 $ 747,932 (A) Includes accretion of the accretable yield on PCD loans. |
Schedule of Other Income (Loss), Net | Other Income (Loss), Net — This item is comprised of the following: Year Ended December 31, 2018 2017 2016 Unrealized gain (loss) on derivative instruments $ (113,558 ) $ (2,190 ) $ 5,774 Unrealized gain (loss) on other ABS 10,283 2,883 (2,322 ) Unrealized gain (loss) on notes and bonds payable (684 ) — — Unrealized gain (loss) on contingent consideration (1,581 ) — — Gain (loss) on transfer of loans to REO 19,519 22,938 18,356 Gain (loss) on transfer of loans to other assets (1,977 ) 488 2,938 Gain (loss) on Excess MSR recapture agreements 979 2,384 2,802 Gain (loss) on Ocwen common stock (10,860 ) 5,346 — Other income (loss) (26,457 ) (27,741 ) 935 $ (124,336 ) $ 4,108 $ 28,483 |
Schedule of Gain (Loss) on Settlement of Investments, Net | Gain (Loss) on Settlement of Investments, Net — This item is comprised of the following: Year Ended December 31, 2018 2017 2016 Gain (loss) on sale of real estate securities, net $ (29,936 ) $ 20,642 $ (27,460 ) Gain (loss) on sale of acquired residential mortgage loans, net (7,677 ) 39,731 12,142 Gain (loss) on settlement of derivatives 54,867 (39,214 ) (27,491 ) Gain (loss) on liquidated residential mortgage loans 5,023 (10,201 ) (1,810 ) Gain (loss) on sale of REO (12,424 ) (9,215 ) 4,690 Gains reclassified from change in fair value of investments in excess MSRs and servicer advance investments 113,002 11,320 — Other gains (losses) (19,013 ) (2,753 ) (8,871 ) $ 103,842 $ 10,310 $ (48,800 ) |
Schedule Of General And Administrative Expenses | General and Administrative Expenses is comprised of the following: Year Ended December 31, 2018 2017 2016 Compensation and benefits expense $ 109,870 $ — $ 663 Legal and professional expense 45,234 40,182 23,983 Loan origination expense 16,050 — — Occupancy expense 8,868 — — Other (A) 51,557 26,977 13,924 $ 231,579 $ 67,159 $ 38,570 (A) Represents miscellaneous general and administrative expenses. |
Schedule of Other Assets and Other Liabilities | Other Assets and Other Liabilities — Other assets and liabilities are comprised of the following: Other Assets Accrued Expenses and Other Liabilities December 31, December 31, 2018 2017 2018 2017 Margin receivable, net (A) $ 145,857 $ 53,150 Interest payable $ 49,352 $ 28,821 Other receivables 23,723 10,635 Accounts payable 75,591 73,017 Principal and interest receivable 76,015 48,373 Derivative liabilities (Note 10) 29,389 697 Receivable from government agency (B) 20,795 41,429 Due to servicers 95,419 24,571 Call rights 290 327 MSRs purchase price holdback 100,593 101,290 Derivative assets (Note 10) 10,893 2,423 Excess spread financing, at fair value 39,304 — Servicing fee receivables 105,563 60,520 Contingent Consideration 40,842 — Ginnie Mae EBO servicer advances receivable, net (C) 2,750 8,916 Reserve for sales recourse 5,880 — Due from servicers 95,261 38,601 Other liabilities 54,140 10,718 Goodwill 24,645 — $ 490,510 $ 239,114 Intangible assets 18,708 — Ocwen common stock, at fair value 7,778 19,259 Prepaid expenses 29,165 7,308 Equity investment (D) 74,323 — Other assets 52,642 21,240 $ 688,408 $ 312,181 (A) Represents collateral posted primarily as a result of changes in fair value of our 1) real estate securities securing our repurchase agreements and 2) derivative instruments. (B) Represents claims receivable from the FHA on EBO and reverse mortgage loans for which foreclosure has been completed and for which New Residential has made or intends to make a claim on the FHA guarantee. (C) Represents an HLSS (Note 1) loan to a counterparty collateralized by servicer advances on Ginnie Mae EBO loans. (D) Represents an indirect equity investment in a commercial redevelopment project. The investment is accounted for at fair value based on the net asset value (“NAV”) of New Residential’s investment. |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Summary of Segment Financial Data | Summary financial data on New Residential’s segments is given below, together with a reconciliation to the same data for New Residential as a whole: Residential Securities and Loans Servicing and Originations Real Estate Securities Residential Mortgage Loans Consumer Loans Corporate Total Year Ended December 31, 2018 Interest income $ 723,965 $ 573,539 $ 158,892 $ 206,321 $ 1,506 $ 1,664,223 Interest expense 242,345 240,615 80,910 42,563 — 606,433 Net interest income 481,620 332,924 77,982 163,758 1,506 1,057,790 Impairment — 30,017 12,061 48,563 — 90,641 Servicing revenue, net 528,595 — — — — 528,595 Gain on sale of originated mortgage loans, net 89,017 — — — — 89,017 Other income (loss) 12,654 (72,926 ) 16,456 9,965 (10,406 ) (44,257 ) Operating expenses 360,889 1,554 32,424 35,230 179,307 609,404 Income (Loss) Before Income Taxes 750,997 228,427 49,953 89,930 (188,207 ) 931,100 Income tax (benefit) expense (8,364 ) — (65,279 ) 212 — (73,431 ) Net Income (Loss) $ 759,361 $ 228,427 $ 115,232 $ 89,718 $ (188,207 ) $ 1,004,531 Noncontrolling interests in income (loss) of consolidated subsidiaries $ 3,577 $ — $ — $ 36,987 $ — $ 40,564 Net income (loss) attributable to common stockholders $ 755,784 $ 228,427 $ 115,232 $ 52,731 $ (188,207 ) $ 963,967 Residential Securities and Loans Servicing and Originations Real Estate Securities Residential Mortgage Loans Consumer Loans Corporate Total December 31, 2018 Investments $ 6,738,923 $ 11,636,581 $ 3,832,701 $ 1,110,496 $ — $ 23,318,701 Cash and cash equivalents 236,871 49 927 8,279 4,932 251,058 Restricted cash 126,401 — — 37,619 — 164,020 Other assets 3,510,192 4,080,202 131,282 64,802 146,111 7,932,589 Goodwill 24,645 — — — — 24,645 Total assets $ 10,637,032 $ 15,716,832 $ 3,964,910 $ 1,221,196 $ 151,043 $ 31,691,013 Debt $ 6,815,112 $ 11,615,364 $ 3,191,859 $ 1,033,900 $ — $ 22,656,235 Other liabilities 520,215 2,111,868 8,916 13,572 291,912 2,946,483 Total liabilities 7,335,327 13,727,232 3,200,775 1,047,472 291,912 25,602,718 Total equity 3,301,705 1,989,600 764,135 173,724 (140,869 ) 6,088,295 Noncontrolling interests in equity of consolidated subsidiaries 60,064 — — 30,561 — 90,625 Total New Residential stockholders’ equity $ 3,241,641 $ 1,989,600 $ 764,135 $ 143,163 $ (140,869 ) $ 5,997,670 Investments in equity method investees $ 147,964 $ — $ — $ 38,294 $ — $ 186,258 Residential Securities and Loans Servicing and Originations Real Estate Securities Residential Mortgage Loans Consumer Loans Corporate Total Year Ended December 31, 2017 Interest income $ 713,413 $ 431,706 $ 110,087 $ 263,844 $ 629 $ 1,519,679 Interest expense 233,587 122,997 51,473 52,808 — 460,865 Net interest income (expense) 479,826 308,709 58,614 211,036 629 1,058,814 Impairment — 10,334 12,593 63,165 — 86,092 Servicing revenue, net 424,349 — — — — 424,349 Gain on sale of originated mortgage loans, net — — — — — — Other income (loss) 174,561 (16,371 ) 16,175 28,075 5,346 207,786 Operating expenses 186,330 1,471 31,529 43,552 159,695 422,577 Income (Loss) Before Income Taxes 892,406 280,533 30,667 132,394 (153,720 ) 1,182,280 Income tax (benefit) expense 166,186 — 1,272 170 — 167,628 Net Income (Loss) $ 726,220 $ 280,533 $ 29,395 $ 132,224 $ (153,720 ) $ 1,014,652 Noncontrolling interests in income (loss) of consolidated subsidiaries $ 11,227 $ — $ — $ 45,892 $ — $ 57,119 Net income (loss) attributable to common stockholders $ 714,993 $ 280,533 $ 29,395 $ 86,332 $ (153,720 ) $ 957,533 Residential Securities and Loans Servicing and Originations Real Estate Securities Residential Mortgage Loans Consumer Loans Corporate Total December 31, 2017 Investments $ 7,707,089 $ 8,071,140 $ 2,544,984 $ 1,425,675 $ — $ 19,748,888 Cash and cash equivalents 183,306 38,728 15,483 40,687 17,594 295,798 Restricted cash 104,123 — — 46,129 — 150,252 Other assets 747,997 1,098,921 113,035 28,621 30,050 2,018,624 Goodwill — — — — — — Total assets $ 8,742,515 $ 9,208,789 $ 2,673,502 $ 1,541,112 $ 47,644 $ 22,213,562 Debt $ 5,771,369 $ 6,534,300 $ 2,108,007 $ 1,332,854 $ — $ 15,746,530 Other liabilities 189,840 1,200,905 23,917 6,596 249,612 1,670,870 Total liabilities 5,961,209 7,735,205 2,131,924 1,339,450 249,612 17,417,400 Total equity 2,781,306 1,473,584 541,578 201,662 (201,968 ) 4,796,162 Noncontrolling interests in equity of consolidated subsidiaries 71,491 — — 34,466 — 105,957 Total New Residential stockholders’ equity $ 2,709,815 $ 1,473,584 $ 541,578 $ 167,196 $ (201,968 ) $ 4,690,205 Investments in equity method investees $ 171,765 $ — $ — $ 51,412 $ — $ 223,177 Residential Securities and Loans Servicing and Originations Real Estate Securities Residential Mortgage Loans Consumer Loans Corporate Total Year Ended December 31, 2016 Interest income $ 519,950 $ 265,862 $ 56,249 $ 232,750 $ 1,924 $ 1,076,735 Interest expense 244,039 49,283 25,675 54,427 — 373,424 Net interest income (expense) 275,911 216,579 30,574 178,323 1,924 703,311 Impairment — 10,264 23,870 53,846 — 87,980 Servicing revenue, net 118,169 — — — — 118,169 Gain on sale of originated mortgage loans, net — — — — — — Other income (loss) 6,774 (47,747 ) 26,779 76,518 13 62,337 Operating expenses 15,676 1,480 14,961 39,466 102,627 174,210 Income (Loss) Before Income Taxes 385,178 157,088 18,522 161,529 (100,690 ) 621,627 Income tax (benefit) expense 36,719 — 2,117 75 — 38,911 Net Income (Loss) $ 348,459 $ 157,088 $ 16,405 $ 161,454 $ (100,690 ) $ 582,716 Noncontrolling interests in income of consolidated subsidiaries $ 40,136 $ — $ — $ 38,127 $ — $ 78,263 Net income (loss) attributable to common stockholders $ 308,323 $ 157,088 $ 16,405 $ 123,327 $ (100,690 ) $ 504,453 |
INVESTMENTS IN EXCESS MORTGAG_2
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Transfers and Servicing [Abstract] | |
Schedule of Servicing Assets at Fair Value | The following table presents activity related to the carrying value of New Residential’s direct investments in Excess MSRs: Servicer Nationstar SLS (A) Ocwen (B) Total Balance as of December 31, 2016 $ 611,293 $ 3,935 $ 784,227 $ 1,399,455 Purchases — — (71,982 ) (71,982 ) Interest income — — — — Other income 46,393 (191 ) 56,851 103,053 Proceeds from repayments 2,384 — 1,993 4,377 Proceeds from sales (120,485 ) (1,400 ) (130,122 ) (252,007 ) Change in fair value (13,505 ) — — (13,505 ) Ocwen Transaction (Note 5) 6,153 569 (2,400 ) 4,322 Balance as of December 31, 2017 532,233 2,913 638,567 1,173,713 Purchases — — — — Interest income 44,386 54 — 44,440 Other income 6,444 — 40,417 46,861 Proceeds from repayments (100,215 ) (632 ) (26,946 ) (127,793 ) Proceeds from sales (19,084 ) — — (19,084 ) Change in fair value (18,436 ) 197 (40,417 ) (58,656 ) Ocwen Transaction (Note 5) — — (611,621 ) (611,621 ) Balance as of December 31, 2018 $ 445,328 $ 2,532 $ — $ 447,860 (A) Specialized Loan Servicing LLC (“SLS”). (B) Ocwen Loan Servicing LLC, a subsidiary of Ocwen Financial Corporation (together with its subsidiaries, including Ocwen Loan Servicing LLC, “Ocwen”), services the loans underlying the Excess MSRs and Servicer Advance Investments. Changes in fair value recorded in other income is comprised of the following: Year Ended December 31, 2018 2017 2016 Original and Recaptured Pools $ (50,030 ) $ (5,630 ) $ (11,221 ) Recapture Agreements (8,626 ) 9,952 3,924 $ (58,656 ) $ 4,322 $ (7,297 ) The following table presents activity related to the carrying value of New Residential’s investments in MSRs: Balance as of December 31, 2016 $ 659,483 Purchases 1,143,693 Amortization of servicing rights (A) (223,167 ) Change in valuation inputs and assumptions (B) 155,495 Balance as of December 31, 2017 $ 1,735,504 Purchases 1,042,933 Transfer In (C) 124,652 Shellpoint Acquisition (D) (E) 151,312 Originations (F) 35,311 Proceeds from sales (5,776 ) Amortization of servicing rights (A) (258,068 ) Change in valuation inputs and assumptions (B) 61,149 (Gain)/loss on sales (G) (2,917 ) Balance as of December 31, 2018 $ 2,884,100 (A) Based on the ratio of the current UPB of the underlying residential mortgage loans relative to the original UPB of the underlying residential mortgage loans. (B) Change in valuation inputs and assumptions includes changes in inputs or assumptions used in the valuation model and other changes due to the realization of expected cash flows. (C) Represents Ginnie Mae MSRs previously accounted for as Mortgage Servicing Rights Financing Receivable. (D) Represents MSRs acquired through New Residential’s acquisition of Shellpoint Partners LLC. (E) Includes $48.3 million of MSRs legally sold by New Penn treated as a secured borrowing as it did not meet the criteria for sale treatment. New Residential elected to record the excess spread financing liability at fair value pursuant to the fair value option. (F) Represents MSRs retained on the sale of originated mortgage loans. (G) Represents the realization of unrealized gain/(loss) as a result of sales. The following table presents activity related to the carrying value of New Residential’s investments in mortgage servicing rights financing receivables: Balance as of December 31, 2016 $ — Purchases 467,884 Ocwen Transaction 64,450 Amortization of servicing rights (A) (43,190 ) Change in valuation inputs and assumptions (B) 109,584 Balance as of December 31, 2017 $ 598,728 Purchases 128,357 Transfer Out (C) (124,652 ) New Ocwen Agreements 1,017,993 Proceeds from sales (7,472 ) Amortization of servicing rights (A) (197,703 ) Change in valuation inputs and assumptions (B) 230,036 (Gain)/loss on sales (D) (783 ) Balance as of December 31, 2018 $ 1,644,504 (A) Based on the ratio of the current UPB of the underlying residential mortgage loans relative to the original UPB of the underlying residential mortgage loans. (B) Change in valuation inputs and assumptions includes changes in inputs or assumptions used in the valuation model and other changes due to the realization of expected cash flows. (C) Represents Ginnie Mae MSRs owned by New Penn accounted for as Mortgage Servicing Rights as a result of the Shellpoint Acquisition. (D) Represents the realization of unrealized gain/(loss) as a result of sales. The following is a summary of New Residential’s investments in mortgage servicing rights financing receivables: UPB of Underlying Mortgages Weighted Average Life (Years) (A) Amortized Cost Basis Carrying Value (B) December 31, 2018 Agency $ 42,265,547 5.9 $ 366,946 $ 434,110 Non-Agency 88,251,018 7.2 936,792 1,210,394 Total $ 130,516,565 6.8 $ 1,303,738 $ 1,644,504 December 31, 2017 Agency $ 49,498,415 5.9 $ 428,657 $ 476,206 Non-Agency 14,846,478 5.6 60,487 122,522 Total $ 64,344,893 5.8 $ 489,144 $ 598,728 (A) Weighted Average Life represents the weighted average expected timing of the receipt of expected cash flows for this investment. (B) Carrying Value represents fair value. As of December 31, 2018 and 2017 , weighted average discount rates of 10.3% and 9.4% , respectively, were used to value New Residential’s investments in mortgage servicing rights financing receivables. The following is a summary of New Residential’s investments in MSRs as of December 31, 2018 and 2017 : UPB of Underlying Mortgages Weighted Average Life (Years) (A) Amortized Cost Basis Carrying Value (B) 2018 Agency (C) $ 226,295,778 6.4 $ 2,189,039 $ 2,506,676 Non-Agency 2,143,212 6.6 19,982 22,438 Ginnie Mae 30,023,713 7.4 357,673 354,986 Total $ 258,462,703 6.5 $ 2,566,694 $ 2,884,100 2017 Agency $ 172,392,496 6.3 $ 1,476,330 $ 1,735,504 Non-Agency 61,654 5.6 — — Total $ 172,454,150 6.3 $ 1,476,330 $ 1,735,504 (A) Weighted Average Life represents the weighted average expected timing of the receipt of expected cash flows for this investment. (B) Carrying Value represents fair value. As of December 31, 2018 and 2017 , weighted average discount rates of 8.7% and 9.1% , respectively, were used to value New Residential’s investments in MSRs. (C) Represents Fannie Mae and Freddie Mac MSRs. |
Servicing Asset at Amortized Cost | The following is a summary of New Residential’s direct investments in Excess MSRs: December 31, 2018 UPB of Underlying Mortgages Interest in Excess MSR Weighted Average Life Years (A) Amortized Cost Basis (B) Carrying Value (C) New Residential (D) Fortress-managed funds Nationstar Agency Original and Recaptured Pools $ 52,368,290 32.5% - 66.7% (53.3%) 0.0% - 40.0% 20.0% - 35.0% 5.6 $ 203,675 $ 226,452 Recapture Agreements — 32.5% - 66.7% (53.3%) 0.0% - 40.0% 20.0% - 35.0% 12.8 15,122 30,935 52,368,290 6.1 218,797 257,387 Non-Agency (E) Nationstar and SLS Serviced: Original and Recaptured Pools $ 54,058,073 33.3% - 100.0% (59.4%) 0.0% - 50.0% 0.0% - 33.3% 5.8 $ 138,314 $ 172,712 Recapture Agreements — 33.3% - 100.0% (59.4%) 0.0% - 50.0% 0.0% - 33.3% 12.8 4,216 17,761 54,058,073 6.0 142,530 190,473 Total $ 106,426,363 6.1 $ 361,327 $ 447,860 December 31, 2017 UPB of Underlying Mortgages Interest in Excess MSR Weighted Average Life Years (A) Amortized Cost Basis (B) Carrying Value (C) New Residential (D) Fortress-managed funds Nationstar Agency Original and Recaptured Pools $ 63,839,281 32.5% - 66.7% (53.5%) 0.0% - 40.0% 20.0% - 35.0% 5.8 $ 249,003 $ 280,033 Recapture Agreements — 32.5% - 66.7% (53.5%) 0.0% - 40.0% 20.0% - 35.0% 11.4 18,944 44,603 63,839,281 6.2 267,947 324,636 Non-Agency (E) Nationstar and SLS Serviced: Original and Recaptured Pools $ 64,146,430 33.3% - 100.0% (59.6%) 0.0% - 50.0% 0.0% - 33.3% 5.4 $ 154,938 $ 190,696 Recapture Agreements — 33.3% - 100.0% (59.6%) 0.0% - 50.0% 0.0% - 33.3% 11.3 7,489 19,814 Ocwen Serviced Pools 89,135,588 100.0% —% —% 6.5 598,149 638,567 153,282,018 6.4 760,576 849,077 Total $ 217,121,299 6.4 $ 1,028,523 $ 1,173,713 (A) Weighted Average Life represents the weighted average expected timing of the receipt of expected cash flows for this investment. (B) The amortized cost basis of the recapture agreements is determined based on the relative fair values of the recapture agreements and related Excess MSRs at the time they were acquired. (C) Carrying Value represents the fair value of the pools or recapture agreements, as applicable. (D) Amounts in parentheses represent weighted averages. (E) New Residential also invested in related Servicer Advance Investments, including the basic fee component of the related MSR as of December 31, 2018 and 2017 (Note 6) on $40.1 billion and $139.5 billion UPB, respectively, underlying these Excess MSRs. |
Summary of the Financial Results of Excess MSR Joint Ventures, Accounted for as Equity Method Investees | The following tables summarize the financial results of the Excess MSR joint ventures, accounted for as equity method investees, held by New Residential: December 31, 2018 2017 Excess MSR assets $ 269,203 $ 321,197 Other assets 27,411 22,333 Other liabilities (687 ) — Equity $ 295,927 $ 343,530 New Residential’s investment $ 147,964 $ 171,765 New Residential’s ownership 50.0 % 50.0 % Year Ended December 31, 2018 2017 2016 Interest income $ 26,363 $ 27,450 $ 36,502 Other income (loss) (9,649 ) (2,149 ) (3,359 ) Expenses — (68 ) (91 ) Net income $ 16,714 $ 25,233 $ 33,052 New Residential’s investments in equity method investees changed during the years ended December 31, 2018 and 2017 as follows: 2018 2017 Balance at beginning of period $ 171,765 $ 194,788 Contributions to equity method investees — — Distributions of earnings from equity method investees (11,059 ) (13,668 ) Distributions of capital from equity method investees (21,099 ) (21,972 ) Change in fair value of investments in equity method investees 8,357 12,617 Balance at end of period $ 147,964 $ 171,765 |
Summary of Excess MSR Investments made through Equity Method Investees | The following is a summary of New Residential’s Excess MSR investments made through equity method investees: December 31, 2018 Unpaid Principal Balance Investee Interest in Excess MSR (A) New Residential Interest in Investees Amortized Cost Basis (B) Carrying Value (C) Weighted Average Life (Years) (D) Agency Original and Recaptured Pools $ 41,707,963 66.7% 50.0% $ 178,560 $ 228,779 5.5 Recapture Agreements — 66.7% 50.0% 19,701 40,424 12.7 Total $ 41,707,963 $ 198,261 $ 269,203 6.2 December 31, 2017 Unpaid Principal Balance Investee Interest in Excess MSR (A) New Residential Interest in Investees Amortized Cost Basis (B) Carrying Value (C) Weighted Average Life (Years) (D) Agency Original and Recaptured Pools $ 50,501,054 66.7% 50.0% $ 209,924 $ 271,785 5.7 Recapture Agreements — 66.7% 50.0% 23,571 49,412 11.4 $ 50,501,054 $ 233,495 $ 321,197 6.3 (A) The remaining interests are held by Nationstar. (B) Represents the amortized cost basis of the equity method investees in which New Residential holds a 50% interest. The amortized cost basis of the recapture agreements is determined based on the relative fair values of the recapture agreements and related Excess MSRs at the time they were acquired. (C) Represents the carrying value of the Excess MSRs held in equity method investees, in which New Residential holds a 50% interest. Carrying value represents the fair value of the pools or recapture agreements, as applicable. (D) The weighted average life represents the weighted average expected timing of the receipt of cash flows of each investment. |
INVESTMENTS IN MORTGAGE SERVI_2
INVESTMENTS IN MORTGAGE SERVICING RIGHTS AND MORTGAGE SERVICING RIGHTS FINANCING RECEIVABLES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Transfers and Servicing [Abstract] | |
Schedule of Mortgage Servicing Rights Acquired | During the year ended December 31, 2018 , New Residential, through its wholly owned subsidiaries, completed the following MSR acquisitions accounted for as Mortgage Servicing Rights: Date of Acquisition Collateral Type (A) UPB (in billions) Purchase Price (in millions) January 16, 2018 Agency $ 11.5 $ 101.5 January 16, 2018 Agency 7.8 81.0 February 28, 2018 Agency 3.3 33.5 March 28, 2018 Agency & Ginnie Mae 8.1 96.6 May 1, 2018 Ginnie Mae 4.6 36.2 May 25, 2018 Agency 2.1 26.3 May 31, 2018 Agency & Ginnie Mae 6.1 79.9 June 1, 2018 Ginnie Mae 0.5 6.1 June 4, 2018 Agency 2.1 19.3 June 28, 2018 Ginnie Mae 4.7 66.5 August 31, 2018 Agency & Ginnie Mae 18.5 220.5 September 28, 2018 Agency 1.1 13.6 September 28, 2018 Agency 10.1 126.4 November 8, 2018 Ginnie Mae 0.1 1.5 December 31, 2018 Agency & Ginnie Mae 7.0 81.4 December 31, 2018 Agency 9.8 135.7 Various (B) Agency 5.6 60.0 Total $ 103.0 $ 1,186.0 (A) “Agency” represents Fannie Mae and Freddie Mac MSRs. (B) Represents Flow MSR acquisitions primarily from Ditech and Shellpoint for the year ended December 31, 2018 . |
Fees Earned in Exchange for Servicing Financial Assets | Interest income from investments in mortgage servicing rights financing receivables was comprised of the following: Year Ended December 31, 2018 Year Ended December 31, 2017 Servicing fee revenue $ 705,812 $ 94,945 Ancillary and other fees 146,829 17,313 Less: subservicing expense (251,184 ) (33,686 ) Interest income, investments in mortgage servicing rights financing receivables $ 601,457 $ 78,572 Change in fair value of investments in mortgage servicing rights financing receivables was comprised of the following: Year Ended December 31, 2018 Year Ended December 31, 2017 Amortization of servicing rights $ (197,703 ) $ (43,190 ) Change in valuation inputs and assumptions (A) 230,036 109,584 (Gain)/loss on sales (B) (783 ) — Change in fair value of investments in mortgage servicing rights financing receivables $ 31,550 $ 66,394 (A) Change in valuation inputs and assumptions includes changes in inputs or assumptions used in the valuation model and other changes due to the realization of expected cash flows. (B) Represents the realization of unrealized gain/(loss) as a result of sales. Servicing revenue, net recognized by New Residential related to its investments in MSRs was comprised of the following: Year Ended December 31, 2018 2017 2016 Servicing fee revenue $ 589,546 $ 412,971 $ 29,168 Ancillary and other fees 130,294 79,050 676 Servicing fee revenue and fees 719,840 492,021 29,844 Amortization of servicing rights (A) (256,915 ) (223,167 ) (15,354 ) Change in valuation inputs and assumptions (B) (C) 68,587 155,495 103,679 (Gain)/loss on sales (D) (2,917 ) — — Servicing revenue, net $ 528,595 $ 424,349 $ 118,169 (A) Includes $1.2 million , $0.0 million and $0.0 million of amortization to Excess spread financing for the years ended December 31, 2018 , 2017 , and 2016 , respectively. (B) Change in valuation inputs and assumptions includes changes in inputs or assumptions used in the valuation model and other changes due to the realization of expected cash flows. (C) Includes $7.4 million , $0.0 million and $0.0 million of fair value adjustment to Excess spread financing for the years ended December 31, 2018 , 2017 , and 2016 , respectively. (D) Represents the realization of unrealized gain/(loss) as a result of sales. |
Schedule of Servicing Assets at Fair Value | The following table presents activity related to the carrying value of New Residential’s direct investments in Excess MSRs: Servicer Nationstar SLS (A) Ocwen (B) Total Balance as of December 31, 2016 $ 611,293 $ 3,935 $ 784,227 $ 1,399,455 Purchases — — (71,982 ) (71,982 ) Interest income — — — — Other income 46,393 (191 ) 56,851 103,053 Proceeds from repayments 2,384 — 1,993 4,377 Proceeds from sales (120,485 ) (1,400 ) (130,122 ) (252,007 ) Change in fair value (13,505 ) — — (13,505 ) Ocwen Transaction (Note 5) 6,153 569 (2,400 ) 4,322 Balance as of December 31, 2017 532,233 2,913 638,567 1,173,713 Purchases — — — — Interest income 44,386 54 — 44,440 Other income 6,444 — 40,417 46,861 Proceeds from repayments (100,215 ) (632 ) (26,946 ) (127,793 ) Proceeds from sales (19,084 ) — — (19,084 ) Change in fair value (18,436 ) 197 (40,417 ) (58,656 ) Ocwen Transaction (Note 5) — — (611,621 ) (611,621 ) Balance as of December 31, 2018 $ 445,328 $ 2,532 $ — $ 447,860 (A) Specialized Loan Servicing LLC (“SLS”). (B) Ocwen Loan Servicing LLC, a subsidiary of Ocwen Financial Corporation (together with its subsidiaries, including Ocwen Loan Servicing LLC, “Ocwen”), services the loans underlying the Excess MSRs and Servicer Advance Investments. Changes in fair value recorded in other income is comprised of the following: Year Ended December 31, 2018 2017 2016 Original and Recaptured Pools $ (50,030 ) $ (5,630 ) $ (11,221 ) Recapture Agreements (8,626 ) 9,952 3,924 $ (58,656 ) $ 4,322 $ (7,297 ) The following table presents activity related to the carrying value of New Residential’s investments in MSRs: Balance as of December 31, 2016 $ 659,483 Purchases 1,143,693 Amortization of servicing rights (A) (223,167 ) Change in valuation inputs and assumptions (B) 155,495 Balance as of December 31, 2017 $ 1,735,504 Purchases 1,042,933 Transfer In (C) 124,652 Shellpoint Acquisition (D) (E) 151,312 Originations (F) 35,311 Proceeds from sales (5,776 ) Amortization of servicing rights (A) (258,068 ) Change in valuation inputs and assumptions (B) 61,149 (Gain)/loss on sales (G) (2,917 ) Balance as of December 31, 2018 $ 2,884,100 (A) Based on the ratio of the current UPB of the underlying residential mortgage loans relative to the original UPB of the underlying residential mortgage loans. (B) Change in valuation inputs and assumptions includes changes in inputs or assumptions used in the valuation model and other changes due to the realization of expected cash flows. (C) Represents Ginnie Mae MSRs previously accounted for as Mortgage Servicing Rights Financing Receivable. (D) Represents MSRs acquired through New Residential’s acquisition of Shellpoint Partners LLC. (E) Includes $48.3 million of MSRs legally sold by New Penn treated as a secured borrowing as it did not meet the criteria for sale treatment. New Residential elected to record the excess spread financing liability at fair value pursuant to the fair value option. (F) Represents MSRs retained on the sale of originated mortgage loans. (G) Represents the realization of unrealized gain/(loss) as a result of sales. The following table presents activity related to the carrying value of New Residential’s investments in mortgage servicing rights financing receivables: Balance as of December 31, 2016 $ — Purchases 467,884 Ocwen Transaction 64,450 Amortization of servicing rights (A) (43,190 ) Change in valuation inputs and assumptions (B) 109,584 Balance as of December 31, 2017 $ 598,728 Purchases 128,357 Transfer Out (C) (124,652 ) New Ocwen Agreements 1,017,993 Proceeds from sales (7,472 ) Amortization of servicing rights (A) (197,703 ) Change in valuation inputs and assumptions (B) 230,036 (Gain)/loss on sales (D) (783 ) Balance as of December 31, 2018 $ 1,644,504 (A) Based on the ratio of the current UPB of the underlying residential mortgage loans relative to the original UPB of the underlying residential mortgage loans. (B) Change in valuation inputs and assumptions includes changes in inputs or assumptions used in the valuation model and other changes due to the realization of expected cash flows. (C) Represents Ginnie Mae MSRs owned by New Penn accounted for as Mortgage Servicing Rights as a result of the Shellpoint Acquisition. (D) Represents the realization of unrealized gain/(loss) as a result of sales. The following is a summary of New Residential’s investments in mortgage servicing rights financing receivables: UPB of Underlying Mortgages Weighted Average Life (Years) (A) Amortized Cost Basis Carrying Value (B) December 31, 2018 Agency $ 42,265,547 5.9 $ 366,946 $ 434,110 Non-Agency 88,251,018 7.2 936,792 1,210,394 Total $ 130,516,565 6.8 $ 1,303,738 $ 1,644,504 December 31, 2017 Agency $ 49,498,415 5.9 $ 428,657 $ 476,206 Non-Agency 14,846,478 5.6 60,487 122,522 Total $ 64,344,893 5.8 $ 489,144 $ 598,728 (A) Weighted Average Life represents the weighted average expected timing of the receipt of expected cash flows for this investment. (B) Carrying Value represents fair value. As of December 31, 2018 and 2017 , weighted average discount rates of 10.3% and 9.4% , respectively, were used to value New Residential’s investments in mortgage servicing rights financing receivables. The following is a summary of New Residential’s investments in MSRs as of December 31, 2018 and 2017 : UPB of Underlying Mortgages Weighted Average Life (Years) (A) Amortized Cost Basis Carrying Value (B) 2018 Agency (C) $ 226,295,778 6.4 $ 2,189,039 $ 2,506,676 Non-Agency 2,143,212 6.6 19,982 22,438 Ginnie Mae 30,023,713 7.4 357,673 354,986 Total $ 258,462,703 6.5 $ 2,566,694 $ 2,884,100 2017 Agency $ 172,392,496 6.3 $ 1,476,330 $ 1,735,504 Non-Agency 61,654 5.6 — — Total $ 172,454,150 6.3 $ 1,476,330 $ 1,735,504 (A) Weighted Average Life represents the weighted average expected timing of the receipt of expected cash flows for this investment. (B) Carrying Value represents fair value. As of December 31, 2018 and 2017 , weighted average discount rates of 8.7% and 9.1% , respectively, were used to value New Residential’s investments in MSRs. (C) Represents Fannie Mae and Freddie Mac MSRs. |
Summary of the Geographic Distribution of the Underlying Residential Mortgage Loans of the Direct Investment in MSRs | The table below summarizes the geographic distribution of the underlying residential mortgage loans of the investments in MSRs and mortgage servicing rights financing receivables: Percentage of Total Outstanding Unpaid Principal Amount State Concentration December 31, 2018 December 31, 2017 California 21.7 % 19.0 % New York 7.8 % 6.3 % Florida 6.9 % 6.0 % Texas 5.3 % 5.7 % New Jersey 5.0 % 5.2 % Illinois 3.7 % 4.1 % Massachusetts 3.5 % 3.8 % Maryland 3.4 % 2.8 % Pennsylvania 3.1 % 3.3 % Virginia 3.1 % 3.1 % Other U.S. 36.5 % 40.7 % 100.0 % 100.0 % |
Schedule of Investment in Servicer Advances | The following types of advances are included in the Servicer Advances Receivable: December 31, 2018 December 31, 2017 Principal and interest advances $ 793,790 $ 172,467 Escrow advances (taxes and insurance advances) 2,186,831 482,884 Foreclosure advances 199,203 16,017 Total (A) (B) (C) $ 3,179,824 $ 671,368 (A) Includes $231.2 million and $167.9 million of servicer advances receivable related to Fannie Mae and Freddie Mac MSRs, respectively, recoverable from such agencies. (B) Includes $41.6 million and $0.0 million of servicer advances receivable related to Ginnie Mae MSRs, respectively, recoverable from Ginnie Mae. Reserves for advances associated with Ginnie Mae loans in the MSR portfolio are considered in the MSR fair valuation through a nonreimbursable advance loss assumption. (C) Net of $98.0 million in accrued advance recoveries and $4.2 million in unamortized discount and accrual for advance recoveries, respectively. The following is a summary of New Residential’s Servicer Advance Investments, including the right to the basic fee component of the related MSRs: Amortized Cost Basis Carrying Value (A) Weighted Average Discount Rate Weighted Average Yield Weighted Average Life (Years) (B) Change in Fair Value Recorded in Other Income for Year then Ended December 31, 2018 Servicer Advance Investments $ 721,801 $ 735,846 5.9 % 5.8 % 5.7 $ (89,332 ) December 31, 2017 Servicer Advance Investments $ 3,924,003 $ 4,027,379 6.8 % 7.3 % 5.1 $ 84,418 (A) Carrying value represents the fair value of the Servicer Advance Investments, including the basic fee component of the related MSRs. (B) Weighted Average Life represents the weighted average expected timing of the receipt of expected net cash flows for this investment. The following is additional information regarding the Servicer Advance Investments and related financing: Loan-to-Value (“LTV”) (A) Cost of Funds (C) UPB of Underlying Residential Mortgage Loans Outstanding Servicer Advances Servicer Advances to UPB of Underlying Residential Mortgage Loans Face Amount of Notes and Bonds Payable Gross Net (B) Gross Net December 31, 2018 Servicer Advance Investments (D) $ 40,096,998 $ 620,050 1.5 % $ 574,117 88.3 % 87.2 % 3.7 % 3.1 % December 31, 2017 Servicer Advance Investments (D) $ 139,460,371 $ 3,581,876 2.6 % $ 3,461,718 93.2 % 92.0 % 3.3 % 3.0 % (A) Based on outstanding servicer advances, excluding purchased but unsettled servicer advances. (B) Ratio of face amount of borrowings to par amount of servicer advance collateral, net of any general reserve. (C) Annualized measure of the cost associated with borrowings. Gross Cost of Funds primarily includes interest expense and facility fees. Net Cost of Funds excludes facility fees. (D) The following types of advances are included in the Servicer Advance Investments: December 31, 2018 2017 Principal and interest advances $ 108,317 $ 909,133 Escrow advances (taxes and insurance advances) 238,349 1,636,381 Foreclosure advances 273,384 1,036,362 Total $ 620,050 $ 3,581,876 |
SERVICER ADVANCE INVESTMENTS (T
SERVICER ADVANCE INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Investments, All Other Investments [Abstract] | |
Schedule of Interest Income Related to Investments in Servicer Advances | Interest income recognized by New Residential related to its Servicer Advance Investments was comprised of the following: Year Ended December 31, 2018 2017 2016 Interest income, gross of amounts attributable to servicer compensation $ 83,807 $ 871,506 $ 922,006 Amounts attributable to base servicer compensation (8,491 ) (227,585 ) (127,631 ) Amounts attributable to incentive servicer compensation (25,098 ) (115,565 ) (430,025 ) Interest income from Servicer Advance Investments $ 50,218 $ 528,356 $ 364,350 New Residential has determined that the Buyer is a VIE. The following table presents information on the assets and liabilities related to this consolidated VIE. As of December 31, 2018 2017 Assets Servicer advance investments, at fair value $ 713,239 $ 1,002,102 Cash and cash equivalents 29,833 40,929 All other assets 10,223 13,011 Total assets (A) $ 753,295 $ 1,056,042 Liabilities Notes and bonds payable $ 556,340 $ 789,979 All other liabilities 2,442 3,308 Total liabilities (A) $ 558,782 $ 793,287 (A) The creditors of the Buyer do not have recourse to the general credit of New Residential and the assets of the Buyer are not directly available to satisfy New Residential’s obligations. Others’ interests in the equity of the Buyer is computed as follows: December 31, 2018 2017 Total Advance Purchaser LLC equity $ 194,513 $ 262,755 Others’ ownership interest 26.8 % 27.2 % Others’ interest in equity of consolidated subsidiary $ 52,066 $ 71,491 Others’ interests in the Buyer’s net income (loss) is computed as follows: Year Ended December 31, 2018 2017 2016 Net Advance Purchaser LLC income $ 7,209 $ 23,604 $ 72,159 Others’ ownership interest as a percent of total (A) 27.4 % 47.6 % 55.6 % Others’ interest in net income of consolidated subsidiaries $ 1,978 $ 11,227 $ 40,136 (A) As a result, New Residential owned 72.6% , 52.4% and 44.4% of the Buyer, on average during the years ended December 31, 2018 , 2017 and 2016 , respectively. |
Schedule of Investment in Servicer Advances | The following types of advances are included in the Servicer Advances Receivable: December 31, 2018 December 31, 2017 Principal and interest advances $ 793,790 $ 172,467 Escrow advances (taxes and insurance advances) 2,186,831 482,884 Foreclosure advances 199,203 16,017 Total (A) (B) (C) $ 3,179,824 $ 671,368 (A) Includes $231.2 million and $167.9 million of servicer advances receivable related to Fannie Mae and Freddie Mac MSRs, respectively, recoverable from such agencies. (B) Includes $41.6 million and $0.0 million of servicer advances receivable related to Ginnie Mae MSRs, respectively, recoverable from Ginnie Mae. Reserves for advances associated with Ginnie Mae loans in the MSR portfolio are considered in the MSR fair valuation through a nonreimbursable advance loss assumption. (C) Net of $98.0 million in accrued advance recoveries and $4.2 million in unamortized discount and accrual for advance recoveries, respectively. The following is a summary of New Residential’s Servicer Advance Investments, including the right to the basic fee component of the related MSRs: Amortized Cost Basis Carrying Value (A) Weighted Average Discount Rate Weighted Average Yield Weighted Average Life (Years) (B) Change in Fair Value Recorded in Other Income for Year then Ended December 31, 2018 Servicer Advance Investments $ 721,801 $ 735,846 5.9 % 5.8 % 5.7 $ (89,332 ) December 31, 2017 Servicer Advance Investments $ 3,924,003 $ 4,027,379 6.8 % 7.3 % 5.1 $ 84,418 (A) Carrying value represents the fair value of the Servicer Advance Investments, including the basic fee component of the related MSRs. (B) Weighted Average Life represents the weighted average expected timing of the receipt of expected net cash flows for this investment. The following is additional information regarding the Servicer Advance Investments and related financing: Loan-to-Value (“LTV”) (A) Cost of Funds (C) UPB of Underlying Residential Mortgage Loans Outstanding Servicer Advances Servicer Advances to UPB of Underlying Residential Mortgage Loans Face Amount of Notes and Bonds Payable Gross Net (B) Gross Net December 31, 2018 Servicer Advance Investments (D) $ 40,096,998 $ 620,050 1.5 % $ 574,117 88.3 % 87.2 % 3.7 % 3.1 % December 31, 2017 Servicer Advance Investments (D) $ 139,460,371 $ 3,581,876 2.6 % $ 3,461,718 93.2 % 92.0 % 3.3 % 3.0 % (A) Based on outstanding servicer advances, excluding purchased but unsettled servicer advances. (B) Ratio of face amount of borrowings to par amount of servicer advance collateral, net of any general reserve. (C) Annualized measure of the cost associated with borrowings. Gross Cost of Funds primarily includes interest expense and facility fees. Net Cost of Funds excludes facility fees. (D) The following types of advances are included in the Servicer Advance Investments: December 31, 2018 2017 Principal and interest advances $ 108,317 $ 909,133 Escrow advances (taxes and insurance advances) 238,349 1,636,381 Foreclosure advances 273,384 1,036,362 Total $ 620,050 $ 3,581,876 |
INVESTMENTS IN REAL ESTATE AN_2
INVESTMENTS IN REAL ESTATE AND OTHER SECURITIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Summary of Real Estate Securities | Activities related to New Residential’s investments in real estate and other securities were as follows: Year Ended December 31, 2018 Year Ended December 31, 2017 (in millions) (in millions) Treasury Agency Non-Agency Treasury Agency Non-Agency Purchases Face $ — $ 11,006.7 $ 9,194.8 $ 1,552.0 $ 7,135.2 $ 7,606.5 Purchase Price — 11,121.6 3,854.4 1,545.3 7,367.8 3,053.0 Sales Face $ 862.0 $ 9,485.0 $ 115.0 $ 690.0 $ 7,310.7 $ 235.1 Amortized Cost 858.0 9,590.6 87.7 687.2 7,536.6 164.3 Sale Price 849.8 9,569.2 86.4 686.7 7,539.6 182.4 Gain (Loss) on Sale (8.2 ) (21.4 ) (1.3 ) (0.5 ) 3.0 18.0 The following is a summary of New Residential’s real estate and other securities, all of which are classified as available-for-sale and are, therefore, reported at fair value with changes in fair value recorded in other comprehensive income, except for securities that are other-than-temporarily impaired and except for securities which New Residential elected to carry at fair value and record changes to valuation through the income statement. Gross Unrealized Weighted Average Asset Type Outstanding Face Amount Amortized Cost Basis Gains Losses Carrying Value (A) Number of Securities Rating (B) Coupon (C) Yield Life (Years) (D) Principal Subordination (E) December 31, 2018 Agency RMBS (F)(G) $ 2,613,395 $ 2,657,917 $ 7,744 $ (43 ) $ 2,665,618 31 AAA 4.01 % 3.70 % 8.1 N/A Non-Agency RMBS (H) (I) 19,539,450 8,554,511 517,861 (101,409 ) 8,970,963 897 B+ 3.40 % 5.63 % 6.9 12.4 % Total/Weighted Average $ 22,152,845 $ 11,212,428 $ 525,605 $ (101,452 ) $ 11,636,581 928 BB+ 3.53 % 5.17 % 7.2 December 31, 2017 Treasury $ 862,000 $ 858,028 $ — $ (5,294 ) $ 852,734 3 AAA 2.21 % 2.27 % 8.1 N/A Agency RMBS (F)(G) 1,203,629 1,247,093 1,176 (4,652 ) 1,243,617 98 AAA 3.49 % 2.83 % 7.0 N/A Non-Agency RMBS (H) (I) 12,757,357 5,599,644 423,504 (48,359 ) 5,974,789 751 CCC- 2.27 % 5.66 % 7.7 8.5 % Total/Weighted Average $ 14,822,986 $ 7,704,765 $ 424,680 $ (58,305 ) $ 8,071,140 852 B+ 2.44 % 4.83 % 7.6 (A) Fair value, which is equal to carrying value for all securities. See Note 12 regarding the estimation of fair value. (B) Represents the weighted average of the ratings of all securities in each asset type, expressed as an S&P equivalent rating. This excludes the ratings of the collateral underlying 252 bonds with a carrying value of $722.1 million which either have never been rated or for which rating information is no longer provided. For each security rated by multiple rating agencies, the lowest rating is used. New Residential used an implied AAA rating for the Agency RMBS. Ratings provided were determined by third party rating agencies, and represent the most recent credit ratings available as of the reporting date and may not be current. (C) Excludes residual bonds, and certain other Non-Agency bonds, with a carrying value of $299.7 million and $1.9 million , respectively, for which no coupon payment is expected. (D) The weighted average life is based on the timing of expected principal reduction on the assets. (E) Percentage of the amortized cost basis of securities that is subordinate to New Residential’s investments, excluding fair value option securities. (F) Includes securities issued or guaranteed by U.S. Government agencies such as Fannie Mae or Freddie Mac. (G) The total outstanding face amount was $2.6 billion and $1.1 billion for fixed rate securities and $0.0 billion and $0.1 billion for floating rate securities as of December 31, 2018 and 2017 , respectively. (H) The total outstanding face amount was $3.8 billion (including $1.5 billion of residual and fair value option notional amount) and $1.3 billion (including $0.7 billion of residual and fair value option notional amount) for fixed rate securities and $15.7 billion (including $7.4 billion of residual and fair value option notional amount) and $11.5 billion (including $4.5 billion of residual and fair value option notional amount) for floating rate securities as of December 31, 2018 and 2017 , respectively. (I) Includes (i) interest-only securities and servicing strips (fair value option securities) which New Residential elected to carry at fair value and record changes to valuation through the income statement, (ii) bonds backed by MSRs, (iii) bonds backed by consumer loans and (iv) corporate debt. Gross Unrealized Weighted Average Asset Type Outstanding Face Amount Amortized Cost Basis Gains Losses Carrying Value Number of Securities Rating Coupon Yield Life (Years) Principal Subordination December 31, 2018 Corporate debt $ 85,000 $ 85,000 $ — $ (12,325 ) $ 72,675 1 B- 8.25 % 8.25 % 6.3 N/A Consumer loan bonds 56,846 57,480 33 (7,075 ) 50,438 6 B 5.50 % 20.26 % 1.6 N/A MSR bond 228,000 228,000 — (400 ) 227,600 2 BBB- 5.24 % 4.89 % 8.8 N/A Fair Value Option Securities Interest-only Securities 6,832,353 259,725 23,694 (13,025 ) 270,394 79 AA+ 1.38 % 6.58 % 3.0 N/A Servicing Strips 975,048 8,588 1,720 (198 ) 10,110 31 N/A 0.21 % 13.23 % 6.0 N/A December 31, 2017 Consumer loan bonds $ 29,690 $ 29,780 $ 971 $ (528 ) $ 30,223 3 N/A N/A 17.17 % 1.5 N/A Fair Value Option Securities Interest-only Securities 4,475,794 205,740 10,407 (9,887 ) 206,260 49 AA- 1.51 % 5.33 % 3.2 N/A Servicing Strips 450,974 4,958 1,613 (225 ) 6,346 20 N/A 0.27 % 21.62 % 6.7 N/A |
Summary of Real Estate Securities in an Unrealized Loss Position | The following table summarizes New Residential’s securities in an unrealized loss position as of December 31, 2018 . Amortized Cost Basis Weighted Average Securities in an Unrealized Loss Position Outstanding Face Amount Before Impairment Other-Than- Temporary Impairment (A) After Impairment Gross Unrealized Losses Carrying Value Number of Securities Rating (B) Coupon Yield Life (Years) Less than 12 Months $ 4,843,505 $ 1,996,349 $ (5,996 ) $ 1,990,353 $ (67,215 ) $ 1,923,138 181 CCC+ 3.46 % 5.02 % 6.3 12 or More Months 1,411,991 450,391 (831 ) 449,560 (34,237 ) 415,323 76 BB- 1.90 % 6.66 % 5.3 Total/Weighted Average $ 6,255,496 $ 2,446,740 $ (6,827 ) $ 2,439,913 $ (101,452 ) $ 2,338,461 257 B- 3.17 % 5.32 % 6.1 (A) This amount represents OTTI recorded on securities that are in an unrealized loss position as of December 31, 2018 . (B) The weighted average rating of securities in an unrealized loss position for less than 12 months excludes the rating of 40 bonds which either have never been rated or for which rating information is no longer provided. The weighted average rating of securities in an unrealized loss position for 12 or more months excludes the rating of 19 bonds which either have never been rated or for which rating information is no longer provided. New Residential performed an assessment of all of its debt securities that are in an unrealized loss position (an unrealized loss position exists when a security’s amortized cost basis, excluding the effect of OTTI, exceeds its fair value) and determined the following: December 31, 2018 Gross Unrealized Losses Fair Value Amortized Cost Basis After Impairment Credit (A) Non-Credit (B) Securities New Residential intends to sell $ — $ — $ — $ — Securities New Residential is more likely than not to be required to sell — — — N/A Securities New Residential has no intent to sell and is not more likely than not to be required to sell: Credit impaired securities 1,155,566 1,204,729 (6,827 ) (49,163 ) Non-credit impaired securities 1,182,895 1,235,184 — (52,289 ) Total debt securities in an unrealized loss position $ 2,338,461 $ 2,439,913 $ (6,827 ) $ (101,452 ) (A) This amount is required to be recorded as OTTI through earnings. In measuring the portion of credit losses, New Residential estimates the expected cash flow for each of the securities. This evaluation includes a review of the credit status and the performance of the collateral supporting those securities, including the credit of the issuer, key terms of the securities and the effect of local, industry and broader economic trends. Significant inputs in estimating the cash flows include New Residential’s expectations of prepayment rates, default rates and loss severities. Credit losses are measured as the decline in the present value of the expected future cash flows discounted at the investment’s effective interest rate. (B) This amount represents unrealized losses on securities that are due to non-credit factors and recorded through other comprehensive income. |
Summary of Activity Related to Credit Losses on Debt Securities | The following table summarizes the activity related to credit losses on debt securities: Year Ended December 31, 2018 2017 Beginning balance of credit losses on debt securities for which a portion of an OTTI was recognized in other comprehensive income $ 23,821 $ 15,495 Increases to credit losses on securities for which an OTTI was previously recognized and a portion of an OTTI was recognized in other comprehensive income 16,924 3,903 Additions for credit losses on securities for which an OTTI was not previously recognized 13,093 6,431 Reductions for securities for which the amount previously recognized in other comprehensive income was recognized in earnings because the entity intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis — — Reduction for credit losses on securities for which no OTTI was recognized in other comprehensive income at the current measurement date — — Reduction for securities sold during the period (1,035 ) (2,008 ) Ending balance of credit losses on debt securities for which a portion of an OTTI was recognized in other comprehensive income $ 52,803 $ 23,821 |
Summary of the Geographic Distribution of the Collateral Securing Non-Agency RMBS | The table below summarizes the geographic distribution of the collateral securing New Residential’s Non-Agency RMBS: December 31, 2018 2017 Geographic Location (A) Outstanding Face Amount Percentage of Total Outstanding Outstanding Face Amount Percentage of Total Outstanding Western U.S. $ 7,318,616 37.7 % $ 4,882,136 38.4 % Southeastern U.S. 4,613,314 23.8 % 3,005,519 23.6 % Northeastern U.S. 3,829,725 19.7 % 2,555,514 20.1 % Midwestern U.S. 2,063,263 10.6 % 1,337,980 10.5 % Southwestern U.S. 1,321,853 6.8 % 927,647 7.3 % Other (B) 250,833 1.4 % 18,871 0.1 % $ 19,397,604 100.0 % $ 12,727,667 100.0 % (A) Excludes $56.8 million and $29.7 million face amount of bonds backed by consumer loans and $85.0 million and $0.0 million face amount of bonds backed by corporate debt as of December 31, 2018 and December 31, 2017 , respectively. (B) Represents collateral for which New Residential was unable to obtain geographic information |
Schedule of the Outstanding Face Amount and Carrying Value for Securities Uncollectible | The following is the outstanding face amount and carrying value for securities, for which, as of the acquisition date, it was probable that New Residential would be unable to collect all contractually required payments, excluding residual and fair value option securities: Outstanding Face Amount Carrying Value December 31, 2018 $ 6,385,306 $ 4,217,242 December 31, 2017 5,364,847 3,493,723 |
Summary of Changes in Accretable Yield for Securities | The following is a summary of the changes in accretable yield for these securities: Year Ended December 31, 2018 2017 Beginning Balance $ 2,000,266 $ 1,200,125 Additions 397,934 863,681 Accretion (290,014 ) (215,018 ) Reclassifications from (to) non-accretable difference 156,070 218,675 Disposals (18,273 ) (67,197 ) Ending Balance $ 2,245,983 $ 2,000,266 |
INVESTMENTS IN RESIDENTIAL MO_2
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Receivables [Abstract] | |
Schedule of Residential Mortgage Loans Outstanding by Loan Type, Excluding REO | The following table presents certain information regarding New Residential’s residential mortgage loans outstanding by loan type, excluding REO: December 31, 2018 Outstanding Face Amount Carrying Loan Weighted Average Yield Weighted Average Life (Years) (A) Floating Rate Loans as a % of Face Amount LTV Ratio (B) Weighted Avg. Delinquency (C) Weighted Average FICO (D) Loan Type Performing Loans (G) (J) $ 636,874 $ 591,264 8,424 8.0 % 4.8 20.3 % 77.7 % 8.9 % 649 Purchased Credit Deteriorated Loans (H) 191,497 144,065 1,556 7.6 % 3.1 16.4 % 84.6 % 71.5 % 596 Total Residential Mortgage Loans, held-for-investment $ 828,371 $ 735,329 9,980 7.9 % 4.4 19.4 % 79.3 % 23.3 % 637 Reverse Mortgage Loans (E) (F) $ 13,807 $ 6,557 37 8.1 % 4.8 10.6 % 142.5 % 67.8 % N/A Performing Loans (G) (I) 408,724 413,883 7,144 4.4 % 3.9 56.6 % 61.3 % 9.0 % 670 Non-Performing Loans (H) (I) 621,700 512,040 5,029 5.5 % 3.0 14.9 % 88.1 % 72.6 % 588 Total Residential Mortgage Loans, held-for-sale $ 1,044,231 $ 932,480 12,210 5.1 % 3.4 31.2 % 78.3 % 47.6 % 621 Acquired Loans 2,295,340 2,153,269 12,873 4.5 % 8.0 7.7 % 75.7 % 14.0 % 626 Originated Loans 638,173 655,260 2,307 5.2 % 28.5 96.3 % 80.0 % 3.8 % 714 Total Residential Mortgage Loans, held-for-sale, at fair value (K) $ 2,933,513 $ 2,808,529 15,180 4.6 % 12.5 27.0 % 76.6 % 11.8 % 645 December 31, 2017 Loan Type Performing Loans (G) $ 557,381 $ 507,615 8,876 8.0 % 5.5 22.1 % 76.4 % 8.7 % 649 Purchased Credit Deteriorated Loans (H) 249,254 183,540 2,142 7.2 % 3.1 14.7 % 84.2 % 75.8 % 597 Total Residential Mortgage Loans, held-for-investment $ 806,635 $ 691,155 11,018 7.7 % 4.8 19.8 % 78.8 % 29.4 % 633 Reverse Mortgage Loans (E) (F) $ 16,755 $ 6,870 48 7.5 % 4.5 15.9 % 141.2 % 77.8 % N/A Performing Loans (G) (I) 1,044,116 1,071,371 15,464 4.0 % 4.8 10.2 % 53.2 % 7.0 % 654 Non-Performing Loans (H) (I) 846,181 647,293 5,597 5.6 % 4.3 18.7 % 94.4 % 63.3 % 581 Total Residential Mortgage Loans, held-for-sale $ 1,907,052 $ 1,725,534 21,109 4.8 % 4.6 14.0 % 72.2 % 32.6 % 622 (A) The weighted average life is based on the expected timing of the receipt of cash flows. (B) LTV refers to the ratio comparing the loan’s unpaid principal balance to the value of the collateral property. (C) Represents the percentage of the total principal balance that is 60+ days delinquent. (D) The weighted average FICO score is based on the weighted average of information updated and provided by the loan servicer on a monthly basis. (E) Represents a 70% participation interest that New Residential holds in a portfolio of reverse mortgage loans. Nationstar holds the other 30% interest and services the loans. The average loan balance outstanding based on total UPB was $0.5 million and $0.5 million at December 31, 2018 and 2017 , respectively. Approximately 54.9% and 54.3% of these loans have reached a termination event at December 31, 2018 and 2017 , respectively. As a result of the termination event, each such loan has matured and the borrower can no longer make draws on these loans. (F) FICO scores are not used in determining how much a borrower can access via a reverse mortgage loan. (G) Performing loans are generally placed on nonaccrual status when principal or interest is 120 days or more past due. (H) Includes loans with evidence of credit deterioration since origination where it is probable that New Residential will not collect all contractually required principal and interest payments. As of December 31, 2018 , New Residential has placed Non-Performing Loans, held-for-sale on nonaccrual status, except as described in (J) below. (I) Includes $24.3 million and $51.9 million UPB of Ginnie Mae EBO performing and non-performing loans as of December 31, 2018 , respectively, on accrual status as contractual cash flows are guaranteed by the FHA. As of December 31, 2017 , these amounts were $33.7 million and $66.5 million , respectively. (J) Includes $122.3 million UPB of non-agency mortgage loans underlying the SAFT 2013-1 securitization, which are carried at fair value based on New Residential’s election of the fair value option. Interest earned on loans measured at fair value are reported in other income. (K) New Residential elected the fair value option to measure these loans at fair value on a recurring basis. Interest earned on loans measured at fair value are reported in interest income. |
Summary of the Geographic Distribution of the Underlying Residential Mortgage Loans | The table below summarizes the geographic distribution of the underlying residential mortgage loans: Percentage of Total Outstanding Unpaid Principal Amount December 31, State Concentration 2018 2017 California 16.7 % 9.1 % New York 11.7 % 12.8 % Florida 8.8 % 8.2 % New Jersey 5.3 % 5.2 % Texas 4.7 % 6.6 % Illinois 4.0 % 3.9 % Maryland 3.6 % 2.7 % Pennsylvania 3.1 % 3.4 % Massachusetts 3.1 % 2.7 % Washington 1.5 % 1.7 % Other U.S. 37.5 % 43.7 % 100.0 % 100.0 % |
Schedule of Residential Mortgage Loan Transactions | |
Past Due Financing Receivables | The following table provides past due information regarding New Residential’s Performing Loans, which is an important indicator of credit quality and the establishment of the allowance for loan losses: December 31, 2018 Days Past Due Delinquency Status (A) Current 83.3 % 30-59 7.4 % 60-89 2.2 % 90-119 (B) 0.8 % 120+ (C) 6.3 % 100.0 % (A) Represents the percentage of the total principal balance that corresponds to loans that are in each delinquency status. (B) Includes loans 90-119 days past due and still accruing interest because they are generally placed on nonaccrual status at 120 days or more past due. (C) Represents nonaccrual loans. The following table provides past due information regarding New Residential’s performing consumer loans, held-for-investment, which is an important indicator of credit quality and the establishment of the allowance for loan losses: December 31, 2018 Days Past Due Delinquency Status (A) Current 94.7 % 30-59 2.0 % 60-89 1.3 % 90-119 (B) 0.8 % 120+ (B) (C) 1.2 % 100.0 % (A) Represents the percentage of the total unpaid principal balance that corresponds to loans that are in each delinquency status. (B) Includes loans more than 90 days past due and still accruing interest. (C) Interest is accrued up to the date of charge-off at 180 days past due. |
Summary of Activities Related to the Carrying Value of Reverse Mortgage Loans and Performing Loans and PCD Loans Held-for-Investment | Activities related to the carrying value of residential mortgage loans held-for-investment were as follows: Performing Loans Balance at December 31, 2016 $ — Purchases/additional fundings 550,742 Proceeds from repayments (50,562 ) Accretion of loan discount (premium) and other amortization (A) 8,101 Provision for loan losses (646 ) Transfer of loans to other assets (B) — Transfer of loans to real estate owned (20 ) Balance at December 31, 2017 $ 507,615 Shellpoint Acquisition 125,350 Purchases/additional fundings 55,993 Proceeds from repayments (106,236 ) Accretion of loan discount (premium) and other amortization (A) 15,773 Provision for loan losses (1,028 ) Transfer of loans to other assets (B) — Transfer of loans to real estate owned (5,131 ) Transfers of loans to held for sale (1,555 ) Fair value adjustment 472 Balance at December 31, 2018 $ 591,253 (A) Includes accelerated accretion of discount on loans paid in full and on loans transferred to other assets. (B) Represents loans for which foreclosure has been completed and for which New Residential has made, or intends to make, a claim with the governmental agency that has guaranteed the loans that are now recognized as claims receivable in Other Assets (Note 2). Activities related to the carrying value of PCD loans held-for-investment were as follows: Balance at December 31, 2016 $ 190,761 Purchases/additional fundings 58,884 Sales — Proceeds from repayments (32,455 ) Accretion of loan discount and other amortization 20,217 (Allowance) reversal for loan losses (A) (1,488 ) Transfer of loans to real estate owned (29,299 ) Transfer of loans to held-for-sale (23,080 ) Balance at December 31, 2017 $ 183,540 Purchases/additional fundings 29,785 Sales — Proceeds from repayments (38,276 ) Accretion of loan discount and other amortization 24,124 (Allowance) reversal for loan losses — Transfer of loans to real estate owned (28,060 ) Transfer of loans to held-for-sale (27,048 ) Balance at December 31, 2018 $ 144,065 (A) An allowance represents the present value of cash flows expected at acquisition that are no longer expected to be collected. A reversal results from an increase to expected cash flows that reverses a prior allowance. |
Summary of Activities Related to the Valuation Provision on Reverse Mortgage Loans and Allowance for Loan Losses on Performing Loans Held-for-Investment | Activities related to the valuation and loss provision on reverse mortgage loans and allowance for loan losses on performing loans held-for-investment were as follows: Performing Loans Balance at December 31, 2016 $ — Provision for loan losses (A) 646 Charge-offs (B) (450 ) Balance at December 31, 2017 $ 196 Provision for loan losses (A) 1,028 Charge-offs (B) (1,224 ) Balance at December 31, 2018 $ — (A) Based on an analysis of collective borrower performance, credit ratings of borrowers, loan-to-value ratios, estimated value of the underlying collateral, key terms of the loans and historical and anticipated trends in defaults and loss severities at a pool level. (B) Loans, other than PCD loans, are generally charged off or charged down to the net realizable value of the collateral (i.e., fair value less costs to sell), with an offset to the allowance for loan losses, when available information confirms that loans are uncollectible. Activities related to the allowance for loan losses on performing consumer loans, held-for-investment were as follows: Collectively Evaluated (A) Individually Impaired (B) Total Balance at December 31, 2016 $ 2,441 $ 997 $ 3,438 Provision for loan losses 65,059 679 65,738 Net charge-offs (C) (63,071 ) — (63,071 ) Balance at December 31, 2017 $ 4,429 $ 1,676 $ 6,105 Provision (reversal) for loan losses 47,839 388 48,227 Net charge-offs (C) (49,664 ) — (49,664 ) Balance at December 31, 2018 $ 2,604 $ 2,064 $ 4,668 (A) Represents smaller-balance homogeneous loans that are not individually considered impaired and are evaluated based on an analysis of collective borrower performance, key terms of the loans and historical and anticipated trends in defaults and loss severities, and consideration of the unamortized acquisition discount. (B) Represents consumer loan modifications considered to be troubled debt restructurings (“TDRs”) as they provide concessions to borrowers, primarily in the form of interest rate reductions, who are experiencing financial difficulty. As of December 31, 2018 , there are $14.2 million in UPB and $12.6 million in carrying value of consumer loans classified as TDRs. (C) Consumer loans, other than PCD loans, are charged off when available information confirms that loans are uncollectible, which is generally when they become 180 days past due. Charge-offs are presented net of $9.0 million and $10.8 million in recoveries of previously charged-off UPB in 2018 and 2017 , respectively. |
Summary of Contractually Required Payments Receivable, Cash Flows Expected to be Collected, and Fair Value at Acquisition date for Loans Acquired During Period | The following is the contractually required payments receivable, cash flows expected to be collected, and fair value at acquisition date for PCD loans acquired during the year ended December 31, 2018 : Contractually Required Payments Receivable Cash Flows Expected to be Collected Fair Value As of Acquisition Date 65,902 45,429 29,785 |
Summary of Unpaid Principal Balance and Carrying Value for Loans Uncollectible | The following is the unpaid principal balance and carrying value for loans, for which, as of the acquisition date, it was probable that New Residential would be unable to collect all contractually required payments: Unpaid Principal Balance Carrying Value December 31, 2018 $ 191,497 $ 144,065 December 31, 2017 249,254 183,540 |
Summary of Changes in Accretable Yield | The following is a summary of the changes in accretable yield for these loans: Balance at December 31, 2016 $ 23,688 Additions 21,860 Accretion (20,217 ) Reclassifications from non-accretable difference (A) 66,751 Disposals (B) (3,451 ) Transfer of loans to held-for-sale (C) — Balance at December 31, 2017 $ 88,631 Additions 15,644 Accretion (24,124 ) Reclassifications from non-accretable difference (A) 5,493 Disposals (B) (7,257 ) Transfer of loans to held-for-sale (C) (9,755 ) Balance at December 31, 2018 $ 68,632 (A) Represents a probable and significant increase in cash flows previously expected to be uncollectible. (B) Includes sales of loans or foreclosures, which result in removal of the loan from the PCD loan pool at its carrying amount. (C) Represents loans not initially acquired with the intent to sell for which New Residential determined that it no longer has the intent to hold for the foreseeable future, or until maturity or payoff. |
Summary of Activities Related to the Carrying Value of Loans Held-for-sale | Activities related to the carrying value of loans held-for-sale were as follows: Balance at December 31, 2016 $ 696,665 Purchases (A) 5,135,700 Transfer of loans from held-for-investment (B) 23,080 Sales (3,901,161 ) Transfer of loans to other assets (C) (17,487 ) Transfer of loans to real estate owned (71,756 ) Proceeds from repayments (125,987 ) Valuation (provision) reversal on loans (D) (13,520 ) Balance at December 31, 2017 $ 1,725,534 Purchases (A) 3,653,608 Transfer of loans from held-for-investment (B) 28,603 Sales (4,205,375 ) Transfer of loans to other assets (C) (9,811 ) Transfer of loans to real estate owned (54,114 ) Proceeds from repayments (195,797 ) Valuation (provision) reversal on loans (D) (10,168 ) Balance at December 31, 2018 $ 932,480 (A) Represents loans acquired with the intent to sell. (B) Represents loans not initially acquired with the intent to sell for which New Residential determined that it no longer has the intent to hold for the foreseeable future, or until maturity or payoff. (C) Represents loans for which foreclosure has been completed and for which New Residential has made, or intends to make, a claim with the governmental agency that has guaranteed the loans that are now recognized as claims receivable in Other Assets (Note 2). (D) Represents the fair value adjustments to loans upon transfer to held-for-sale and provision recorded on certain purchased held-for-sale loans, including an aggregate of $59.2 million and $30.1 million of provision related to the call transactions executed during the years ended December 31, 2018 and 2017 , respectively. |
Schedule of Loans Held For Sale, Fair Value | Activities related to the carrying value of originated loans held-for-sale, at fair value were as follows: Balance at December 31, 2017 $ — Shellpoint acquisition 488,233 Originations 3,439,574 Sales (3,269,689 ) Proceeds from repayments (6,348 ) Change in fair value 3,490 Balance at December 31, 2018 $ 655,260 Activities related to the carrying value of acquired loans held-for-sale, at fair value were as follows: Balance at December 31, 2017 $ — Purchases 2,088,638 Sales — Proceeds from repayments (3,963 ) Transfer of loans to real estate owned (753 ) Change in fair value 69,347 Balance at December 31, 2018 $ 2,153,269 |
Schedule of Originated Mortgage Loans | Gain on sale of originated mortgage loans, net is summarized below: Gain on loans originated and sold (A) $ 38,415 Gain (loss) on settlement of mortgage loan origination derivative instruments (B) 1,234 MSRs retained on transfer of loans (C) 35,311 Other (D) 14,057 Gain on sale of originated mortgage loans, net $ 89,017 (A) Includes loan origination fees and direct loan origination costs. Other indirect costs related to loan origination are included within general and administrative expenses. (B) Represents settlement of forward securities delivery commitments utilized as an economic hedge for mortgage loans not included within forward loan sale commitments. (C) Represents the initial fair value of the capitalized mortgage servicing rights upon loan sales with servicing retained. (D) Includes fees for services associated with the loan origination process. |
Schedule of Real Estate Owned | New Residential recognizes REO assets at the completion of the foreclosure process or upon execution of a deed in lieu of foreclosure with the borrower. REO assets are managed for prompt sale and disposition at the best possible economic value. Real Estate Owned Balance at December 31, 2016 $ 59,591 Purchases 38,127 Transfer of loans to real estate owned 124,013 Sales (A) (95,456 ) Valuation provision on REO 2,020 Balance at December 31, 2017 $ 128,295 Purchases 33,377 Transfer of loans to real estate owned 107,577 Sales (A) (152,725 ) Valuation (provision) reversal on REO (3,114 ) Balance at December 31, 2018 $ 113,410 (A) Recognized when control of the property has transferred to the buyer. |
Schedule of Variable Interest Entities | The following table presents information on the assets and liabilities of the Shelter JVs: As of December 31, 2018 Assets Cash and cash equivalents $ 17,346 Property and equipment, net 137 Intangible assets, net 70 Prepaid expenses and other assets 411 Total assets $ 17,964 Liabilities Accounts payable and accrued expenses $ 1,315 Reserve for sales recourse 967 Total liabilities $ 2,282 Noncontrolling Interests Noncontrolling interests in the equity of the Shelter JVs is computed as follows: December 31, 2018 Total consolidated equity of JVs $ 15,682 Noncontrolling ownership interest 51.0 % Noncontrolling equity interest in consolidated JVs $ 7,998 Total consolidated net income of JVs $ 3,135 Noncontrolling ownership interest in net income 51.0 % Noncontrolling interest in net income of consolidated JVs $ 1,599 As described in “Call Rights” above, New Residential has issued securitizations which were treated as sales under GAAP. New Residential has no obligation to repurchase any loans from these securitizations and its exposure to loss is limited to the carrying amount of its retained interests in the securitization entities. These securitizations are conducted through variable interest entities, of which New Residential is not the primary beneficiary. Additionally, New Penn, a wholly owned subsidiary of New Residential, was deemed to be the primary beneficiary of the SAFT 2013-1 securitization entity as a result of its ability to direct activities that most significantly impact the economic performance of the entity in its role as servicer and its ownership of subordinate retained interests. The following table summarizes certain characteristics of the underlying residential mortgage loans, and related financing, in these securitizations as of December 31, 2018 : Residential mortgage loan UPB $ 7,818,221 Weighted average delinquency (A) 1.97 % Net credit losses for the year ended December 31, 2018 $ 9,101 Face amount of debt held by third parties (B) $ 6,783,187 Carrying value of bonds retained by New Residential (C) $ 1,206,402 Cash flows received by New Residential on these bonds for the year ended December 31, 2018 $ 178,301 (A) Represents the percentage of the UPB that is 60 + days delinquent. (B) Excludes bonds retained by New Residential. (C) Includes bonds retained pursuant to required risk retention regulations. As of December 31, 2018 2017 Assets Consumer loans, held-for-investment $ 1,039,480 $ 1,289,010 Restricted cash 10,186 11,563 Accrued interest receivable 15,627 19,360 Total assets (A) $ 1,065,293 $ 1,319,933 Liabilities Notes and bonds payable (B) $ 1,030,096 $ 1,284,436 Accounts payable and accrued expenses 3,814 4,007 Total liabilities (A) $ 1,033,910 $ 1,288,443 (A) The creditors of the Consumer Loan SPVs do not have recourse to the general credit of New Residential, and the assets of the Consumer Loan SPVs are not directly available to satisfy New Residential’s obligations. (B) Includes $121.0 million face amount of bonds retained by New Residential issued by these VIEs. |
INVESTMENTS IN CONSUMER LOANS (
INVESTMENTS IN CONSUMER LOANS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Investments in Consumer Loan Equity Method Investees | The following table summarizes the investment in consumer loans, held-for-investment held by New Residential: Unpaid Principal Balance Interest in Consumer Loans Carrying Value Weighted Average Coupon Weighted Average Expected Life (Years) (A) Weighted Average Delinquency (B) December 31, 2018 Consumer Loan Companies Performing Loans $ 815,341 53.5 % $ 856,563 18.8 % 3.6 5.4 % Purchased Credit Deteriorated Loans (C) 221,910 53.5 % 182,917 16.0 % 3.4 11.6 % Other - Performing Loans 35,326 100.0 % 32,722 14.2 % 0.8 5.6 % Total Consumer Loans, held-for-investment $ 1,072,577 $ 1,072,202 18.1 % 3.5 6.7 % December 31, 2017 Consumer Loan Companies Performing Loans $ 1,005,570 53.5 % $ 1,052,561 18.7 % 3.7 6.0 % Purchased Credit Deteriorated Loans (C) 282,540 53.5 % 236,449 16.2 % 3.3 12.5 % Other - Performing Loans 89,682 100.0 % 85,253 14.1 % 1.0 4.5 % Total Consumer Loans, held-for-investment $ 1,377,792 $ 1,374,263 17.9 % 3.5 7.3 % (A) Represents the weighted average expected timing of the receipt of expected cash flows for this investment. (B) Represents the percentage of the total unpaid principal balance that is 30+ days delinquent. Delinquency status is the primary credit quality indicator as it provides early warning of borrowers who may be experiencing financial difficulties. (C) Includes loans with evidence of credit deterioration since origination where it is probable that New Residential will not collect all contractually required principal and interest payments, which are accounted for as PCD loans. |
Past Due Financing Receivables | The following table provides past due information regarding New Residential’s Performing Loans, which is an important indicator of credit quality and the establishment of the allowance for loan losses: December 31, 2018 Days Past Due Delinquency Status (A) Current 83.3 % 30-59 7.4 % 60-89 2.2 % 90-119 (B) 0.8 % 120+ (C) 6.3 % 100.0 % (A) Represents the percentage of the total principal balance that corresponds to loans that are in each delinquency status. (B) Includes loans 90-119 days past due and still accruing interest because they are generally placed on nonaccrual status at 120 days or more past due. (C) Represents nonaccrual loans. The following table provides past due information regarding New Residential’s performing consumer loans, held-for-investment, which is an important indicator of credit quality and the establishment of the allowance for loan losses: December 31, 2018 Days Past Due Delinquency Status (A) Current 94.7 % 30-59 2.0 % 60-89 1.3 % 90-119 (B) 0.8 % 120+ (B) (C) 1.2 % 100.0 % (A) Represents the percentage of the total unpaid principal balance that corresponds to loans that are in each delinquency status. (B) Includes loans more than 90 days past due and still accruing interest. (C) Interest is accrued up to the date of charge-off at 180 days past due. |
Schedule of Carrying Value of Performing Consumer Loans | Activities related to the carrying value of performing consumer loans, held-for-investment were as follows: Performing Loans Balance at December 31, 2016 $ 1,482,954 Purchases — Additional fundings (A) 56,321 Proceeds from repayments (329,843 ) Accretion of loan discount and premium amortization, net 4,891 Gross charge-offs (73,842 ) Additions to the allowance for loan losses, net (2,667 ) Balance at December 31, 2017 $ 1,137,814 Purchases Additional fundings (A) 63,971 Proceeds from repayments (257,182 ) Accretion of loan discount and premium amortization, net 1,940 Gross charge-offs (56,870 ) Additions to the allowance for loan losses, net (388 ) Balance at December 31, 2018 $ 889,285 (A) Represents draws on consumer loans with revolving privileges. |
Allowance for Credit Losses on Financing Receivables | Activities related to the valuation and loss provision on reverse mortgage loans and allowance for loan losses on performing loans held-for-investment were as follows: Performing Loans Balance at December 31, 2016 $ — Provision for loan losses (A) 646 Charge-offs (B) (450 ) Balance at December 31, 2017 $ 196 Provision for loan losses (A) 1,028 Charge-offs (B) (1,224 ) Balance at December 31, 2018 $ — (A) Based on an analysis of collective borrower performance, credit ratings of borrowers, loan-to-value ratios, estimated value of the underlying collateral, key terms of the loans and historical and anticipated trends in defaults and loss severities at a pool level. (B) Loans, other than PCD loans, are generally charged off or charged down to the net realizable value of the collateral (i.e., fair value less costs to sell), with an offset to the allowance for loan losses, when available information confirms that loans are uncollectible. Activities related to the allowance for loan losses on performing consumer loans, held-for-investment were as follows: Collectively Evaluated (A) Individually Impaired (B) Total Balance at December 31, 2016 $ 2,441 $ 997 $ 3,438 Provision for loan losses 65,059 679 65,738 Net charge-offs (C) (63,071 ) — (63,071 ) Balance at December 31, 2017 $ 4,429 $ 1,676 $ 6,105 Provision (reversal) for loan losses 47,839 388 48,227 Net charge-offs (C) (49,664 ) — (49,664 ) Balance at December 31, 2018 $ 2,604 $ 2,064 $ 4,668 (A) Represents smaller-balance homogeneous loans that are not individually considered impaired and are evaluated based on an analysis of collective borrower performance, key terms of the loans and historical and anticipated trends in defaults and loss severities, and consideration of the unamortized acquisition discount. (B) Represents consumer loan modifications considered to be troubled debt restructurings (“TDRs”) as they provide concessions to borrowers, primarily in the form of interest rate reductions, who are experiencing financial difficulty. As of December 31, 2018 , there are $14.2 million in UPB and $12.6 million in carrying value of consumer loans classified as TDRs. (C) Consumer loans, other than PCD loans, are charged off when available information confirms that loans are uncollectible, which is generally when they become 180 days past due. Charge-offs are presented net of $9.0 million and $10.8 million in recoveries of previously charged-off UPB in 2018 and 2017 , respectively. |
Schedule of Carrying Value of Purchased Credit Deteriorated Loans | A portion of the consumer loans are considered PCD loans. Activities related to the carrying value of PCD consumer loans, held-for-investment were as follows: Balance at December 31, 2016 $ 316,532 (Allowance) reversal for loan losses (A) 3,013 Proceeds from repayments (123,932 ) Accretion of loan discount and other amortization 40,836 Balance at December 31, 2017 $ 236,449 (Allowance) reversal for loan losses (A) (31 ) Proceeds from repayments (90,700 ) Accretion of loan discount and other amortization 37,199 Balance at December 31, 2018 $ 182,917 (A) An allowance represents the present value of cash flows expected at acquisition that are no longer expected to be collected. A reversal results from an increase to expected cash flows that reverses a prior allowance. |
Impaired Financing Receivables | The following is the unpaid principal balance and carrying value for consumer loans, for which, as of the acquisition date, it was probable that New Residential would be unable to collect all contractually required payments: Unpaid Principal Balance Carrying Value December 31, 2018 $ 221,910 $ 182,917 December 31, 2017 282,540 236,449 |
Schedule of Changes in Accretable Yield | The following is a summary of the changes in accretable yield for these loans: Balance at December 31, 2016 $ 167,928 Accretion (40,836 ) Reclassifications from (to) non-accretable difference (A) 5,199 Balance at December 31, 2017 $ 132,291 Accretion (37,199 ) Reclassifications from (to) non-accretable difference (A) 31,426 Balance at December 31, 2018 $ 126,518 (A) Represents a probable and significant increase in cash flows previously expected to be uncollectible. |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net | Others’ interests in the equity of the Consumer Loan Companies is computed as follows: December 31, 2018 2017 Total Consumer Loan Companies equity $ 66,105 $ 74,071 Others’ ownership interest 46.5 % 46.5 % Others’ interests in equity of consolidated subsidiary $ 30,561 $ 34,466 Others’ interests in the Consumer Loan Companies’ net income (loss) is computed as follows: Year Ended December 31, 2018 2017 Net Consumer Loan Companies income (loss) $ 79,539 $ 98,692 Others’ ownership interest as a percent of total 46.5 % 46.5 % Others’ interest in net income (loss) of consolidated subsidiaries $ 36,987 $ 45,892 |
Schedule of Variable Interest Entities | The following table presents information on the assets and liabilities of the Shelter JVs: As of December 31, 2018 Assets Cash and cash equivalents $ 17,346 Property and equipment, net 137 Intangible assets, net 70 Prepaid expenses and other assets 411 Total assets $ 17,964 Liabilities Accounts payable and accrued expenses $ 1,315 Reserve for sales recourse 967 Total liabilities $ 2,282 Noncontrolling Interests Noncontrolling interests in the equity of the Shelter JVs is computed as follows: December 31, 2018 Total consolidated equity of JVs $ 15,682 Noncontrolling ownership interest 51.0 % Noncontrolling equity interest in consolidated JVs $ 7,998 Total consolidated net income of JVs $ 3,135 Noncontrolling ownership interest in net income 51.0 % Noncontrolling interest in net income of consolidated JVs $ 1,599 As described in “Call Rights” above, New Residential has issued securitizations which were treated as sales under GAAP. New Residential has no obligation to repurchase any loans from these securitizations and its exposure to loss is limited to the carrying amount of its retained interests in the securitization entities. These securitizations are conducted through variable interest entities, of which New Residential is not the primary beneficiary. Additionally, New Penn, a wholly owned subsidiary of New Residential, was deemed to be the primary beneficiary of the SAFT 2013-1 securitization entity as a result of its ability to direct activities that most significantly impact the economic performance of the entity in its role as servicer and its ownership of subordinate retained interests. The following table summarizes certain characteristics of the underlying residential mortgage loans, and related financing, in these securitizations as of December 31, 2018 : Residential mortgage loan UPB $ 7,818,221 Weighted average delinquency (A) 1.97 % Net credit losses for the year ended December 31, 2018 $ 9,101 Face amount of debt held by third parties (B) $ 6,783,187 Carrying value of bonds retained by New Residential (C) $ 1,206,402 Cash flows received by New Residential on these bonds for the year ended December 31, 2018 $ 178,301 (A) Represents the percentage of the UPB that is 60 + days delinquent. (B) Excludes bonds retained by New Residential. (C) Includes bonds retained pursuant to required risk retention regulations. As of December 31, 2018 2017 Assets Consumer loans, held-for-investment $ 1,039,480 $ 1,289,010 Restricted cash 10,186 11,563 Accrued interest receivable 15,627 19,360 Total assets (A) $ 1,065,293 $ 1,319,933 Liabilities Notes and bonds payable (B) $ 1,030,096 $ 1,284,436 Accounts payable and accrued expenses 3,814 4,007 Total liabilities (A) $ 1,033,910 $ 1,288,443 (A) The creditors of the Consumer Loan SPVs do not have recourse to the general credit of New Residential, and the assets of the Consumer Loan SPVs are not directly available to satisfy New Residential’s obligations. (B) Includes $121.0 million face amount of bonds retained by New Residential issued by these VIEs. |
Summary of the Investment in the Consumer Loan Companies | The following tables summarize the investment in LoanCo and WarrantCo held by New Residential: December 31, 2018 (A) December 31, 2017 Consumer loans, at fair value $ 231,560 $ 178,422 Warrants, at fair value 103,067 80,746 Other assets 25,971 46,342 Warehouse financing (182,065 ) (117,944 ) Other liabilities (1,142 ) (13,059 ) Equity $ 177,391 $ 174,507 Undistributed retained earnings $ — $ — New Residential’s investment $ 42,875 $ 42,473 New Residential’s ownership 24.2 % 24.3 % Year Ended December 31, 2018 (A) Interest income $ 42,920 Interest expense (12,258 ) Change in fair value of consumer loans and warrants 17,491 Gain on sale of consumer loans (B) 2,697 Other expenses (7,257 ) Net income $ 43,593 New Residential’s equity in net income $ 10,803 New Residential’s ownership 24.8 % (A) Data as of, and for the periods ended, November 30, 2018 , as a result of the one month reporting lag. (B) During the year ended December 31, 2018 , LoanCo sold, through securitizations which were treated as sales for accounting purposes, $1.2 billion in UPB of consumer loans. LoanCo retained $103.0 million of residual interests in the securitizations and distributed them to the LoanCo co-investors, including New Residential. The following is a summary of LoanCo’s consumer loan investments: Unpaid Principal Balance Interest in Consumer Loans Carrying Value Weighted Average Coupon Weighted Average Expected Life (Years) (A) Weighted Average Delinquency (B) December 31, 2018 (C) $ 231,560 25.0 % $ 231,560 14.2 % 1.3 0.4 % (A) Represents the weighted average expected timing of the receipt of expected cash flows for this investment. (B) Represents the percentage of the total unpaid principal balance that is 30+ days delinquent. Delinquency status is the primary credit quality indicator as it provides early warning of borrowers who may be experiencing financial difficulties. (C) Data as of November 30, 2018 as a result of the one month reporting lag. New Residential’s investment in LoanCo and WarrantCo changed as follows: Balance at December 31, 2017 $ 51,412 Contributions to equity method investees 308,050 Distributions of earnings from equity method investees (6,176 ) Distributions of capital from equity method investees (325,795 ) Earnings from investments in consumer loans, equity method investees 10,803 Balance at December 31, 2018 $ 38,294 |
DERIVATIVES (Tables)
DERIVATIVES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivatives | New Residential’s derivatives are recorded at fair value on the Consolidated Balance Sheets as follows: December 31, Balance Sheet Location 2018 2017 Derivative assets Interest Rate Caps Other assets $ 3 $ 2,423 Interest Rate Lock Commitments Other assets 10,851 — Forward Loan Sale Commitments Other assets 39 — $ 10,893 $ 2,423 Derivative liabilities Interest Rate Swaps (A) Accrued expenses and other liabilities $ 5,245 $ — Interest Rate Lock Commitments Accrued expenses and other liabilities 223 — TBAs Accrued expenses and other liabilities 23,921 697 $ 29,389 $ 697 (A) Net of $106.1 million of related variation margin accounts as of December 31, 2018 . As of December 31, 2017 , no variation margin accounts existed. The following table summarizes notional amounts related to derivatives: December 31, 2018 2017 Interest Rate Caps (A) $ 50,000 $ 772,500 Interest Rate Swaps (B) 4,725,000 — Interest Rate Lock Commitments 823,187 — Forward Loan Sale Commitments 30,274 — TBAs, short position (C) 5,904,300 3,101,100 TBAs, long position (C) 5,067,200 — 1,014,000 (A) As of December 31, 2018 , caps LIBOR at 4.00% for $50.0 million of notional. The weighted average maturity of the interest rate caps as of December 31, 2018 was 23 months. (B) Receive LIBOR and pay a fixed rate. The weighted average maturity of the interest rate swaps was 52 months and the weighted average fixed pay rate was 3.21% as of December 31, 2018 . There were no interest rate swaps outstanding at December 31, 2017 . (C) Represents the notional amount of Agency RMBS, classified as derivatives. The following table summarizes all income (losses) recorded in relation to derivatives: Year Ended December 31, 2018 2017 2016 Other income (loss), net (A) Interest Rate Caps $ 431 $ 323 $ 688 Interest Rate Swaps (108,098 ) (720 ) 5,500 Unrealized gains(losses) on Interest Rate Lock Commitments 23 — — Forward Loan Sale Commitments (283 ) — — TBAs (5,631 ) (1,793 ) (414 ) (113,558 ) (2,190 ) 5,774 Gain (loss) on settlement of investments, net Interest Rate Caps $ (603 ) $ (1,911 ) $ (4,754 ) Interest Rate Swaps 65,823 6,921 (4,810 ) TBAs (B) (10,353 ) (44,224 ) (17,927 ) 54,867 (39,214 ) (27,491 ) Total income (losses) $ (58,691 ) $ (41,404 ) $ (21,717 ) (A) Represents unrealized gains (losses). (B) Excludes $1.2 million in loss on settlement included within gain on sale of originated mortgage loans, net (Note 8). |
DEBT OBLIGATIONS (Tables)
DEBT OBLIGATIONS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Debt Obligations | Activities related to the carrying value of New Residential’s debt obligations were as follows: Excess MSRs MSRs Servicer Advances (A) Real Estate Securities Residential Mortgage Loans and REO Consumer Loans Total Balance at December 31, 2016 $ 729,145 $ — $ 5,549,872 $ 4,419,002 $ 783,006 $ 1,700,211 $ 13,181,236 Repurchase Agreements: Borrowings — — — 55,233,007 2,529,556 — 57,762,563 Repayments — — — (52,957,555 ) (1,334,952 ) — (54,292,507 ) Capitalized deferred financing costs, net of amortization — — — — 1,449 — 1,449 Notes and Bonds Payable: Borrowings 1,400,354 1,172,058 5,344,985 — 140,323 — 8,057,720 Repayments (1,650,409 ) (13,973 ) (6,838,862 ) — (11,375 ) (456,904 ) (8,971,523 ) Discount on borrowings, net of amortization — — (147 ) — — (700 ) (847 ) Capitalized deferred financing costs, net of amortization 4,888 (906 ) 4,308 — — 149 8,439 Balance at December 31, 2017 $ 483,978 $ 1,157,179 $ 4,060,156 $ 6,694,454 $ 2,108,007 $ 1,242,756 $ 15,746,530 Repurchase Agreements: Shellpoint Acquisition — — — 1,957 437,675 — 439,632 Borrowings — — — 90,996,778 8,665,900 — 99,662,678 Repayments — — — (85,912,169 ) (7,298,734 ) — (93,210,903 ) Capitalized deferred financing costs, net of amortization — — — (165 ) 589 — 424 Notes and Bonds Payable: Shellpoint Acquisition — 20,731 — — 120,702 — 141,433 Borrowings 350,787 4,212,855 5,207,084 — 183 — 9,770,909 Repayments (537,227 ) (3,022,785 ) (5,887,384 ) — (136,947 ) (308,316 ) (9,892,659 ) Discount on borrowings, net of amortization — — 41 — — 1,633 1,674 Unrealized loss on notes, fair value — — — — 684 — 684 Capitalized deferred financing costs, net of amortization 25 (7,124 ) 2,558 — — 374 (4,167 ) Balance at December 31, 2018 $ 297,563 $ 2,360,856 $ 3,382,455 $ 11,780,855 $ 3,898,059 $ 936,447 $ 22,656,235 (A) New Residential net settles daily borrowings and repayments of the Notes and Bonds Payable on its servicer advances. The following table presents certain information regarding New Residential’s debt obligations: December 31, 2018 December 31, 2017 Collateral Debt Obligations/Collateral Outstanding Face Amount Carrying Value (A) Final Stated Maturity (B) Weighted Average Funding Cost Weighted Average Life (Years) Outstanding Face Amortized Cost Basis Carrying Value Weighted Average Life (Years) Carrying Value (A) Repurchase Agreements (C) Agency RMBS (D) $ 4,346,070 $ 4,346,070 Jan-19 to Feb-19 2.66 % 0.1 $ 4,462,104 $ 4,492,912 $ 4,533,921 2.1 $ 1,974,164 Non-Agency RMBS (E) 7,434,950 7,434,785 Jan-19 to Aug-19 3.54 % 0.1 17,057,929 8,459,512 8,877,653 7.0 4,720,290 Residential Mortgage Loans (F) 3,679,239 3,678,246 Feb-19 to Dec-20 4.24 % 0.6 4,498,036 4,222,366 4,218,615 11.9 1,849,004 Real Estate Owned (G) (H) 94,897 94,868 Feb-19 to Dec-20 4.38 % 0.8 N/A N/A 116,381 N/A 118,681 Total Repurchase Agreements 15,555,156 15,553,969 3.46 % 0.3 8,662,139 Notes and Bonds Payable Excess MSRs (I) 297,759 297,563 Feb-20 to Jul-22 5.15 % 2.7 119,363,054 372,901 470,498 5.7 483,978 MSRs (J) 2,368,885 2,360,856 Feb-19 to Jul-24 4.32 % 2.8 365,610,961 3,496,265 4,241,604 6.7 1,157,179 Servicer Advances (K) 3,386,234 3,382,455 Mar-19 to Dec-21 3.52 % 1.7 3,824,237 3,999,597 4,013,642 1.5 4,060,156 Residential Mortgage Loans (L) 122,816 122,465 Jan-19 to Jul-43 3.74 % 7.6 130,399 127,021 124,593 7.8 137,196 Consumer Loans (M) 939,735 936,447 Dec-21 to Mar-24 3.41 % 2.8 1,072,431 1,076,725 1,072,056 3.5 1,242,756 Receivable from government agency (L) 2,480 2,480 Jan-19 4.54 % 0.1 N/A N/A 1,736 N/A 3,126 Total Notes and Bonds Payable 7,117,909 7,102,266 3.84 % 2.4 7,084,391 Total/Weighted Average $ 22,673,065 $ 22,656,235 3.58 % 0.9 $ 15,746,530 (A) Net of deferred financing costs. (B) All debt obligations with a stated maturity through the date of issuance were refinanced, extended or repaid. (C) These repurchase agreements had approximately $38.8 million of associated accrued interest payable as of December 31, 2018 . (D) All of the Agency RMBS repurchase agreements have a fixed rate. Collateral amounts include approximately $3.9 billion of related trade and other receivables. (E) $7,193.4 million face amount of the Non-Agency RMBS repurchase agreements have LIBOR-based floating interest rates while the remaining $241.5 million face amount of the Non-Agency RMBS repurchase agreements have a fixed rate. This includes repurchase agreements of $163.6 million on retained servicer advance and consumer loan bonds. (F) All of these repurchase agreements have LIBOR-based floating interest rates. (G) All of these repurchase agreements have LIBOR-based floating interest rates. (H) Includes financing collateralized by receivables including claims from FHA on Ginnie Mae EBO loans for which foreclosure has been completed and for which New Residential has made or intends to make a claim on the FHA guarantee. (I) Includes $197.8 million of corporate loans which bear interest equal to the sum of (i) a floating rate index equal to one-month LIBOR and (ii) a margin of 3.00% , and includes $100.0 million of corporate loans which bear interest equal to the sum of (i) a floating rate index equal to one-month LIBOR and (ii) a margin of 2.50% . The outstanding face amount of the collateral represents the UPB of the residential mortgage loans underlying the interests in MSRs that secure these notes. (J) Includes: $645.3 million of MSR notes which bear interest equal to the sum of (i) a floating rate index equal to one-month LIBOR and (ii) a margin ranging from 2.25% to 2.75% , and $1,723.6 million of public notes with fixed interest rates ranging from 3.55% to 4.62% . The outstanding face amount of the collateral represents the UPB of the residential mortgage loans underlying the MSRs and mortgage servicing rights financing receivables that secure these notes. (K) $2.9 billion face amount of the notes have a fixed rate while the remaining notes bear interest equal to the sum of (i) a floating rate index equal to one-month LIBOR or a cost of funds rate, as applicable, and (ii) a margin ranging from 2.0% to 2.2% . Collateral includes Servicer Advance Investments, as well as servicer advances receivable related to the mortgage servicing rights and mortgage servicing rights financing receivables owned by NRM. (L) Represents: (i) a $7.7 million note payable to Nationstar that bears interest equal to one-month LIBOR plus 2.88% , and (ii) $117.0 million fair value of SAFT 2013-1 mortgage-backed securities issued with fixed interest rates ranging from 3.50% to 3.76% (see Note 12 for details). (M) Includes the SpringCastle debt, which is comprised of the following classes of asset-backed notes held by third parties: $671.0 million UPB of Class A notes with a coupon of 3.05% and a stated maturity date in November 2023; $210.8 million UPB of Class B notes with a coupon of 4.10% and a stated maturity date in March 2024; $18.3 million UPB of Class C-1 notes with a coupon of 5.63% and a stated maturity date in March 2024; $18.3 million UPB of Class C-2 notes with a coupon of 5.63% and a stated maturity date in March 2024. Also includes a $21.3 million face amount note which bears interest equal to 4.00% . |
Schedule of Contractual Maturities of Debt Obligations | New Residential’s debt obligations as of December 31, 2018 had contractual maturities as follows: Year Nonrecourse Recourse Total 2019 $ 879,241 $ 16,124,611 $ 17,003,852 2020 771,582 181,854 953,436 2021 1,758,663 736,368 2,495,031 2022 — 197,759 197,759 2023 671,013 487,323 1,158,336 2024 and thereafter 364,770 499,881 864,651 $ 4,445,269 $ 18,227,796 $ 22,673,065 |
Schedule of Borrowing Capacity | The following table represents New Residential’s borrowing capacity as of December 31, 2018 : Debt Obligations/ Collateral Borrowing Capacity Balance Outstanding Available Financing Repurchase Agreements Residential mortgage loans and REO $ 5,575,197 $ 3,774,136 $ 1,801,061 Non-Agency RMBS 250,000 241,535 8,465 Notes and Bonds Payable Excess MSRs 150,000 100,000 50,000 MSRs 990,000 645,319 344,681 Servicer advances (A) 1,678,541 1,372,576 305,965 Consumer loans 150,000 21,303 128,697 $ 8,793,738 $ 6,154,869 $ 2,638,869 (A) New Residential’s unused borrowing capacity is available if New Residential has additional eligible collateral to pledge and meets other borrowing conditions as set forth in the applicable agreements, including any applicable advance rate. New Residential pays a 0.1% fee on the unused borrowing capacity. Excludes borrowing capacity and outstanding debt for retained Non-Agency bonds collateralized by servicer advances with a current face amount of $86.3 million . |
FAIR VALUE MEASURMENT (Tables)
FAIR VALUE MEASURMENT (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of Carrying Values and Fair Values of Financial Assets and Liabilities Recorded at Fair Value on a Recurring Basis | The carrying values and fair values of New Residential’s assets and liabilities recorded at fair value on a recurring basis, as well as other financial instruments for which fair value is disclosed, as of December 31, 2018 were as follows: Fair Value Principal Balance or Notional Amount Carrying Value Level 1 Level 2 Level 3 Total Assets: Investments in: Excess mortgage servicing rights, at fair value (A) $ 106,426,363 $ 447,860 $ — $ — $ 447,860 $ 447,860 Excess mortgage servicing rights, equity method investees, at fair value (A) 41,707,963 147,964 — — 147,964 147,964 Mortgage servicing rights, at fair value (A) 258,462,703 2,884,100 — — 2,884,100 2,884,100 Mortgage servicing rights financing receivables, at fair value (A) 130,516,565 1,644,504 — — 1,644,504 1,644,504 Servicer advance investments, at fair value 620,050 735,846 — — 735,846 735,846 Real estate and other securities, available-for-sale 22,152,845 11,636,581 — 2,665,618 8,970,963 11,636,581 Residential mortgage loans, held-for-investment 706,111 614,241 — — 625,321 625,321 Residential mortgage loans, held-for-sale 1,043,550 932,480 — — 958,970 958,970 Residential mortgage loans, held-for-sale, at fair value (B) 2,934,727 2,808,529 — 213,882 2,594,647 2,808,529 Residential mortgage loans, held-for-investment, at fair value (C) 122,260 121,088 — — 121,088 121,088 Residential mortgage loans subject to repurchase 121,602 121,602 — 121,602 — 121,602 Consumer loans, held-for-investment 1,072,577 1,072,202 — — 1,054,820 1,054,820 Derivative assets 840,179 10,893 — 42 10,851 10,893 Cash and cash equivalents 251,058 251,058 251,058 — — 251,058 Restricted cash 164,020 164,020 164,020 — — 164,020 Other assets (D) 16,991 7,778 — 9,213 16,991 $ 23,609,959 $ 422,856 $ 3,001,144 $ 20,206,147 $ 23,630,147 Liabilities: Repurchase agreements $ 15,555,156 $ 15,553,969 $ — $ 15,555,156 $ — $ 15,555,156 Notes and bonds payable (E) 7,117,909 7,102,266 — — 7,076,400 7,076,400 Residential mortgage loans repurchase liability 121,602 121,602 — 121,602 — 121,602 Derivative liabilities 15,759,782 29,389 — 29,166 223 29,389 Excess spread financing 3,492,587 39,304 — — 39,304 39,304 Contingent consideration N/A 40,842 — — 40,842 40,842 $ 22,887,372 $ — $ 15,705,924 $ 7,156,769 $ 22,862,693 (A) The notional amount represents the total unpaid principal balance of the residential mortgage loans underlying the MSRs, MSR financing receivables, and Excess MSRs. New Residential does not receive an excess mortgage servicing amount on non-performing loans in Agency portfolios. (B) Includes $88.7 million in fair value of loans that are 90 days or more past due. (C) Includes $0.4 million in fair value of loans that are 90 days or more past due. (D) Excludes the indirect equity investment in a commercial redevelopment project that is accounted for at fair value on a recurring basis based on the NAV of New Residential’s investment. The investment had a fair value of $74.3 million as of December 31, 2018 . (E) Includes the SAFT 2013-1 mortgage-backed securities issued for which the fair value option for financial instruments was elected and resulted in a fair value of $117.0 million as of December 31, 2018 . The carrying values and fair values of New Residential’s assets and liabilities recorded at fair value on a recurring basis, as well as other financial instruments for which fair value is disclosed, as of December 31, 2017 were as follows: Fair Value Principal Balance or Notional Amount Carrying Value Level 1 Level 2 Level 3 Total Assets Investments in: Excess mortgage servicing rights, at fair value (A) $ 217,121,299 $ 1,173,713 $ — $ — $ 1,173,713 $ 1,173,713 Excess mortgage servicing rights, equity method investees, at fair value (A) 50,501,054 171,765 — — 171,765 171,765 Mortgage servicing rights, at fair value (A) 172,454,150 1,735,504 — — 1,735,504 1,735,504 Mortgage servicing rights financing receivables, at fair value (A) 64,344,893 598,728 — — 598,728 598,728 Servicer advance investments, at fair value 3,581,876 4,027,379 — — 4,027,379 4,027,379 Real estate and other securities, available-for-sale 14,822,986 8,071,140 — 2,096,351 5,974,789 8,071,140 Residential mortgage loans, held-for-investment 806,635 691,155 — — 694,692 694,692 Residential mortgage loans, held-for-sale 1,907,052 1,725,534 — — 1,794,210 1,794,210 Consumer loans, held-for-investment 1,377,792 1,374,263 — — 1,379,746 1,379,746 Derivative assets 772,500 2,423 — 2,423 — 2,423 Cash and cash equivalents 295,798 295,798 295,798 — — 295,798 Restricted cash 150,252 150,252 150,252 — — 150,252 Other assets 1,788,354 28,802 19,259 — 9,543 28,802 $ 20,046,456 $ 465,309 $ 2,098,774 $ 17,560,069 $ 20,124,152 Liabilities Repurchase agreements $ 8,663,747 $ 8,662,139 $ — $ 8,663,747 $ — $ 8,663,747 Notes and bonds payable 7,097,223 7,084,391 — — 7,109,803 7,109,803 Derivative liabilities 4,115,100 697 — 697 — 697 $ 15,747,227 $ — $ 8,664,444 $ 7,109,803 $ 15,774,247 (A) The notional amount represents the total unpaid principal balance of the residential mortgage loans underlying the MSRs and Excess MSRs. New Residential does not receive an excess mortgage servicing amount on non-performing loans in Agency portfolios. |
Schedule of Financial Assets Measured at Fair Value on a Recurring Basis using Level 3 Inputs | New Residential’s assets measured at fair value on a recurring basis using Level 3 inputs changed as follows: Level 3 Excess MSRs (A) Excess MSRs in Equity Method Investees (A)(B) Agency Non-Agency MSRs (A) Mortgage Servicing Rights Financing Receivables (A) Servicer Advance Investments Non-Agency RMBS Derivatives (C) Residential Mortgage Loans Total Balance at December 31, 2016 $ 381,757 $ 1,017,698 $ 194,788 $ 659,483 $ — $ 5,706,593 $ 3,543,560 $ — $ — $ 11,503,879 Transfers (D) Transfers from Level 3 — — — — — — — — — — Transfers to Level 3 — — — — — — — — — — Gains (losses) included in net income Included in other-than-temporary impairment on securities (E) — — — — — — (10,334 ) — — (10,334 ) Included in change in fair value of investments in excess mortgage servicing rights (E) (3,037 ) 7,359 — — — — — — — 4,322 Included in change in fair value of investments in excess mortgage servicing rights, equity method investees (E) — — 12,617 — — — — — — 12,617 Included in servicing revenue, net (F) — — — (67,672 ) — — — — — (67,672 ) Included in change in fair value of investments in mortgage servicing rights financing receivables (E) — — — — 66,394 — — — — 66,394 Included in change in fair value of servicer advance investments — — — — — 84,418 — — — 84,418 Included in gain (loss) on settlement of investments, net — — — — — 9,327 18,050 — — 27,377 Included in other income (loss), net (E) 2,150 2,227 — — — — 2,883 — — 7,260 Gains (losses) included in other comprehensive income (G) — — — — — — 244,608 — — 244,608 Interest income 28,351 74,702 — — — 528,356 333,297 — — 964,706 Purchases, sales, repayments and transfers Purchases — — — 1,143,693 467,884 12,168,519 3,052,965 — — 16,833,061 Proceeds from sales (13,505 ) — — — — — (182,325 ) — — (195,830 ) Proceeds from repayments (71,080 ) (180,927 ) (35,640 ) — — (13,988,614 ) (1,027,915 ) — — (15,304,176 ) Ocwen Transaction (Note 5) — (71,982 ) — — 64,450 (481,220 ) — — — (488,752 ) Balance at December 31, 2017 $ 324,636 $ 849,077 $ 171,765 $ 1,735,504 $ 598,728 $ 4,027,379 $ 5,974,789 $ — $ — $ 13,681,878 Transfers (D) Transfers from Level 3 — — — — — — — — — — Transfers to Level 3 — — — — — — — — — — Shellpoint Acquisition (Note 1) — — — 275,964 (124,652 ) — — 10,604 179,644 341,560 Gains (losses) included in net income Included in other-than-temporary impairment on securities (E) — — — — — — (24,940 ) — — (24,940 ) Included in change in fair value of investments in excess mortgage servicing rights (E) (18,099 ) (40,557 ) — — — — — — — (58,656 ) Included in change in fair value of investments in excess mortgage servicing rights, equity method investees (E) — — 8,357 — — — — — — 8,357 Included in servicing revenue, net (F) — — — (199,836 ) — — — — — (199,836 ) Included in change in fair value of investments in mortgage servicing rights financing receivables (E) — — — — 31,550 — — — — 31,550 Included in change in fair value of servicer advance investments — — — — — (89,332 ) — — — (89,332 ) Included in gain (loss) on settlement of investments, net — 40,417 — — — 72,585 (1,288 ) — — 111,714 Included in other income (loss), net (E) 6,137 307 — — — — 10,283 24 (175 ) 16,576 Gains (losses) included in other comprehensive income (G) — — — — — — 31,031 — — 31,031 Interest income 21,936 22,504 — — — 50,218 377,018 — — 471,676 Purchases, sales and repayments Purchases — — — 1,042,933 128,357 2,332,989 3,854,439 — — 7,358,718 Proceeds from sales (19,084 ) — — (5,776 ) (7,472 ) — (86,448 ) — — (118,780 ) Proceeds from repayments (58,139 ) (69,654 ) (32,158 ) — — (2,455,155 ) (1,163,921 ) — (2,111 ) (3,781,138 ) Originations — — — 35,311 — — — — — 35,311 Ocwen Transaction (Note 5) — (611,621 ) — — 1,017,993 (3,202,838 ) — — — (2,796,466 ) Balance at December 31, 2018 $ 257,387 $ 190,473 $ 147,964 $ 2,884,100 $ 1,644,504 $ 735,846 $ 8,970,963 $ 10,628 $ 177,358 $ 15,019,223 (A) Includes the recapture agreement for each respective pool, as applicable. (B) Amounts represent New Residential’s portion of the Excess MSRs held by the respective joint ventures in which New Residential has a 50% interest. (C) For the purpose of this table, the IRLC asset and liability positions are shown net. (D) Transfers are assumed to occur at the beginning of the respective period. (E) The gains (losses) recorded in earnings during the period are attributable to the change in unrealized gains (losses) relating to Level 3 assets still held at the reporting dates and realized gains (losses) recorded during the period. (F) The components of Servicing revenue, net are disclosed in Note 5. (G) These gains (losses) were included in net unrealized gain (loss) on securities in the Consolidated Statements of Comprehensive Income. |
Schedule of Financial Liabilities Measured at Fair Value on a Recurring Basis using Level 3 Inputs | New Residential’s liabilities measured at fair value on a recurring basis using Level 3 inputs changed as follows: Level 3 Excess Spread Financing Mortgage-Backed Securities Issued Contingent Consideration Total Balance at December 31, 2017 $ — $ — $ — $ — Transfers (A) Transfers from Level 3 — — — — Transfers to Level 3 — — — — Shellpoint Acquisition (Note 1) 48,262 120,702 39,262 208,226 Gains (losses) included in net income Included in other-than-temporary impairment on securities (B) — — — — Included in change in fair value of investments in excess mortgage servicing rights — — — — Included in change in fair value of investments in excess mortgage servicing rights, equity method investees (B) — — — — Included in servicing revenue, net (C) (8,591 ) — — (8,591 ) Included in change in fair value of investments in notes receivable - rights to MSRs — — — — Included in change in fair value of servicer advance investments — — — — Included in gain (loss) on settlement of investments, net — — — — Included in other income (B) — 684 1,580 2,264 Gains (losses) included in other comprehensive income, net of tax (D) — — — — Interest income — — — — Purchases, sales and repayments Purchases — — — — Proceeds from sales — — — — Proceeds from repayments — (4,338 ) — (4,338 ) Other (367 ) — — (367 ) Ocwen Transaction — — — — Balance at December 31, 2018 $ 39,304 $ 117,048 $ 40,842 $ 197,194 (A) Transfers are assumed to occur at the beginning of the respective period. (B) The gains (losses) recorded in earnings during the period are attributable to the change in unrealized gains (losses) relating to Level 3 assets still held at the reporting dates and realized gains (losses) recorded during the period. (C) The components of Servicing revenue, net are disclosed in Note 5. (D) These gains (losses) were included in net unrealized gain (loss) on securities in the Consolidated Statements of Comprehensive Income. |
Summary of Certain Information Regarding Weighted Average Inputs used in Valuing Excess MSRs Owned Directly and through Equity Method Investees | The following table summarizes certain information regarding the inputs used in valuing IRLCs: Fair Value Loan Funding Probability Fair Value of initial servicing rights (bps) IRLCs $ 10,628 54% to 100% 0 to 320 The following tables summarize certain information regarding the weighted average inputs used: December 31, 2018 Significant Inputs (A) Prepayment Rate (B) Delinquency (C) Recapture Rate (D) Mortgage Servicing Amount (E) Collateral Weighted Average Maturity Years (F) Excess MSRs Directly Held (Note 4) Agency Original Pools 9.8 % 2.5 % 26.3 % 21 21 Recaptured Pools 8.0 % 2.1 % 23.6 % 22 24 Recapture Agreement 7.9 % 2.2 % 24.8 % 22 — 9.1 % 2.4 % 25.4 % 21 22 Non-Agency (G) Nationstar and SLS Serviced: Original Pools 10.4 % N/A 15.4 % 15 24 Recaptured Pools 8.0 % N/A 19.9 % 23 24 Recapture Agreement 7.9 % N/A 19.8 % 20 — 9.9 % N/A 16.3 % 16 24 Total/Weighted Average--Excess MSRs Directly Held 9.4 % 2.4 % 21.5 % 19 23 Excess MSRs Held through Equity Method Investees (Note 4) Agency Original Pools 10.9 % 3.9 % 29.6 % 19 20 Recaptured Pools 8.5 % 2.6 % 28.8 % 23 23 Recapture Agreement 8.6 % 2.7 % 30.4 % 23 — Total/Weighted Average--Excess MSRs Held through Investees 9.6 % 3.2 % 29.4 % 21 21 Total/Weighted Average--Excess MSRs All Pools 9.5 % 2.7 % 24.5 % 20 22 MSRs Agency (H) Mortgage Servicing Rights (I) 9.4 % 1.0 % 22.2 % 26 22 Mortgage Servicing Rights Financing Receivables (I) 9.5 % 0.9 % 14.7 % 27 20 Non-Agency Mortgage Servicing Rights 13.2 % 0.9 % 10.0 % 25 25 Mortgage Servicing Rights Financing Receivables (I) 8.2 % 17.2 % 5.0 % 45 26 Ginnie Mae Mortgage Servicing Rights (J) 11.2 % 3.9 % 24.2 % 33 27 December 31, 2017 Significant Inputs (A) Prepayment Rate (B) Delinquency (C) Recapture Rate (D) Mortgage Servicing Amount (E) Collateral Weighted Average Maturity Years (F) Excess MSRs Directly Held (Note 4) Agency Original Pools 9.7 % 3.0 % 31.6 % 21 23 Recaptured Pools 7.1 % 4.4 % 23.1 % 22 24 Recapture Agreement 7.1 % 4.3 % 26.2 % 21 — 8.8 % 3.5 % 29.1 % 21 23 Non-Agency (G) Nationstar and SLS Serviced: Original Pools 12.2 % N/A 15.4 % 15 24 Recaptured Pools 6.9 % N/A 19.8 % 22 24 Recapture Agreement 6.9 % N/A 19.7 % 20 — Ocwen Serviced Pools 8.8 % N/A — % 14 26 9.4 % N/A 4.0 % 15 26 Total/Weighted Average--Excess MSRs Directly Held 9.2 % 3.5 % 10.9 % 16 25 Excess MSRs Held through Equity Method Investees (Note 4) Agency Original Pools 11.3 % 5.0 % 34.8 % 19 22 Recaptured Pools 7.3 % 4.7 % 24.3 % 23 24 Recapture Agreement 7.3 % 4.7 % 24.2 % 23 — Total/Weighted Average--Excess MSRs Held through Investees 9.3 % 4.8 % 29.5 % 21 23 Total/Weighted Average--Excess MSRs All Pools 9.2 % 3.8 % 14.9 % 17 25 MSRs Agency Mortgage Servicing Rights (I) 10.5 % 0.9 % 25.4 % 27 21 Mortgage Servicing Rights Financing Receivables (I) 10.3 % 0.9 % 14.8 % 27 20 Non-Agency Mortgage Servicing Rights Financing Receivables (I) 10.0 % 10.9 % — % 34 22 (A) Weighted by fair value of the portfolio. (B) Projected annualized weighted average lifetime voluntary and involuntary prepayment rate using a prepayment vector. (C) Projected percentage of residential mortgage loans in the pool for which the borrower will miss its mortgage payments. (D) Percentage of voluntarily prepaid loans that are expected to be refinanced by the related servicer or subservicer, as applicable. (E) Weighted average total mortgage servicing amount, in excess of the basic fee as applicable, measured in bps. As of December 31, 2018 and 2017 , weighted average costs of subservicing of $7.30 and $7.23 , respectively, per loan per month was used to value the Fannie Mae and Freddie Mac MSRs, including MSR Financing Receivables. Weighted average costs of subservicing of $11.45 and $12.45 , respectively, per loan per month was used to value the non-agency MSRs, including MSR Financing Receivables. As of December 31, 2018 , a weighted average cost of subservicing of $10.06 per loan per month was used to value the Ginnie Mae MSRs. (F) Weighted average maturity of the underlying residential mortgage loans in the pool. (G) For certain pools, the Excess MSR will be paid on the total UPB of the mortgage portfolio (including both performing and delinquent loans until REO). For these pools, no delinquency assumption is used. (H) Represents Fannie Mae and Freddie Mac MSRs. (I) For certain pools, recapture rate represents the expected recapture rate with the successor subservicer appointed by NRM. (J) Includes valuation of the related Excess spread financing (Note 5). The following table summarizes certain information regarding the inputs used in valuing residential mortgage loans held-for-investment, at fair value classified as Level 3: Fair Value Discount Rate Prepayment Rate CDR Loss Severity Residential Mortgage Loans Held-for-Investment, at Fair Value $ 121,088 4.00% 7.0% 0.1% 20.0% The following table summarizes certain information regarding the inputs used in valuing residential mortgage loans held-for-sale, at fair value classified as Level 3: Fair Value Discount Rate Prepayment Rate CDR Loss Severity Acquired Loans $ 2,153,269 4.5% 8.2% 1.5% 39.4% Originated Loans 655,260 3.50% - 4.50% 10.0% - 15.0% 0.0% - 4.0% 0.0% - 50.0% Residential Mortgage Loans Held-for-Sale, at Fair Value $ 2,808,529 The following table summarizes certain information regards the inputs used in valuing Mortgage-Backed Securities Issued: Fair Value Discount Rate Prepayment Rate CDR Loss Severity Mortgage-Backed Securities Issued $ 117,903 3.5% to 5.25% 6.0% to 12.0% 0.0% to 0.25% 0.0% to 10.0% |
Summary of Certain Information Regarding the Inputs used in Valuing the Servicer Advances | The following table summarizes certain information regarding the inputs used in valuing the Servicer Advance Investments, including the basic fee component of the related MSRs: Significant Inputs Weighted Average Outstanding Servicer Advances to UPB of Underlying Residential Mortgage Loans Prepayment Rate (A) Delinquency Mortgage Servicing Amount (B) Discount Rate Collateral Weighted Average Maturity (Years) (C) December 31, 2018 1.4 % 10.9 % 17.7 % 19.6 bps 5.9 % 23.4 December 31, 2017 1.7 % 10.0 % 13.8 % 18.2 bps 6.8 % 25.6 (A) Projected annual weighted average lifetime voluntary and involuntary prepayment rate using a prepayment vector. (B) Mortgage servicing amount is net of 9.6 bps and 12.5 bps which represent the amounts New Residential paid its servicers as a monthly servicing fee as of December 31, 2018 and 2017 , respectively. (C) Weighted average maturity of the underlying residential mortgage loans in the pool. |
Schedule of Securities Valuation Methodology and Results | New Residential’s securities valuation methodology and results are further detailed as follows: Fair Value Asset Type Outstanding Face Amount Amortized Cost Basis Multiple Quotes (A) Single Quote (B) Total Level December 31, 2018 Agency RMBS $ 2,613,395 $ 2,657,917 $ 2,665,618 $ — $ 2,665,618 2 Non-Agency RMBS (C) 19,539,450 8,554,511 8,959,845 11,118 8,970,963 3 Total $ 22,152,845 $ 11,212,428 $ 11,625,463 $ 11,118 $ 11,636,581 December 31, 2017 Agency RMBS $ 1,203,629 $ 1,247,093 $ 1,243,617 $ — $ 1,243,617 2 Treasury 862,000 858,028 852,734 — 852,734 2 Non-Agency RMBS (C) 12,757,357 5,599,644 5,963,577 11,212 5,974,789 3 Total $ 14,822,986 $ 7,704,765 $ 8,059,928 $ 11,212 $ 8,071,140 (A) New Residential generally obtained pricing service quotations or broker quotations from two sources, one of which was generally the seller (the party that sold New Residential the security) for Non-Agency RMBS. New Residential evaluates quotes received and determines one as being most representative of fair value, and does not use an average of the quotes. Even if New Residential receives two or more quotes on a particular security that come from non-selling brokers or pricing services, it does not use an average because it believes using an actual quote more closely represents a transactable price for the security than an average level. Furthermore, in some cases, for non-agency RMBS, there is a wide disparity between the quotes New Residential receives. New Residential believes using an average of the quotes in these cases would not represent the fair value of the asset. Based on New Residential’s own fair value analysis, it selects one of the quotes which is believed to more accurately reflect fair value. New Residential has not adjusted any of the quotes received in the periods presented. These quotations for Non-Agency RMBS are generally received via email and contain disclaimers which state that they are “indicative” and not “actionable” — meaning that the party giving the quotation is not bound to actually purchase the security at the quoted price. New Residential’s investments in Agency RMBS are classified within Level 2 of the fair value hierarchy because the market for these securities is very active and market prices are readily observable. The third-party pricing services and brokers engaged by New Residential (collectively, “valuation providers”) use either the income approach or the market approach, or a combination of the two, in arriving at their estimated valuations of RMBS. Valuation providers using the market approach generally look at prices and other relevant information generated by market transactions involving identical or comparable assets. Valuation providers using the income approach create pricing models that generally incorporate such assumptions as discount rates, expected prepayment rates, expected default rates and expected loss severities. New Residential has reviewed the methodologies utilized by its valuation providers and has found them to be consistent with GAAP requirements. In addition to obtaining multiple quotations, when available, and reviewing the valuation methodologies of its valuation providers, New Residential creates its own internal pricing models for Level 3 securities and uses the outputs of these models as part of its process of evaluating the fair value estimates it receives from its valuation providers. These models incorporate the same types of assumptions as the models used by the valuation providers, but the assumptions are developed independently. These assumptions are regularly refined and updated at least quarterly by New Residential, and reviewed by its valuation group, which is separate from its investment acquisition and management group, to reflect market developments and actual performance. For 73.3% of New Residential’s Non-Agency RMBS, the ranges of assumptions used by New Residential’s valuation providers are summarized in the table below. The assumptions used by New Residential’s valuation providers with respect to the remainder of New Residential’s Non-Agency RMBS were not readily available. Fair Value Discount Rate Prepayment Rate (a) CDR (b) Loss Severity (c) Non-Agency RMBS $ 6,578,455 2.78% to 30% 0.25% to 25.0% 0.25% to 9.00% 5.0% to 100% (a) Represents the annualized rate of the prepayments as a percentage of the total principal balance of the pool. (b) Represents the annualized rate of the involuntary prepayments (defaults) as a percentage of the total principal balance of the pool. (c) Represents the expected amount of future realized losses resulting from the ultimate liquidation of a particular loan, expressed as the net amount of loss relative to the outstanding balance. (B) New Residential was unable to obtain quotations from more than one source on these securities. For approximately $11.1 million in 2018 and $10.5 million in 2017 , the one source was the party that sold New Residential the security. (C) Includes New Residential’s investments in interest-only notes for which the fair value option for financial instruments was elected. |
Schedule of Inputs Used in Valuing Residential Mortgage Loans | The following table summarizes the inputs used in valuing these residential mortgage loans: Fair Value and Carrying Value Discount Rate Weighted Average Life (Years) (A) Prepayment Rate CDR (B) Loss Severity (C) December 31, 2018 Performing Loans $ 307,135 4.4 % 4.0 10.5 % 3.0 % 33.2 % Non-Performing Loans 381,940 5.5 % 3.1 2.9 % 2.8 % 30.0 % Total/Weighted Average $ 689,075 5.0 % 3.5 6.3 % 31.4 % December 31, 2017 Performing Loans $ 721,121 3.8 % 4.8 11.5 % 1.1 % 36.9 % Non-Performing Loans 4,203 7.5 % 3.8 3.0 % 3.0 % 30.0 % Total/Weighted Average $ 725,324 3.8 % 4.8 11.5 % 36.9 % (A) The weighted average life is based on the expected timing of the receipt of cash flows. (B) Represents the annualized rate of the involuntary prepayments (defaults) as a percentage of the total principal balance. (C) Loss severity is the expected amount of future realized losses resulting from the ultimate liquidation of a particular loan, expressed as the net amount of loss relative to the outstanding loan balance. |
EQUITY AND ENARNINGS PER SHARE
EQUITY AND ENARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Summary of Common Dividends Declared | Common dividends have been declared as follows: Per Share Declaration Date Payment Date Quarterly Dividend Total Amounts Distributed (millions) March 22, 2016 April 2016 0.46 106.0 June 27, 2016 July 2016 0.46 106.0 September 23, 2016 October 2016 0.46 115.4 December 16, 2016 January 2017 0.46 115.4 January 26, 2017 April 2017 0.48 147.5 June 21, 2017 July 2017 0.50 153.7 September 22, 2017 October 2017 0.50 153.7 December 18, 2017 January 2018 0.50 153.7 March 22, 2018 April 2018 0.50 168.1 June 21, 2018 July 2018 0.50 169.9 September 20, 2018 October 2018 0.50 170.2 December 20, 2018 January 2019 0.50 184.6 |
Summary of Outstanding Options | New Residential’s outstanding options were summarized as follows: December 31, 2018 2017 Held by the Manager 6,961,222 16,387,480 Issued to the Manager and subsequently assigned to certain of the Manager’s employees 1,530,916 2,108,708 Issued to the independent directors 6,000 6,000 Total 8,498,138 18,502,188 The following table summarizes New Residential’s outstanding options as of December 31, 2018 . The last sales price on the New York Stock Exchange for New Residential’s common stock in the year ended December 31, 2018 was $14.21 per share. Recipient Date of Grant/ Exercise (A) Number of Unexercised Options Options Exercisable as of December 31, 2018 Weighted Average Exercise Price (B) Intrinsic Value of Exercisable Options as of December 31, 2018 (millions) Directors Various 6,000 6,000 $ 13.99 $ — Manager (C) 2012 — — — — Manager (C) 2013 — — — — Manager (C) 2014 — — — — Manager (C) 2015 — — — — Manager (C) 2016 533,334 200,000 13.70 0.1 Manager (C) 2017 2,638,804 1,130,917 14.50 — Manager (C) 2018 5,320,000 581,215 17.12 — Outstanding 8,498,138 1,918,132 (A) Options expire on the tenth anniversary from date of grant. (B) The exercise prices are subject to adjustment in connection with return of capital dividends. A portion of New Residential’s 2017 dividends was deemed to be a return of capital and the exercise prices were adjusted accordingly. (C) The Manager assigned certain of its options to its employees as follows: Date of Grant to Manager Range of Exercise Prices Total Unexercised Inception to Date 2016 $13.70 400,000 2017 $14.50 1,130,916 Total 1,530,916 The following table summarizes activity in New Residential’s outstanding options: Amount Weighted Average Exercise Price December 31, 2016 outstanding options 13,196,610 Options granted 5,654,578 $ 14.50 Options exercised (A) — $ — Options expired unexercised (349,000 ) December 31, 2017 outstanding options 18,502,188 Options granted 5,799,166 $ 17.23 Options exercised (15,803,216 ) $ 14.30 Options expired unexercised — December 31, 2018 outstanding options 8,498,138 See table above (A) The 15.8 million options that were exercised in 2018 had an intrinsic value of approximately $68.9 million at the date of exercise. |
TRANSACTIONS WITH AFFILIATES _2
TRANSACTIONS WITH AFFILIATES AND AFFILIATED ENTITIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Schedule of Affiliate Transactions | Due to affiliates is comprised of the following amounts: December 31, 2018 2017 Management fees $ 5,779 $ 4,734 Incentive compensation 94,900 81,373 Expense reimbursements and other 792 2,854 Total $ 101,471 $ 88,961 Affiliate expenses and fees were comprised of: Year Ended December 31, 2018 2017 2016 Management fees $ 62,594 $ 55,634 $ 41,610 Incentive compensation 94,900 81,373 42,197 Expense reimbursements (A) 500 500 500 Total $ 157,994 $ 137,507 $ 84,307 (A) Included in General and Administrative Expenses in the Consolidated Statements of Income. |
RECLASSIFICATION FROM ACCUMUL_2
RECLASSIFICATION FROM ACCUMULATED OTHER COMPREHENSIVE INCOME INTO NET INCOME (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Summary of Amounts Reclassified out of Accumulated Other Comprehensive Income into Net Income | The following table summarizes the amounts reclassified out of accumulated other comprehensive income into net income: Accumulated Other Comprehensive Income Components Statement of Income Location Year Ended December 31, 2018 2017 2016 Reclassification of net realized (gain) loss on securities into earnings Gain (loss) on settlement of investments, net $ 29,936 $ (20,642 ) $ 27,460 Reclassification of net realized (gain) loss on securities into earnings Other-than-temporary impairment on securities 30,017 10,334 10,264 Total reclassifications $ 59,953 $ (10,308 ) $ 37,724 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Tax Expense (Benefit) | Income tax (benefit) expense consists of the following: Year Ended December 31, 2018 2017 2016 Current: Federal $ 6,146 $ (1,250 ) $ 3,813 State and Local 477 360 252 Total Current Income Tax Expense (Benefit) 6,623 (890 ) 4,065 Deferred: Federal (68,907 ) 148,997 33,999 State and Local (11,147 ) 19,521 847 Total Deferred Income Tax Expense (Benefit) (80,054 ) 168,518 34,846 Total Income Tax (Benefit) Expense $ (73,431 ) $ 167,628 $ 38,911 |
Schedule of Reported Provision for Income Taxes and the U.S. Federal Statutory Rate | The difference between New Residential’s reported provision for income taxes and the U.S. federal statutory rate of 21% is as follows: December 31, 2018 2017 2016 Provision at the statutory rate 21.00 % 35.00 % 35.00 % Non-taxable REIT income (25.44 )% (21.72 )% (28.22 )% State and local taxes (1.19 )% 1.76 % 0.18 % Change in valuation allowance (2.31 )% 0.85 % 0.67 % Change in federal tax rate — % (0.92 )% — % Other (0.30 )% (0.17 )% (0.48 )% Total provision (8.24 )% 14.80 % 7.15 % |
Schedule of Deferred Tax Assets and Liabilities | The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liability are presented below: December 31, 2018 2017 Deferred tax assets: Net operating losses and tax credit carryforwards (B) $ 41,713 $ 20,682 Interest accruals not currently deductible for tax purposes — 2,628 Basis differences for REO and other assets 8,453 8,034 Unrealized mark to market 36,758 — Other 3,087 2,279 Total deferred tax assets 90,011 33,623 Less valuation allowance — (12,404 ) Net deferred tax assets $ 90,011 $ 21,219 Deferred tax liabilities: Basis difference for partnership and other investments $ (24,179 ) $ (3,873 ) Interest accruals not currently includible in income for tax purposes — (6,979 ) Unrealized mark to market — (29,585 ) Total deferred tax (liability) $ (24,179 ) $ (40,437 ) Net deferred tax assets (liability) $ 65,832 $ (19,218 ) (A) As of December 31, 2018 , New Residential’s TRSs had approximately $131.3 million of net operating loss carryforwards for federal and state income tax purposes which may be available to offset future taxable income, if and when it arises. Approximately, $131.3 million of these federal and state net operating loss carryforwards will begin to expire in 2034. The utilization of the net operating loss carryforwards to reduce future income taxes will depend on the TRSs ability to generate sufficient taxable income prior to the expiration of the carryforward period. |
Summary of Changes in Deferred Tax Asset Valuation Allowance | The following table summarizes the change in the deferred tax asset valuation allowance: Valuation allowance at December 31, 2016 $ 10,054 Increase related to net operating losses and loan loss reserves 4,720 Decrease related to changes in tax rates (3,845 ) Other increase (decrease) 1,475 Valuation allowance at December 31, 2017 12,404 Increase related to net operating losses and loan loss reserves 18,769 Decrease related to changes in tax rates — Other increase (decrease) (31,173 ) Valuation allowance at December 31, 2018 $ — |
Schedule of Taxable Common Stock Distributions | Common stock distributions were taxable as follows: Year Dividends per Share Ordinary Income Long-term Capital Gain Return of Capital 2018 (A) $ 1.60 78.03 % 1.03 % 20.94 % 2017 (B) 1.94 66.64 % 7.83 % 25.53 % 2016 1.38 96.13 % 3.87 % — % (A) The entire $0.50 per share dividend declared in December 2018 and paid in January 2019 is treated as received by stockholders in 2019 . (B) The entire $0.50 per share dividend declared in December 2017 and paid in January 2018 is treated as received by stockholders in 2018 . |
SUMMARY QUARTERLY CONSOLIDATE_2
SUMMARY QUARTERLY CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED) (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Unaudited Summary Information | The following is an unaudited summary information on New Residential’s quarterly operations. 2018 Quarter Ended Year Ended December 31 March 31 June 30 September 30 December 31 Interest income $ 383,573 $ 403,805 $ 425,524 $ 451,321 $ 1,664,223 Interest expense 124,387 133,916 162,806 185,324 606,433 Net interest income 259,186 269,889 262,718 265,997 1,057,790 Impairment Other-than-temporary impairment (OTTI) on securities 6,670 12,631 3,889 6,827 30,017 Valuation and loss provision (reversal) on loans and real estate owned 19,007 3,658 5,471 32,488 60,624 25,677 16,289 9,360 39,315 90,641 Net interest income after impairment 233,509 253,600 253,358 226,682 967,149 Servicing revenue, net 217,236 146,193 175,355 (10,189 ) 528,595 Gain on sale of originated mortgage loans, net — — 45,732 43,285 89,017 Other income (loss) (A) 264,524 (96,812 ) (83,298 ) (128,671 ) (44,257 ) Operating Expenses 107,817 119,753 192,107 189,727 609,404 Income Before Income Taxes 607,452 183,228 199,040 (58,620 ) 931,100 Income tax (benefit) expense (6,912 ) (2,608 ) 3,563 (67,474 ) (73,431 ) Net Income $ 614,364 $ 185,836 $ 195,477 $ 8,854 $ 1,004,531 Noncontrolling Interests in Income of Consolidated Subsidiaries $ 10,111 $ 11,078 $ 10,869 $ 8,506 $ 40,564 Net Income Attributable to Common Stockholders $ 604,253 $ 174,758 $ 184,608 $ 348 $ 963,967 Net Income Per Share of Common Stock Basic $ 1.83 $ 0.52 $ 0.54 $ — $ 2.82 Diluted $ 1.81 $ 0.51 $ 0.54 $ — $ 2.81 Weighted Average Number of Shares of Common Stock Outstanding Basic 330,384,856 336,311,253 340,044,440 358,044,646 341,268,923 Diluted 333,380,436 339,538,503 340,868,403 358,509,094 343,137,361 Dividends Declared per Share of Common Stock $ 0.50 $ 0.50 $ 0.50 $ 0.50 $ 2.00 2017 Quarter Ended Year Ended December 31 March 31 June 30 September 30 December 31 Interest income $ 292,538 $ 471,952 $ 397,722 $ 357,467 $ 1,519,679 Interest expense 98,229 115,157 125,278 122,201 460,865 Net interest income 194,309 356,795 272,444 235,266 1,058,814 Impairment Other-than-temporary impairment (OTTI) on securities 2,112 5,115 1,509 1,598 10,334 Valuation and loss provision (reversal) on loans and real estate owned 17,910 20,771 26,700 10,377 75,758 20,022 25,886 28,209 11,975 86,092 Net interest income after impairment 174,287 330,909 244,235 223,291 972,722 Servicing revenue, net 40,602 170,851 58,014 154,882 424,349 Other (loss) income (A) (3,694 ) 57,847 87,145 66,488 207,786 Operating Expenses 68,441 139,360 117,060 97,716 422,577 Income Before Income Taxes 142,754 420,247 272,334 346,945 1,182,280 Income tax expense 5,596 82,844 32,613 46,575 167,628 Net Income $ 137,158 $ 337,403 $ 239,721 $ 300,370 $ 1,014,652 Noncontrolling Interests in Income of Consolidated Subsidiaries $ 15,780 $ 15,671 $ 13,600 $ 12,068 $ 57,119 Net Income Attributable to Common Stockholders $ 121,378 $ 321,732 $ 226,121 $ 288,302 $ 957,533 Net Income Per Share of Common Stock Basic $ 0.42 $ 1.05 $ 0.74 $ 0.94 $ 3.17 Diluted $ 0.42 $ 1.04 $ 0.73 $ 0.93 $ 3.15 Weighted Average Number of Shares of Common Stock Outstanding Basic 286,600,324 307,344,874 307,361,309 307,361,309 302,238,065 Diluted 288,241,188 309,392,512 309,207,345 310,388,102 304,381,388 Dividends Declared per Share of Common Stock $ 0.48 $ 0.50 $ 0.50 $ 0.50 $ 1.98 (A) Earnings from investments in equity method investees is included in other income. |
ORGANIZATION - Narrative (Detai
ORGANIZATION - Narrative (Details) $ in Thousands | Dec. 31, 2018USD ($)shares | Jul. 03, 2018USD ($)earnout_payment | Dec. 31, 2018USD ($)shares | Dec. 31, 2018USD ($)shares | Dec. 31, 2018USD ($)shares | Dec. 31, 2017USD ($)shares | Dec. 31, 2016USD ($)shares | Aug. 02, 2018 |
Related Party Transaction [Line Items] | ||||||||
Common stock, shares outstanding (in shares) | shares | 369,104,429 | 369,104,429 | 369,104,429 | 369,104,429 | 307,361,309 | |||
Stock options outstanding (in shares) | shares | 8,498,138 | 8,498,138 | 8,498,138 | 8,498,138 | 18,502,188 | 13,196,610 | ||
Increase (decrease) in contingent consideration | $ 1,581 | $ 0 | $ 0 | |||||
Goodwill | $ 24,645 | $ 24,645 | $ 24,645 | 24,645 | 0 | |||
Shellpoint Acquisition | ||||||||
Related Party Transaction [Line Items] | ||||||||
Cash consideration | $ 212,300 | |||||||
Number of earnout payments | earnout_payment | 3 | |||||||
Revenue from acquiree | 177,400 | |||||||
Net income of acquiree | $ 26,800 | |||||||
Shellpoint Acquisition contingent consideration | $ 40,800 | $ 39,300 | $ 39,300 | $ 0 | $ 0 | |||
Effective settlement of preexisting relationships | 173,900 | |||||||
Total consideration | 425,500 | |||||||
Increase (decrease) in contingent consideration | (3,500) | |||||||
Increase (decrease) in consideration transferred | (6,400) | |||||||
Increase (decrease) in intangibles | 14,100 | |||||||
Increase (decrease) in other assets | 300 | |||||||
increase (decrease) in goodwill | $ (24,300) | |||||||
Goodwill | 24,600 | |||||||
Goodwill expected to be tax deductible | $ 24,600 | |||||||
Fortress-managed funds | ||||||||
Related Party Transaction [Line Items] | ||||||||
Common stock, shares outstanding (in shares) | shares | 2,400,000 | 2,400,000 | 2,400,000 | 2,400,000 | ||||
Stock options outstanding (in shares) | shares | 6,900,000 | 6,900,000 | 6,900,000 | 6,900,000 | ||||
Nationstar Mortgage LLC | FIG LLC | ||||||||
Related Party Transaction [Line Items] | ||||||||
Interest in Consumer Loans | 40.50% | |||||||
Nationstar Mortgage LLC | WMIH Corp | ||||||||
Related Party Transaction [Line Items] | ||||||||
Interest in Consumer Loans | 0.00% | 0.00% | 0.00% | 0.00% | ||||
Shellpoint Partners LLC | Shellpoint Acquisition | NRM Acquisition LLC | ||||||||
Related Party Transaction [Line Items] | ||||||||
Percentage of voting interests acquired | 100.00% | |||||||
Cash consideration | $ 212,300 | |||||||
ShellPoint | NRM Acquisition LLC | ||||||||
Related Party Transaction [Line Items] | ||||||||
Earnout payments, maximum | $ 60,000 |
ORGANIZATION - Summary of Total
ORGANIZATION - Summary of Total Consideration (Details) - Shellpoint Acquisition - USD ($) | Dec. 31, 2018 | Jul. 03, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Business Combination, Separately Recognized Transactions [Line Items] | |||||
Cash consideration | $ 212,300,000 | ||||
Earnout Payment | $ 40,800,000 | 39,300,000 | $ 39,300,000 | $ 0 | $ 0 |
Effective Settlement of Preexisting Relationships | 173,900,000 | ||||
Total consideration | 425,500,000 | ||||
Contingent consideration, high | $ 60,000,000 | ||||
Contingent consideration, payment term | 3 years | ||||
Contingent consideration, earnout payments fair value | $ 39,300,000 | ||||
Minimum | |||||
Business Combination, Separately Recognized Transactions [Line Items] | |||||
Contingent consideration, low | 0 | ||||
Maximum | |||||
Business Combination, Separately Recognized Transactions [Line Items] | |||||
Contingent consideration, high | $ 60,000,000 |
ORGANIZATION - Summary of Preli
ORGANIZATION - Summary of Preliminary Allocation of Total Consideration (Details) - USD ($) $ in Thousands | Jul. 03, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Assets | |||||
Cash and cash equivalents | [1] | $ 251,058 | $ 295,798 | ||
Restricted cash | 164,020 | 150,252 | |||
Residential mortgage loans, held-for-sale, at fair value | 2,808,529 | 0 | |||
Mortgage servicing rights, at fair value | 2,884,100 | 1,735,504 | |||
Residential mortgage loans, held-for-investment, fair value | 121,088 | 0 | |||
Residential mortgage loans subject to repurchase | 121,602 | 0 | $ 0 | ||
Intangible assets | 18,708 | 0 | |||
Other assets | 688,408 | 312,181 | |||
Total assets | 31,691,013 | 22,213,562 | |||
Liabilities | |||||
Repurchase agreements | 15,553,969 | 8,662,139 | |||
Notes and bonds payable | [1] | 7,102,266 | 7,084,391 | ||
Residential mortgage loans repurchase liability | 121,602 | 0 | |||
Excess spread financing, at fair value | 39,304 | 0 | |||
Accrued expenses and other liabilities | [1] | 490,510 | 239,114 | ||
Total liabilities | 25,602,718 | 17,417,400 | |||
Noncontrolling interests in equity of consolidated subsidiaries | 90,625 | 105,957 | |||
Goodwill | $ 24,645 | $ 0 | |||
Shellpoint Acquisition | |||||
Business Acquisition [Line Items] | |||||
Total consideration | $ 425,500 | ||||
Assets | |||||
Cash and cash equivalents | 79,200 | ||||
Restricted cash | 9,900 | ||||
Residential mortgage loans, held-for-sale, at fair value | 488,200 | ||||
Mortgage servicing rights, at fair value | 286,600 | ||||
Residential mortgage loans, held-for-investment, fair value | 125,300 | ||||
Residential mortgage loans subject to repurchase | 121,400 | ||||
Intangible assets | 18,400 | ||||
Other assets | 81,500 | ||||
Total assets | 1,210,500 | ||||
Liabilities | |||||
Repurchase agreements | 439,600 | ||||
Notes and bonds payable | 20,700 | ||||
Mortgage-backed securities issued, at fair value | 120,700 | ||||
Residential mortgage loans repurchase liability | 121,400 | ||||
Excess spread financing, at fair value | 48,300 | ||||
Accrued expenses and other liabilities | 50,600 | ||||
Total liabilities | 801,300 | ||||
Noncontrolling interests in equity of consolidated subsidiaries | 8,300 | ||||
Net Assets | 400,900 | ||||
Goodwill | 24,600 | ||||
Ginnie Mae Excess MSRs | Shellpoint Acquisition | |||||
Assets | |||||
Mortgage servicing rights, at fair value | $ 135,300 | ||||
Internally developed software | Shellpoint Acquisition | |||||
Liabilities | |||||
Finite-lived intangible assets, useful life | 5 years | ||||
Tradenames | Shellpoint Acquisition | |||||
Liabilities | |||||
Finite-lived intangible assets, useful life | 6 months | ||||
[1] | New Residential’s Consolidated Balance Sheets include the assets and liabilities of certain consolidated VIEs, Advance Purchaser LLC (the “Buyer”) (Note 6), the RPL Borrowers, Shellpoint Asset Funding Trust 2013-1 (“SAFT 2013-1”) and the Shelter retail mortgage origination joint ventures (“Shelter JVs”) (Note 8) and the Consumer Loan SPVs (Note 9), which primarily hold investments in Servicer Advance Investments, residential mortgage loans and consumer loans, respectively, financed with notes and bonds payable. The balance sheets of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs are included in Notes 6, 8 and 9, respectively. The creditors of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs do not have recourse to the general credit of New Residential and the assets of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs are not directly available to satisfy New Residential’s obligations. See Note 8 regarding deconsolidation of the RPL Borrowers during 2018. |
ORGANIZATION - Summary of Unaud
ORGANIZATION - Summary of Unaudited Pro Forma Combined Interest Income and Income Before Income Taxes (Details) - Shellpoint Acquisition - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||
Servicing and Originations Revenue | $ 766,997 | $ 749,031 |
Income Before Income Taxes | $ 948,086 | $ 1,197,485 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018USD ($)risk | Dec. 31, 2017USD ($) | |
Cash and Cash Equivalents [Line Items] | ||
Number of significant types of economic risk | risk | 2 | |
Monthly payment threshold period to determine whether loan is past due (in days) | 30 days | |
Principal or interest past due threshold period (in days) | 120 days | |
Restricted cash | $ 164,020 | $ 150,252 |
General maturity term of repurchase agreements and notes payable (in years) | 1 year | |
Ginnie Mae Excess MSRs | ||
Cash and Cash Equivalents [Line Items] | ||
Restricted cash | $ 4,100 | 3,300 |
MSRs | ||
Cash and Cash Equivalents [Line Items] | ||
Restricted cash | 60,400 | 28,600 |
Secured Corporate Note | ||
Cash and Cash Equivalents [Line Items] | ||
Restricted cash | 1,900 | 9,900 |
Servicer Advance Investments | ||
Cash and Cash Equivalents [Line Items] | ||
Restricted cash | 60,000 | 62,400 |
Consumer Loan | ||
Cash and Cash Equivalents [Line Items] | ||
Restricted cash | $ 37,600 | $ 46,100 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Accretion and Other Amortization (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Accretion of discount and other amortization: | |||
Accretion of servicer advances receivable discount and servicer advance investments | $ 214,876 | $ 542,983 | $ 364,350 |
Accretion of excess mortgage servicing rights income | 44,440 | 103,053 | 150,141 |
Accretion of net discount on securities and loans | 452,500 | 398,213 | 253,243 |
Amortization of deferred financing costs | (7,795) | (12,076) | (18,326) |
Amortization of discount on notes and bonds payable | (2,054) | (789) | (1,476) |
Accretion and other amortization | $ 701,967 | $ 1,031,384 | $ 747,932 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Other Income (Loss), Net (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Other income (loss), net | |||
Unrealized gain (loss) on derivative instruments | $ (113,558) | $ (2,190) | $ 5,774 |
Unrealized gain (loss) on other ABS | 10,283 | 2,883 | (2,322) |
Unrealized gain (loss) on notes and bonds payable | (684) | 0 | 0 |
Unrealized gain (loss) on contingent consideration | (1,581) | 0 | 0 |
Gain (loss) on transfer of loans to REO | 19,519 | 22,938 | 18,356 |
Gain (loss) on transfer of loans to other assets | (1,977) | 488 | 2,938 |
Gain (loss) on Excess MSR recapture agreements | 979 | 2,384 | 2,802 |
Gain (loss) on Ocwen common stock | (10,860) | 5,346 | 0 |
Other income (loss) | (26,457) | (27,741) | 935 |
Nonoperating Income (Expense) | $ (124,336) | $ 4,108 | $ 28,483 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Gain (Loss) on Settlement of Investments, Net (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Accounting Policies [Abstract] | |||
Gain (loss) on sale of real estate securities, net | $ (29,936) | $ 20,642 | $ (27,460) |
Gain (loss) on sale of acquired residential mortgage loans, net | (7,677) | 39,731 | 12,142 |
Gain (loss) on settlement of derivatives | 54,867 | (39,214) | (27,491) |
Gain (loss) on liquidated residential mortgage loans | 5,023 | (10,201) | (1,810) |
Gain (loss) on sale of REO | (12,424) | (9,215) | 4,690 |
Gains reclassified from change in fair value of investments in excess MSRs and servicer advance investments | 113,002 | 11,320 | 0 |
Other gains (losses) | (19,013) | (2,753) | (8,871) |
Gain (loss) on settlement of investments, net | $ 103,842 | $ 10,310 | $ (48,800) |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of General and Administrative Expenses (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Accounting Policies [Abstract] | |||
Compensation and benefits expense | $ 109,870 | $ 0 | $ 663 |
Legal and professional expense | 45,234 | 40,182 | 23,983 |
Loan origination expense | 16,050 | 0 | 0 |
Occupancy expense | 8,868 | 0 | 0 |
Other | 51,557 | 26,977 | 13,924 |
General and Administrative Expense | $ 231,579 | $ 67,159 | $ 38,570 |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Other Assets and Other Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | |
Other Assets | |||
Margin receivable, net(A) | $ 145,857 | $ 53,150 | |
Other receivables | 23,723 | 10,635 | |
Principal and interest receivable | 76,015 | 48,373 | |
Receivable from government agency | 20,795 | 41,429 | |
Call rights | 290 | 327 | |
Derivative assets | 10,893 | 2,423 | |
Servicing fee receivables | 105,563 | 60,520 | |
Ginnie Mae EBO servicer advances receivable, net | 2,750 | 8,916 | |
Due from servicers | 95,261 | 38,601 | |
Goodwill | 24,645 | 0 | |
Intangible assets | 18,708 | 0 | |
Ocwen common stock, at fair value | 7,778 | 19,259 | |
Prepaid expenses | 29,165 | 7,308 | |
Equity investment | 74,323 | 0 | |
Other assets | 52,642 | 21,240 | |
Total Other Assets | 688,408 | 312,181 | |
Accrued Expenses and Other Liabilities | |||
Interest payable | 49,352 | 28,821 | |
Accounts payable | 75,591 | 73,017 | |
Derivative liabilities | 29,389 | 697 | |
Due to servicers | 95,419 | 24,571 | |
MSRs purchase price holdback | 100,593 | 101,290 | |
Excess spread financing, at fair value | 39,304 | 0 | |
Contingent Consideration | 40,842 | 0 | |
Reserve for sales recourse | 5,880 | 0 | |
Other liabilities | 54,140 | 10,718 | |
Accrued Expenses and Other Liabilities | [1] | $ 490,510 | $ 239,114 |
[1] | New Residential’s Consolidated Balance Sheets include the assets and liabilities of certain consolidated VIEs, Advance Purchaser LLC (the “Buyer”) (Note 6), the RPL Borrowers, Shellpoint Asset Funding Trust 2013-1 (“SAFT 2013-1”) and the Shelter retail mortgage origination joint ventures (“Shelter JVs”) (Note 8) and the Consumer Loan SPVs (Note 9), which primarily hold investments in Servicer Advance Investments, residential mortgage loans and consumer loans, respectively, financed with notes and bonds payable. The balance sheets of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs are included in Notes 6, 8 and 9, respectively. The creditors of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs do not have recourse to the general credit of New Residential and the assets of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs are not directly available to satisfy New Residential’s obligations. See Note 8 regarding deconsolidation of the RPL Borrowers during 2018. |
SEGMENT REPORTING (Details)
SEGMENT REPORTING (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Segment Reporting Information [Line Items] | ||||||||||||
Interest income | $ 451,321 | $ 425,524 | $ 403,805 | $ 383,573 | $ 357,467 | $ 397,722 | $ 471,952 | $ 292,538 | $ 1,664,223 | $ 1,519,679 | $ 1,076,735 | |
Interest expense | 185,324 | 162,806 | 133,916 | 124,387 | 122,201 | 125,278 | 115,157 | 98,229 | 606,433 | 460,865 | 373,424 | |
Net interest income | 265,997 | 262,718 | 269,889 | 259,186 | 235,266 | 272,444 | 356,795 | 194,309 | 1,057,790 | 1,058,814 | 703,311 | |
Impairment | 39,315 | 9,360 | 16,289 | 25,677 | 11,975 | 28,209 | 25,886 | 20,022 | 90,641 | 86,092 | 87,980 | |
Servicing revenue, net | (10,189) | 175,355 | 146,193 | 217,236 | 154,882 | 58,014 | 170,851 | 40,602 | 528,595 | 424,349 | 118,169 | |
Gain on sale of originated mortgage loans, net | 43,285 | 45,732 | 0 | 0 | 89,017 | 0 | 0 | |||||
Other income (loss) | (128,671) | (83,298) | (96,812) | 264,524 | 66,488 | 87,145 | 57,847 | (3,694) | (44,257) | 207,786 | 62,337 | |
Operating expenses | 189,727 | 192,107 | 119,753 | 107,817 | 97,716 | 117,060 | 139,360 | 68,441 | 609,404 | 422,577 | 174,210 | |
Income (Loss) Before Income Taxes | (58,620) | 199,040 | 183,228 | 607,452 | 346,945 | 272,334 | 420,247 | 142,754 | 931,100 | 1,182,280 | 621,627 | |
Income tax (benefit) expense | (67,474) | 3,563 | (2,608) | (6,912) | 46,575 | 32,613 | 82,844 | 5,596 | (73,431) | 167,628 | 38,911 | |
Net Income (Loss) | 8,854 | 195,477 | 185,836 | 614,364 | 300,370 | 239,721 | 337,403 | 137,158 | 1,004,531 | 1,014,652 | 582,716 | |
Noncontrolling interests in income (loss) of consolidated subsidiaries | 8,506 | 10,869 | 11,078 | 10,111 | 12,068 | 13,600 | 15,671 | 15,780 | 40,564 | 57,119 | 78,263 | |
Net income (loss) attributable to common stockholders | 348 | $ 184,608 | $ 174,758 | $ 604,253 | 288,302 | $ 226,121 | $ 321,732 | $ 121,378 | 963,967 | 957,533 | 504,453 | |
Investments | 23,318,701 | 19,748,888 | 23,318,701 | 19,748,888 | ||||||||
Cash and cash equivalents | 251,058 | 295,798 | 251,058 | 295,798 | ||||||||
Restricted cash | 164,020 | 150,252 | 164,020 | 150,252 | ||||||||
Other assets | 7,932,589 | 2,018,624 | 7,932,589 | 2,018,624 | ||||||||
Goodwill | 24,645 | 0 | 24,645 | 0 | ||||||||
Total assets | 31,691,013 | 22,213,562 | 31,691,013 | 22,213,562 | ||||||||
Debt | 22,656,235 | 15,746,530 | 22,656,235 | 15,746,530 | 13,181,236 | |||||||
Other liabilities | 2,946,483 | 1,670,870 | 2,946,483 | 1,670,870 | ||||||||
Total liabilities | 25,602,718 | 17,417,400 | 25,602,718 | 17,417,400 | ||||||||
Total equity | 6,088,295 | 4,796,162 | 6,088,295 | 4,796,162 | 3,468,177 | $ 2,986,580 | ||||||
Noncontrolling interests in equity of consolidated subsidiaries | 90,625 | 105,957 | 90,625 | 105,957 | ||||||||
Total New Residential stockholders’ equity | 5,997,670 | 4,690,205 | 5,997,670 | 4,690,205 | ||||||||
Investments in equity method investees | 186,258 | 223,177 | 186,258 | 223,177 | ||||||||
Servicing and Originations | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Interest income | 723,965 | 713,413 | 519,950 | |||||||||
Interest expense | 242,345 | 233,587 | 244,039 | |||||||||
Net interest income | 481,620 | 479,826 | 275,911 | |||||||||
Impairment | 0 | 0 | 0 | |||||||||
Servicing revenue, net | 528,595 | 424,349 | 118,169 | |||||||||
Gain on sale of originated mortgage loans, net | 89,017 | 0 | 0 | |||||||||
Other income (loss) | 12,654 | 174,561 | 6,774 | |||||||||
Operating expenses | 360,889 | 186,330 | 15,676 | |||||||||
Income (Loss) Before Income Taxes | 750,997 | 892,406 | 385,178 | |||||||||
Income tax (benefit) expense | (8,364) | 166,186 | 36,719 | |||||||||
Net Income (Loss) | 759,361 | 726,220 | 348,459 | |||||||||
Noncontrolling interests in income (loss) of consolidated subsidiaries | 3,577 | 11,227 | 40,136 | |||||||||
Net income (loss) attributable to common stockholders | 755,784 | 714,993 | 308,323 | |||||||||
Investments | 6,738,923 | 7,707,089 | 6,738,923 | 7,707,089 | ||||||||
Cash and cash equivalents | 236,871 | 183,306 | 236,871 | 183,306 | ||||||||
Restricted cash | 126,401 | 104,123 | 126,401 | 104,123 | ||||||||
Other assets | 3,510,192 | 747,997 | 3,510,192 | 747,997 | ||||||||
Goodwill | 24,645 | 0 | 24,645 | 0 | ||||||||
Total assets | 10,637,032 | 8,742,515 | 10,637,032 | 8,742,515 | ||||||||
Debt | 6,815,112 | 5,771,369 | 6,815,112 | 5,771,369 | ||||||||
Other liabilities | 520,215 | 189,840 | 520,215 | 189,840 | ||||||||
Total liabilities | 7,335,327 | 5,961,209 | 7,335,327 | 5,961,209 | ||||||||
Total equity | 3,301,705 | 2,781,306 | 3,301,705 | 2,781,306 | ||||||||
Noncontrolling interests in equity of consolidated subsidiaries | 60,064 | 71,491 | 60,064 | 71,491 | ||||||||
Total New Residential stockholders’ equity | 3,241,641 | 2,709,815 | 3,241,641 | 2,709,815 | ||||||||
Investments in equity method investees | 147,964 | 171,765 | 147,964 | 171,765 | ||||||||
Real Estate Securities | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Interest income | 573,539 | 431,706 | 265,862 | |||||||||
Interest expense | 240,615 | 122,997 | 49,283 | |||||||||
Net interest income | 332,924 | 308,709 | 216,579 | |||||||||
Impairment | 30,017 | 10,334 | 10,264 | |||||||||
Servicing revenue, net | 0 | 0 | 0 | |||||||||
Gain on sale of originated mortgage loans, net | 0 | 0 | 0 | |||||||||
Other income (loss) | (72,926) | (16,371) | (47,747) | |||||||||
Operating expenses | 1,554 | 1,471 | 1,480 | |||||||||
Income (Loss) Before Income Taxes | 228,427 | 280,533 | 157,088 | |||||||||
Income tax (benefit) expense | 0 | 0 | 0 | |||||||||
Net Income (Loss) | 228,427 | 280,533 | 157,088 | |||||||||
Noncontrolling interests in income (loss) of consolidated subsidiaries | 0 | 0 | 0 | |||||||||
Net income (loss) attributable to common stockholders | 228,427 | 280,533 | 157,088 | |||||||||
Investments | 11,636,581 | 8,071,140 | 11,636,581 | 8,071,140 | ||||||||
Cash and cash equivalents | 49 | 38,728 | 49 | 38,728 | ||||||||
Restricted cash | 0 | 0 | 0 | 0 | ||||||||
Other assets | 4,080,202 | 1,098,921 | 4,080,202 | 1,098,921 | ||||||||
Goodwill | 0 | 0 | ||||||||||
Total assets | 15,716,832 | 9,208,789 | 15,716,832 | 9,208,789 | ||||||||
Debt | 11,615,364 | 6,534,300 | 11,615,364 | 6,534,300 | ||||||||
Other liabilities | 2,111,868 | 1,200,905 | 2,111,868 | 1,200,905 | ||||||||
Total liabilities | 13,727,232 | 7,735,205 | 13,727,232 | 7,735,205 | ||||||||
Total equity | 1,989,600 | 1,473,584 | 1,989,600 | 1,473,584 | ||||||||
Noncontrolling interests in equity of consolidated subsidiaries | 0 | 0 | 0 | 0 | ||||||||
Total New Residential stockholders’ equity | 1,989,600 | 1,473,584 | 1,989,600 | 1,473,584 | ||||||||
Investments in equity method investees | 0 | 0 | 0 | 0 | ||||||||
Residential Mortgage Loans | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Interest income | 158,892 | 110,087 | 56,249 | |||||||||
Interest expense | 80,910 | 51,473 | 25,675 | |||||||||
Net interest income | 77,982 | 58,614 | 30,574 | |||||||||
Impairment | 12,061 | 12,593 | 23,870 | |||||||||
Servicing revenue, net | 0 | 0 | 0 | |||||||||
Gain on sale of originated mortgage loans, net | 0 | 0 | 0 | |||||||||
Other income (loss) | 16,456 | 16,175 | 26,779 | |||||||||
Operating expenses | 32,424 | 31,529 | 14,961 | |||||||||
Income (Loss) Before Income Taxes | 49,953 | 30,667 | 18,522 | |||||||||
Income tax (benefit) expense | (65,279) | 1,272 | 2,117 | |||||||||
Net Income (Loss) | 115,232 | 29,395 | 16,405 | |||||||||
Noncontrolling interests in income (loss) of consolidated subsidiaries | 0 | 0 | 0 | |||||||||
Net income (loss) attributable to common stockholders | 115,232 | 29,395 | 16,405 | |||||||||
Investments | 3,832,701 | 2,544,984 | 3,832,701 | 2,544,984 | ||||||||
Cash and cash equivalents | 927 | 15,483 | 927 | 15,483 | ||||||||
Restricted cash | 0 | 0 | 0 | 0 | ||||||||
Other assets | 131,282 | 113,035 | 131,282 | 113,035 | ||||||||
Goodwill | 0 | 0 | ||||||||||
Total assets | 3,964,910 | 2,673,502 | 3,964,910 | 2,673,502 | ||||||||
Debt | 3,191,859 | 2,108,007 | 3,191,859 | 2,108,007 | ||||||||
Other liabilities | 8,916 | 23,917 | 8,916 | 23,917 | ||||||||
Total liabilities | 3,200,775 | 2,131,924 | 3,200,775 | 2,131,924 | ||||||||
Total equity | 764,135 | 541,578 | 764,135 | 541,578 | ||||||||
Noncontrolling interests in equity of consolidated subsidiaries | 0 | 0 | 0 | 0 | ||||||||
Total New Residential stockholders’ equity | 764,135 | 541,578 | 764,135 | 541,578 | ||||||||
Investments in equity method investees | 0 | 0 | 0 | 0 | ||||||||
Consumer Loans | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Interest income | 206,321 | 263,844 | 232,750 | |||||||||
Interest expense | 42,563 | 52,808 | 54,427 | |||||||||
Net interest income | 163,758 | 211,036 | 178,323 | |||||||||
Impairment | 48,563 | 63,165 | 53,846 | |||||||||
Servicing revenue, net | 0 | 0 | 0 | |||||||||
Gain on sale of originated mortgage loans, net | 0 | 0 | 0 | |||||||||
Other income (loss) | 9,965 | 28,075 | 76,518 | |||||||||
Operating expenses | 35,230 | 43,552 | 39,466 | |||||||||
Income (Loss) Before Income Taxes | 89,930 | 132,394 | 161,529 | |||||||||
Income tax (benefit) expense | 212 | 170 | 75 | |||||||||
Net Income (Loss) | 89,718 | 132,224 | 161,454 | |||||||||
Noncontrolling interests in income (loss) of consolidated subsidiaries | 36,987 | 45,892 | 38,127 | |||||||||
Net income (loss) attributable to common stockholders | 52,731 | 86,332 | 123,327 | |||||||||
Investments | 1,110,496 | 1,425,675 | 1,110,496 | 1,425,675 | ||||||||
Cash and cash equivalents | 8,279 | 40,687 | 8,279 | 40,687 | ||||||||
Restricted cash | 37,619 | 46,129 | 37,619 | 46,129 | ||||||||
Other assets | 64,802 | 28,621 | 64,802 | 28,621 | ||||||||
Goodwill | 0 | 0 | ||||||||||
Total assets | 1,221,196 | 1,541,112 | 1,221,196 | 1,541,112 | ||||||||
Debt | 1,033,900 | 1,332,854 | 1,033,900 | 1,332,854 | ||||||||
Other liabilities | 13,572 | 6,596 | 13,572 | 6,596 | ||||||||
Total liabilities | 1,047,472 | 1,339,450 | 1,047,472 | 1,339,450 | ||||||||
Total equity | 173,724 | 201,662 | 173,724 | 201,662 | ||||||||
Noncontrolling interests in equity of consolidated subsidiaries | 30,561 | 34,466 | 30,561 | 34,466 | ||||||||
Total New Residential stockholders’ equity | 143,163 | 167,196 | 143,163 | 167,196 | ||||||||
Investments in equity method investees | 38,294 | 51,412 | 38,294 | 51,412 | ||||||||
Corporate | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Interest income | 1,506 | 629 | 1,924 | |||||||||
Interest expense | 0 | 0 | 0 | |||||||||
Net interest income | 1,506 | 629 | 1,924 | |||||||||
Impairment | 0 | 0 | 0 | |||||||||
Servicing revenue, net | 0 | 0 | 0 | |||||||||
Gain on sale of originated mortgage loans, net | 0 | 0 | 0 | |||||||||
Other income (loss) | (10,406) | 5,346 | 13 | |||||||||
Operating expenses | 179,307 | 159,695 | 102,627 | |||||||||
Income (Loss) Before Income Taxes | (188,207) | (153,720) | (100,690) | |||||||||
Income tax (benefit) expense | 0 | 0 | 0 | |||||||||
Net Income (Loss) | (188,207) | (153,720) | (100,690) | |||||||||
Noncontrolling interests in income (loss) of consolidated subsidiaries | 0 | 0 | 0 | |||||||||
Net income (loss) attributable to common stockholders | (188,207) | (153,720) | $ (100,690) | |||||||||
Investments | 0 | 0 | 0 | 0 | ||||||||
Cash and cash equivalents | 4,932 | 17,594 | 4,932 | 17,594 | ||||||||
Restricted cash | 0 | 0 | 0 | 0 | ||||||||
Other assets | 146,111 | 30,050 | 146,111 | 30,050 | ||||||||
Goodwill | 0 | 0 | ||||||||||
Total assets | 151,043 | 47,644 | 151,043 | 47,644 | ||||||||
Debt | 0 | 0 | 0 | 0 | ||||||||
Other liabilities | 291,912 | 249,612 | 291,912 | 249,612 | ||||||||
Total liabilities | 291,912 | 249,612 | 291,912 | 249,612 | ||||||||
Total equity | (140,869) | (201,968) | (140,869) | (201,968) | ||||||||
Noncontrolling interests in equity of consolidated subsidiaries | 0 | 0 | 0 | 0 | ||||||||
Total New Residential stockholders’ equity | (140,869) | (201,968) | (140,869) | (201,968) | ||||||||
Investments in equity method investees | $ 0 | $ 0 | $ 0 | $ 0 |
INVESTMENTS IN EXCESS MORTGAG_3
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS - Schedule of Activity Related to the Carrying Value of Investments in Excess MSRs (Details) - Excess MSRs - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Carrying Value of Investments in Excess MSRs | ||
Beginning balance | $ 1,173,713 | $ 1,399,455 |
Purchases | 0 | (71,982) |
Interest income | 44,440 | 0 |
Other income | 46,861 | 103,053 |
Proceeds from repayments | (127,793) | 4,377 |
Proceeds from sales | (19,084) | (252,007) |
Change in fair value | (58,656) | (13,505) |
Ocwen Transaction | (611,621) | 4,322 |
Ending balance | 447,860 | 1,173,713 |
Nationstar | ||
Carrying Value of Investments in Excess MSRs | ||
Beginning balance | 532,233 | 611,293 |
Purchases | 0 | 0 |
Interest income | 44,386 | 0 |
Other income | 6,444 | 46,393 |
Proceeds from repayments | (100,215) | 2,384 |
Proceeds from sales | (19,084) | (120,485) |
Change in fair value | (18,436) | (13,505) |
Ocwen Transaction | 0 | 6,153 |
Ending balance | 445,328 | 532,233 |
SLS | ||
Carrying Value of Investments in Excess MSRs | ||
Beginning balance | 2,913 | 3,935 |
Purchases | 0 | 0 |
Interest income | 54 | 0 |
Other income | 0 | (191) |
Proceeds from repayments | (632) | 0 |
Proceeds from sales | 0 | (1,400) |
Change in fair value | 197 | 0 |
Ocwen Transaction | 0 | 569 |
Ending balance | 2,532 | 2,913 |
Ocwen | ||
Carrying Value of Investments in Excess MSRs | ||
Beginning balance | 638,567 | 784,227 |
Purchases | 0 | (71,982) |
Interest income | 0 | 0 |
Other income | 40,417 | 56,851 |
Proceeds from repayments | (26,946) | 1,993 |
Proceeds from sales | 0 | (130,122) |
Change in fair value | (40,417) | 0 |
Ocwen Transaction | (611,621) | (2,400) |
Ending balance | $ 0 | $ 638,567 |
INVESTMENTS IN EXCESS MORTGAG_4
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS - Narrative (Details) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
MSRs | Excess MSRs Investees | ||
Investment [Line Items] | ||
Weighted average discount rate, used to value investments in excess MSRs | 8.80% | 8.90% |
INVESTMENTS IN EXCESS MORTGAG_5
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS - Summary of Investments in Excess MSRs (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Investment [Line Items] | |||
UPB of Underlying Mortgages | $ 103,000,000 | ||
Weighted Average Life (Years) | 10 months 29 days | ||
Changes in fair value recorded in other income | $ (58,656) | $ 4,322 | $ (7,297) |
Corporate Joint Venture | Consumer loan bonds | |||
Investment [Line Items] | |||
UPB of Underlying Mortgages | 40,096,998 | 139,460,371 | |
Original and Recaptured Pools | |||
Investment [Line Items] | |||
Changes in fair value recorded in other income | (50,030) | (5,630) | (11,221) |
Recapture Agreements | |||
Investment [Line Items] | |||
Changes in fair value recorded in other income | (8,626) | 9,952 | 3,924 |
Excess MSRs | |||
Investment [Line Items] | |||
UPB of Underlying Mortgages | $ 106,426,363 | $ 217,121,299 | |
Weighted Average Life (Years) | 6 years 1 month 6 days | 6 years 4 months 24 days | |
Amortized Cost Basis | $ 361,327 | $ 1,028,523 | |
Carrying Value | 447,860 | 1,173,713 | 1,399,455 |
Excess MSRs | Nationstar | |||
Investment [Line Items] | |||
Carrying Value | 445,328 | 532,233 | $ 611,293 |
Excess MSRs | Agency | |||
Investment [Line Items] | |||
UPB of Underlying Mortgages | $ 52,368,290 | $ 63,839,281 | |
Weighted Average Life (Years) | 6 years 1 month 6 days | 6 years 2 months 12 days | |
Amortized Cost Basis | $ 218,797 | $ 267,947 | |
Carrying Value | 257,387 | 324,636 | |
Excess MSRs | Agency | Original and Recaptured Pools | |||
Investment [Line Items] | |||
UPB of Underlying Mortgages | $ 52,368,290 | $ 63,839,281 | |
Weighted Average Life (Years) | 5 years 7 months 6 days | 5 years 9 months 18 days | |
Amortized Cost Basis | $ 203,675 | $ 249,003 | |
Carrying Value | $ 226,452 | $ 280,033 | |
Excess MSRs | Agency | Original and Recaptured Pools | Minimum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 32.50% | 32.50% | |
Excess MSRs | Agency | Original and Recaptured Pools | Maximum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 66.70% | 66.70% | |
Excess MSRs | Agency | Original and Recaptured Pools | Weighted Average | |||
Investment [Line Items] | |||
Interest in Excess MSR | 53.30% | 53.50% | |
Excess MSRs | Agency | Original and Recaptured Pools | Fortress-managed funds | Minimum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 0.00% | 0.00% | |
Excess MSRs | Agency | Original and Recaptured Pools | Fortress-managed funds | Maximum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 40.00% | 40.00% | |
Excess MSRs | Agency | Original and Recaptured Pools | Nationstar | Minimum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 20.00% | 20.00% | |
Excess MSRs | Agency | Original and Recaptured Pools | Nationstar | Maximum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 35.00% | 35.00% | |
Excess MSRs | Agency | Recapture Agreements | |||
Investment [Line Items] | |||
UPB of Underlying Mortgages | $ 0 | $ 0 | |
Weighted Average Life (Years) | 12 years 9 months 18 days | 11 years 4 months 24 days | |
Amortized Cost Basis | $ 15,122 | $ 18,944 | |
Carrying Value | $ 30,935 | $ 44,603 | |
Excess MSRs | Agency | Recapture Agreements | Minimum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 32.50% | 32.50% | |
Excess MSRs | Agency | Recapture Agreements | Maximum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 66.70% | 66.70% | |
Excess MSRs | Agency | Recapture Agreements | Weighted Average | |||
Investment [Line Items] | |||
Interest in Excess MSR | 53.30% | 53.50% | |
Excess MSRs | Agency | Recapture Agreements | Fortress-managed funds | Minimum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 0.00% | 0.00% | |
Excess MSRs | Agency | Recapture Agreements | Fortress-managed funds | Maximum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 40.00% | 40.00% | |
Excess MSRs | Agency | Recapture Agreements | Nationstar | Minimum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 20.00% | 20.00% | |
Excess MSRs | Agency | Recapture Agreements | Nationstar | Maximum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 35.00% | 35.00% | |
Excess MSRs | Non-Agency | |||
Investment [Line Items] | |||
UPB of Underlying Mortgages | $ 54,058,073 | $ 153,282,018 | |
Weighted Average Life (Years) | 6 years | 6 years 4 months 24 days | |
Amortized Cost Basis | $ 142,530 | $ 760,576 | |
Carrying Value | 190,473 | 849,077 | |
Excess MSRs | Non-Agency | Original and Recaptured Pools | |||
Investment [Line Items] | |||
UPB of Underlying Mortgages | $ 54,058,073 | $ 64,146,430 | |
Weighted Average Life (Years) | 5 years 9 months 18 days | 5 years 4 months 24 days | |
Amortized Cost Basis | $ 138,314 | $ 154,938 | |
Carrying Value | $ 172,712 | $ 190,696 | |
Excess MSRs | Non-Agency | Original and Recaptured Pools | Minimum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 33.30% | 33.30% | |
Excess MSRs | Non-Agency | Original and Recaptured Pools | Maximum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 100.00% | 100.00% | |
Excess MSRs | Non-Agency | Original and Recaptured Pools | Weighted Average | |||
Investment [Line Items] | |||
Interest in Excess MSR | 59.40% | 59.60% | |
Excess MSRs | Non-Agency | Original and Recaptured Pools | Fortress-managed funds | Minimum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 0.00% | 0.00% | |
Excess MSRs | Non-Agency | Original and Recaptured Pools | Fortress-managed funds | Maximum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 50.00% | 50.00% | |
Excess MSRs | Non-Agency | Original and Recaptured Pools | Nationstar | Minimum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 0.00% | 0.00% | |
Excess MSRs | Non-Agency | Original and Recaptured Pools | Nationstar | Maximum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 33.30% | 33.30% | |
Excess MSRs | Non-Agency | Recapture Agreements | |||
Investment [Line Items] | |||
UPB of Underlying Mortgages | $ 0 | $ 0 | |
Weighted Average Life (Years) | 12 years 9 months 18 days | 11 years 3 months 18 days | |
Amortized Cost Basis | $ 4,216 | $ 7,489 | |
Carrying Value | $ 17,761 | $ 19,814 | |
Excess MSRs | Non-Agency | Recapture Agreements | Minimum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 33.30% | 33.30% | |
Excess MSRs | Non-Agency | Recapture Agreements | Maximum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 100.00% | 100.00% | |
Excess MSRs | Non-Agency | Recapture Agreements | Weighted Average | |||
Investment [Line Items] | |||
Interest in Excess MSR | 59.40% | 59.60% | |
Excess MSRs | Non-Agency | Recapture Agreements | Fortress-managed funds | Minimum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 0.00% | 0.00% | |
Excess MSRs | Non-Agency | Recapture Agreements | Fortress-managed funds | Maximum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 50.00% | 50.00% | |
Excess MSRs | Non-Agency | Recapture Agreements | Nationstar | Minimum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 0.00% | 0.00% | |
Excess MSRs | Non-Agency | Recapture Agreements | Nationstar | Maximum | |||
Investment [Line Items] | |||
Interest in Excess MSR | 33.30% | 33.30% | |
Excess MSRs | Non-Agency | Ocwen Serviced Pools | |||
Investment [Line Items] | |||
UPB of Underlying Mortgages | $ 89,135,588 | ||
Interest in Excess MSR | 100.00% | ||
Weighted Average Life (Years) | 6 years 6 months | ||
Amortized Cost Basis | $ 598,149 | ||
Carrying Value | $ 638,567 | ||
Excess MSRs | Non-Agency | Ocwen Serviced Pools | Fortress-managed funds | |||
Investment [Line Items] | |||
Interest in Excess MSR | 0.00% | ||
Excess MSRs | Non-Agency | Ocwen Serviced Pools | Nationstar | |||
Investment [Line Items] | |||
Interest in Excess MSR | 0.00% |
INVESTMENTS IN EXCESS MORTGAG_6
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS - Summary of Financial Results of Excess MSR Joint Ventures (Details) - Excess MSRs Investees - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Schedule of MSRs [Line Items] | |||
Excess MSR assets | $ 269,203 | $ 321,197 | |
Other assets | 27,411 | 22,333 | |
Other liabilities | (687) | 0 | |
Equity | 295,927 | 343,530 | |
New Residential’s investment | $ 147,964 | $ 171,765 | |
New Residential’s ownership | 50.00% | 50.00% | |
Interest income | $ 26,363 | $ 27,450 | $ 36,502 |
Other income (loss) | (9,649) | (2,149) | (3,359) |
Expenses | 0 | (68) | (91) |
Net income | $ 16,714 | $ 25,233 | $ 33,052 |
INVESTMENTS IN EXCESS MORTGAG_7
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS - Summary of Excess MSRs Made Through Equity Method Investees (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Schedule of MSRs [Line Items] | ||
Unpaid Principal Balance | $ 103,000,000 | |
Weighted Average Life (Years) | 10 months 29 days | |
Excess MSRs Investees | ||
Schedule of MSRs [Line Items] | ||
Unpaid Principal Balance | $ 41,707,963 | $ 50,501,054 |
New Residential Interest in Investees | 50.00% | 50.00% |
Amortized Cost Basis | $ 198,261 | $ 233,495 |
Carrying Value | $ 269,203 | $ 321,197 |
Weighted Average Life (Years) | 6 years 2 months 12 days | 6 years 3 months 4 days |
Excess MSRs Investees | Agency | ||
Schedule of MSRs [Line Items] | ||
New Residential Interest in Investees | 50.00% | |
Excess MSRs Investees | Agency | Original and Recaptured Pools | ||
Schedule of MSRs [Line Items] | ||
Unpaid Principal Balance | $ 41,707,963 | $ 50,501,054 |
Investee Interest in Excess MSR | 66.70% | 66.70% |
New Residential Interest in Investees | 50.00% | 50.00% |
Amortized Cost Basis | $ 178,560 | $ 209,924 |
Carrying Value | $ 228,779 | $ 271,785 |
Weighted Average Life (Years) | 5 years 5 months 23 days | 5 years 8 months 5 days |
Excess MSRs Investees | Agency | Recapture Agreements | ||
Schedule of MSRs [Line Items] | ||
Unpaid Principal Balance | $ 0 | $ 0 |
Investee Interest in Excess MSR | 66.70% | 66.70% |
New Residential Interest in Investees | 50.00% | 50.00% |
Amortized Cost Basis | $ 19,701 | $ 23,571 |
Carrying Value | $ 40,424 | $ 49,412 |
Weighted Average Life (Years) | 12 years 8 months 19 days | 11 years 5 months 7 days |
INVESTMENTS IN EXCESS MORTGAG_8
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS - Schedule of Change in Equity Method Investments (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Schedule of Equity Method Investments [Line Items] | |||
Distributions of earnings from equity method investees | $ (11,059) | $ (13,668) | $ (22,046) |
Distributions of capital from equity method investees | (300,056) | (393,722) | 0 |
Recurring Basis | |||
Schedule of Equity Method Investments [Line Items] | |||
Balance at beginning of period | 171,765 | 194,788 | |
Contributions to equity method investees | 0 | 0 | |
Distributions of earnings from equity method investees | (11,059) | (13,668) | |
Distributions of capital from equity method investees | (21,099) | (21,972) | |
Change in fair value of investments in equity method investees | 8,357 | 12,617 | |
Balance at end of period | $ 147,964 | $ 171,765 | $ 194,788 |
INVESTMENTS IN MORTGAGE SERVI_3
INVESTMENTS IN MORTGAGE SERVICING RIGHTS AND MORTGAGE SERVICING RIGHTS FINANCING RECEIVABLES - Narrative (Details) - USD ($) $ in Thousands | Nov. 08, 2018 | Aug. 31, 2018 | Jun. 28, 2018 | Jun. 04, 2018 | Jun. 01, 2018 | May 31, 2018 | May 25, 2018 | May 01, 2018 | Mar. 28, 2018 | Feb. 28, 2018 | Jan. 18, 2018 | Nov. 29, 2017 | Jul. 23, 2017 | Jun. 30, 2018 | Dec. 31, 2018 | Jan. 01, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Schedule of MSRs [Line Items] | ||||||||||||||||||
UPB of Underlying Mortgages | $ 103,000,000 | |||||||||||||||||
Payments to acquire mortgage servicing rights (MSR) | $ 1,500 | $ 220,500 | $ 66,500 | $ 19,300 | $ 6,100 | $ 79,900 | $ 26,300 | $ 36,200 | $ 96,600 | $ 33,500 | 1,186,000 | |||||||
Residential mortgage loans subject to repurchase | 121,602 | $ 0 | $ 0 | |||||||||||||||
Initial contract term (in years) | 5 years | |||||||||||||||||
Contract extension term with thirty day notice (in months) | 3 months | |||||||||||||||||
Ocwen | ||||||||||||||||||
Schedule of MSRs [Line Items] | ||||||||||||||||||
UPB of Underlying Mortgages | $ 86,800,000 | |||||||||||||||||
Payments to acquire finance receivables | $ 279,600 | |||||||||||||||||
MSRs | ||||||||||||||||||
Schedule of MSRs [Line Items] | ||||||||||||||||||
UPB of Underlying Mortgages | $ 100,000 | $ 18,500,000 | $ 4,700,000 | $ 2,100,000 | $ 500,000 | $ 6,100,000 | $ 2,100,000 | $ 4,600,000 | $ 8,100,000 | $ 3,300,000 | ||||||||
Mortgage Loans Subserviced | ||||||||||||||||||
Schedule of MSRs [Line Items] | ||||||||||||||||||
UPB of Underlying Mortgages | 47,300,000 | |||||||||||||||||
Subservicing revenue | $ 61,300 | |||||||||||||||||
Nationstar | ||||||||||||||||||
Schedule of MSRs [Line Items] | ||||||||||||||||||
Subservicer percent of UPB | 24.40% | |||||||||||||||||
Ocwen | ||||||||||||||||||
Schedule of MSRs [Line Items] | ||||||||||||||||||
Subservicer percent of UPB | 22.70% | |||||||||||||||||
Ocwen | New Residential Mortgage LLC | MSRs | ||||||||||||||||||
Schedule of MSRs [Line Items] | ||||||||||||||||||
Payments to acquire mortgage servicing rights (MSR) | $ 334,200 | |||||||||||||||||
Unpaid Principal Balance of underlying loans transferred | $ 36,100,000 | |||||||||||||||||
Ditech Financial LLC | ||||||||||||||||||
Schedule of MSRs [Line Items] | ||||||||||||||||||
Subservicer percent of UPB | 20.90% | |||||||||||||||||
PHH Mortgage Corporation | ||||||||||||||||||
Schedule of MSRs [Line Items] | ||||||||||||||||||
Subservicer percent of UPB | 10.90% | |||||||||||||||||
LoanCare | ||||||||||||||||||
Schedule of MSRs [Line Items] | ||||||||||||||||||
Subservicer percent of UPB | 1.60% | |||||||||||||||||
Flagstar | ||||||||||||||||||
Schedule of MSRs [Line Items] | ||||||||||||||||||
Subservicer percent of UPB | 0.60% | |||||||||||||||||
ShellPoint | New Residential Mortgage LLC | MSRs | ||||||||||||||||||
Schedule of MSRs [Line Items] | ||||||||||||||||||
UPB of Underlying Mortgages | $ 7,800,000 | |||||||||||||||||
Payments to acquire mortgage servicing rights (MSR) | $ 81,000 | |||||||||||||||||
New Penn | MSRs | ||||||||||||||||||
Schedule of MSRs [Line Items] | ||||||||||||||||||
UPB of Underlying Mortgages | $ 11,400,000 | |||||||||||||||||
Payments to acquire mortgage servicing rights (MSR) | $ 139,100 | |||||||||||||||||
New Penn | New Residential Mortgage LLC | MSRs | ||||||||||||||||||
Schedule of MSRs [Line Items] | ||||||||||||||||||
Unpaid Principal Balance of underlying loans transferred | $ 20,600,000 |
INVESTMENTS IN MORTGAGE SERVI_4
INVESTMENTS IN MORTGAGE SERVICING RIGHTS AND MORTGAGE SERVICING RIGHTS FINANCING RECEIVABLES - Schedule of Mortgage Rights Acquired (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Nov. 08, 2018 | Sep. 28, 2018 | Aug. 31, 2018 | Jun. 28, 2018 | Jun. 04, 2018 | Jun. 01, 2018 | May 31, 2018 | May 25, 2018 | May 01, 2018 | Mar. 28, 2018 | Feb. 28, 2018 | Jan. 16, 2018 | Dec. 31, 2018 |
Schedule of Investments in Mortgage Servicing Rights [Line Items] | ||||||||||||||
Unpaid Principal Balance | $ 103,000 | $ 103,000 | ||||||||||||
Payments to acquire mortgage servicing rights (MSR) | $ 1.5 | $ 220.5 | $ 66.5 | $ 19.3 | $ 6.1 | $ 79.9 | $ 26.3 | $ 36.2 | $ 96.6 | $ 33.5 | 1,186 | |||
MSRs | ||||||||||||||
Schedule of Investments in Mortgage Servicing Rights [Line Items] | ||||||||||||||
Unpaid Principal Balance | $ 100 | $ 18,500 | $ 4,700 | $ 2,100 | $ 500 | $ 6,100 | $ 2,100 | $ 4,600 | $ 8,100 | $ 3,300 | ||||
Batch 1 | ||||||||||||||
Schedule of Investments in Mortgage Servicing Rights [Line Items] | ||||||||||||||
Payments to acquire mortgage servicing rights (MSR) | 81.4 | $ 13.6 | $ 101.5 | |||||||||||
Batch 1 | MSRs | ||||||||||||||
Schedule of Investments in Mortgage Servicing Rights [Line Items] | ||||||||||||||
Unpaid Principal Balance | 7,000 | 1,100 | 11,500 | 7,000 | ||||||||||
Batch 2 | ||||||||||||||
Schedule of Investments in Mortgage Servicing Rights [Line Items] | ||||||||||||||
Payments to acquire mortgage servicing rights (MSR) | 135.7 | 126.4 | 81 | |||||||||||
Batch 2 | MSRs | ||||||||||||||
Schedule of Investments in Mortgage Servicing Rights [Line Items] | ||||||||||||||
Unpaid Principal Balance | 9,800 | $ 10,100 | $ 7,800 | 9,800 | ||||||||||
Various Acquisition | ||||||||||||||
Schedule of Investments in Mortgage Servicing Rights [Line Items] | ||||||||||||||
Payments to acquire mortgage servicing rights (MSR) | 60 | |||||||||||||
Various Acquisition | MSRs | ||||||||||||||
Schedule of Investments in Mortgage Servicing Rights [Line Items] | ||||||||||||||
Unpaid Principal Balance | $ 5,600 | $ 5,600 |
INVESTMENTS IN MORTGAGE SERVI_5
INVESTMENTS IN MORTGAGE SERVICING RIGHTS AND MORTGAGE SERVICING RIGHTS FINANCING RECEIVABLES - Schedule of Servicing Fee Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Schedule of Investments in Mortgage Servicing Rights [Line Items] | |||||||||||
Less: subservicing expense | $ (176,784) | $ (166,081) | $ (7,832) | ||||||||
Servicing revenue, net | $ (10,189) | $ 175,355 | $ 146,193 | $ 217,236 | $ 154,882 | $ 58,014 | $ 170,851 | $ 40,602 | 528,595 | 424,349 | 118,169 |
Change in fair value of investments in mortgage servicing rights financing receivables | 31,550 | 66,394 | 0 | ||||||||
Excess Spread Financing | |||||||||||
Schedule of Investments in Mortgage Servicing Rights [Line Items] | |||||||||||
Amortization of servicing rights | (1,200) | 0 | 0 | ||||||||
MSRs | |||||||||||
Schedule of Investments in Mortgage Servicing Rights [Line Items] | |||||||||||
Servicing fee revenue | 589,546 | 412,971 | 29,168 | ||||||||
Ancillary and other fees | 130,294 | 79,050 | 676 | ||||||||
Servicing fee revenue and fees and Interest income, investments in mortgage servicing rights financing receivable | 719,840 | 492,021 | 29,844 | ||||||||
Amortization of servicing rights | (256,915) | (223,167) | (15,354) | ||||||||
Change in valuation inputs and assumptions | 68,587 | 155,495 | 103,679 | ||||||||
(Gain)/loss on sales | (2,917) | 0 | 0 | ||||||||
Servicing revenue, net | 528,595 | 424,349 | 118,169 | ||||||||
MSRs | Mortgage Servicing Rights Financing Receivable | New Residential Mortgage LLC | |||||||||||
Schedule of Investments in Mortgage Servicing Rights [Line Items] | |||||||||||
Servicing fee revenue | 705,812 | 94,945 | |||||||||
Ancillary and other fees | 146,829 | 17,313 | |||||||||
Less: subservicing expense | (251,184) | (33,686) | |||||||||
Servicing fee revenue and fees and Interest income, investments in mortgage servicing rights financing receivable | 601,457 | 78,572 | |||||||||
Amortization of servicing rights | (197,703) | (43,190) | |||||||||
Change in valuation inputs and assumptions | (230,036) | (109,584) | |||||||||
(Gain)/loss on sales | (783) | 0 | |||||||||
Change in fair value of investments in mortgage servicing rights financing receivables | 31,550 | 66,394 | |||||||||
MSRs | Excess Spread Financing | |||||||||||
Schedule of Investments in Mortgage Servicing Rights [Line Items] | |||||||||||
Change in valuation inputs and assumptions | $ 7,400 | $ 0 | $ 0 |
INVESTMENTS IN MORTGAGE SERVI_6
INVESTMENTS IN MORTGAGE SERVICING RIGHTS AND MORTGAGE SERVICING RIGHTS FINANCING RECEIVABLES - Rollforward of Carrying Value of Investments In MSRs (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Mortgage Servicing Rights [Roll Forward] | |||
Beginning balance | $ 598,728 | ||
Proceeds from sales | (5,776) | $ 0 | $ 0 |
Ending balance | 1,644,504 | 598,728 | |
MSRs | |||
Mortgage Servicing Rights [Roll Forward] | |||
Beginning balance | 1,735,504 | 659,483 | |
Purchases | 1,042,933 | 1,143,693 | |
Transfer in (out) | 124,652 | ||
Acquisitions | 151,312 | ||
Originations | 35,311 | ||
Proceeds from sales | 5,776 | ||
Amortization of servicing rights | (256,915) | (223,167) | (15,354) |
Change in valuation inputs and assumptions | 68,587 | 155,495 | 103,679 |
Change in valuation inputs and assumptions | 61,149 | ||
(Gain)/loss on sales | (2,917) | 0 | 0 |
Ending balance | 2,884,100 | 1,735,504 | 659,483 |
Mortgage Servicing Rights [Roll Forward] | |||
Purchases | 1,042,933 | 1,143,693 | |
Amortization of servicing rights | (256,915) | (223,167) | (15,354) |
Amortization of servicing rights | (258,068) | ||
Change in valuation inputs and assumptions | 68,587 | 155,495 | 103,679 |
Mortgage Servicing Rights Financing Receivable | MSRs | |||
Mortgage Servicing Rights [Roll Forward] | |||
Beginning balance | 598,728 | ||
Ending balance | 1,644,504 | 598,728 | |
Mortgage Servicing Rights Financing Receivable | New Residential Mortgage LLC | MSRs | |||
Mortgage Servicing Rights [Roll Forward] | |||
Purchases | 128,357 | 467,884 | |
Transfer in (out) | (124,652) | ||
Amortization of servicing rights | (197,703) | (43,190) | |
Change in valuation inputs and assumptions | (230,036) | (109,584) | |
(Gain)/loss on sales | (783) | 0 | |
Mortgage Servicing Rights [Roll Forward] | |||
Beginning balance | 598,728 | 0 | |
Purchases | 128,357 | 467,884 | |
Ocwen Transaction | 1,017,993 | 64,450 | |
Proceeds from sales | (7,472) | ||
Amortization of servicing rights | (197,703) | (43,190) | |
Change in valuation inputs and assumptions | (230,036) | (109,584) | |
Ending balance | 1,644,504 | $ 598,728 | $ 0 |
New Penn | MSRs | |||
Mortgage Servicing Rights [Roll Forward] | |||
Acquisitions | $ 48,300 |
INVESTMENTS IN MORTGAGE SERVI_7
INVESTMENTS IN MORTGAGE SERVICING RIGHTS AND MORTGAGE SERVICING RIGHTS FINANCING RECEIVABLES - Schedule of Investment in MSRs (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||||||||||
Dec. 31, 2018 | Dec. 31, 2017 | Nov. 08, 2018 | Aug. 31, 2018 | Jun. 28, 2018 | Jun. 04, 2018 | Jun. 01, 2018 | May 31, 2018 | May 25, 2018 | May 01, 2018 | Mar. 28, 2018 | Feb. 28, 2018 | Dec. 31, 2016 | |
Schedule of Mortgage Servicing Rights [Line Items] | |||||||||||||
UPB of Underlying Mortgages | $ 103,000,000 | ||||||||||||
Weighted Average Life (Years) | 10 months 29 days | ||||||||||||
Carrying Value | $ 1,644,504 | $ 598,728 | |||||||||||
MSRs | |||||||||||||
Schedule of Mortgage Servicing Rights [Line Items] | |||||||||||||
UPB of Underlying Mortgages | $ 258,462,703 | $ 172,454,150 | |||||||||||
Weighted Average Life (Years) | 6 years 6 months 7 days | 6 years 3 months 22 days | |||||||||||
Amortized Cost Basis | $ 2,566,694 | $ 1,476,330 | |||||||||||
Carrying Value | $ 2,884,100 | $ 1,735,504 | |||||||||||
Discount rate | 8.70% | 9.10% | |||||||||||
Mortgage Servicing Rights Financing Receivable | |||||||||||||
Schedule of Mortgage Servicing Rights [Line Items] | |||||||||||||
Discount rate | 10.30% | 9.40% | |||||||||||
Agency | MSRs | |||||||||||||
Schedule of Mortgage Servicing Rights [Line Items] | |||||||||||||
UPB of Underlying Mortgages | $ 226,295,778 | $ 172,392,496 | |||||||||||
Weighted Average Life (Years) | 6 years 4 months 24 days | 6 years 3 months 22 days | |||||||||||
Amortized Cost Basis | $ 2,189,039 | $ 1,476,330 | |||||||||||
Carrying Value | 2,506,676 | 1,735,504 | |||||||||||
Non-Agency | MSRs | |||||||||||||
Schedule of Mortgage Servicing Rights [Line Items] | |||||||||||||
UPB of Underlying Mortgages | $ 2,143,212 | $ 61,654 | |||||||||||
Weighted Average Life (Years) | 6 years 7 months 6 days | 5 years 7 months 22 days | |||||||||||
Amortized Cost Basis | $ 19,982 | $ 0 | |||||||||||
Carrying Value | 22,438 | 0 | |||||||||||
Ginnie Mae | MSRs | |||||||||||||
Schedule of Mortgage Servicing Rights [Line Items] | |||||||||||||
UPB of Underlying Mortgages | $ 30,023,713 | ||||||||||||
Weighted Average Life (Years) | 7 years 4 months 24 days | ||||||||||||
Amortized Cost Basis | $ 357,673 | ||||||||||||
Carrying Value | 354,986 | ||||||||||||
MSRs | |||||||||||||
Schedule of Mortgage Servicing Rights [Line Items] | |||||||||||||
UPB of Underlying Mortgages | $ 100,000 | $ 18,500,000 | $ 4,700,000 | $ 2,100,000 | $ 500,000 | $ 6,100,000 | $ 2,100,000 | $ 4,600,000 | $ 8,100,000 | $ 3,300,000 | |||
Carrying Value | 2,884,100 | 1,735,504 | $ 659,483 | ||||||||||
MSRs | Mortgage Servicing Rights Financing Receivable | |||||||||||||
Schedule of Mortgage Servicing Rights [Line Items] | |||||||||||||
UPB of Underlying Mortgages | $ 130,516,565 | $ 64,344,893 | |||||||||||
Weighted Average Life (Years) | 6 years 9 months 11 days | 5 years 10 months 4 days | |||||||||||
Amortized Cost Basis | $ 1,303,738 | $ 489,144 | |||||||||||
Carrying Value | 1,644,504 | 598,728 | |||||||||||
MSRs | Agency | Mortgage Servicing Rights Financing Receivable | |||||||||||||
Schedule of Mortgage Servicing Rights [Line Items] | |||||||||||||
UPB of Underlying Mortgages | $ 42,265,547 | $ 49,498,415 | |||||||||||
Weighted Average Life (Years) | 5 years 10 months 24 days | 5 years 10 months 26 days | |||||||||||
Amortized Cost Basis | $ 366,946 | $ 428,657 | |||||||||||
Carrying Value | 434,110 | 476,206 | |||||||||||
MSRs | Non-Agency | Mortgage Servicing Rights Financing Receivable | |||||||||||||
Schedule of Mortgage Servicing Rights [Line Items] | |||||||||||||
UPB of Underlying Mortgages | $ 88,251,018 | $ 14,846,478 | |||||||||||
Weighted Average Life (Years) | 7 years 2 months 12 days | 5 years 7 months 22 days | |||||||||||
Amortized Cost Basis | $ 936,792 | $ 60,487 | |||||||||||
Carrying Value | $ 1,210,394 | $ 122,522 |
INVESTMENTS IN MORTGAGE SERVI_8
INVESTMENTS IN MORTGAGE SERVICING RIGHTS AND MORTGAGE SERVICING RIGHTS FINANCING RECEIVABLES - Summary of the Geographic Distribution of the Underlying Residential Mortgage Loans of the MSRs (Details) - MSRs - Mortgage Loans | Dec. 31, 2018 | Dec. 31, 2017 |
Schedule of MSRs [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 100.00% | 100.00% |
California | ||
Schedule of MSRs [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 21.70% | 19.00% |
New York | ||
Schedule of MSRs [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 7.80% | 6.30% |
Florida | ||
Schedule of MSRs [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 6.90% | 6.00% |
Texas | ||
Schedule of MSRs [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 5.30% | 5.70% |
New Jersey | ||
Schedule of MSRs [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 5.00% | 5.20% |
Illinois | ||
Schedule of MSRs [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 3.70% | 4.10% |
Massachusetts | ||
Schedule of MSRs [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 3.50% | 3.80% |
Maryland | ||
Schedule of MSRs [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 3.40% | 2.80% |
Pennsylvania | ||
Schedule of MSRs [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 3.10% | 3.30% |
Virginia | ||
Schedule of MSRs [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 3.10% | 3.10% |
Other U.S. | ||
Schedule of MSRs [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 36.50% | 40.70% |
INVESTMENTS IN MORTGAGE SERVI_9
INVESTMENTS IN MORTGAGE SERVICING RIGHTS AND MORTGAGE SERVICING RIGHTS FINANCING RECEIVABLES - Schedule of Advances Included in Servicing Advances Receivable (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | |
Schedule of Investments in Mortgage Servicing Rights [Line Items] | |||
Servicer Advances | [1] | $ 735,846 | $ 4,027,379 |
Servicer Advances Receivable | |||
Schedule of Investments in Mortgage Servicing Rights [Line Items] | |||
Principal and interest advances | 793,790 | 172,467 | |
Escrow advances (taxes and insurance advances) | 2,186,831 | 482,884 | |
Foreclosure advances | 199,203 | 16,017 | |
Servicer Advances | 3,179,824 | 671,368 | |
Servicer advances receivable related to Agency MSRs | 231,200 | 167,900 | |
Servicer advances receivable related to Ginnie Mae MSRs | 41,600 | 0 | |
Unamortized discount and accrual | $ 98,000 | $ 4,200 | |
[1] | New Residential’s Consolidated Balance Sheets include the assets and liabilities of certain consolidated VIEs, Advance Purchaser LLC (the “Buyer”) (Note 6), the RPL Borrowers, Shellpoint Asset Funding Trust 2013-1 (“SAFT 2013-1”) and the Shelter retail mortgage origination joint ventures (“Shelter JVs”) (Note 8) and the Consumer Loan SPVs (Note 9), which primarily hold investments in Servicer Advance Investments, residential mortgage loans and consumer loans, respectively, financed with notes and bonds payable. The balance sheets of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs are included in Notes 6, 8 and 9, respectively. The creditors of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs do not have recourse to the general credit of New Residential and the assets of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs are not directly available to satisfy New Residential’s obligations. See Note 8 regarding deconsolidation of the RPL Borrowers during 2018. |
SERVICER ADVANCE INVESTMENTS -
SERVICER ADVANCE INVESTMENTS - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2016 | Dec. 31, 2014 | |
Advance Purchaser LLC | ||||
Investment [Line Items] | ||||
Capital distributed to third-party co-investors | $ 322.6 | |||
Capital distributed to New Residential | $ 291.1 | |||
Nationstar | ||||
Investment [Line Items] | ||||
Servicer basic fee, percent | 9.20% | |||
Performance fee, percent (up to) | 100.00% | |||
SLS | ||||
Investment [Line Items] | ||||
Servicing asset fee, basis points | 0.1075% | |||
SLS | Excess MSRs | ||||
Investment [Line Items] | ||||
Percentage of Excess MSRs acquired | 50.00% | |||
Fortress-managed funds | Excess MSRs | ||||
Investment [Line Items] | ||||
Percentage of additional Excess MSRs acquired | 50.00% | |||
Ocwen Loan Servicing LLC | ||||
Investment [Line Items] | ||||
Servicing asset fee, basis points | 0.061% | 0.059% | ||
Servicing asset fee, percent | 12.00% | |||
Ocwen Loan Servicing LLC | LIBOR | ||||
Investment [Line Items] | ||||
Variable interest rate spread | 2.75% | |||
Corporate Joint Venture | ||||
Investment [Line Items] | ||||
New Residential’s ownership | 73.20% | |||
Funded capital commitments | $ 312.7 | |||
Corporate Joint Venture | Noncontrolling Third-party Investors | ||||
Investment [Line Items] | ||||
Funded capital commitments | $ 389.6 |
SERVICER ADVANCE INVESTMENTS _2
SERVICER ADVANCE INVESTMENTS - Summary of Investments in Servicer Advances (Details) - Corporate Joint Venture - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Investments in and Advances to Affiliates [Line Items] | ||
Amortized Cost Basis | $ 721,801 | $ 3,924,003 |
Carrying Value | $ 735,846 | $ 4,027,379 |
Weighted Average Discount Rate | 5.90% | 6.80% |
Weighted Average Yield | 5.80% | 7.30% |
Weighted Average Life (Years) | 5 years 8 months 14 days | 5 years 1 month 2 days |
Change in Fair Value Recorded in Other Income for Year then Ended | $ (89,332) | $ 84,418 |
SERVICER ADVANCE INVESTMENTS _3
SERVICER ADVANCE INVESTMENTS - Summary of Investments in Servicer Advances - Additional Information (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | |
Investments in and Advances to Affiliates [Line Items] | |||
UPB of Underlying Mortgages | $ 103,000,000 | ||
Outstanding Servicer Advances | [1] | 735,846 | $ 4,027,379 |
Face Amount of Notes and Bonds Payable | 22,673,065 | ||
Corporate Joint Venture | |||
Investments in and Advances to Affiliates [Line Items] | |||
Outstanding Servicer Advances | 620,050 | 3,581,876 | |
Corporate Joint Venture | Servicer Advance Investments | |||
Investments in and Advances to Affiliates [Line Items] | |||
UPB of Underlying Mortgages | 40,096,998 | 139,460,371 | |
Outstanding Servicer Advances | $ 620,050 | $ 3,581,876 | |
Servicer Advances to UPB of Underlying Residential Mortgage Loans | 1.50% | 2.60% | |
Face Amount of Notes and Bonds Payable | $ 574,117 | $ 3,461,718 | |
Gross Loan-to-Value | 88.30% | 93.20% | |
Net Loan-to-Value | 87.20% | 92.00% | |
Gross Cost of Funds | 3.70% | 3.30% | |
Net Cost of Funds | 3.10% | 3.00% | |
[1] | New Residential’s Consolidated Balance Sheets include the assets and liabilities of certain consolidated VIEs, Advance Purchaser LLC (the “Buyer”) (Note 6), the RPL Borrowers, Shellpoint Asset Funding Trust 2013-1 (“SAFT 2013-1”) and the Shelter retail mortgage origination joint ventures (“Shelter JVs”) (Note 8) and the Consumer Loan SPVs (Note 9), which primarily hold investments in Servicer Advance Investments, residential mortgage loans and consumer loans, respectively, financed with notes and bonds payable. The balance sheets of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs are included in Notes 6, 8 and 9, respectively. The creditors of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs do not have recourse to the general credit of New Residential and the assets of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs are not directly available to satisfy New Residential’s obligations. See Note 8 regarding deconsolidation of the RPL Borrowers during 2018. |
SERVICER ADVANCE INVESTMENTS _4
SERVICER ADVANCE INVESTMENTS - Summary of Investments in Servicer Advances - Components of Funded Advances (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | |
Investment [Line Items] | |||
Total | [1] | $ 735,846 | $ 4,027,379 |
Corporate Joint Venture | |||
Investment [Line Items] | |||
Principal and interest advances | 108,317 | 909,133 | |
Escrow advances (taxes and insurance advances) | 238,349 | 1,636,381 | |
Foreclosure advances | 273,384 | 1,036,362 | |
Total | $ 620,050 | $ 3,581,876 | |
[1] | New Residential’s Consolidated Balance Sheets include the assets and liabilities of certain consolidated VIEs, Advance Purchaser LLC (the “Buyer”) (Note 6), the RPL Borrowers, Shellpoint Asset Funding Trust 2013-1 (“SAFT 2013-1”) and the Shelter retail mortgage origination joint ventures (“Shelter JVs”) (Note 8) and the Consumer Loan SPVs (Note 9), which primarily hold investments in Servicer Advance Investments, residential mortgage loans and consumer loans, respectively, financed with notes and bonds payable. The balance sheets of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs are included in Notes 6, 8 and 9, respectively. The creditors of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs do not have recourse to the general credit of New Residential and the assets of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs are not directly available to satisfy New Residential’s obligations. See Note 8 regarding deconsolidation of the RPL Borrowers during 2018. |
SERVICER ADVANCE INVESTMENTS _5
SERVICER ADVANCE INVESTMENTS - Schedule of Interest Income Related to Investments in Servicer Advances (Details) - Servicer Advance Investments - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Investment [Line Items] | |||
Interest income, gross of amounts attributable to servicer compensation | $ 83,807 | $ 871,506 | $ 922,006 |
Amounts attributable to base servicer compensation | (8,491) | (227,585) | (127,631) |
Amounts attributable to incentive servicer compensation | (25,098) | (115,565) | (430,025) |
Interest income from Servicer Advance Investments | $ 50,218 | $ 528,356 | $ 364,350 |
SERVICER ADVANCE INVESTMENTS _6
SERVICER ADVANCE INVESTMENTS - Summary of Information on the Assets and Liabilities related to Consolidated VIE (Details) - VIE - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Assets | ||
Servicer advance investments, at fair value | $ 713,239 | $ 1,002,102 |
Cash and cash equivalents | 29,833 | 40,929 |
All other assets | 10,223 | 13,011 |
Total assets | 753,295 | 1,056,042 |
Liabilities | ||
Notes and bonds payable | 556,340 | 789,979 |
All other liabilities | 2,442 | 3,308 |
Total liabilities | $ 558,782 | $ 793,287 |
SERVICER ADVANCE INVESTMENTS _7
SERVICER ADVANCE INVESTMENTS - Schedule of Interest Income Related to Investments in Servicer Advances - Others' Interests (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Others | |||
Investment [Line Items] | |||
New Residential’s investment | $ 52,066 | $ 71,491 | |
Others’ ownership interest | 26.80% | 27.20% | |
Net income in joint venture | $ 1,978 | $ 11,227 | $ 40,136 |
Noncontrolling ownership interest in net income | 27.40% | 47.60% | 55.60% |
Corporate Joint Venture | |||
Investment [Line Items] | |||
New Residential’s investment | $ 194,513 | $ 262,755 | |
Others’ ownership interest | 73.20% | ||
Net income in joint venture | $ 7,209 | $ 23,604 | $ 72,159 |
Average ownership percentage | 72.60% | 52.40% | 44.40% |
INVESTMENTS IN REAL ESTATE AN_3
INVESTMENTS IN REAL ESTATE AND OTHER SECURITIES - Schedule of Investment in Real Estate Securities (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Treasury | ||
Debt Securities, Available-for-sale [Line Items] | ||
Purchases, face | $ 0 | $ 1,552 |
Purchases, purchase price | 0 | 1,545.3 |
Sales, face | 862 | 690 |
Sales, amortized cost | 858 | 687.2 |
Sales, sale price | 849.8 | 686.7 |
Sales, gain (loss) on sale | (8.2) | (0.5) |
Agency | ||
Debt Securities, Available-for-sale [Line Items] | ||
Purchases, face | 11,006.7 | 7,135.2 |
Purchases, purchase price | 11,121.6 | 7,367.8 |
Sales, face | 9,485 | 7,310.7 |
Sales, amortized cost | 9,590.6 | 7,536.6 |
Sales, sale price | 9,569.2 | 7,539.6 |
Sales, gain (loss) on sale | (21.4) | 3 |
Non-Agency | ||
Debt Securities, Available-for-sale [Line Items] | ||
Purchases, face | 9,194.8 | 7,606.5 |
Purchases, purchase price | 3,854.4 | 3,053 |
Sales, face | 115 | 235.1 |
Sales, amortized cost | 87.7 | 164.3 |
Sales, sale price | 86.4 | 182.4 |
Sales, gain (loss) on sale | $ (1.3) | $ 18 |
INVESTMENTS IN REAL ESTATE AN_4
INVESTMENTS IN REAL ESTATE AND OTHER SECURITIES - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Debt Securities, Available-for-sale [Line Items] | |||||||||||
Other-than-temporary impairment (OTTI) on securities | $ 6,827 | $ 3,889 | $ 12,631 | $ 6,670 | $ 1,598 | $ 1,509 | $ 5,115 | $ 2,112 | $ 30,017 | $ 10,334 | $ 10,264 |
Real estate securities acquired during the period with credit quality deterioration, face amount | 1,723,600 | 3,148,300 | |||||||||
Real estate securities acquired with credit quality deterioration, expected cash flows | 1,546,600 | 2,699,700 | |||||||||
Real estate securities acquired with credit quality deterioration, fair value | 1,148,700 | $ 1,836,100 | |||||||||
Agency | |||||||||||
Debt Securities, Available-for-sale [Line Items] | |||||||||||
Face amount of securities sold | 3,900,000 | 3,900,000 | |||||||||
Face amount of securities purchased, unsettled | 2,000,000 | 2,000,000 | |||||||||
Sale price of securities sold | 3,900,000 | 3,900,000 | |||||||||
Purchase of real estate securities, unsettled | $ 2,000,000 | $ 2,000,000 |
INVESTMENTS IN REAL ESTATE AN_5
INVESTMENTS IN REAL ESTATE AND OTHER SECURITIES - Summary of Real Estate Securities (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018USD ($)securitybond | Dec. 31, 2017USD ($)security | |
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | $ 22,152,845 | $ 14,822,986 |
Amortized Cost Basis | 11,212,428 | 7,704,765 |
Carrying Value | $ 11,636,581 | 8,071,140 |
Weighted Average Life (Years) | 10 months 29 days | |
Investments | $ 23,318,701 | 19,748,888 |
Bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Carrying Value | $ 722,100 | |
Number of bonds which New Residential was unable to obtain rating information | bond | 252 | |
Residual Bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Investments | $ 299,700 | |
Non-Agency Bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Investments | 1,900 | |
Treasury | ||
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | 862,000 | |
Amortized Cost Basis | 858,028 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (5,294) | |
Carrying Value | $ 852,734 | |
Number of Securities | 3 | |
Weighted Average Rating | AAA | |
Weighted Average Coupon | 2.21% | |
Weighted Average Yield | 2.27% | |
Weighted Average Life (Years) | 8 years 1 month 2 days | |
Agency | ||
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | 2,613,395 | $ 1,203,629 |
Amortized Cost Basis | 2,657,917 | 1,247,093 |
Gross Unrealized Gains | 7,744 | 1,176 |
Gross Unrealized Losses | (43) | (4,652) |
Carrying Value | $ 2,665,618 | $ 1,243,617 |
Number of Securities | 31 | 98 |
Weighted Average Rating | AAA | AAA |
Weighted Average Coupon | 4.01% | 3.49% |
Weighted Average Yield | 3.70% | 2.83% |
Weighted Average Life (Years) | 8 years 29 days | 7 years 15 days |
Agency | Fixed Rate Securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | $ 2,600,000 | $ 1,100,000 |
Agency | Floating Rate Securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | 0 | 100,000 |
Non-Agency | ||
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | 19,539,450 | 12,757,357 |
Amortized Cost Basis | 8,554,511 | 5,599,644 |
Gross Unrealized Gains | 517,861 | 423,504 |
Gross Unrealized Losses | (101,409) | (48,359) |
Carrying Value | $ 8,970,963 | $ 5,974,789 |
Number of Securities | 897 | 751 |
Weighted Average Rating | B+ | CCC- |
Weighted Average Coupon | 3.40% | 2.27% |
Weighted Average Yield | 5.63% | 5.66% |
Weighted Average Life (Years) | 6 years 10 months 26 days | 7 years 8 months 3 days |
Weighted Average Principal Subordination | 12.40% | 8.50% |
Non-Agency | Fixed Rate Securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | $ 3,800,000 | $ 1,300,000 |
Residual and interest - only notional amount | 1,500,000 | 700,000 |
Non-Agency | Floating Rate Securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | 15,700,000 | 11,500,000 |
Residual and interest - only notional amount | 7,400,000 | 4,500,000 |
Total/Weighted Average | ||
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | 22,152,845 | 14,822,986 |
Amortized Cost Basis | 11,212,428 | 7,704,765 |
Gross Unrealized Gains | 525,605 | 424,680 |
Gross Unrealized Losses | (101,452) | (58,305) |
Carrying Value | $ 11,636,581 | $ 8,071,140 |
Number of Securities | security | 928 | 852 |
Weighted Average Rating | BB+ | B+ |
Weighted Average Coupon | 3.53% | 2.44% |
Weighted Average Yield | 5.17% | 4.83% |
Weighted Average Life (Years) | 7 years 2 months 6 days | 7 years 7 months 13 days |
Corporate bond | ||
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | $ 85,000 | |
Amortized Cost Basis | 85,000 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (12,325) | |
Carrying Value | $ 72,675 | |
Number of Securities | security | 1 | |
Weighted Average Rating | B- | |
Weighted Average Coupon | 8.25% | |
Weighted Average Yield | 8.25% | |
Weighted Average Life (Years) | 6 years 3 months 16 days | |
Consumer loan bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | $ 56,846 | $ 29,690 |
Amortized Cost Basis | 57,480 | 29,780 |
Gross Unrealized Gains | 33 | 971 |
Gross Unrealized Losses | (7,075) | (528) |
Carrying Value | $ 50,438 | $ 30,223 |
Number of Securities | security | 6 | 3 |
Weighted Average Rating | B | N/A |
Weighted Average Coupon | 5.50% | |
Weighted Average Yield | 20.26% | 17.17% |
Weighted Average Life (Years) | 1 year 7 months 12 days | 1 year 5 months 19 days |
MSR bond | ||
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | $ 228,000 | |
Amortized Cost Basis | 228,000 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (400) | |
Carrying Value | $ 227,600 | |
Number of Securities | security | 2 | |
Weighted Average Rating | BBB- | |
Weighted Average Coupon | 5.24% | |
Weighted Average Yield | 4.89% | |
Weighted Average Life (Years) | 8 years 9 months 23 days | |
Interest-only Securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | $ 6,832,353 | $ 4,475,794 |
Amortized Cost Basis | 259,725 | 205,740 |
Gross Unrealized Gains | 23,694 | 10,407 |
Gross Unrealized Losses | (13,025) | (9,887) |
Carrying Value | $ 270,394 | $ 206,260 |
Number of Securities | security | 79 | 49 |
Weighted Average Rating | AA+ | AA- |
Weighted Average Coupon | 1.38% | 1.51% |
Weighted Average Yield | 6.58% | 5.33% |
Weighted Average Life (Years) | 2 years 11 months 21 days | 3 years 2 months 19 days |
Servicing Strips | ||
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | $ 975,048 | $ 450,974 |
Amortized Cost Basis | 8,588 | 4,958 |
Gross Unrealized Gains | 1,720 | 1,613 |
Gross Unrealized Losses | (198) | (225) |
Carrying Value | $ 10,110 | $ 6,346 |
Number of Securities | security | 31 | 20 |
Weighted Average Rating | N/A | N/A |
Weighted Average Coupon | 0.21% | 0.27% |
Weighted Average Yield | 13.23% | 21.62% |
Weighted Average Life (Years) | 5 years 11 months 30 days | 6 years 8 months 5 days |
INVESTMENTS IN REAL ESTATE AN_6
INVESTMENTS IN REAL ESTATE AND OTHER SECURITIES - Summary of Real Estate Securities in an Unrealized Loss Position (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018USD ($)bondsecurity | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Debt Securities, Available-for-sale [Line Items] | |||
Outstanding Face Amount | $ 22,152,845 | $ 14,822,986 | |
Other Than Temporary Impairment - Amortized Cost Basis | (52,803) | (23,821) | $ (15,495) |
Amortized Cost Basis | $ 11,212,428 | $ 7,704,765 | |
Weighted Average Life (Years) | 10 months 29 days | ||
Less than 12 Months | |||
Debt Securities, Available-for-sale [Line Items] | |||
Outstanding Face Amount | $ 4,843,505 | ||
Before Impairment - Amortized Cost Basis | 1,996,349 | ||
Other Than Temporary Impairment - Amortized Cost Basis | (5,996) | ||
Amortized Cost Basis | 1,990,353 | ||
Gross Unrealized Losses - Less than Twelve Months | (67,215) | ||
Carrying Value - Less than Twelve Months | $ 1,923,138 | ||
Number of Securities - Less than Twelve Months | security | 181 | ||
Weighted Average Rating | CCC+ | ||
Weighted Average Coupon | 3.46% | ||
Weighted Average Yield | 5.02% | ||
Weighted Average Life (Years) | 6 years 3 months 6 days | ||
Number of bonds which New Residential was unable to obtain rating information | bond | 40 | ||
12 or More Months | |||
Debt Securities, Available-for-sale [Line Items] | |||
Outstanding Face Amount | $ 1,411,991 | ||
Before Impairment - Amortized Cost Basis | 450,391 | ||
Other Than Temporary Impairment - Amortized Cost Basis | (831) | ||
Amortized Cost Basis | 449,560 | ||
Gross Unrealized Losses - Twelve or More Months | (34,237) | ||
Carrying Value - Twelve or More Months | $ 415,323 | ||
Number of Securities - Twelve or More Months | security | 76 | ||
Weighted Average Rating | BB- | ||
Weighted Average Coupon | 1.90% | ||
Weighted Average Yield | 6.66% | ||
Weighted Average Life (Years) | 5 years 3 months 5 days | ||
Number of bonds which New Residential was unable to obtain rating information | bond | 19 | ||
Total/Weighted Average | |||
Debt Securities, Available-for-sale [Line Items] | |||
Outstanding Face Amount | $ 6,255,496 | ||
Before Impairment - Amortized Cost Basis | 2,446,740 | ||
Other Than Temporary Impairment - Amortized Cost Basis | (6,827) | ||
Amortized Cost Basis | 2,439,913 | ||
Gross Unrealized Losses - Total/Weighted Average | (101,452) | ||
Carrying Value - Total/Weighted Average | $ 2,338,461 | ||
Number of Securities - Total/Weighted Average | security | 257 | ||
Weighted Average Rating | B- | ||
Weighted Average Coupon | 3.17% | ||
Weighted Average Yield | 5.32% | ||
Weighted Average Life (Years) | 6 years 30 days |
INVESTMENTS IN REAL ESTATE AN_7
INVESTMENTS IN REAL ESTATE AND OTHER SECURITIES - Summary of Real Estate Securities in an Unrealized Loss Position - Associated Intent to Sell (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Securities New Residential intends to sell | |
Debt Securities, Available-for-sale [Line Items] | |
Fair Value | $ 0 |
Amortized Cost Basis After Impairment | 0 |
Unrealized Credit Losses | 0 |
Unrealized Non-Credit Losses | 0 |
Securities New Residential is more likely than not to be required to sell | |
Debt Securities, Available-for-sale [Line Items] | |
Fair Value | 0 |
Amortized Cost Basis After Impairment | 0 |
Unrealized Credit Losses | 0 |
Credit impaired securities | |
Debt Securities, Available-for-sale [Line Items] | |
Fair Value | 1,155,566 |
Amortized Cost Basis After Impairment | 1,204,729 |
Unrealized Credit Losses | (6,827) |
Unrealized Non-Credit Losses | (49,163) |
Non-credit impaired securities | |
Debt Securities, Available-for-sale [Line Items] | |
Fair Value | 1,182,895 |
Amortized Cost Basis After Impairment | 1,235,184 |
Unrealized Credit Losses | 0 |
Unrealized Non-Credit Losses | (52,289) |
Total debt securities in an unrealized loss position | |
Debt Securities, Available-for-sale [Line Items] | |
Fair Value | 2,338,461 |
Amortized Cost Basis After Impairment | 2,439,913 |
Unrealized Credit Losses | (6,827) |
Unrealized Non-Credit Losses | $ (101,452) |
INVESTMENTS IN REAL ESTATE AN_8
INVESTMENTS IN REAL ESTATE AND OTHER SECURITIES - Summary of Activity Related to Credit Losses on Debt Securities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Roll Forward] | ||
Beginning balance of credit losses on debt securities for which a portion of an OTTI was recognized in other comprehensive income | $ 23,821 | $ 15,495 |
Increases to credit losses on securities for which an OTTI was previously recognized and a portion of an OTTI was recognized in other comprehensive income | 16,924 | 3,903 |
Additions for credit losses on securities for which an OTTI was not previously recognized | 13,093 | 6,431 |
Reductions for securities for which the amount previously recognized in other comprehensive income was recognized in earnings because the entity intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis | 0 | 0 |
Reduction for credit losses on securities for which no OTTI was recognized in other comprehensive income at the current measurement date | 0 | 0 |
Reduction for securities sold during the period | (1,035) | (2,008) |
Ending balance of credit losses on debt securities for which a portion of an OTTI was recognized in other comprehensive income | $ 52,803 | $ 23,821 |
INVESTMENTS IN REAL ESTATE AN_9
INVESTMENTS IN REAL ESTATE AND OTHER SECURITIES - Summary of the Geographic Distribution of the Collateral Securing Non-Agency RMBS (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Non-Agency | ||
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | $ 19,397,604 | $ 12,727,667 |
Percentage of Total Outstanding | 100.00% | 100.00% |
Non-Agency | Western U.S. | ||
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | $ 7,318,616 | $ 4,882,136 |
Percentage of Total Outstanding | 37.70% | 38.40% |
Non-Agency | Southeastern U.S. | ||
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | $ 4,613,314 | $ 3,005,519 |
Percentage of Total Outstanding | 23.80% | 23.60% |
Non-Agency | Northeastern U.S. | ||
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | $ 3,829,725 | $ 2,555,514 |
Percentage of Total Outstanding | 19.70% | 20.10% |
Non-Agency | Midwestern U.S. | ||
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | $ 2,063,263 | $ 1,337,980 |
Percentage of Total Outstanding | 10.60% | 10.50% |
Non-Agency | Southwestern U.S. | ||
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | $ 1,321,853 | $ 927,647 |
Percentage of Total Outstanding | 6.80% | 7.30% |
Non-Agency | Other U.S. | ||
Debt Securities, Available-for-sale [Line Items] | ||
Outstanding Face Amount | $ 250,833 | $ 18,871 |
Percentage of Total Outstanding | 1.40% | 0.10% |
Consumer loan bonds | Bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Face Amount | $ 56,800 | $ 29,700 |
Corporate bond | Bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Face Amount | $ 85,000 | $ 0 |
INVESTMENTS IN REAL ESTATE A_10
INVESTMENTS IN REAL ESTATE AND OTHER SECURITIES - Schedule of the Outstanding Face Amount and Carrying Value for Securities Uncollectible (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Investments, Debt and Equity Securities [Abstract] | ||
Outstanding Face Amount | $ 6,385,306 | $ 5,364,847 |
Carrying Value | $ 4,217,242 | $ 3,493,723 |
INVESTMENTS IN REAL ESTATE A_11
INVESTMENTS IN REAL ESTATE AND OTHER SECURITIES - Summary of Changes in Accretable Yield for Securities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Certain Loans Acquired in Transfer Accounted for as Available-for-sale Debt Securities, Accretable Yield Movement Schedule [Roll Forward] | ||
Beginning Balance | $ 2,000,266 | $ 1,200,125 |
Additions | 397,934 | 863,681 |
Accretion | (290,014) | (215,018) |
Reclassifications from (to) non-accretable difference | 156,070 | 218,675 |
Disposals | (18,273) | (67,197) |
Ending Balance | $ 2,245,983 | $ 2,000,266 |
INVESTMENTS IN RESIDENTIAL MO_3
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Loans Outstanding by Loan Type, Excluding REO (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018USD ($)loan | Dec. 31, 2017USD ($)loan | |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Weighted Average Life (Years) | 10 months 29 days | |
UPB of Underlying Mortgages | $ 103,000,000 | |
Performing Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Outstanding Face Amount | 636,874 | $ 557,381 |
Carrying Value | $ 591,264 | $ 507,615 |
Loan Count | loan | 8,424 | 8,876 |
Weighted Average Yield | 8.00% | 8.00% |
Weighted Average Life (Years) | 4 years 9 months 11 days | 5 years 6 months 1 day |
Floating Rate Loans as a % of Face Amount | 20.30% | 22.10% |
LTV Ratio | 77.70% | 76.40% |
Weighted Average Delinquency | 8.90% | 8.70% |
Weighted Average FICO | 649 | 649 |
Performing Loans | Ginnie Mae EBO | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
UPB of Underlying Mortgages | $ 24,300 | $ 33,700 |
Purchased Credit Deteriorated Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Outstanding Face Amount | 191,497 | 249,254 |
Carrying Value | $ 144,065 | $ 183,540 |
Loan Count | loan | 1,556 | 2,142 |
Weighted Average Yield | 7.60% | 7.20% |
Weighted Average Life (Years) | 3 years 1 month 19 days | 3 years 1 month 13 days |
Floating Rate Loans as a % of Face Amount | 16.40% | 14.70% |
LTV Ratio | 84.60% | 84.20% |
Weighted Average Delinquency | 71.50% | 75.80% |
Weighted Average FICO | 596 | 597 |
Total Residential Mortgage Loans, Held-for-Investment | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Outstanding Face Amount | $ 828,371 | $ 806,635 |
Carrying Value | $ 735,329 | $ 691,155 |
Loan Count | loan | 9,980 | 11,018 |
Weighted Average Yield | 7.90% | 7.70% |
Weighted Average Life (Years) | 4 years 4 months 25 days | 4 years 9 months 6 days |
Floating Rate Loans as a % of Face Amount | 19.40% | 19.80% |
LTV Ratio | 79.30% | 78.80% |
Weighted Average Delinquency | 23.30% | 29.40% |
Weighted Average FICO | 637 | 633 |
Reverse Mortgage Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Outstanding Face Amount | $ 13,807 | $ 16,755 |
Carrying Value | $ 6,557 | $ 6,870 |
Loan Count | loan | 37 | 48 |
Weighted Average Yield | 8.10% | 7.50% |
Weighted Average Life (Years) | 4 years 9 months 27 days | 4 years 6 months 12 days |
Floating Rate Loans as a % of Face Amount | 10.60% | 15.90% |
LTV Ratio | 142.50% | 141.20% |
Weighted Average Delinquency | 67.80% | 77.80% |
Performing Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Outstanding Face Amount | $ 408,724 | $ 1,044,116 |
Carrying Value | $ 413,883 | $ 1,071,371 |
Loan Count | loan | 7,144 | 15,464 |
Weighted Average Yield | 4.40% | 4.00% |
Weighted Average Life (Years) | 3 years 10 months 20 days | 4 years 10 months 2 days |
Floating Rate Loans as a % of Face Amount | 56.60% | 10.20% |
LTV Ratio | 61.30% | 53.20% |
Weighted Average Delinquency | 9.00% | 7.00% |
Weighted Average FICO | 670 | 654 |
Non-Performing Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Outstanding Face Amount | $ 621,700 | $ 846,181 |
Carrying Value | $ 512,040 | $ 647,293 |
Loan Count | loan | 5,029 | 5,597 |
Weighted Average Yield | 5.50% | 5.60% |
Weighted Average Life (Years) | 3 years 15 days | 4 years 3 months 12 days |
Floating Rate Loans as a % of Face Amount | 14.90% | 18.70% |
LTV Ratio | 88.10% | 94.40% |
Weighted Average Delinquency | 72.60% | 63.30% |
Weighted Average FICO | 588 | 581 |
Total Residential Mortgage Loans, Held-for-Sale | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Outstanding Face Amount | $ 1,044,231 | $ 1,907,052 |
Carrying Value | $ 932,480 | $ 1,725,534 |
Loan Count | loan | 12,210 | 21,109 |
Weighted Average Yield | 5.10% | 4.80% |
Weighted Average Life (Years) | 3 years 4 months 23 days | 4 years 7 months 2 days |
Floating Rate Loans as a % of Face Amount | 31.20% | 14.00% |
LTV Ratio | 78.30% | 72.20% |
Weighted Average Delinquency | 47.60% | 32.60% |
Weighted Average FICO | 621 | 622 |
Acquired Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Outstanding Face Amount | $ 2,295,340 | |
Carrying Value | $ 2,153,269 | |
Loan Count | loan | 12,873 | |
Weighted Average Yield | 4.50% | |
Weighted Average Life (Years) | 8 years 16 days | |
Floating Rate Loans as a % of Face Amount | 7.70% | |
LTV Ratio | 75.70% | |
Weighted Average Delinquency | 14.00% | |
Weighted Average FICO | 626 | |
Originated Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Outstanding Face Amount | $ 638,173 | |
Carrying Value | $ 655,260 | |
Loan Count | loan | 2,307 | |
Weighted Average Yield | 5.20% | |
Weighted Average Life (Years) | 28 years 6 months 15 days | |
Floating Rate Loans as a % of Face Amount | 96.30% | |
LTV Ratio | 80.00% | |
Weighted Average Delinquency | 3.80% | |
Weighted Average FICO | 714 | |
Total Residential Mortgage Loans, held-for-sale, at fair value | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Outstanding Face Amount | $ 2,933,513 | |
Carrying Value | $ 2,808,529 | |
Loan Count | loan | 15,180 | |
Weighted Average Yield | 4.60% | |
Weighted Average Life (Years) | 12 years 6 months 1 day | |
Floating Rate Loans as a % of Face Amount | 27.00% | |
LTV Ratio | 76.60% | |
Weighted Average Delinquency | 11.80% | |
Weighted Average FICO | 645 | |
Reverse Mortgage Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Interest in reverse mortgage loans | 70.00% | |
Unpaid principal balance | $ 500 | $ 500 |
Percentage of loans that have reached a termination event | 54.90% | 54.30% |
Non-Performing Loans | Ginnie Mae EBO | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
UPB of Underlying Mortgages | $ 51,900 | $ 66,500 |
Non Agency Mortgage Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
UPB of Underlying Mortgages | $ 122,300 | |
Nationstar | Reverse Mortgage Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Interest in reverse mortgage loans | 30.00% |
INVESTMENTS IN RESIDENTIAL MO_4
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Narrative (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2018USD ($)trust | |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | |
Threshold period past due (in days) | 60 days |
Government Guaranteed Mortgage Loans upon Foreclosure Receivable | |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | |
Claims receivable | $ 20.8 |
Residential Mortgage Loans | |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | |
Unpaid principal balance | $ 273.5 |
Residential Mortgage Loans | |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | |
Number of trusts called | trust | 88 |
Loans Sold | Residential Mortgage Loans | |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | |
Investment income, interest | $ 97.8 |
Gain (loss) on sale | $ 50.1 |
INVESTMENTS IN RESIDENTIAL MO_5
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Geographic Distribution of the Underlying Residential Mortgage Loans (Details) - Residential Mortgage Loans | Dec. 31, 2018 | Dec. 31, 2017 |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 100.00% | 100.00% |
California | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 16.70% | 9.10% |
New York | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 11.70% | 12.80% |
Florida | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 8.80% | 8.20% |
New Jersey | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 5.30% | 5.20% |
Texas | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 4.70% | 6.60% |
Illinois | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 4.00% | 3.90% |
Maryland | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 3.60% | 2.70% |
Pennsylvania | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 3.10% | 3.40% |
Massachusetts | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 3.10% | 2.70% |
Washington | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 1.50% | 1.70% |
Other U.S. | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount | 37.50% | 43.70% |
INVESTMENTS IN RESIDENTIAL MO_6
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Performing Loans Past Due (Details) - Residential Portfolio Segment - Performing Loans | Dec. 31, 2018 |
Investment [Line Items] | |
Delinquency Status | 100.00% |
Current | |
Investment [Line Items] | |
Delinquency Status | 83.30% |
30-59 | |
Investment [Line Items] | |
Delinquency Status | 7.40% |
60-89 | |
Investment [Line Items] | |
Delinquency Status | 2.20% |
90-119 | |
Investment [Line Items] | |
Delinquency Status | 0.80% |
120 | |
Investment [Line Items] | |
Delinquency Status | 6.30% |
INVESTMENTS IN RESIDENTIAL MO_7
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Carrying Value of Mortgage Loans (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
SEC Schedule, 12-29, Real Estate Companies, Investment in Movement in Mortgage Loans on Real Estate [Roll Forward] | |||
Accretion and other amortization | $ 701,967 | $ 1,031,384 | $ 747,932 |
Transfer of loans to real estate owned | (107,577) | (124,013) | |
Residential Portfolio Segment | Performing Loans | |||
SEC Schedule, 12-29, Real Estate Companies, Investment in Movement in Mortgage Loans on Real Estate [Roll Forward] | |||
Balance, beginning | 507,615 | 0 | |
Shellpoint Acquisition | 125,350 | ||
Purchases/additional fundings | 55,993 | 550,742 | |
Proceeds from repayments | (106,236) | (50,562) | |
Accretion and other amortization | 15,773 | 8,101 | |
Provision for loan losses | (1,028) | (646) | |
Transfer of loans to other assets | 0 | 0 | |
Transfer of loans to real estate owned | (5,131) | (20) | |
Transfer of loans to held-for-sale | (1,555) | ||
Fair value adjustment | 472 | ||
Balance, ending | 591,253 | 507,615 | 0 |
PCD Loans | |||
SEC Schedule, 12-29, Real Estate Companies, Investment in Movement in Mortgage Loans on Real Estate [Roll Forward] | |||
Balance, beginning | 183,540 | 190,761 | |
Purchases/additional fundings | 29,785 | 58,884 | |
Sales | 0 | 0 | |
Proceeds from repayments | (38,276) | (32,455) | |
Accretion and other amortization | 24,124 | 20,217 | |
(Allowance) reversal for loan losses | 0 | (1,488) | |
Transfer of loans to real estate owned | (28,060) | (29,299) | |
Transfer of loans to held-for-sale | (27,048) | (23,080) | |
Balance, ending | $ 144,065 | $ 183,540 | $ 190,761 |
INVESTMENTS IN RESIDENTIAL MO_8
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Valuation Provision on Reverse Mortgage Loans and Allowance for Loan Losses on Performing Loans (Details) - Residential Portfolio Segment - Performing Loans - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Financing Receivable, Allowance for Credit Losses [Roll Forward] | ||
Beginning balance | $ 196 | $ 0 |
Provision for loan losses | 1,028 | 646 |
Charge-offs | (1,224) | (450) |
Ending balance | $ 0 | $ 196 |
INVESTMENTS IN RESIDENTIAL MO_9
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Required Payments Receivable, Cash Flows Expected to be Collected, and Fair Value at Acquisition Date for Loans Acquired during the Period (Details) - PCD Loans $ in Thousands | Dec. 31, 2018USD ($) |
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities Acquired During Period [Line Items] | |
Contractually Required Payments Receivable | $ 65,902 |
Cash Flows Expected to be Collected | 45,429 |
Fair Value | $ 29,785 |
INVESTMENTS IN RESIDENTIAL M_10
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Unpaid Principal Balance and Carrying Value for Loans Uncollectible (Details) - PCD Loans - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Unpaid Principal Balance | $ 191,497 | $ 249,254 |
Carrying Value | $ 144,065 | $ 183,540 |
INVESTMENTS IN RESIDENTIAL M_11
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Changes in Accretable Yield (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward] | ||
Beginning balance | $ 88,631 | $ 23,688 |
Additions | 15,644 | 21,860 |
Accretion | (24,124) | (20,217) |
Reclassifications from non-accretable difference | 5,493 | 66,751 |
Disposals | (7,257) | (3,451) |
Transfer to held-for-sale | (9,755) | 0 |
Ending balance | $ 68,632 | $ 88,631 |
INVESTMENTS IN RESIDENTIAL M_12
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Activities Related to the Carrying Value of Loans Held-for-sale (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Loans Held-for-sale, Reconciliation [Roll Forward] | |||
Transfers of loans from held-for-investment | $ 23,080 | $ 23,080 | $ 316,199 |
Transfer of loans to real estate owned | (107,577) | (124,013) | |
Loans Held-for-sale | |||
Loans Held-for-sale, Reconciliation [Roll Forward] | |||
Beginning balance, loans held-for-sale | 1,725,534 | 696,665 | |
Purchases | 3,653,608 | 5,135,700 | |
Transfers of loans from held-for-investment | 28,603 | 23,080 | |
Sales | (4,205,375) | (3,901,161) | |
Transfer of loans to other assets | (9,811) | (17,487) | |
Transfer of loans to real estate owned | (54,114) | (71,756) | |
Proceeds from repayments | (195,797) | (125,987) | |
Valuation (provision) reversal on loans | (10,168) | (13,520) | |
Ending balance, loans held-for-sale | 932,480 | 1,725,534 | $ 696,665 |
Provision for loans held-for-sale | $ 59,200 | $ 30,100 |
INVESTMENTS IN RESIDENTIAL M_13
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Schedule of Loans Held-For-Sale, at Fair Value (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Originated Loans | |
Loans Held-for-sale, Reconciliation [Roll Forward] | |
Beginning balance, loans held-for-sale | $ 0 |
Shellpoint acquisition | 488,233 |
Originations | 3,439,574 |
Sales | (3,269,689) |
Proceeds from repayments | (6,348) |
Change in fair value | 3,490 |
Ending balance, loans held-for-sale | 655,260 |
Acquired Loans | |
Loans Held-for-sale, Reconciliation [Roll Forward] | |
Beginning balance, loans held-for-sale | 0 |
Purchases | 2,088,638 |
Sales | 0 |
Proceeds from repayments | (3,963) |
Transfer of loans to real estate owned | (753) |
Change in fair value | 69,347 |
Ending balance, loans held-for-sale | $ 2,153,269 |
INVESTMENTS IN RESIDENTIAL M_14
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Schedule of Gain on Sale of Originated Mortgage Loans, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Receivables [Abstract] | |||||||
Gain on loans originated and sold | $ 38,415 | ||||||
Gain (loss) on settlement of mortgage loan origination derivative instruments | 1,234 | ||||||
MSRs retained on transfer of loans | 35,311 | ||||||
Other | 14,057 | ||||||
Gain on sale of originated mortgage loans, net | $ 43,285 | $ 45,732 | $ 0 | $ 0 | $ 89,017 | $ 0 | $ 0 |
INVESTMENTS IN RESIDENTIAL M_15
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Schedule of Real Estate Owned (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Real Estate Owned [Roll Forward] | ||
Beginning balance | $ 128,295 | $ 59,591 |
Purchases | 33,377 | 38,127 |
Transfer of loans to real estate owned | 107,577 | 124,013 |
Sales | (152,725) | (95,456) |
Valuation provision on REO | 3,114 | 2,020 |
Ending balance | $ 113,410 | $ 128,295 |
INVESTMENTS IN RESIDENTIAL M_16
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Variable Interest Entities, Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | |
Assets | |||
Cash and cash equivalents | [1] | $ 251,058 | $ 295,798 |
Intangible assets | 18,708 | 0 | |
Prepaid expenses and other assets | 688,408 | 312,181 | |
Total assets | 31,691,013 | 22,213,562 | |
Liabilities | |||
Accrued expenses and other liabilities | [1] | 490,510 | 239,114 |
Reserve for sales recourse | 5,880 | 0 | |
Total liabilities | 25,602,718 | $ 17,417,400 | |
Shelter Mortgage Company, LLC | VIE | |||
Assets | |||
Cash and cash equivalents | 17,346 | ||
Property and equipment, net | 137 | ||
Intangible assets | 70 | ||
Prepaid expenses and other assets | 411 | ||
Total assets | 17,964 | ||
Liabilities | |||
Accrued expenses and other liabilities | 1,315 | ||
Reserve for sales recourse | 967 | ||
Total liabilities | $ 2,282 | ||
[1] | New Residential’s Consolidated Balance Sheets include the assets and liabilities of certain consolidated VIEs, Advance Purchaser LLC (the “Buyer”) (Note 6), the RPL Borrowers, Shellpoint Asset Funding Trust 2013-1 (“SAFT 2013-1”) and the Shelter retail mortgage origination joint ventures (“Shelter JVs”) (Note 8) and the Consumer Loan SPVs (Note 9), which primarily hold investments in Servicer Advance Investments, residential mortgage loans and consumer loans, respectively, financed with notes and bonds payable. The balance sheets of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs are included in Notes 6, 8 and 9, respectively. The creditors of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs do not have recourse to the general credit of New Residential and the assets of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs are not directly available to satisfy New Residential’s obligations. See Note 8 regarding deconsolidation of the RPL Borrowers during 2018. |
INVESTMENTS IN RESIDENTIAL M_17
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Variable Interest Entities, Characteristics (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Variable Interest Entity [Line Items] | |||||||||||
Noncontrolling interests in income (loss) of consolidated subsidiaries | $ 8,506 | $ 10,869 | $ 11,078 | $ 10,111 | $ 12,068 | $ 13,600 | $ 15,671 | $ 15,780 | $ 40,564 | $ 57,119 | $ 78,263 |
UPB of Underlying Mortgages | 103,000,000 | 103,000,000 | |||||||||
VIE, Not Primary Beneficiary | |||||||||||
Variable Interest Entity [Line Items] | |||||||||||
UPB of Underlying Mortgages | $ 7,818,221 | $ 7,818,221 | |||||||||
Weighted average delinquency | 1.97% | 1.97% | |||||||||
Net credit losses for the year ended December 31, 2018 | $ 9,101 | ||||||||||
Face amount of debt held by third parties | $ 6,783,187 | 6,783,187 | |||||||||
Carrying value of bonds retained by New Residential | 1,206,402 | 1,206,402 | |||||||||
Cash flows received by New Residential on these bonds for the year ended December 31, 2018 | $ 178,301 | ||||||||||
Number of days delinquent | 60 days | ||||||||||
Shelter Mortgage Company, LLC | VIE | |||||||||||
Variable Interest Entity [Line Items] | |||||||||||
Total consolidated equity of JVs | $ 15,682 | $ 15,682 | |||||||||
New Residential’s ownership | 51.00% | 51.00% | |||||||||
Noncontrolling equity interest in consolidated JVs | $ 7,998 | $ 7,998 | |||||||||
Total consolidated net income of JVs | $ 3,135 | ||||||||||
Noncontrolling ownership interest in net income | 51.00% | ||||||||||
Noncontrolling interests in income (loss) of consolidated subsidiaries | $ 1,599 |
INVESTMENTS IN CONSUMER LOANS -
INVESTMENTS IN CONSUMER LOANS - Narrative (Details) $ / shares in Units, shares in Millions | Nov. 30, 2017shares | Feb. 28, 2017USD ($)investor$ / sharesshares | Dec. 31, 2018 | Nov. 30, 2018shares |
WarrantCo | Consumer Portfolio Segment | ||||
Schedule of Consumer Loans [Line Items] | ||||
Number of warrants to be purchased (in shares) | 177.7 | |||
Value of Series F convertible preferred stock | $ | $ 75,000,000 | |||
Exercise price (in dollars per share) | $ / shares | $ 0.01 | |||
Consumer Loan Companies | ||||
Schedule of Consumer Loans [Line Items] | ||||
New Residential’s ownership | 53.50% | |||
LoanCo | Consumer Portfolio Segment | ||||
Schedule of Consumer Loans [Line Items] | ||||
New Residential’s ownership | 25.00% | |||
Purchase agreement amount | $ | $ 5,000,000,000 | |||
Terms of purchase agreement contract | 2 years | |||
Recording lag | 1 month | |||
WarrantCo | Consumer Portfolio Segment | ||||
Schedule of Consumer Loans [Line Items] | ||||
New Residential’s ownership | 23.57% | |||
Number of co-investors | investor | 3 | |||
Consumer Loan Seller | WarrantCo | Consumer Portfolio Segment | ||||
Schedule of Consumer Loans [Line Items] | ||||
Number of warrants owned (in shares) | 117.8 | |||
Series F Convertible Preferred Stock | Consumer Loan Seller | New Residential and Co Investors | Consumer Portfolio Segment | ||||
Schedule of Consumer Loans [Line Items] | ||||
Number of securities called by warrants (in shares) | 30 |
INVESTMENTS IN CONSUMER LOANS_2
INVESTMENTS IN CONSUMER LOANS - Summary of Investment in Consumer Loans (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | ||
Schedule of Consumer Loans [Line Items] | |||
UPB of Underlying Mortgages | $ 103,000,000 | ||
Carrying Value | [1] | $ 1,072,202 | $ 1,374,263 |
Weighted Average Expected Life (Years) | 10 months 29 days | ||
Consumer Portfolio Segment | |||
Schedule of Consumer Loans [Line Items] | |||
UPB of Underlying Mortgages | $ 14,200 | ||
Consumer Portfolio Segment | Parent Company | SpringCastle and Prosper | |||
Schedule of Consumer Loans [Line Items] | |||
UPB of Underlying Mortgages | 1,072,577 | 1,377,792 | |
Carrying Value | $ 1,072,202 | $ 1,374,263 | |
Weighted Average Coupon | 18.10% | 17.90% | |
Weighted Average Expected Life (Years) | 3 years 6 months 1 day | 3 years 5 months 23 days | |
Weighted Average Delinquency | 6.70% | 7.30% | |
Consumer Portfolio Segment | Parent Company | Other - Performing Loans | Prosper | |||
Schedule of Consumer Loans [Line Items] | |||
UPB of Underlying Mortgages | $ 35,326 | $ 89,682 | |
Interest in Consumer Loans | 100.00% | 100.00% | |
Carrying Value | $ 32,722 | $ 85,253 | |
Weighted Average Coupon | 14.20% | 14.10% | |
Weighted Average Expected Life (Years) | 9 months 2 days | 1 year 2 days | |
Weighted Average Delinquency | 5.60% | 4.50% | |
Consumer Portfolio Segment | Parent Company | Performing Loans | SpringCastle | |||
Schedule of Consumer Loans [Line Items] | |||
UPB of Underlying Mortgages | $ 815,341 | $ 1,005,570 | |
Interest in Consumer Loans | 53.50% | 53.50% | |
Carrying Value | $ 856,563 | $ 1,052,561 | |
Weighted Average Coupon | 18.80% | 18.70% | |
Weighted Average Expected Life (Years) | 3 years 7 months 20 days | 3 years 8 months 30 days | |
Weighted Average Delinquency | 5.40% | 6.00% | |
Consumer Portfolio Segment | Parent Company | Non-Performing Loans | SpringCastle | |||
Schedule of Consumer Loans [Line Items] | |||
UPB of Underlying Mortgages | $ 221,910 | $ 282,540 | |
Interest in Consumer Loans | 53.50% | 53.50% | |
Carrying Value | $ 182,917 | $ 236,449 | |
Weighted Average Coupon | 16.00% | 16.20% | |
Weighted Average Expected Life (Years) | 3 years 5 months 10 days | 3 years 3 months 20 days | |
Weighted Average Delinquency | 11.60% | 12.50% | |
[1] | New Residential’s Consolidated Balance Sheets include the assets and liabilities of certain consolidated VIEs, Advance Purchaser LLC (the “Buyer”) (Note 6), the RPL Borrowers, Shellpoint Asset Funding Trust 2013-1 (“SAFT 2013-1”) and the Shelter retail mortgage origination joint ventures (“Shelter JVs”) (Note 8) and the Consumer Loan SPVs (Note 9), which primarily hold investments in Servicer Advance Investments, residential mortgage loans and consumer loans, respectively, financed with notes and bonds payable. The balance sheets of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs are included in Notes 6, 8 and 9, respectively. The creditors of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs do not have recourse to the general credit of New Residential and the assets of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs are not directly available to satisfy New Residential’s obligations. See Note 8 regarding deconsolidation of the RPL Borrowers during 2018. |
INVESTMENTS IN CONSUMER LOANS_3
INVESTMENTS IN CONSUMER LOANS - Credit Quality Indicator (Details) - Consumer Portfolio Segment - Performing Loans | Dec. 31, 2018 |
Debt Securities, Available-for-sale [Line Items] | |
Delinquency Status | 100.00% |
Current | |
Debt Securities, Available-for-sale [Line Items] | |
Delinquency Status | 94.70% |
30-59 | |
Debt Securities, Available-for-sale [Line Items] | |
Delinquency Status | 2.00% |
60-89 | |
Debt Securities, Available-for-sale [Line Items] | |
Delinquency Status | 1.30% |
90-119 | |
Debt Securities, Available-for-sale [Line Items] | |
Delinquency Status | 0.80% |
120 | |
Debt Securities, Available-for-sale [Line Items] | |
Delinquency Status | 1.20% |
INVESTMENTS IN CONSUMER LOANS_4
INVESTMENTS IN CONSUMER LOANS - Carrying Value of Performing Consumer Loans (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Loans Receivable [Roll Forward] | |||
Proceeds from repayments | $ (147,403) | $ (94,807) | $ (38,700) |
Accretion of loan discount and premium amortization, net | 701,967 | 1,031,384 | 747,932 |
Consumer Portfolio Segment | Performing Loans | |||
Loans Receivable [Roll Forward] | |||
Beginning balance | 1,137,814 | 1,482,954 | |
Purchases | 0 | ||
Additional fundings | 63,971 | 56,321 | |
Proceeds from repayments | (257,182) | (329,843) | |
Accretion of loan discount and premium amortization, net | 1,940 | 4,891 | |
Charge-offs | (56,870) | (73,842) | |
Allowance for loan losses | (388) | (2,667) | |
Ending balance | $ 889,285 | $ 1,137,814 | $ 1,482,954 |
INVESTMENTS IN CONSUMER LOANS_5
INVESTMENTS IN CONSUMER LOANS - Allowance for Loan Losses on Performing Consumer Loans, Held-for-Investment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Loans Receivable [Roll Forward] | ||
UPB of Underlying Mortgages | $ 103,000,000 | |
Consumer Portfolio Segment | ||
Loans Receivable [Roll Forward] | ||
UPB of Underlying Mortgages | 14,200 | |
Post-modification recorded investment | 12,600 | |
Performing Loans | Consumer Portfolio Segment | ||
Loans Receivable [Roll Forward] | ||
Collectively Evaluated, beginning balance | 4,429 | $ 2,441 |
Individually Impaired, beginning balance | 1,676 | 997 |
Beginning balance | 6,105 | 3,438 |
Provision (reversal) for loan losses | 48,227 | 65,738 |
Provision for loan losses | (49,664) | (63,071) |
Collectively Evaluated, ending balance | 2,604 | 4,429 |
Individually Impaired, ending balance | 2,064 | 1,676 |
Ending balance | 4,668 | 6,105 |
Recovery of bad debts | 9,000 | 10,800 |
Performing Loans | Collectively Evaluated | Consumer Portfolio Segment | ||
Loans Receivable [Roll Forward] | ||
Provision (reversal) for loan losses | 47,839 | 65,059 |
Provision for loan losses | (49,664) | (63,071) |
Performing Loans | Individually Impaired | Consumer Portfolio Segment | ||
Loans Receivable [Roll Forward] | ||
Provision (reversal) for loan losses | 388 | 679 |
Provision for loan losses | $ 0 | $ 0 |
INVESTMENTS IN CONSUMER LOANS_6
INVESTMENTS IN CONSUMER LOANS - Carrying Value of Purchased Deteriorated Loans (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Loans Receivable [Roll Forward] | |||
Proceeds from repayments | $ (147,403) | $ (94,807) | $ (38,700) |
Accretion and other amortization | 701,967 | 1,031,384 | 747,932 |
Receivables Acquired with Deteriorated Credit Quality | Consumer Portfolio Segment | |||
Loans Receivable [Roll Forward] | |||
Beginning balance | 236,449 | 316,532 | |
Provision for loan losses | (31) | 3,013 | |
Proceeds from repayments | (90,700) | (123,932) | |
Accretion and other amortization | 37,199 | 40,836 | |
Ending balance | $ 182,917 | $ 236,449 | $ 316,532 |
INVESTMENTS IN CONSUMER LOANS_7
INVESTMENTS IN CONSUMER LOANS - UPB and Carrying Value of Consumer Loans (Details) - Receivables Acquired with Deteriorated Credit Quality - Consumer Portfolio Segment - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | $ 221,910 | $ 282,540 |
Carrying Value | $ 182,917 | $ 236,449 |
INVESTMENTS IN CONSUMER LOANS_8
INVESTMENTS IN CONSUMER LOANS - Accretable Yield for Consumer Loans (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Loans Receivable [Roll Forward] | ||
Beginning balance | $ 88,631 | $ 23,688 |
Accretion | (24,124) | (20,217) |
Ending balance | 68,632 | 88,631 |
Consumer Portfolio Segment | Receivables Acquired with Deteriorated Credit Quality | ||
Loans Receivable [Roll Forward] | ||
Beginning balance | 132,291 | 167,928 |
Accretion | (37,199) | (40,836) |
Reclassifications from non-accretable difference | 31,426 | 5,199 |
Ending balance | $ 126,518 | $ 132,291 |
INVESTMENTS IN CONSUMER LOANS_9
INVESTMENTS IN CONSUMER LOANS - Others' Interest in Equity of Consumer Loan Companies (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Noncontrolling Interest [Line Items] | |||||||||||
Total Consumer Loan Companies equity | $ 5,997,670 | $ 4,690,205 | $ 5,997,670 | $ 4,690,205 | |||||||
Noncontrolling interests in equity of consolidated subsidiaries | 90,625 | 105,957 | 90,625 | 105,957 | |||||||
Noncontrolling Interests in Income of Consolidated Subsidiaries | 8,506 | $ 10,869 | $ 11,078 | $ 10,111 | 12,068 | $ 13,600 | $ 15,671 | $ 15,780 | 40,564 | 57,119 | $ 78,263 |
Consumer Loan Companies | |||||||||||
Noncontrolling Interest [Line Items] | |||||||||||
Total Consumer Loan Companies equity | 66,105 | 74,071 | 66,105 | 74,071 | |||||||
Net Consumer Loan Companies income (loss) | 79,539 | 98,692 | |||||||||
Consumer Loan Companies | |||||||||||
Noncontrolling Interest [Line Items] | |||||||||||
Noncontrolling interests in equity of consolidated subsidiaries | $ 30,561 | $ 34,466 | 30,561 | 34,466 | |||||||
Noncontrolling Interests in Income of Consolidated Subsidiaries | $ 36,987 | $ 45,892 | |||||||||
Other's Interest | Consumer Loan Companies | |||||||||||
Noncontrolling Interest [Line Items] | |||||||||||
Others’ ownership interest | 46.50% | 46.50% | 46.50% | 46.50% |
INVESTMENTS IN CONSUMER LOAN_10
INVESTMENTS IN CONSUMER LOANS - Assets and Liabilities Related to Variable Interest Entities (Details) - VIE - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Assets | ||
Total assets | $ 753,295 | $ 1,056,042 |
Liabilities | ||
Notes and bonds payable | 556,340 | 789,979 |
Accounts payable and accrued expenses | 2,442 | 3,308 |
Total liabilities | 558,782 | 793,287 |
Consumer Loan Companies | ||
Assets | ||
Consumer loans, held-for-investment | 1,039,480 | 1,289,010 |
Restricted cash | 10,186 | 11,563 |
Accrued interest receivable | 15,627 | 19,360 |
Total assets | 1,065,293 | 1,319,933 |
Liabilities | ||
Notes and bonds payable | 1,030,096 | 1,284,436 |
Accounts payable and accrued expenses | 3,814 | 4,007 |
Total liabilities | 1,033,910 | $ 1,288,443 |
Face amount of bonds retained by New Residential issued by VIEs | $ 121,000 |
INVESTMENTS IN CONSUMER LOAN_11
INVESTMENTS IN CONSUMER LOANS - Summary of Equity Method Investments Prior to Consolidation, Balance Sheet Components (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Nov. 30, 2018 | Dec. 31, 2017 | Nov. 30, 2017 |
Schedule of Consumer Loans [Line Items] | ||||
Undistributed retained earnings | $ 0 | $ 0 | ||
Consumer Portfolio Segment | LoanCo and WarrantCo | ||||
Schedule of Consumer Loans [Line Items] | ||||
Consumer Loan Assets (amortized cost basis) | 231,560 | 178,422 | ||
Warrants, at fair value | 103,067 | 80,746 | ||
Other assets | 25,971 | 46,342 | ||
Warehouse financing | (182,065) | (117,944) | ||
Other liabilities | (1,142) | (13,059) | ||
Equity | 177,391 | 174,507 | ||
New Residential’s investment | $ 38,294 | $ 42,875 | $ 51,412 | $ 42,473 |
New Residential’s ownership | 24.20% | 24.30% |
INVESTMENTS IN CONSUMER LOAN_12
INVESTMENTS IN CONSUMER LOANS - Summary of Equity Method Investments Prior to Consolidation (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018 | Nov. 30, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Schedule of Consumer Loans [Line Items] | ||||
New Residential’s equity in net income | $ 10,803 | $ 25,617 | $ 0 | |
Bonds and residual interests retained | 900,491 | $ 403,270 | $ 165,782 | |
Consumer Portfolio Segment | LoanCo and WarrantCo | ||||
Schedule of Consumer Loans [Line Items] | ||||
Interest income | $ 42,920 | |||
Interest expense | (12,258) | |||
Change in fair value of consumer loans and warrants | 17,491 | |||
Gain on sale of consumer loans | 2,697 | |||
Other expenses | (7,257) | |||
Net income | 43,593 | |||
New Residential’s equity in net income | 10,803 | $ 10,803 | ||
New Residential’s ownership | 24.80% | |||
LoanCo | ||||
Schedule of Consumer Loans [Line Items] | ||||
Bonds and residual interests retained | 103,000 | |||
LoanCo | Consumer Portfolio Segment | ||||
Schedule of Consumer Loans [Line Items] | ||||
Unpaid principal of consumer loans | $ 1,200,000 |
INVESTMENTS IN CONSUMER LOAN_13
INVESTMENTS IN CONSUMER LOANS - Consumer Loan Equity Method Investments (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | ||
Schedule of Equity Method Investments [Line Items] | |||
UPB of Underlying Mortgages | $ 103,000,000 | ||
Carrying Value | [1] | $ 1,072,202 | $ 1,374,263 |
Weighted Average Life (Years) | 10 months 29 days | ||
Consumer Portfolio Segment | |||
Schedule of Equity Method Investments [Line Items] | |||
UPB of Underlying Mortgages | $ 14,200 | ||
Consumer Portfolio Segment | LoanCo | |||
Schedule of Equity Method Investments [Line Items] | |||
UPB of Underlying Mortgages | $ 231,560 | ||
Interest in Consumer Loans | 25.00% | ||
Carrying Value | $ 231,560 | ||
Weighted Average Coupon | 14.20% | ||
Weighted Average Life (Years) | 1 year 4 months 5 days | ||
Weighted Average Delinquency | 0.40% | ||
[1] | New Residential’s Consolidated Balance Sheets include the assets and liabilities of certain consolidated VIEs, Advance Purchaser LLC (the “Buyer”) (Note 6), the RPL Borrowers, Shellpoint Asset Funding Trust 2013-1 (“SAFT 2013-1”) and the Shelter retail mortgage origination joint ventures (“Shelter JVs”) (Note 8) and the Consumer Loan SPVs (Note 9), which primarily hold investments in Servicer Advance Investments, residential mortgage loans and consumer loans, respectively, financed with notes and bonds payable. The balance sheets of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs are included in Notes 6, 8 and 9, respectively. The creditors of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs do not have recourse to the general credit of New Residential and the assets of the Buyer, the RPL Borrowers, SAFT 2013-1, Shelter JVs and the Consumer Loan SPVs are not directly available to satisfy New Residential’s obligations. See Note 8 regarding deconsolidation of the RPL Borrowers during 2018. |
INVESTMENTS IN CONSUMER LOAN_14
INVESTMENTS IN CONSUMER LOANS - Changes in Consumer Loan Equity Method Investments (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018 | Nov. 30, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Increase (Decrease) in Equity Method Investments [Roll Forward] | ||||
Distributions of earnings from equity method investees | $ (11,059) | $ (13,668) | $ (22,046) | |
Distributions of capital from equity method investees | (300,056) | (393,722) | 0 | |
Earnings from investments in consumer loans, equity method investees | 10,803 | 25,617 | $ 0 | |
Consumer Portfolio Segment | LoanCo and WarrantCo | ||||
Increase (Decrease) in Equity Method Investments [Roll Forward] | ||||
Balance at beginning of period | 51,412 | $ 42,473 | ||
Contributions to equity method investees | 308,050 | |||
Distributions of earnings from equity method investees | (6,176) | |||
Distributions of capital from equity method investees | (325,795) | |||
Earnings from investments in consumer loans, equity method investees | 10,803 | 10,803 | ||
Balance at end of period | $ 38,294 | $ 42,875 | $ 51,412 |
DERIVATIVES - Schedule of Deriv
DERIVATIVES - Schedule of Derivatives (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Derivative [Line Items] | ||
Derivative assets | $ 10,893,000 | $ 2,423,000 |
Derivative liabilities | 29,389,000 | 697,000 |
Interest Rate Caps | ||
Derivative [Line Items] | ||
Derivative assets | 3,000 | 2,423,000 |
Interest Rate Lock Commitments | ||
Derivative [Line Items] | ||
Derivative assets | 10,851,000 | 0 |
Derivative liabilities | 223,000 | 0 |
Forward Loan Sale Commitments | ||
Derivative [Line Items] | ||
Derivative assets | 39,000 | 0 |
Interest Rate Swaps | ||
Derivative [Line Items] | ||
Derivative liabilities | 5,245,000 | 0 |
Variation margin accounts | 106,100,000 | 0 |
TBAs | ||
Derivative [Line Items] | ||
Derivative liabilities | $ 23,921,000 | $ 697,000 |
DERIVATIVES - Notional Amount (
DERIVATIVES - Notional Amount (Details) - Not Designated as Hedging Instrument - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Interest Rate Caps | ||
Derivative [Line Items] | ||
Derivative asset, notional amount | $ 50,000,000 | $ 772,500,000 |
Derivative, cap interest rate | 4.00% | |
Notional amount of derivatives | $ 50,000,000 | |
Average remaining maturity (in months) | 23 months | |
Interest Rate Swaps | ||
Derivative [Line Items] | ||
Derivative liability, notional amount | $ 4,725,000,000 | 0 |
Average remaining maturity (in months) | 52 months | |
Average fixed interest rate | 3.21% | |
Interest Rate Lock Commitments | ||
Derivative [Line Items] | ||
Notional amount of derivatives | $ 823,187,000 | 0 |
Forward Loan Sale Commitments | ||
Derivative [Line Items] | ||
Derivative asset, notional amount | 30,274,000 | 0 |
TBAs | Short | ||
Derivative [Line Items] | ||
Derivative liability, notional amount | 5,904,300,000 | 3,101,100,000 |
TBAs | Long | ||
Derivative [Line Items] | ||
Derivative liability, notional amount | $ 5,067,200,000 | $ 1,014,000,000 |
DERIVATIVES - Gain (Losses) (De
DERIVATIVES - Gain (Losses) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Derivative [Line Items] | |||
Other income (loss), net | $ (113,558) | $ (2,190) | $ 5,774 |
Gain (loss) on settlement of investments, net | 54,867 | (39,214) | (27,491) |
Total gains (losses) | (58,691) | (41,404) | (21,717) |
Gain (loss) on settlement of mortgage loan origination derivative instruments | 1,234 | ||
Interest Rate Caps | |||
Derivative [Line Items] | |||
Other income (loss), net | 431 | 323 | 688 |
Gain (loss) on settlement of investments, net | (603) | (1,911) | (4,754) |
Interest Rate Swaps | |||
Derivative [Line Items] | |||
Other income (loss), net | (108,098) | (720) | 5,500 |
Gain (loss) on settlement of investments, net | 65,823 | 6,921 | (4,810) |
TBAs | |||
Derivative [Line Items] | |||
Other income (loss), net | (5,631) | (1,793) | (414) |
Gain (loss) on settlement of investments, net | (10,353) | (44,224) | (17,927) |
Interest Rate Lock Commitments | |||
Derivative [Line Items] | |||
Other income (loss), net | 23 | 0 | 0 |
Forward Loan Sale Commitments | |||
Derivative [Line Items] | |||
Other income (loss), net | $ (283) | $ 0 | $ 0 |
DEBT OBLIGATIONS - Schedule of
DEBT OBLIGATIONS - Schedule of Debt Obligations (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | |||
Outstanding Face Amount | $ 22,673,065,000 | ||
Carrying Value | $ 22,656,235,000 | $ 15,746,530,000 | $ 13,181,236,000 |
Weighted Average Funding Cost | 3.58% | ||
Weighted Average Life (Years) | 10 months 29 days | ||
Interest payable | $ 49,352,000 | 28,821,000 | |
UPB of Underlying Mortgages | 103,000,000,000 | ||
Excess MSRs | |||
Debt Instrument [Line Items] | |||
Carrying Value | 297,563,000 | 483,978,000 | 729,145,000 |
Servicer Advances | |||
Debt Instrument [Line Items] | |||
Carrying Value | 3,382,455,000 | 4,060,156,000 | 5,549,872,000 |
Consumer Loans | |||
Debt Instrument [Line Items] | |||
Carrying Value | 936,447,000 | 1,242,756,000 | $ 1,700,211,000 |
Repurchase Agreements: | Agency RMBS | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | 4,346,070,000 | ||
Carrying Value | $ 4,346,070,000 | 1,974,164,000 | |
Weighted Average Funding Cost | 2.66% | ||
Weighted Average Life (Years) | 1 month 21 days | ||
Repurchase Agreements: | Agency RMBS | Trade And Other Receivables | |||
Debt Instrument [Line Items] | |||
Collateral amount | $ 3,900,000,000 | ||
Repurchase Agreements: | Agency RMBS | Collateral | |||
Debt Instrument [Line Items] | |||
Weighted Average Life (Years) | 2 years 1 month 23 days | ||
Outstanding Face | $ 4,462,104,000 | ||
Amortized Cost Basis | 4,492,912,000 | ||
Carrying Value | 4,533,921,000 | ||
Repurchase Agreements: | Non-Agency RMBS | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | 7,434,950,000 | ||
Carrying Value | $ 7,434,785,000 | 4,720,290,000 | |
Weighted Average Funding Cost | 3.54% | ||
Weighted Average Life (Years) | 1 month 21 days | ||
Repurchase Agreements: | Non-Agency RMBS | Retained Servicer Advance and Consumer Bonds | |||
Debt Instrument [Line Items] | |||
Carrying Value | $ 163,600,000 | ||
Repurchase Agreements: | Non-Agency RMBS | Collateral | |||
Debt Instrument [Line Items] | |||
Weighted Average Life (Years) | 7 years 9 days | ||
Outstanding Face | $ 17,057,929,000 | ||
Amortized Cost Basis | 8,459,512,000 | ||
Carrying Value | 8,877,653,000 | ||
Repurchase Agreements: | Residential Mortgage Loans | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | 3,679,239,000 | ||
Carrying Value | $ 3,678,246,000 | 1,849,004,000 | |
Weighted Average Funding Cost | 4.24% | ||
Weighted Average Life (Years) | 7 months 1 day | ||
Repurchase Agreements: | Residential Mortgage Loans | Collateral | |||
Debt Instrument [Line Items] | |||
Weighted Average Life (Years) | 11 years 10 months 19 days | ||
Outstanding Face | $ 4,498,036,000 | ||
Amortized Cost Basis | 4,222,366,000 | ||
Carrying Value | 4,218,615,000 | ||
Repurchase Agreements: | Real Estate Owned | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | 94,897,000 | ||
Carrying Value | $ 94,868,000 | 118,681,000 | |
Weighted Average Funding Cost | 4.38% | ||
Weighted Average Life (Years) | 9 months 2 days | ||
Repurchase Agreements: | Real Estate Owned | Collateral | |||
Debt Instrument [Line Items] | |||
Carrying Value | $ 116,381,000 | ||
Repurchase Agreements: | Repurchase Agreements | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | 15,555,156,000 | ||
Carrying Value | $ 15,553,969,000 | 8,662,139,000 | |
Weighted Average Funding Cost | 3.46% | ||
Weighted Average Life (Years) | 3 months | ||
Interest payable | $ 38,800,000 | ||
Repurchase Agreements: | Non-agency RMBS Repurchase Agreements, LIBOR Based Floating Interest Rate | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | 7,193,400,000 | ||
Repurchase Agreements: | Non-agency RMBS Repurchase Agreements, Fixed Rate | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | 241,500,000 | ||
Notes and Bonds Payable: | Residential Mortgage Loans | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | 122,816,000 | ||
Carrying Value | $ 122,465,000 | 137,196,000 | |
Weighted Average Funding Cost | 3.74% | ||
Weighted Average Life (Years) | 7 years 7 months 1 day | ||
Notes and Bonds Payable: | Residential Mortgage Loans | Collateral | |||
Debt Instrument [Line Items] | |||
Weighted Average Life (Years) | 7 years 9 months 4 days | ||
Outstanding Face | $ 130,399,000 | ||
Amortized Cost Basis | 127,021,000 | ||
Carrying Value | 124,593,000 | ||
Notes and Bonds Payable: | Real Estate Owned | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | 2,480,000 | ||
Carrying Value | $ 2,480,000 | 3,126,000 | |
Weighted Average Funding Cost | 4.54% | ||
Weighted Average Life (Years) | 29 days | ||
Notes and Bonds Payable: | Real Estate Owned | Collateral | |||
Debt Instrument [Line Items] | |||
Carrying Value | $ 1,736,000 | ||
Notes and Bonds Payable: | Excess MSRs | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | 297,759,000 | ||
Carrying Value | $ 297,563,000 | 483,978,000 | |
Weighted Average Funding Cost | 5.15% | ||
Weighted Average Life (Years) | 2 years 8 months 28 days | ||
Notes and Bonds Payable: | Excess MSRs | Collateral | |||
Debt Instrument [Line Items] | |||
Weighted Average Life (Years) | 5 years 8 months 12 days | ||
Outstanding Face | $ 119,363,054,000 | ||
Amortized Cost Basis | 372,901,000 | ||
Carrying Value | 470,498,000 | ||
Notes and Bonds Payable: | MSRs | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | 2,368,885,000 | ||
Carrying Value | $ 2,360,856,000 | 1,157,179,000 | |
Weighted Average Funding Cost | 4.32% | ||
Weighted Average Life (Years) | 2 years 9 months 6 days | ||
Notes and Bonds Payable: | MSRs | Collateral | |||
Debt Instrument [Line Items] | |||
Weighted Average Life (Years) | 6 years 8 months 5 days | ||
Outstanding Face | $ 365,610,961,000 | ||
Amortized Cost Basis | 3,496,265,000 | ||
Carrying Value | 4,241,604,000 | ||
Notes and Bonds Payable: | Servicer Advances | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | 3,386,234,000 | ||
Carrying Value | $ 3,382,455,000 | 4,060,156,000 | |
Weighted Average Funding Cost | 3.52% | ||
Weighted Average Life (Years) | 1 year 8 months 20 days | ||
Face amount of fixed rate debt | $ 2,900,000,000 | ||
Notes and Bonds Payable: | Servicer Advances | LIBOR | Minimum | |||
Debt Instrument [Line Items] | |||
Variable interest rate spread | 1.9848% | ||
Notes and Bonds Payable: | Servicer Advances | LIBOR | Maximum | |||
Debt Instrument [Line Items] | |||
Variable interest rate spread | 2.15% | ||
Notes and Bonds Payable: | Servicer Advances | Collateral | |||
Debt Instrument [Line Items] | |||
Weighted Average Life (Years) | 1 year 6 months 14 days | ||
Outstanding Face | $ 3,824,237,000 | ||
Amortized Cost Basis | 3,999,597,000 | ||
Carrying Value | 4,013,642,000 | ||
Notes and Bonds Payable: | Consumer Loans | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | 939,735,000 | ||
Carrying Value | $ 936,447,000 | 1,242,756,000 | |
Weighted Average Funding Cost | 3.41% | ||
Weighted Average Life (Years) | 2 years 9 months 22 days | ||
Notes and Bonds Payable: | Consumer Loans | Collateral | |||
Debt Instrument [Line Items] | |||
Weighted Average Life (Years) | 3 years 6 months 1 day | ||
Outstanding Face | $ 1,072,431,000 | ||
Amortized Cost Basis | 1,076,725,000 | ||
Carrying Value | 1,072,056,000 | ||
Notes and Bonds Payable: | Total Notes and Bonds Payable | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | 7,117,909,000 | ||
Carrying Value | $ 7,102,266,000 | $ 7,084,391,000 | |
Weighted Average Funding Cost | 3.84% | ||
Weighted Average Life (Years) | 2 years 4 months 9 days | ||
Notes and Bonds Payable: | Residential Mortgage Loans | Nationstar | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | $ 7,700,000 | ||
Notes and Bonds Payable: | Residential Mortgage Loans | LIBOR | Nationstar | |||
Debt Instrument [Line Items] | |||
Variable interest rate spread | 2.875% | ||
Notes and Bonds Payable: | Residential Mortgage Backed Securities | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | $ 117,000,000 | ||
Notes and Bonds Payable: | Residential Mortgage Backed Securities | Minimum | |||
Debt Instrument [Line Items] | |||
Weighted Average Funding Cost | 3.50% | ||
Notes and Bonds Payable: | Residential Mortgage Backed Securities | Maximum | |||
Debt Instrument [Line Items] | |||
Weighted Average Funding Cost | 3.76% | ||
Secured Debt | 3.00% Secured Corporate Note | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | $ 197,800,000 | ||
Secured Debt | 3.00% Secured Corporate Note | LIBOR | |||
Debt Instrument [Line Items] | |||
Variable interest rate spread | 3.00% | ||
Secured Debt | Secured Corporate Note | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | $ 100,000,000 | ||
Secured Debt | Secured Corporate Note | LIBOR | |||
Debt Instrument [Line Items] | |||
Variable interest rate spread | 2.50% | ||
Secured Debt | 2.25% Agency MSR Secured Note | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | $ 645,300,000 | ||
Secured Debt | 2.25% Agency MSR Secured Note | LIBOR | Minimum | |||
Debt Instrument [Line Items] | |||
Variable interest rate spread | 2.25% | ||
Secured Debt | 2.25% Agency MSR Secured Note | LIBOR | Maximum | |||
Debt Instrument [Line Items] | |||
Variable interest rate spread | 2.75% | ||
Secured Debt | 3.55% Agency MSR Secured Note | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | $ 1,723,600,000 | ||
Secured Debt | 3.55% Agency MSR Secured Note | LIBOR | Minimum | |||
Debt Instrument [Line Items] | |||
Variable interest rate spread | 3.55384% | ||
Secured Debt | 3.55% Agency MSR Secured Note | LIBOR | Maximum | |||
Debt Instrument [Line Items] | |||
Variable interest rate spread | 4.62207% | ||
Secured Debt | Consumer Loan, UPB Class A | |||
Debt Instrument [Line Items] | |||
UPB of Underlying Mortgages | $ 671,000,000 | ||
Interest rate, stated percentage | 3.05% | ||
Secured Debt | Consumer Loan, UPB Class B | |||
Debt Instrument [Line Items] | |||
UPB of Underlying Mortgages | $ 210,800,000 | ||
Interest rate, stated percentage | 4.10% | ||
Secured Debt | Consumer Loan, UPB Class C-1 | |||
Debt Instrument [Line Items] | |||
UPB of Underlying Mortgages | $ 18,300,000 | ||
Interest rate, stated percentage | 5.63% | ||
Secured Debt | Consumer Loan, UPB Class C-2 | |||
Debt Instrument [Line Items] | |||
UPB of Underlying Mortgages | $ 18,300,000 | ||
Interest rate, stated percentage | 5.63% | ||
Secured Debt | 4.00% Consumer Loans | |||
Debt Instrument [Line Items] | |||
Outstanding Face Amount | $ 21,300,000 | ||
Interest rate, stated percentage | 4.00% |
DEBT OBLIGATIONS - Narrative (D
DEBT OBLIGATIONS - Narrative (Details) $ in Thousands | Dec. 31, 2018USD ($)agreement |
Debt Instrument [Line Items] | |
Face Amount of Notes and Bonds Payable | $ 22,673,065 |
Repurchase Agreements: | Repurchase Agreements | |
Debt Instrument [Line Items] | |
Face Amount of Notes and Bonds Payable | $ 15,555,156 |
Repurchase Agreements: | Stockholders' Equity | Counterpary Concentration Risk Exceeding 10% | |
Debt Instrument [Line Items] | |
Number of outstanding repurchase agreements | agreement | 0 |
DEBT OBLIGATIONS - Carrying Val
DEBT OBLIGATIONS - Carrying Value (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Debt Instrument [Roll Forward] | |||
Beginning balance | $ 15,746,530 | $ 13,181,236 | |
Borrowings | 99,662,678 | 57,762,563 | $ 31,015,797 |
Repayments | (93,214,286) | (54,289,124) | (29,866,052) |
Ending balance | 22,656,235 | 15,746,530 | 13,181,236 |
Excess MSRs | |||
Debt Instrument [Roll Forward] | |||
Beginning balance | 483,978 | 729,145 | |
Ending balance | 297,563 | 483,978 | 729,145 |
MSRs | |||
Debt Instrument [Roll Forward] | |||
Beginning balance | 1,157,179 | 0 | |
Ending balance | 2,360,856 | 1,157,179 | 0 |
Servicer Advances | |||
Debt Instrument [Roll Forward] | |||
Beginning balance | 4,060,156 | 5,549,872 | |
Ending balance | 3,382,455 | 4,060,156 | 5,549,872 |
Real Estate Securities | |||
Debt Instrument [Roll Forward] | |||
Beginning balance | 6,694,454 | 4,419,002 | |
Ending balance | 11,780,855 | 6,694,454 | 4,419,002 |
Residential mortgage loans and REO | |||
Debt Instrument [Roll Forward] | |||
Beginning balance | 2,108,007 | 783,006 | |
Ending balance | 3,898,059 | 2,108,007 | 783,006 |
Consumer Loans | |||
Debt Instrument [Roll Forward] | |||
Beginning balance | 1,242,756 | 1,700,211 | |
Ending balance | 936,447 | 1,242,756 | $ 1,700,211 |
Repurchase Agreements: | |||
Debt Instrument [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Long-term Debt | 439,632 | ||
Debt Instrument [Roll Forward] | |||
Borrowings | 99,662,678 | 57,762,563 | |
Repayments | (93,210,903) | (54,292,507) | |
Capitalized deferred financing costs, net of amortization | (424) | 1,449 | |
Repurchase Agreements: | Excess MSRs | |||
Debt Instrument [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Long-term Debt | 0 | ||
Debt Instrument [Roll Forward] | |||
Borrowings | 0 | 0 | |
Repayments | 0 | 0 | |
Capitalized deferred financing costs, net of amortization | 0 | 0 | |
Repurchase Agreements: | MSRs | |||
Debt Instrument [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Long-term Debt | 0 | ||
Debt Instrument [Roll Forward] | |||
Borrowings | 0 | 0 | |
Repayments | 0 | 0 | |
Capitalized deferred financing costs, net of amortization | 0 | 0 | |
Repurchase Agreements: | Servicer Advances | |||
Debt Instrument [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Long-term Debt | 0 | ||
Debt Instrument [Roll Forward] | |||
Borrowings | 0 | 0 | |
Repayments | 0 | 0 | |
Capitalized deferred financing costs, net of amortization | 0 | 0 | |
Repurchase Agreements: | Real Estate Securities | |||
Debt Instrument [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Long-term Debt | 1,957 | ||
Debt Instrument [Roll Forward] | |||
Borrowings | 90,996,778 | 55,233,007 | |
Repayments | (85,912,169) | (52,957,555) | |
Capitalized deferred financing costs, net of amortization | 165 | 0 | |
Repurchase Agreements: | Residential mortgage loans and REO | |||
Debt Instrument [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Long-term Debt | 437,675 | ||
Debt Instrument [Roll Forward] | |||
Borrowings | 8,665,900 | 2,529,556 | |
Repayments | (7,298,734) | (1,334,952) | |
Capitalized deferred financing costs, net of amortization | (589) | 1,449 | |
Repurchase Agreements: | Consumer Loans | |||
Debt Instrument [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Long-term Debt | 0 | ||
Debt Instrument [Roll Forward] | |||
Borrowings | 0 | 0 | |
Repayments | 0 | 0 | |
Capitalized deferred financing costs, net of amortization | 0 | 0 | |
Notes and Bonds Payable: | |||
Debt Instrument [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Long-term Debt | 141,433 | ||
Debt Instrument [Roll Forward] | |||
Borrowings | 9,770,909 | 8,057,720 | |
Repayments | (9,892,659) | (8,971,523) | |
Discount on borrowings, net of amortization | 1,674 | (847) | |
Unrealized gain on notes, fair value | 684 | ||
Capitalized deferred financing costs, net of amortization | (4,167) | 8,439 | |
Notes and Bonds Payable: | Excess MSRs | |||
Debt Instrument [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Long-term Debt | 0 | ||
Debt Instrument [Roll Forward] | |||
Beginning balance | 483,978 | ||
Borrowings | 350,787 | 1,400,354 | |
Repayments | (537,227) | (1,650,409) | |
Discount on borrowings, net of amortization | 0 | 0 | |
Unrealized gain on notes, fair value | 0 | ||
Capitalized deferred financing costs, net of amortization | 25 | 4,888 | |
Ending balance | 297,563 | 483,978 | |
Notes and Bonds Payable: | MSRs | |||
Debt Instrument [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Long-term Debt | 20,731 | ||
Debt Instrument [Roll Forward] | |||
Borrowings | 4,212,855 | 1,172,058 | |
Repayments | (3,022,785) | (13,973) | |
Discount on borrowings, net of amortization | 0 | 0 | |
Unrealized gain on notes, fair value | 0 | ||
Capitalized deferred financing costs, net of amortization | (7,124) | (906) | |
Notes and Bonds Payable: | Servicer Advances | |||
Debt Instrument [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Long-term Debt | 0 | ||
Debt Instrument [Roll Forward] | |||
Beginning balance | 4,060,156 | ||
Borrowings | 5,207,084 | 5,344,985 | |
Repayments | (5,887,384) | (6,838,862) | |
Discount on borrowings, net of amortization | 41 | (147) | |
Unrealized gain on notes, fair value | 0 | ||
Capitalized deferred financing costs, net of amortization | 2,558 | 4,308 | |
Ending balance | 3,382,455 | 4,060,156 | |
Notes and Bonds Payable: | Real Estate Securities | |||
Debt Instrument [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Long-term Debt | 0 | ||
Debt Instrument [Roll Forward] | |||
Borrowings | 0 | 0 | |
Repayments | 0 | 0 | |
Discount on borrowings, net of amortization | 0 | 0 | |
Unrealized gain on notes, fair value | 0 | ||
Capitalized deferred financing costs, net of amortization | 0 | 0 | |
Notes and Bonds Payable: | Residential mortgage loans and REO | |||
Debt Instrument [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Long-term Debt | 120,702 | ||
Debt Instrument [Roll Forward] | |||
Borrowings | 183 | 140,323 | |
Repayments | (136,947) | (11,375) | |
Discount on borrowings, net of amortization | 0 | 0 | |
Unrealized gain on notes, fair value | 684 | ||
Capitalized deferred financing costs, net of amortization | 0 | 0 | |
Notes and Bonds Payable: | Consumer Loans | |||
Debt Instrument [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Long-term Debt | 0 | ||
Debt Instrument [Roll Forward] | |||
Beginning balance | 1,242,756 | ||
Borrowings | 0 | 0 | |
Repayments | (308,316) | (456,904) | |
Discount on borrowings, net of amortization | 1,633 | (700) | |
Unrealized gain on notes, fair value | 0 | ||
Capitalized deferred financing costs, net of amortization | 374 | 149 | |
Ending balance | $ 936,447 | $ 1,242,756 |
DEBT OBLIGATIONS - Contractual
DEBT OBLIGATIONS - Contractual Maturities of Debt Obligations (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Debt maturing in: | |
2,019 | $ 17,003,852 |
2,020 | 953,436 |
2,021 | 2,495,031 |
2,022 | 197,759 |
2,023 | 1,158,336 |
2024 and thereafter | 864,651 |
Total long-term debt | 22,673,065 |
Nonrecourse | |
Debt maturing in: | |
2,019 | 879,241 |
2,020 | 771,582 |
2,021 | 1,758,663 |
2,022 | 0 |
2,023 | 671,013 |
2024 and thereafter | 364,770 |
Total long-term debt | 4,445,269 |
Recourse | |
Debt maturing in: | |
2,019 | 16,124,611 |
2,020 | 181,854 |
2,021 | 736,368 |
2,022 | 197,759 |
2,023 | 487,323 |
2024 and thereafter | 499,881 |
Total long-term debt | $ 18,227,796 |
DEBT OBLIGATIONS - Schedule o_2
DEBT OBLIGATIONS - Schedule of Borrowing Capacity (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Debt Instrument [Line Items] | |
Face Amount of Notes and Bonds Payable | $ 22,673,065 |
Non-Agency Bonds | |
Debt Instrument [Line Items] | |
Face Amount of Notes and Bonds Payable | 86,300 |
Residential mortgage loans and REO | |
Debt Instrument [Line Items] | |
Borrowing Capacity | 5,575,197 |
Balance Outstanding | 3,774,136 |
Available Financing | 1,801,061 |
Non-Agency RMBS | |
Debt Instrument [Line Items] | |
Borrowing Capacity | 250,000 |
Balance Outstanding | 241,535 |
Available Financing | 8,465 |
Excess MSRs | |
Debt Instrument [Line Items] | |
Borrowing Capacity | 150,000 |
Balance Outstanding | 100,000 |
Available Financing | 50,000 |
MSRs | |
Debt Instrument [Line Items] | |
Borrowing Capacity | 990,000 |
Balance Outstanding | 645,319 |
Available Financing | 344,681 |
Servicer Advances | |
Debt Instrument [Line Items] | |
Borrowing Capacity | 1,678,541 |
Balance Outstanding | 1,372,576 |
Available Financing | $ 305,965 |
Unused borrowing capacity fee | 0.10% |
Consumer loan bonds | |
Debt Instrument [Line Items] | |
Borrowing Capacity | $ 150,000 |
Balance Outstanding | 21,303 |
Available Financing | 128,697 |
Debt Borrowing Capacity | |
Debt Instrument [Line Items] | |
Borrowing Capacity | 8,793,738 |
Balance Outstanding | 6,154,869 |
Available Financing | $ 2,638,869 |
FAIR VALUE MEASUREMENT - Carryi
FAIR VALUE MEASUREMENT - Carrying Values and Fair Values of Financial Assets and Liabilities Recorded at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Investments in: | |||
Excess mortgage servicing rights, at fair value | $ 447,860 | $ 1,173,713 | |
Mortgage servicing rights financing receivables, at fair value | 1,644,504 | 598,728 | |
Real estate and other securities, available-for-sale | 11,636,581 | 8,071,140 | |
Residential mortgage loans, held for sale, at fair value | 2,808,529 | 0 | |
Residential mortgage loans, held-for-investment, fair value | 121,088 | 0 | |
Residential mortgage loans subject to repurchase, at fair value | 121,602 | 0 | $ 0 |
Derivative assets, at fair value | 10,893 | 2,423 | |
Restricted cash, at fair value | 164,020 | 150,252 | |
Liabilities: | |||
Residential mortgage loan repurchase liability, at fair value | 121,602 | 0 | |
Derivative liabilities, at fair value | 29,389 | 697 | |
Excess spread financing, at fair value | 39,304 | 0 | |
Equity investment | 74,323 | 0 | |
Recurring Basis | |||
Investments in: | |||
Excess mortgage servicing rights, principal balance | 106,426,363 | 217,121,299 | |
Excess mortgage servicing rights, equity method investees, principal balance | 41,707,963 | 50,501,054 | |
Mortgage servicing rights, principal balance | 258,462,703 | 172,454,150 | |
Mortgage servicing rights, financing receivables, principal balance | 130,516,565 | 64,344,893 | |
Servicer advance investments, principal balance | 620,050 | 3,581,876 | |
Real estate and other securities, available-for-sale, principal balance | 22,152,845 | 14,822,986 | |
Residential mortgage loans, held-for-investment, principal balance | 706,111 | 806,635 | |
Residential mortgage loans, held-for-sale, principal balance | 1,043,550 | 1,907,052 | |
Residential mortgage loans, held for sale, principal balance | 2,934,727 | ||
Residential mortgage loans, held-for-investment, principal balance | 122,260 | ||
Residential mortgage loans subject to repurchase, principal balance | 121,602 | ||
Consumer loans, principal balance | 1,072,577 | 1,377,792 | |
Derivative assets, principal balance | 840,179 | 772,500 | |
Cash and cash equivalents, principal balance | 251,058 | 295,798 | |
Restricted cash, principal balance | 164,020 | 150,252 | |
Other assets, principal balance | 1,788,354 | ||
Liabilities: | |||
Repurchase agreements, principal balance | 15,555,156 | 8,663,747 | |
Notes and bonds payable, principal balance | 7,117,909 | 7,097,223 | |
Residential mortgage loan repurchase liability, principal balance | 121,602 | ||
Derivative liabilities, principal balance | 15,759,782 | 4,115,100 | |
Excess spread financing, principal balance | 3,492,587 | ||
Recurring Basis | Carrying Value | |||
Investments in: | |||
Excess mortgage servicing rights, at fair value | 447,860 | 1,173,713 | |
Excess mortgage servicing rights, equity method investees, at fair value | 147,964 | 171,765 | |
Mortgage servicing rights, at fair value | 2,884,100 | 1,735,504 | |
Mortgage servicing rights financing receivables, at fair value | 1,644,504 | 598,728 | |
Servicer advance investments, at fair value | 735,846 | 4,027,379 | |
Real estate and other securities, available-for-sale | 11,636,581 | 8,071,140 | |
Residential mortgage loans, held-for-investment, at fair value | 614,241 | 691,155 | |
Residential mortgage loans, held-for-sale, at fair value | 932,480 | 1,725,534 | |
Residential mortgage loans, held for sale, at fair value | 2,808,529 | ||
Residential mortgage loans, held-for-investment, fair value | 121,088 | ||
Residential mortgage loans subject to repurchase, at fair value | 121,602 | ||
Consumer loans, at fair value | 1,072,202 | 1,374,263 | |
Derivative assets, at fair value | 10,893 | 2,423 | |
Cash and cash equivalents, at fair value | 251,058 | 295,798 | |
Restricted cash, at fair value | 164,020 | 150,252 | |
Other assets, at fair value | 16,991 | 28,802 | |
Assets, fair value | 23,609,959 | 20,046,456 | |
Liabilities: | |||
Repurchase agreements, at fair value | 15,553,969 | 8,662,139 | |
Notes and bonds payable, at fair value | 7,102,266 | 7,084,391 | |
Residential mortgage loan repurchase liability, at fair value | 121,602 | ||
Derivative liabilities, at fair value | 29,389 | 697 | |
Excess spread financing, at fair value | 39,304 | ||
Contingent consideration, at fair value | 40,842 | ||
Liabilities, fair value | 22,887,372 | 15,747,227 | |
Recurring Basis | Fair Value | |||
Investments in: | |||
Excess mortgage servicing rights, at fair value | 447,860 | 1,173,713 | |
Excess mortgage servicing rights, equity method investees, at fair value | 147,964 | 171,765 | |
Mortgage servicing rights, at fair value | 2,884,100 | 1,735,504 | |
Mortgage servicing rights financing receivables, at fair value | 1,644,504 | 598,728 | |
Servicer advance investments, at fair value | 735,846 | 4,027,379 | |
Real estate and other securities, available-for-sale | 11,636,581 | 8,071,140 | |
Residential mortgage loans, held-for-investment, at fair value | 625,321 | 694,692 | |
Residential mortgage loans, held-for-sale, at fair value | 958,970 | 1,794,210 | |
Residential mortgage loans, held for sale, at fair value | 2,808,529 | ||
Residential mortgage loans, held-for-investment, fair value | 121,088 | ||
Residential mortgage loans subject to repurchase, at fair value | 121,602 | ||
Consumer loans, at fair value | 1,054,820 | 1,379,746 | |
Derivative assets, at fair value | 10,893 | 2,423 | |
Cash and cash equivalents, at fair value | 251,058 | 295,798 | |
Restricted cash, at fair value | 164,020 | 150,252 | |
Other assets, at fair value | 16,991 | 28,802 | |
Assets, fair value | 23,630,147 | 20,124,152 | |
Liabilities: | |||
Repurchase agreements, at fair value | 15,555,156 | 8,663,747 | |
Notes and bonds payable, at fair value | 7,076,400 | 7,109,803 | |
Residential mortgage loan repurchase liability, at fair value | 121,602 | ||
Derivative liabilities, at fair value | 29,389 | 697 | |
Excess spread financing, at fair value | 39,304 | ||
Contingent consideration, at fair value | 40,842 | ||
Liabilities, fair value | 22,862,693 | 15,774,247 | |
Equity investment | 74,300 | ||
Recurring Basis | Fair Value | Level 1 | |||
Investments in: | |||
Excess mortgage servicing rights, at fair value | 0 | 0 | |
Excess mortgage servicing rights, equity method investees, at fair value | 0 | 0 | |
Mortgage servicing rights, at fair value | 0 | 0 | |
Mortgage servicing rights financing receivables, at fair value | 0 | 0 | |
Servicer advance investments, at fair value | 0 | 0 | |
Real estate and other securities, available-for-sale | 0 | 0 | |
Residential mortgage loans, held-for-investment, at fair value | 0 | 0 | |
Residential mortgage loans, held-for-sale, at fair value | 0 | 0 | |
Residential mortgage loans, held for sale, at fair value | 0 | ||
Residential mortgage loans, held-for-investment, fair value | 0 | ||
Residential mortgage loans subject to repurchase, at fair value | 0 | ||
Consumer loans, at fair value | 0 | 0 | |
Derivative assets, at fair value | 0 | 0 | |
Cash and cash equivalents, at fair value | 251,058 | 295,798 | |
Restricted cash, at fair value | 164,020 | 150,252 | |
Other assets, at fair value | 7,778 | 19,259 | |
Assets, fair value | 422,856 | 465,309 | |
Liabilities: | |||
Repurchase agreements, at fair value | 0 | 0 | |
Notes and bonds payable, at fair value | 0 | 0 | |
Residential mortgage loan repurchase liability, at fair value | 0 | ||
Derivative liabilities, at fair value | 0 | 0 | |
Excess spread financing, at fair value | 0 | ||
Contingent consideration, at fair value | 0 | ||
Liabilities, fair value | 0 | 0 | |
Recurring Basis | Fair Value | Level 2 | |||
Investments in: | |||
Excess mortgage servicing rights, at fair value | 0 | 0 | |
Excess mortgage servicing rights, equity method investees, at fair value | 0 | 0 | |
Mortgage servicing rights, at fair value | 0 | 0 | |
Mortgage servicing rights financing receivables, at fair value | 0 | 0 | |
Servicer advance investments, at fair value | 0 | 0 | |
Real estate and other securities, available-for-sale | 2,665,618 | 2,096,351 | |
Residential mortgage loans, held-for-investment, at fair value | 0 | 0 | |
Residential mortgage loans, held-for-sale, at fair value | 0 | 0 | |
Residential mortgage loans, held for sale, at fair value | 213,882 | ||
Residential mortgage loans, held-for-investment, fair value | 0 | ||
Residential mortgage loans subject to repurchase, at fair value | 121,602 | ||
Consumer loans, at fair value | 0 | 0 | |
Derivative assets, at fair value | 42 | 2,423 | |
Cash and cash equivalents, at fair value | 0 | 0 | |
Restricted cash, at fair value | 0 | 0 | |
Other assets, at fair value | 0 | 0 | |
Assets, fair value | 3,001,144 | 2,098,774 | |
Liabilities: | |||
Repurchase agreements, at fair value | 15,555,156 | 8,663,747 | |
Notes and bonds payable, at fair value | 0 | 0 | |
Residential mortgage loan repurchase liability, at fair value | 121,602 | ||
Derivative liabilities, at fair value | 29,166 | 697 | |
Excess spread financing, at fair value | 0 | ||
Contingent consideration, at fair value | 0 | ||
Liabilities, fair value | 15,705,924 | 8,664,444 | |
Recurring Basis | Fair Value | Level 3 | |||
Investments in: | |||
Excess mortgage servicing rights, at fair value | 447,860 | 1,173,713 | |
Excess mortgage servicing rights, equity method investees, at fair value | 147,964 | 171,765 | |
Mortgage servicing rights, at fair value | 2,884,100 | 1,735,504 | |
Mortgage servicing rights financing receivables, at fair value | 1,644,504 | 598,728 | |
Servicer advance investments, at fair value | 735,846 | 4,027,379 | |
Real estate and other securities, available-for-sale | 8,970,963 | 5,974,789 | |
Residential mortgage loans, held-for-investment, at fair value | 625,321 | 694,692 | |
Residential mortgage loans, held-for-sale, at fair value | 958,970 | 1,794,210 | |
Residential mortgage loans, held for sale, at fair value | 2,594,647 | ||
Residential mortgage loans, held-for-investment, fair value | 121,088 | ||
Residential mortgage loans subject to repurchase, at fair value | 0 | ||
Consumer loans, at fair value | 1,054,820 | 1,379,746 | |
Derivative assets, at fair value | 10,851 | 0 | |
Cash and cash equivalents, at fair value | 0 | 0 | |
Restricted cash, at fair value | 0 | 0 | |
Other assets, at fair value | 9,213 | 9,543 | |
Assets, fair value | 20,206,147 | 17,560,069 | |
Liabilities: | |||
Repurchase agreements, at fair value | 0 | 0 | |
Notes and bonds payable, at fair value | 7,076,400 | 7,109,803 | |
Residential mortgage loan repurchase liability, at fair value | 0 | ||
Derivative liabilities, at fair value | 223 | 0 | |
Excess spread financing, at fair value | 39,304 | ||
Contingent consideration, at fair value | 40,842 | ||
Liabilities, fair value | 7,156,769 | $ 7,109,803 | |
Equal to Greater than 90 Days Past Due | Recurring Basis | Fair Value | |||
Investments in: | |||
Residential mortgage loans, held for sale, at fair value | 88,700 | ||
Residential mortgage loans, held-for-investment, fair value | 400 | ||
Residential Mortgage Backed Securities | Notes and bonds payable | |||
Liabilities: | |||
Notes and bonds payable, at fair value | $ 117,000 |
FAIR VALUE MEASUREMENT - Financ
FAIR VALUE MEASUREMENT - Financial Assets Measured at Fair Value on a Recurring Basis using Level 3 Inputs (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance, beginning | ||
Purchases, sales and repayments | ||
Balance, ending | ||
Non-Agency | ||
Gains (losses) included in net income | ||
Included in gain (loss) on settlement of investments, net | $ (1,300) | $ 18,000 |
Excess MSRs Investees | ||
Purchases, sales and repayments | ||
New Residential’s ownership | 50.00% | 50.00% |
Recurring Basis | Level 3 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance, beginning | $ 13,681,878 | $ 11,503,879 |
Transfers | ||
Transfers from Level 3 | 0 | 0 |
Transfers to Level 3 | 0 | 0 |
Shellpoint Acquisitions | 341,560 | |
Gains (losses) included in net income | ||
Included in other-than-temporary impairment on securities | (24,940) | (10,334) |
Included in change in fair value of investments in excess mortgage servicing rights | (58,656) | 4,322 |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 8,357 | 12,617 |
Included in servicing revenue, net | (199,836) | (67,672) |
Included in changes in fair value of investments in mortgage servicing rights financing receivables | 66,394 | |
Included in change in fair value of investments in mortgage servicing rights financing receivables | 31,550 | |
Included in change in fair value of servicer advance investments | (89,332) | 84,418 |
Included in gain (loss) on settlement of investments, net | 111,714 | |
Included in gain (loss) on settlement of investments, net | 27,377 | |
Included in other income (loss), net | 16,576 | 7,260 |
Gains (losses) included in other comprehensive income | 31,031 | 244,608 |
Interest income | 471,676 | |
Interest income | 964,706 | |
Purchases, sales and repayments | ||
Purchases | 7,358,718 | 16,833,061 |
Proceeds from sales | (118,780) | (195,830) |
Proceeds from repayments | (3,781,138) | (15,304,176) |
Originations | 35,311 | |
Ocwen Transaction | (2,796,466) | (488,752) |
Balance, ending | 15,019,223 | 13,681,878 |
Recurring Basis | Level 3 | Consumer loan bonds | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance, beginning | 4,027,379 | 5,706,593 |
Transfers | ||
Transfers from Level 3 | 0 | 0 |
Transfers to Level 3 | 0 | 0 |
Shellpoint Acquisitions | 0 | |
Gains (losses) included in net income | ||
Included in other-than-temporary impairment on securities | 0 | 0 |
Included in change in fair value of investments in excess mortgage servicing rights | 0 | 0 |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 0 | 0 |
Included in servicing revenue, net | 0 | 0 |
Included in changes in fair value of investments in mortgage servicing rights financing receivables | 0 | |
Included in change in fair value of investments in mortgage servicing rights financing receivables | 0 | |
Included in change in fair value of servicer advance investments | (89,332) | 84,418 |
Included in gain (loss) on settlement of investments, net | 72,585 | |
Included in gain (loss) on settlement of investments, net | 9,327 | |
Included in other income (loss), net | 0 | 0 |
Gains (losses) included in other comprehensive income | 0 | 0 |
Interest income | 50,218 | |
Interest income | 528,356 | |
Purchases, sales and repayments | ||
Purchases | 2,332,989 | 12,168,519 |
Proceeds from sales | 0 | 0 |
Proceeds from repayments | (2,455,155) | (13,988,614) |
Originations | 0 | |
Ocwen Transaction | (3,202,838) | (481,220) |
Balance, ending | 735,846 | 4,027,379 |
Recurring Basis | Level 3 | MSRs | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance, beginning | 1,735,504 | 659,483 |
Transfers | ||
Transfers from Level 3 | 0 | 0 |
Transfers to Level 3 | 0 | 0 |
Shellpoint Acquisitions | 275,964 | |
Gains (losses) included in net income | ||
Included in other-than-temporary impairment on securities | 0 | 0 |
Included in change in fair value of investments in excess mortgage servicing rights | 0 | 0 |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 0 | 0 |
Included in servicing revenue, net | (199,836) | (67,672) |
Included in changes in fair value of investments in mortgage servicing rights financing receivables | 0 | |
Included in change in fair value of investments in mortgage servicing rights financing receivables | 0 | |
Included in change in fair value of servicer advance investments | 0 | 0 |
Included in gain (loss) on settlement of investments, net | 0 | |
Included in gain (loss) on settlement of investments, net | 0 | |
Included in other income (loss), net | 0 | 0 |
Gains (losses) included in other comprehensive income | 0 | 0 |
Interest income | 0 | |
Interest income | 0 | |
Purchases, sales and repayments | ||
Purchases | 1,042,933 | 1,143,693 |
Proceeds from sales | (5,776) | 0 |
Proceeds from repayments | 0 | 0 |
Originations | 35,311 | |
Ocwen Transaction | 0 | 0 |
Balance, ending | 2,884,100 | 1,735,504 |
Recurring Basis | Level 3 | Mortgage Servicing Rights Financing Receivables | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance, beginning | 598,728 | 0 |
Transfers | ||
Transfers from Level 3 | 0 | 0 |
Transfers to Level 3 | 0 | 0 |
Shellpoint Acquisitions | (124,652) | |
Gains (losses) included in net income | ||
Included in other-than-temporary impairment on securities | 0 | 0 |
Included in change in fair value of investments in excess mortgage servicing rights | 0 | 0 |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 0 | 0 |
Included in servicing revenue, net | 0 | 0 |
Included in changes in fair value of investments in mortgage servicing rights financing receivables | 66,394 | |
Included in change in fair value of investments in mortgage servicing rights financing receivables | 31,550 | |
Included in change in fair value of servicer advance investments | 0 | 0 |
Included in gain (loss) on settlement of investments, net | 0 | |
Included in gain (loss) on settlement of investments, net | 0 | |
Included in other income (loss), net | 0 | 0 |
Gains (losses) included in other comprehensive income | 0 | 0 |
Interest income | 0 | |
Interest income | 0 | |
Purchases, sales and repayments | ||
Purchases | 128,357 | 467,884 |
Proceeds from sales | (7,472) | 0 |
Proceeds from repayments | 0 | 0 |
Originations | 0 | |
Ocwen Transaction | 1,017,993 | 64,450 |
Balance, ending | 1,644,504 | 598,728 |
Recurring Basis | Level 3 | Non-Agency | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance, beginning | 5,974,789 | 3,543,560 |
Transfers | ||
Transfers from Level 3 | 0 | 0 |
Transfers to Level 3 | 0 | 0 |
Shellpoint Acquisitions | 0 | |
Gains (losses) included in net income | ||
Included in other-than-temporary impairment on securities | (24,940) | (10,334) |
Included in change in fair value of investments in excess mortgage servicing rights | 0 | 0 |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 0 | 0 |
Included in servicing revenue, net | 0 | 0 |
Included in changes in fair value of investments in mortgage servicing rights financing receivables | 0 | |
Included in change in fair value of investments in mortgage servicing rights financing receivables | 0 | |
Included in change in fair value of servicer advance investments | 0 | 0 |
Included in gain (loss) on settlement of investments, net | (1,288) | |
Included in gain (loss) on settlement of investments, net | 18,050 | |
Included in other income (loss), net | 10,283 | 2,883 |
Gains (losses) included in other comprehensive income | 31,031 | 244,608 |
Interest income | 377,018 | |
Interest income | 333,297 | |
Purchases, sales and repayments | ||
Purchases | 3,854,439 | 3,052,965 |
Proceeds from sales | (86,448) | (182,325) |
Proceeds from repayments | (1,163,921) | (1,027,915) |
Originations | 0 | |
Ocwen Transaction | 0 | 0 |
Balance, ending | 8,970,963 | 5,974,789 |
Recurring Basis | Level 3 | Derivatives | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance, beginning | 0 | 0 |
Transfers | ||
Transfers from Level 3 | 0 | 0 |
Transfers to Level 3 | 0 | 0 |
Shellpoint Acquisitions | 10,604 | |
Gains (losses) included in net income | ||
Included in other-than-temporary impairment on securities | 0 | 0 |
Included in change in fair value of investments in excess mortgage servicing rights | 0 | 0 |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 0 | 0 |
Included in servicing revenue, net | 0 | 0 |
Included in changes in fair value of investments in mortgage servicing rights financing receivables | 0 | |
Included in change in fair value of investments in mortgage servicing rights financing receivables | 0 | |
Included in change in fair value of servicer advance investments | 0 | 0 |
Included in gain (loss) on settlement of investments, net | 0 | |
Included in gain (loss) on settlement of investments, net | 0 | |
Included in other income (loss), net | 24 | 0 |
Gains (losses) included in other comprehensive income | 0 | 0 |
Interest income | 0 | |
Interest income | 0 | |
Purchases, sales and repayments | ||
Purchases | 0 | 0 |
Proceeds from sales | 0 | 0 |
Proceeds from repayments | 0 | 0 |
Originations | 0 | |
Ocwen Transaction | 0 | 0 |
Balance, ending | 10,628 | 0 |
Recurring Basis | Level 3 | Residential Mortgage Loans | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance, beginning | 0 | 0 |
Transfers | ||
Transfers from Level 3 | 0 | 0 |
Transfers to Level 3 | 0 | 0 |
Shellpoint Acquisitions | 179,644 | |
Gains (losses) included in net income | ||
Included in other-than-temporary impairment on securities | 0 | 0 |
Included in change in fair value of investments in excess mortgage servicing rights | 0 | 0 |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 0 | 0 |
Included in servicing revenue, net | 0 | 0 |
Included in changes in fair value of investments in mortgage servicing rights financing receivables | 0 | |
Included in change in fair value of investments in mortgage servicing rights financing receivables | 0 | |
Included in change in fair value of servicer advance investments | 0 | 0 |
Included in gain (loss) on settlement of investments, net | 0 | |
Included in gain (loss) on settlement of investments, net | 0 | |
Included in other income (loss), net | (175) | 0 |
Gains (losses) included in other comprehensive income | 0 | 0 |
Interest income | 0 | |
Interest income | 0 | |
Purchases, sales and repayments | ||
Purchases | 0 | 0 |
Proceeds from sales | 0 | 0 |
Proceeds from repayments | 2,111 | 0 |
Originations | 0 | |
Ocwen Transaction | 0 | 0 |
Balance, ending | 177,358 | 0 |
Recurring Basis | Level 3 | MSRs Agency | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance, beginning | 324,636 | 381,757 |
Transfers | ||
Transfers from Level 3 | 0 | 0 |
Transfers to Level 3 | 0 | 0 |
Shellpoint Acquisitions | 0 | |
Gains (losses) included in net income | ||
Included in other-than-temporary impairment on securities | 0 | 0 |
Included in change in fair value of investments in excess mortgage servicing rights | (18,099) | (3,037) |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 0 | 0 |
Included in servicing revenue, net | 0 | 0 |
Included in changes in fair value of investments in mortgage servicing rights financing receivables | 0 | |
Included in change in fair value of investments in mortgage servicing rights financing receivables | 0 | |
Included in change in fair value of servicer advance investments | 0 | 0 |
Included in gain (loss) on settlement of investments, net | 0 | |
Included in gain (loss) on settlement of investments, net | 0 | |
Included in other income (loss), net | 6,137 | 2,150 |
Gains (losses) included in other comprehensive income | 0 | 0 |
Interest income | 21,936 | |
Interest income | 28,351 | |
Purchases, sales and repayments | ||
Purchases | 0 | 0 |
Proceeds from sales | (19,084) | (13,505) |
Proceeds from repayments | (58,139) | (71,080) |
Originations | 0 | |
Ocwen Transaction | 0 | 0 |
Balance, ending | 257,387 | 324,636 |
Recurring Basis | Level 3 | MSRs Agency | Excess MSRs Investees | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance, beginning | 171,765 | 194,788 |
Transfers | ||
Transfers from Level 3 | 0 | 0 |
Transfers to Level 3 | 0 | 0 |
Shellpoint Acquisitions | 0 | |
Gains (losses) included in net income | ||
Included in other-than-temporary impairment on securities | 0 | 0 |
Included in change in fair value of investments in excess mortgage servicing rights | 0 | 0 |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 8,357 | 12,617 |
Included in servicing revenue, net | 0 | 0 |
Included in changes in fair value of investments in mortgage servicing rights financing receivables | 0 | |
Included in change in fair value of investments in mortgage servicing rights financing receivables | 0 | |
Included in change in fair value of servicer advance investments | 0 | 0 |
Included in gain (loss) on settlement of investments, net | 0 | |
Included in gain (loss) on settlement of investments, net | 0 | |
Included in other income (loss), net | 0 | 0 |
Gains (losses) included in other comprehensive income | 0 | 0 |
Interest income | 0 | |
Interest income | 0 | |
Purchases, sales and repayments | ||
Purchases | 0 | 0 |
Proceeds from sales | 0 | 0 |
Proceeds from repayments | (32,158) | (35,640) |
Originations | 0 | |
Ocwen Transaction | 0 | 0 |
Balance, ending | 147,964 | 171,765 |
Recurring Basis | Level 3 | MSRs Non-Agency | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance, beginning | 849,077 | 1,017,698 |
Transfers | ||
Transfers from Level 3 | 0 | 0 |
Transfers to Level 3 | 0 | 0 |
Shellpoint Acquisitions | 0 | |
Gains (losses) included in net income | ||
Included in other-than-temporary impairment on securities | 0 | 0 |
Included in change in fair value of investments in excess mortgage servicing rights | (40,557) | 7,359 |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 0 | 0 |
Included in servicing revenue, net | 0 | 0 |
Included in changes in fair value of investments in mortgage servicing rights financing receivables | 0 | |
Included in change in fair value of investments in mortgage servicing rights financing receivables | 0 | |
Included in change in fair value of servicer advance investments | 0 | 0 |
Included in gain (loss) on settlement of investments, net | 40,417 | |
Included in gain (loss) on settlement of investments, net | 0 | |
Included in other income (loss), net | 307 | 2,227 |
Gains (losses) included in other comprehensive income | 0 | 0 |
Interest income | 22,504 | |
Interest income | 74,702 | |
Purchases, sales and repayments | ||
Purchases | 0 | 0 |
Proceeds from sales | 0 | 0 |
Proceeds from repayments | (69,654) | (180,927) |
Originations | 0 | |
Ocwen Transaction | (611,621) | (71,982) |
Balance, ending | $ 190,473 | $ 849,077 |
FAIR VALUE MEASUREMENT - Fair V
FAIR VALUE MEASUREMENT - Fair Value Liabilities Measured at Fair Value on a Recurring Basis using Level 3 Inputs (Details) - Level 3 - Recurring Basis $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Fair value, liability, beginning balance | $ 0 |
Transfers | |
Transfers from Level 3 | 0 |
Transfers to Level 3 | 0 |
Shellpoint Acquisition | 208,226 |
Gains (losses) included in net income | |
Included in other-than-temporary impairment on securities | 0 |
Included in change in fair value of investments in excess mortgage servicing rights | 0 |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 0 |
Included in servicing revenue, net | (8,591) |
Included in change in fair value of investments in notes receivable - rights to MSRs | 0 |
Included in change in fair value of servicer advance investments | 0 |
Included in gain (loss) on settlement of investments, net | 0 |
Included in other income | 2,264 |
Gains (losses) included in other comprehensive income, net of tax | 0 |
Interest income | 0 |
Purchases, sales and repayments | |
Purchases | 0 |
Proceeds from sales | 0 |
Proceeds from repayments | (4,338) |
Other | (367) |
Ocwen Transaction | 0 |
Fair value, liability, ending balance | 197,194 |
Excess Spread Financing | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Fair value, liability, beginning balance | 0 |
Transfers | |
Transfers from Level 3 | 0 |
Transfers to Level 3 | 0 |
Shellpoint Acquisition | 48,262 |
Gains (losses) included in net income | |
Included in other-than-temporary impairment on securities | 0 |
Included in change in fair value of investments in excess mortgage servicing rights | 0 |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 0 |
Included in servicing revenue, net | (8,591) |
Included in change in fair value of investments in notes receivable - rights to MSRs | 0 |
Included in change in fair value of servicer advance investments | 0 |
Included in gain (loss) on settlement of investments, net | 0 |
Included in other income | 0 |
Gains (losses) included in other comprehensive income, net of tax | 0 |
Interest income | 0 |
Purchases, sales and repayments | |
Purchases | 0 |
Proceeds from sales | 0 |
Proceeds from repayments | 0 |
Other | (367) |
Ocwen Transaction | 0 |
Fair value, liability, ending balance | 39,304 |
Mortgage Backed Securities Issued | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Fair value, liability, beginning balance | 0 |
Transfers | |
Transfers from Level 3 | 0 |
Transfers to Level 3 | 0 |
Shellpoint Acquisition | 120,702 |
Gains (losses) included in net income | |
Included in other-than-temporary impairment on securities | 0 |
Included in change in fair value of investments in excess mortgage servicing rights | 0 |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 0 |
Included in servicing revenue, net | 0 |
Included in change in fair value of investments in notes receivable - rights to MSRs | 0 |
Included in change in fair value of servicer advance investments | 0 |
Included in gain (loss) on settlement of investments, net | 0 |
Included in other income | 684 |
Gains (losses) included in other comprehensive income, net of tax | 0 |
Interest income | 0 |
Purchases, sales and repayments | |
Purchases | 0 |
Proceeds from sales | 0 |
Proceeds from repayments | (4,338) |
Other | 0 |
Ocwen Transaction | 0 |
Fair value, liability, ending balance | 117,048 |
Contingent Consideration | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Fair value, liability, beginning balance | 0 |
Transfers | |
Transfers from Level 3 | 0 |
Transfers to Level 3 | 0 |
Shellpoint Acquisition | 39,262 |
Gains (losses) included in net income | |
Included in other-than-temporary impairment on securities | 0 |
Included in change in fair value of investments in excess mortgage servicing rights | 0 |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 0 |
Included in servicing revenue, net | 0 |
Included in change in fair value of investments in notes receivable - rights to MSRs | 0 |
Included in change in fair value of servicer advance investments | 0 |
Included in gain (loss) on settlement of investments, net | 0 |
Included in other income | 1,580 |
Gains (losses) included in other comprehensive income, net of tax | 0 |
Interest income | 0 |
Purchases, sales and repayments | |
Purchases | 0 |
Proceeds from sales | 0 |
Proceeds from repayments | 0 |
Other | 0 |
Ocwen Transaction | 0 |
Fair value, liability, ending balance | $ 40,842 |
FAIR VALUE MEASUREMENT - Weight
FAIR VALUE MEASUREMENT - Weighted Average Inputs used in Valuing Excess MSRs Owned Directly and through Equity Method Investees (Details) | 12 Months Ended | |
Dec. 31, 2018$ / Loan | Dec. 31, 2017$ / Loan | |
Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage Servicing Amount or Excess Mortgage Servicing Amount (bps) | 0.002 | 0.0017 |
Agency | MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage Servicing Amount or Excess Mortgage Servicing Amount (bps) | 0.0026 | 0.0027 |
Agency | Mortgage Servicing Rights Financing Receivable | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage Servicing Amount or Excess Mortgage Servicing Amount (bps) | 0.0027 | 0.0027 |
Agency | Weighted Average | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Assets and Servicing Liabilities at Fair Value, Monthly Cost Per Loan | 7.30 | 7.23 |
Non-Agency | MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage Servicing Amount or Excess Mortgage Servicing Amount (bps) | 0.0025 | |
Non-Agency | Mortgage Servicing Rights Financing Receivable | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage Servicing Amount or Excess Mortgage Servicing Amount (bps) | 0.0045 | 0.0034 |
Non-Agency | Weighted Average | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Assets and Servicing Liabilities at Fair Value, Monthly Cost Per Loan | 11.45 | 12.45 |
Ginnie Mae | MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage Servicing Amount or Excess Mortgage Servicing Amount (bps) | 0.0033 | |
Ginnie Mae | Weighted Average | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Assets and Servicing Liabilities at Fair Value, Monthly Cost Per Loan | 10.06 | |
Directly Held | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage Servicing Amount or Excess Mortgage Servicing Amount (bps) | 0.0019 | 0.0016 |
Directly Held | Agency | Original Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage Servicing Amount or Excess Mortgage Servicing Amount (bps) | 0.0021 | 0.0021 |
Directly Held | Agency | Recaptured Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage Servicing Amount or Excess Mortgage Servicing Amount (bps) | 0.0022 | 0.0022 |
Directly Held | Agency | Recapture Agreement | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage Servicing Amount or Excess Mortgage Servicing Amount (bps) | 0.0022 | 0.0021 |
Directly Held | Agency | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage Servicing Amount or Excess Mortgage Servicing Amount (bps) | 0.0021 | 0.0021 |
Directly Held | Non-Agency | Original Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage Servicing Amount or Excess Mortgage Servicing Amount (bps) | 0.0015 | 0.0015 |
Directly Held | Non-Agency | Recaptured Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage Servicing Amount or Excess Mortgage Servicing Amount (bps) | 0.0023 | 0.0022 |
Directly Held | Non-Agency | Recapture Agreement | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage Servicing Amount or Excess Mortgage Servicing Amount (bps) | 0.002 | 0.002 |
Directly Held | Non-Agency | Ocwen Serviced Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage Servicing Amount or Excess Mortgage Servicing Amount (bps) | 0.0014 | |
Directly Held | Non-Agency | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage Servicing Amount or Excess Mortgage Servicing Amount (bps) | 0.0016 | 0.0015 |
Held through Equity Method Investees | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage Servicing Amount or Excess Mortgage Servicing Amount (bps) | 0.0021 | 0.0021 |
Held through Equity Method Investees | Agency | Original Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage Servicing Amount or Excess Mortgage Servicing Amount (bps) | 0.0019 | 0.0019 |
Held through Equity Method Investees | Agency | Recaptured Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage Servicing Amount or Excess Mortgage Servicing Amount (bps) | 0.0023 | 0.0023 |
Held through Equity Method Investees | Agency | Recapture Agreement | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage Servicing Amount or Excess Mortgage Servicing Amount (bps) | 0.0023 | 0.0023 |
Prepayment Rate | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.095 | 0.092 |
Prepayment Rate | Agency | MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.094 | 0.105 |
Prepayment Rate | Agency | Mortgage Servicing Rights Financing Receivable | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.095 | 0.103 |
Prepayment Rate | Non-Agency | MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.132 | |
Prepayment Rate | Non-Agency | Mortgage Servicing Rights Financing Receivable | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.082 | 0.100 |
Prepayment Rate | Ginnie Mae | MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.112 | |
Prepayment Rate | Directly Held | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.094 | 0.092 |
Prepayment Rate | Directly Held | Agency | Original Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.098 | 0.097 |
Prepayment Rate | Directly Held | Agency | Recaptured Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.080 | 0.071 |
Prepayment Rate | Directly Held | Agency | Recapture Agreement | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.079 | 0.071 |
Prepayment Rate | Directly Held | Agency | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.091 | 0.088 |
Prepayment Rate | Directly Held | Non-Agency | Original Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.104 | 0.122 |
Prepayment Rate | Directly Held | Non-Agency | Recaptured Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.080 | 0.069 |
Prepayment Rate | Directly Held | Non-Agency | Recapture Agreement | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.079 | 0.069 |
Prepayment Rate | Directly Held | Non-Agency | Ocwen Serviced Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.088 | |
Prepayment Rate | Directly Held | Non-Agency | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.099 | 0.094 |
Prepayment Rate | Held through Equity Method Investees | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.096 | 0.093 |
Prepayment Rate | Held through Equity Method Investees | Agency | Original Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.109 | 0.113 |
Prepayment Rate | Held through Equity Method Investees | Agency | Recaptured Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.085 | 0.073 |
Prepayment Rate | Held through Equity Method Investees | Agency | Recapture Agreement | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.086 | 0.073 |
Delinquency | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.027 | 0.038 |
Delinquency | Agency | MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.01 | 0.009 |
Delinquency | Agency | Mortgage Servicing Rights Financing Receivable | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.009 | 0.009 |
Delinquency | Non-Agency | MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.009 | |
Delinquency | Non-Agency | Mortgage Servicing Rights Financing Receivable | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.172 | 0.109 |
Delinquency | Ginnie Mae | MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.039 | |
Delinquency | Directly Held | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.024 | 0.035 |
Delinquency | Directly Held | Agency | Original Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.025 | 0.030 |
Delinquency | Directly Held | Agency | Recaptured Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.021 | 0.044 |
Delinquency | Directly Held | Agency | Recapture Agreement | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.022 | 0.043 |
Delinquency | Directly Held | Agency | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.024 | 0.035 |
Delinquency | Held through Equity Method Investees | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.032 | 0.048 |
Delinquency | Held through Equity Method Investees | Agency | Original Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.039 | 0.050 |
Delinquency | Held through Equity Method Investees | Agency | Recaptured Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.026 | 0.047 |
Delinquency | Held through Equity Method Investees | Agency | Recapture Agreement | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.027 | 0.047 |
Recapture Rate | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.245 | 0.149 |
Recapture Rate | Agency | MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.222 | 0.254 |
Recapture Rate | Agency | Mortgage Servicing Rights Financing Receivable | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.147 | 0.148 |
Recapture Rate | Non-Agency | MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.100 | |
Recapture Rate | Non-Agency | Mortgage Servicing Rights Financing Receivable | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.050 | 0 |
Recapture Rate | Ginnie Mae | MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.242 | |
Recapture Rate | Directly Held | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.215 | 0.109 |
Recapture Rate | Directly Held | Agency | Original Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.263 | 0.316 |
Recapture Rate | Directly Held | Agency | Recaptured Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.236 | 0.231 |
Recapture Rate | Directly Held | Agency | Recapture Agreement | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.248 | 0.262 |
Recapture Rate | Directly Held | Agency | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.254 | 0.291 |
Recapture Rate | Directly Held | Non-Agency | Original Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.154 | 0.154 |
Recapture Rate | Directly Held | Non-Agency | Recaptured Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.199 | 0.198 |
Recapture Rate | Directly Held | Non-Agency | Recapture Agreement | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.198 | 0.197 |
Recapture Rate | Directly Held | Non-Agency | Ocwen Serviced Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0 | |
Recapture Rate | Directly Held | Non-Agency | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.163 | 0.040 |
Recapture Rate | Held through Equity Method Investees | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.294 | 0.295 |
Recapture Rate | Held through Equity Method Investees | Agency | Original Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.296 | 0.348 |
Recapture Rate | Held through Equity Method Investees | Agency | Recaptured Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.288 | 0.243 |
Recapture Rate | Held through Equity Method Investees | Agency | Recapture Agreement | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.304 | 0.242 |
Collateral Weighted Average Maturity Years | Weighted Average | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Collateral Weighted Average Maturity (in years) | 22 years | 25 years |
Collateral Weighted Average Maturity Years | Agency | Weighted Average | MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Collateral Weighted Average Maturity (in years) | 22 years | 21 years |
Collateral Weighted Average Maturity Years | Agency | Weighted Average | Mortgage Servicing Rights Financing Receivable | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Collateral Weighted Average Maturity (in years) | 20 years | 20 years |
Collateral Weighted Average Maturity Years | Non-Agency | Weighted Average | MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Collateral Weighted Average Maturity (in years) | 25 years | |
Collateral Weighted Average Maturity Years | Non-Agency | Weighted Average | Mortgage Servicing Rights Financing Receivable | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Collateral Weighted Average Maturity (in years) | 26 years | 22 years |
Collateral Weighted Average Maturity Years | Ginnie Mae | Weighted Average | MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Collateral Weighted Average Maturity (in years) | 27 years | |
Collateral Weighted Average Maturity Years | Directly Held | Weighted Average | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Collateral Weighted Average Maturity (in years) | 23 years | 25 years |
Collateral Weighted Average Maturity Years | Directly Held | Agency | Weighted Average | Original Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Collateral Weighted Average Maturity (in years) | 21 years | 23 years |
Collateral Weighted Average Maturity Years | Directly Held | Agency | Weighted Average | Recaptured Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Collateral Weighted Average Maturity (in years) | 24 years | 24 years |
Collateral Weighted Average Maturity Years | Directly Held | Agency | Weighted Average | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Collateral Weighted Average Maturity (in years) | 22 years | 23 years |
Collateral Weighted Average Maturity Years | Directly Held | Non-Agency | Weighted Average | Original Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Collateral Weighted Average Maturity (in years) | 24 years | 24 years |
Collateral Weighted Average Maturity Years | Directly Held | Non-Agency | Weighted Average | Recaptured Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Collateral Weighted Average Maturity (in years) | 24 years | 24 years |
Collateral Weighted Average Maturity Years | Directly Held | Non-Agency | Weighted Average | Ocwen Serviced Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Collateral Weighted Average Maturity (in years) | 26 years | |
Collateral Weighted Average Maturity Years | Directly Held | Non-Agency | Weighted Average | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Collateral Weighted Average Maturity (in years) | 24 years | 26 years |
Collateral Weighted Average Maturity Years | Held through Equity Method Investees | Weighted Average | Excess MSRs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Collateral Weighted Average Maturity (in years) | 21 years | 23 years |
Collateral Weighted Average Maturity Years | Held through Equity Method Investees | Agency | Weighted Average | Original Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Collateral Weighted Average Maturity (in years) | 20 years | 22 years |
Collateral Weighted Average Maturity Years | Held through Equity Method Investees | Agency | Weighted Average | Recaptured Pools | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Collateral Weighted Average Maturity (in years) | 23 years | 24 years |
FAIR VALUE MEASUREMENT - Narrat
FAIR VALUE MEASUREMENT - Narrative (Details) $ in Millions | Sep. 20, 2018 | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Jul. 03, 2018USD ($)earnout_payment |
Schedule of Equity Method Investments [Line Items] | ||||
Assets, fair value adjustment | $ (14.4) | $ (13.7) | ||
Minimum | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Recapture rate, term (in months) | 3 months | |||
Broker price discount | 10.00% | |||
Maximum | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Recapture rate, term (in months) | 6 months | |||
Broker price discount | 25.00% | |||
Real Estate Owned | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Assets, fair value adjustment | $ (3.1) | |||
Real Estate Acquired in Satisfaction of Debt | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Assets, fair value adjustment | (2) | |||
Residential Mortgage Loans | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Assets, fair value adjustment | $ (11.3) | |||
Loans Held-for-sale | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Assets, fair value adjustment | $ (15.7) | |||
Maturity Greater than 30 Days | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Days delinquent (in days) | 30 days | |||
MSRs | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Discount rate | 8.70% | 9.10% | ||
MSRs | Excess MSRs Investees | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Weighted average discount rate, used to value investments in excess MSRs | 8.80% | 8.90% | ||
Mortgage Servicing Rights Financing Receivable | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Discount rate | 10.30% | 9.40% | ||
Nonrecurring | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Assets measured at fair value on a nonrecurring basis | $ 764.1 | $ 803.2 | ||
Nonrecurring | Residential Mortgage Loans Held-for-sale Carried At Lower Cost Or Market | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Assets measured at fair value on a nonrecurring basis | 689.1 | |||
Nonrecurring | Real Estate Owned | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Assets measured at fair value on a nonrecurring basis | $ 75 | |||
Nonrecurring | Real Estate Securities | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Assets measured at fair value on a nonrecurring basis | 725.3 | |||
Nonrecurring | Real Estate Acquired in Satisfaction of Debt | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Assets measured at fair value on a nonrecurring basis | $ 77.9 | |||
LIBOR | Mortgage Servicing Rights Financing Receivable | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Variable interest rate spread | 0.90% | |||
Shellpoint Acquisition | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Cash earnout payments | earnout_payment | 3 | |||
Contingent consideration, high | $ 60 | |||
Contingent consideration, discount rate | 11.00% | |||
Shellpoint Acquisition | Maximum | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Contingent consideration, high | $ 60 |
FAIR VALUE MEASUREMENT - Inputs
FAIR VALUE MEASUREMENT - Inputs used in Valuing the Servicer Advances (Details) - Servicer Advances | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Outstanding Servicer Advances to UPB of Underlying Residential Mortgage Loans | 1.40% | 1.70% |
Mortgage Servicing Amount (bps) | 0.00196 | 0.00182 |
Cost to service amount | 0.096% | 0.125% |
Prepayment Rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.109 | 0.100 |
Delinquency | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.177 | 0.138 |
Discount Rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Servicing Asset, Measurement Input | 0.059 | 0.068 |
Collateral Weighted Average Maturity Years | Weighted Average | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Collateral Weighted Average Maturity (in years) | 23 years 4 months 8 days | 25 years 7 months 17 days |
FAIR VALUE MEASUREMENT - Securi
FAIR VALUE MEASUREMENT - Securities Valuation Methodology and Results (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018USD ($)source | Dec. 31, 2017USD ($) | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Outstanding Face Amount | $ 22,152,845 | $ 14,822,986 |
Amortized Cost Basis | 11,212,428 | 7,704,765 |
Real estate and other securities, available-for-sale | $ 11,636,581 | 8,071,140 |
Number of broker quotation sources | source | 2 | |
Percentage of instruments with ranges of assumptions used available | 73.30% | |
Fair Value | $ 117,903 | |
Agency | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Outstanding Face Amount | 2,613,395 | 1,203,629 |
Amortized Cost Basis | 2,657,917 | 1,247,093 |
Real estate and other securities, available-for-sale | 2,665,618 | 1,243,617 |
Treasury | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Outstanding Face Amount | 862,000 | |
Amortized Cost Basis | 858,028 | |
Real estate and other securities, available-for-sale | 852,734 | |
Non-Agency | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Outstanding Face Amount | 19,539,450 | 12,757,357 |
Amortized Cost Basis | 8,554,511 | 5,599,644 |
Real estate and other securities, available-for-sale | 8,970,963 | 5,974,789 |
Fair Value | 6,578,455 | |
Multiple Quotes | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Real estate and other securities, available-for-sale | 11,625,463 | 8,059,928 |
Single Quote | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Real estate and other securities, available-for-sale | 11,118 | 11,212 |
Single Quote | Seller | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Real estate and other securities, available-for-sale | 11,100 | 10,500 |
Level 2 | Agency | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Real estate and other securities, available-for-sale | 2,665,618 | 1,243,617 |
Level 2 | Treasury | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Real estate and other securities, available-for-sale | 852,734 | |
Level 2 | Multiple Quotes | Agency | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Real estate and other securities, available-for-sale | 2,665,618 | 1,243,617 |
Level 2 | Multiple Quotes | Treasury | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Real estate and other securities, available-for-sale | 852,734 | |
Level 2 | Single Quote | Agency | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Real estate and other securities, available-for-sale | 0 | 0 |
Level 2 | Single Quote | Treasury | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Real estate and other securities, available-for-sale | 0 | |
Level 3 | Non-Agency | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Real estate and other securities, available-for-sale | 8,970,963 | 5,974,789 |
Level 3 | Multiple Quotes | Non-Agency | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Real estate and other securities, available-for-sale | 8,959,845 | 5,963,577 |
Level 3 | Single Quote | Non-Agency | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Real estate and other securities, available-for-sale | $ 11,118 | $ 11,212 |
Discount Rate | Minimum | Non-Agency | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement Input | 0.0278 | |
Discount Rate | Maximum | Non-Agency | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement Input | 0.30 | |
Prepayment Rate | Minimum | Non-Agency | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement Input | 0.0025 | |
Prepayment Rate | Maximum | Non-Agency | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement Input | 0.250 | |
CDR | Minimum | Non-Agency | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement Input | 0.0025 | |
CDR | Maximum | Non-Agency | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement Input | 0.0900 | |
Loss Severity | Minimum | Non-Agency | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement Input | 0.050 | |
Loss Severity | Maximum | Non-Agency | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement Input | 1 |
FAIR VALUE MEASUREMENT - Inpu_2
FAIR VALUE MEASUREMENT - Inputs Used in Valuing Investments (Details) $ in Thousands | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Mortgage-backed securities, fair value | $ 117,903 | |
Nonrecurring | Fair Value | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans receivable, fair value | 689,075 | $ 725,324 |
Nonrecurring | Fair Value | Performing Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans receivable, fair value | 307,135 | 721,121 |
Nonrecurring | Fair Value | Non-Performing Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans receivable, fair value | $ 381,940 | $ 4,203 |
Discount Rate | Nonrecurring | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.050 | 0.038 |
Discount Rate | Nonrecurring | Performing Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.044 | 0.038 |
Discount Rate | Nonrecurring | Non-Performing Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.055 | 0.075 |
Collateral Weighted Average Maturity Years | Nonrecurring | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Weighted Average Life (Years) | 3 years 6 months 10 days | 4 years 9 months 16 days |
Collateral Weighted Average Maturity Years | Nonrecurring | Performing Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Weighted Average Life (Years) | 3 years 11 months 30 days | 4 years 9 months 18 days |
Collateral Weighted Average Maturity Years | Nonrecurring | Non-Performing Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Weighted Average Life (Years) | 3 years 1 month 23 days | 3 years 9 months 18 days |
Prepayment Rate | Nonrecurring | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.063 | 0.115 |
Prepayment Rate | Nonrecurring | Performing Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.105 | 0.115 |
Prepayment Rate | Nonrecurring | Non-Performing Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.029 | 0.030 |
CDR | Nonrecurring | Performing Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.030 | 0.011 |
CDR | Nonrecurring | Non-Performing Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.028 | 0.030 |
Loss Severity | Nonrecurring | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.314 | 0.369 |
Loss Severity | Nonrecurring | Performing Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.332 | 0.369 |
Loss Severity | Nonrecurring | Non-Performing Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.300 | 0.300 |
Acquired Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, fair value | $ 2,153,269 | |
Acquired Loans | Discount Rate | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.045 | |
Acquired Loans | Prepayment Rate | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.08234 | |
Acquired Loans | CDR | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.01482 | |
Acquired Loans | Loss Severity | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.3936 | |
Originated Loans | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, fair value | $ 655,260 | |
Residential Mortgage Loans Held-for-Investment, At Fair Value | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, fair value | 2,808,529 | |
Loans, held-for-investment, fair value | $ 121,088 | |
Residential Mortgage Loans Held-for-Investment, At Fair Value | Discount Rate | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans, held-for-investment, measurement input | 0.0400 | |
Residential Mortgage Loans Held-for-Investment, At Fair Value | Prepayment Rate | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans, held-for-investment, measurement input | 0.070 | |
Residential Mortgage Loans Held-for-Investment, At Fair Value | CDR | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans, held-for-investment, measurement input | 0.001 | |
Residential Mortgage Loans Held-for-Investment, At Fair Value | Loss Severity | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans, held-for-investment, measurement input | 0.200 | |
IRLCs | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Derivative, fair value | $ 10,628 | |
Minimum | Discount Rate | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Mortgage-backed securities, measurement input | 0.035 | |
Minimum | Prepayment Rate | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Mortgage-backed securities, measurement input | 0.060 | |
Minimum | CDR | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Mortgage-backed securities, measurement input | 0 | |
Minimum | Loss Severity | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Mortgage-backed securities, measurement input | 0 | |
Minimum | Originated Loans | Discount Rate | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.0350 | |
Minimum | Originated Loans | Prepayment Rate | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.100 | |
Minimum | Originated Loans | CDR | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0 | |
Minimum | Originated Loans | Loss Severity | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0 | |
Minimum | IRLCs | Loan Funding Probability | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Derivative, Measurement Input | 0.54 | |
Minimum | IRLCs | Initial Servicing Rights | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Derivative, Measurement Input | 0 | |
Maximum | Discount Rate | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Mortgage-backed securities, measurement input | 0.0525 | |
Maximum | Prepayment Rate | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Mortgage-backed securities, measurement input | 0.120 | |
Maximum | CDR | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Mortgage-backed securities, measurement input | 0.0025 | |
Maximum | Loss Severity | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Mortgage-backed securities, measurement input | 0.100 | |
Maximum | Originated Loans | Discount Rate | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.0450 | |
Maximum | Originated Loans | Prepayment Rate | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.150 | |
Maximum | Originated Loans | CDR | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.040 | |
Maximum | Originated Loans | Loss Severity | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Loans held-for-sale, measurement input | 0.500 | |
Maximum | IRLCs | Loan Funding Probability | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Derivative, Measurement Input | 1 | |
Maximum | IRLCs | Initial Servicing Rights | ||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||
Derivative, Measurement Input | 0.0320 |
EQUITY AND EARNINGS PER SHARE -
EQUITY AND EARNINGS PER SHARE - Narrative (Details) $ / shares in Units, $ in Thousands | Jan. 01, 2019shares | Jul. 30, 2018USD ($)$ / shares | Jan. 01, 2018shares | Jan. 01, 2017shares | Jan. 01, 2016shares | Jan. 01, 2014shares | Nov. 30, 2018USD ($)$ / sharesshares | Jan. 31, 2018USD ($)$ / sharesshares | Feb. 28, 2017USD ($)employee$ / sharesshares | Aug. 31, 2016USD ($)$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | Dec. 31, 2016USD ($)shares |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||||||||||
Common stock, shares authorized (in shares) | 2,000,000,000 | 2,000,000,000 | |||||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | |||||||||||
Preferred stock, shares authorized (in shares) | 100,000,000 | ||||||||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.01 | ||||||||||||
Issuance of common stock (in shares) | 28,800,000 | 28,800,000 | |||||||||||
Share price (in dollars per share) | $ / shares | $ 17.32 | $ 17.10 | |||||||||||
Proceeds from issuance of common stock | $ | $ 489,200 | $ 482,300 | $ 834,500 | $ 278,800 | $ 983,149 | $ 835,465 | $ 279,600 | ||||||
Options granted to Manager (in shares) | 2,900,000 | 2,900,000 | |||||||||||
Fair value of options granted to Manager | $ | $ 3,800 | $ 3,800 | |||||||||||
Risk-free interest rate | 3.25% | 2.58% | 2.38% | 1.45% | |||||||||
Dividend yield | 8.61% | 9.86% | 10.82% | 11.80% | |||||||||
Volatility | 17.50% | 23.16% | 28.64% | 27.57% | |||||||||
Term (in years) | 10 years | 10 years | 10 years | 10 years | |||||||||
Options granted (in shares) | 5,799,166 | 5,654,578 | |||||||||||
Common stock, shares outstanding (in shares) | 369,104,429 | 307,361,309 | |||||||||||
Reserved shares of common stock for issuance (in shares) | 15,000,000 | ||||||||||||
Stock option plan term (in years) | 10 years | ||||||||||||
Yearly increase in number of shares available for options | 10.00% | ||||||||||||
Number of additional shares authorized (in shares) | 5,654,578 | 2,000,000 | 8,543,539 | 0 | |||||||||
Threshold percentage for options that may be issued to the Manager | 10.00% | ||||||||||||
Stock options outstanding (in shares) | 8,498,138 | ||||||||||||
Share price (in dollars per share) | $ / shares | $ 14.21 | ||||||||||||
Shares of dilutive common stock equivalents (in shares) | 1,868,438 | 364,107 | 2,167,796 | ||||||||||
Subsequent Event | |||||||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||||||||||
Number of additional shares authorized (in shares) | 5,799,166 | ||||||||||||
Executive Officer | |||||||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||||||||||
Number of employees | employee | 1 | ||||||||||||
Fortress-managed funds | |||||||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||||||||||
Common stock, shares outstanding (in shares) | 2,400,000 | ||||||||||||
Director | |||||||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||||||||||
Stock options outstanding (in shares) | 6,000 | 6,000 | |||||||||||
Director | Equity Option | |||||||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||||||||||
Stock options outstanding (in shares) | 6,000 | ||||||||||||
Common Stock | |||||||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||||||||||
Issuance of common stock (in shares) | 56,500,000 | 20,000,000 | |||||||||||
Share price (in dollars per share) | $ / shares | $ 15 | $ 14.20 | |||||||||||
Options granted to Manager (in shares) | 5,700,000 | 2,000,000 | |||||||||||
Fair value of options granted to Manager | $ | $ 8,100 | $ 2,300 | |||||||||||
Common Stock | Executive Officer | |||||||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||||||||||
Issuance of common stock (in shares) | 18,600 | ||||||||||||
Common Stock | |||||||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||||||||||
Issuance of common stock (in shares) | 57,991,659 | 56,545,787 | 20,000,000 | ||||||||||
Distribution Agreement | |||||||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | ||||||||||||
Distribution Agreement | Common Stock | |||||||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||||||||||
Aggregate offering price | $ | $ 500,000 | $ 9,100 | |||||||||||
Shares sold (in shares) | 500,000 | ||||||||||||
Options granted (in shares) | 50,000 | ||||||||||||
Fair value of grants | $ | $ 100 |
EQUITY AND EARNINGS PER SHARE_2
EQUITY AND EARNINGS PER SHARE - Common Dividends Declared (Details) - USD ($) $ / shares in Units, $ in Thousands | Dec. 20, 2018 | Sep. 20, 2018 | Jun. 21, 2018 | Mar. 22, 2018 | Dec. 18, 2017 | Sep. 22, 2017 | Jun. 21, 2017 | Jan. 26, 2017 | Dec. 16, 2016 | Sep. 23, 2016 | Jun. 27, 2016 | Mar. 22, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Dividends Payable [Line Items] | |||||||||||||||||||||||||
Dividends declared per share of common stock (in dollars per share) | $ 0.50 | $ 0.50 | $ 0.50 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.48 | $ 2 | $ 1.98 | $ 1.84 | |||||||||||
Total Amounts Distributed (millions) | $ 184,600 | $ 170,200 | $ 169,900 | $ 168,100 | $ 153,700 | $ 153,700 | $ 153,700 | $ 147,500 | $ 115,400 | $ 115,400 | $ 106,000 | $ 106,000 | $ 692,730 | $ 608,557 | $ 442,753 | ||||||||||
Quarterly Dividend | |||||||||||||||||||||||||
Dividends Payable [Line Items] | |||||||||||||||||||||||||
Dividends declared per share of common stock (in dollars per share) | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.48 | $ 0.46 | $ 0.46 | $ 0.46 | $ 0.46 |
EQUITY AND EARNINGS PER SHARE_3
EQUITY AND EARNINGS PER SHARE - Outstanding Options (Details) - shares | Dec. 31, 2018 | Dec. 31, 2017 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock options outstanding (in shares) | 8,498,138 | |
Held by the Manager | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock options outstanding (in shares) | 6,961,222 | 16,387,480 |
Issued to the Manager and subsequently assigned to certain of the Manager’s employees | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock options outstanding (in shares) | 1,530,916 | 2,108,708 |
Issued to the independent directors | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock options outstanding (in shares) | 6,000 | 6,000 |
Total | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock options outstanding (in shares) | 8,498,138 | 18,502,188 |
EQUITY AND EARNINGS PER SHARE_4
EQUITY AND EARNINGS PER SHARE - Outstanding Options by Recipient (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of unexercised options (in shares) | 8,498,138 | |
Options exercisable (in shares) | 1,918,132 | |
Director | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of unexercised options (in shares) | 6,000 | 6,000 |
Stock Options | Director | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Date of grant/exercise | Various | |
Number of unexercised options (in shares) | 6,000 | |
Options exercisable (in shares) | 6,000 | |
Weighted average exercise price (in dollars per share) | $ 13.99 | |
Intrinsic value of exercisable options | $ 0 | |
Stock Options | Manager | 2012 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Date of grant/exercise | 2,012 | |
Number of unexercised options (in shares) | 0 | |
Options exercisable (in shares) | 0 | |
Weighted average exercise price (in dollars per share) | $ 0 | |
Intrinsic value of exercisable options | $ 0 | |
Stock Options | Manager | 2013 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Date of grant/exercise | 2,013 | |
Number of unexercised options (in shares) | 0 | |
Options exercisable (in shares) | 0 | |
Weighted average exercise price (in dollars per share) | $ 0 | |
Intrinsic value of exercisable options | $ 0 | |
Stock Options | Manager | 2014 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Date of grant/exercise | 2,014 | |
Number of unexercised options (in shares) | 0 | |
Options exercisable (in shares) | 0 | |
Weighted average exercise price (in dollars per share) | $ 0 | |
Intrinsic value of exercisable options | $ 0 | |
Stock Options | Manager | 2015 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Date of grant/exercise | 2,015 | |
Number of unexercised options (in shares) | 0 | |
Options exercisable (in shares) | 0 | |
Weighted average exercise price (in dollars per share) | $ 0 | |
Intrinsic value of exercisable options | $ 0 | |
Stock Options | Manager | 2016 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Date of grant/exercise | 2,016 | |
Number of unexercised options (in shares) | 533,334 | |
Options exercisable (in shares) | 200,000 | |
Weighted average exercise price (in dollars per share) | $ 13.70 | |
Intrinsic value of exercisable options | $ 0.1 | |
Stock Options | Manager | 2017 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Date of grant/exercise | 2,017 | |
Number of unexercised options (in shares) | 2,638,804 | |
Options exercisable (in shares) | 1,130,917 | |
Weighted average exercise price (in dollars per share) | $ 14.50 | |
Intrinsic value of exercisable options | $ 0 | |
Stock Options | Manager | 2018 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Date of grant/exercise | 2,018 | |
Number of unexercised options (in shares) | 5,320,000 | |
Options exercisable (in shares) | 581,215 | |
Weighted average exercise price (in dollars per share) | $ 17.12 | |
Intrinsic value of exercisable options | $ 0 |
EQUITY AND EARNINGS PER SHARE_5
EQUITY AND EARNINGS PER SHARE - Options Assigned (Details) | Dec. 31, 2018$ / sharesshares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options outstanding (in shares) | 8,498,138 |
2,016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Range of exercise prices (in dollars per share) | $ / shares | $ 13.70 |
Stock options outstanding (in shares) | 400,000 |
2,017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Range of exercise prices (in dollars per share) | $ / shares | $ 14.5047 |
Stock options outstanding (in shares) | 1,130,916 |
Options Assigned | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options outstanding (in shares) | 1,530,916 |
EQUITY AND EARNINGS PER SHARE_6
EQUITY AND EARNINGS PER SHARE - Activity in Outstanding Options (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Beginning balance, Outstanding options (in shares) | 18,502,188 | 13,196,610 |
Options granted (in shares) | 5,799,166 | 5,654,578 |
Options exercised (in shares) | (15,803,216) | 0 |
Options expired unexercised (in shares) | 0 | (349,000) |
Ending balance, Outstanding options (in shares) | 8,498,138 | 18,502,188 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||
Weighted average exercise price, options granted (in dollars per share) | $ 17.23 | $ 14.50 |
Weighted average exercise price, options exercised (in dollars per share) | $ 14.30 | $ 0 |
Option exercised (in shares) | 15,803,216 | 0 |
Intrinsic value of options exercised | $ 68.9 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Loss Contingencies [Line Items] | ||
Representation and warranties | $ 5,900 | |
Residential mortgage loans repurchase liability | 121,602 | $ 0 |
Future lease commitments | 26,500 | |
New Penn | ||
Loss Contingencies [Line Items] | ||
Committed to fund | 823,200 | |
Forward loan sale commitments | 30,300 | |
Consumer Loan Companies | Consumer Portfolio Segment | Unfunded Loan Commitment | ||
Loss Contingencies [Line Items] | ||
Loans of unfunded and available revolving credit privileges | $ 389,200 |
TRANSACTIONS WITH AFFILIATES _3
TRANSACTIONS WITH AFFILIATES AND AFFILIATED ENTITIES - Narrative (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transaction [Line Items] | |
Management agreement, renewal term (in years) | 1 year |
Termination fee, number of months' pay (in months) | 12 months |
Proportion of directors' votes needed to terminate | 0.6667 |
Manager | |
Related Party Transaction [Line Items] | |
Management fee rate (percent) | 1.50% |
Incentive compensation percentage | 25.00% |
Interest rate for incentive compensation | 10.00% |
TRANSACTIONS WITH AFFILIATES _4
TRANSACTIONS WITH AFFILIATES AND AFFILIATED ENTITIES - Schedule of Affiliate Transactions (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Due to Related Parties [Abstract] | |||
Total | $ 101,471 | $ 88,961 | |
Management fees | 62,594 | 55,634 | $ 41,610 |
Incentive compensation | 94,900 | 81,373 | 42,197 |
Manager | |||
Due to Related Parties [Abstract] | |||
Management fees | 5,779 | 4,734 | |
Incentive compensation | 94,900 | 81,373 | |
Expense reimbursements and other | 792 | 2,854 | |
Total | 101,471 | 88,961 | |
Management fees | 62,594 | 55,634 | 41,610 |
Incentive compensation | 94,900 | 81,373 | 42,197 |
Expense reimbursements | 500 | 500 | 500 |
Total | $ 157,994 | $ 137,507 | $ 84,307 |
RECLASSIFICATION FROM ACCUMUL_3
RECLASSIFICATION FROM ACCUMULATED OTHER COMPREHENSIVE INCOME INTO NET INCOME (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||||||||
Other-than-temporary impairment (OTTI) on securities | $ (6,827) | $ (3,889) | $ (12,631) | $ (6,670) | $ (1,598) | $ (1,509) | $ (5,115) | $ (2,112) | $ (30,017) | $ (10,334) | $ (10,264) |
Net income (loss) | $ 8,854 | $ 195,477 | $ 185,836 | $ 614,364 | $ 300,370 | $ 239,721 | $ 337,403 | $ 137,158 | 1,004,531 | 1,014,652 | 582,716 |
Reclassification out of Accumulated Other Comprehensive Income | |||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||||||||
Net income (loss) | 59,953 | (10,308) | 37,724 | ||||||||
Reclassification out of Accumulated Other Comprehensive Income | Accumulated Net Investment Gain (Loss) Including Portion Attributable to Noncontrolling Interest | |||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||||||||
Gain (loss) on settlement of investments, net | 29,936 | (20,642) | 27,460 | ||||||||
Other-than-temporary impairment (OTTI) on securities | $ 30,017 | $ 10,334 | $ 10,264 |
INCOME TAXES - Schedule of Inco
INCOME TAXES - Schedule of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Current: | |||||||||||
Federal | $ 6,146 | $ (1,250) | $ 3,813 | ||||||||
State and Local | 477 | 360 | 252 | ||||||||
Total Current Income Tax Expense (Benefit) | 6,623 | (890) | 4,065 | ||||||||
Deferred: | |||||||||||
Federal | (68,907) | 148,997 | 33,999 | ||||||||
State and Local | (11,147) | 19,521 | 847 | ||||||||
Total Deferred Income Tax Expense (Benefit) | (80,054) | 168,518 | 34,846 | ||||||||
Total Income Tax Expense (Benefit) | $ (67,474) | $ 3,563 | $ (2,608) | $ (6,912) | $ 46,575 | $ 32,613 | $ 82,844 | $ 5,596 | $ (73,431) | $ 167,628 | $ 38,911 |
INCOME TAXES - Schedule of Repo
INCOME TAXES - Schedule of Reported Provision for Income Taxes and the U.S. Federal Statutory Rate (Details) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||
Provision at the statutory rate | 21.00% | 35.00% | 35.00% |
Non-taxable REIT income | (25.44%) | (21.72%) | (28.22%) |
State and local taxes | (1.19%) | 1.76% | 0.18% |
Change in valuation allowance | (2.31%) | 0.85% | 0.67% |
Change in federal tax rate | 0.00% | (0.92%) | 0.00% |
Other | (0.30%) | (0.17%) | (0.48%) |
Total provision | (8.24%) | 14.80% | 7.15% |
INCOME TAXES - Schedule of Defe
INCOME TAXES - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Deferred tax assets: | |||
Net operating losses and tax credit carryforwards | $ 41,713 | $ 20,682 | |
Interest accruals not currently deductible for tax purposes | 0 | 2,628 | |
Basis differences for REO and other assets | 8,453 | 8,034 | |
Unrealized mark to market | 36,758 | 0 | |
Other | 3,087 | 2,279 | |
Total deferred tax assets | 90,011 | 33,623 | |
Less valuation allowance | 0 | (12,404) | $ (10,054) |
Net deferred tax assets | 90,011 | 21,219 | |
Deferred tax liabilities: | |||
Basis difference for partnership and other investments | (24,179) | (3,873) | |
Interest accruals not currently includible in income for tax purposes | 0 | (6,979) | |
Unrealized gains on servicer advances | 0 | (29,585) | |
Total deferred tax liability | (24,179) | (40,437) | |
Net deferred tax assets | 65,832 | ||
Net deferred tax liability | $ (19,218) | ||
Taxable REIT Subsidiaries | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards | $ 131,300 |
INCOME TAXES - Summary of Chang
INCOME TAXES - Summary of Changes in Deferred Tax Asset Valuation Allowance (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Deferred Tax Assets, Valuation Allowance [Roll Forward] | ||
Valuation allowance, beginning balance | $ 12,404 | $ 10,054 |
Increase related to net operating losses and loan loss reserves | 18,769 | 4,720 |
Decrease related to changes in tax rates | 0 | (3,845) |
Other increase (decrease) | (31,173) | 1,475 |
Valuation allowance, ending balance | $ 0 | $ 12,404 |
INCOME TAXES - Schedule of Taxa
INCOME TAXES - Schedule of Taxable Common Stock Distributions (Details) - $ / shares | Dec. 20, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Income Tax Disclosure [Abstract] | ||||||||||||||
Dividends per share (in dollars per share) | $ 1.6 | $ 1.94 | $ 1.38 | |||||||||||
Ordinary Income | 78.03% | 66.64% | 96.13% | |||||||||||
Long-term Capital Gain | 1.03% | 7.83% | 3.87% | |||||||||||
Return of Capital | 20.94% | 25.53% | 0.00% | |||||||||||
Dividends declared per share of common stock (in dollars per share) | $ 0.50 | $ 0.50 | $ 0.50 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.48 | $ 2 | $ 1.98 | $ 1.84 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) $ / shares in Units, $ in Millions | Jan. 25, 2019 | Dec. 20, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Subsequent Event [Line Items] | |||||||||||||||
Dividends declared per share of common stock (in dollars per share) | $ 0.50 | $ 0.50 | $ 0.50 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.48 | $ 2 | $ 1.98 | $ 1.84 | |
Dividends per share (in dollars per share) | $ 1.6 | $ 1.94 | $ 1.38 | ||||||||||||
Subsequent Event | |||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||
Dividends per share (in dollars per share) | $ 0.50 | ||||||||||||||
Dividends | $ 184.6 |
SUMMARY QUARTERLY CONSOLIDATE_3
SUMMARY QUARTERLY CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED) (Details) - USD ($) $ / shares in Units, $ in Thousands | Dec. 20, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||||
Interest income | $ 451,321 | $ 425,524 | $ 403,805 | $ 383,573 | $ 357,467 | $ 397,722 | $ 471,952 | $ 292,538 | $ 1,664,223 | $ 1,519,679 | $ 1,076,735 | |||
Interest expense | 185,324 | 162,806 | 133,916 | 124,387 | 122,201 | 125,278 | 115,157 | 98,229 | 606,433 | 460,865 | 373,424 | |||
Net interest income | 265,997 | 262,718 | 269,889 | 259,186 | 235,266 | 272,444 | 356,795 | 194,309 | 1,057,790 | 1,058,814 | 703,311 | |||
Impairment | ||||||||||||||
Other-than-temporary impairment (OTTI) on securities | 6,827 | 3,889 | 12,631 | 6,670 | 1,598 | 1,509 | 5,115 | 2,112 | 30,017 | 10,334 | 10,264 | |||
Valuation and Loss Provision/ (Reversal) In Current Year | 32,488 | 5,471 | 3,658 | 19,007 | 10,377 | 26,700 | 20,771 | 17,910 | 60,624 | 75,758 | 77,716 | |||
Total Impairment Charges | 39,315 | 9,360 | 16,289 | 25,677 | 11,975 | 28,209 | 25,886 | 20,022 | 90,641 | 86,092 | 87,980 | |||
Net interest income after impairment | 226,682 | 253,358 | 253,600 | 233,509 | 223,291 | 244,235 | 330,909 | 174,287 | 967,149 | 972,722 | 615,331 | |||
Servicing revenue, net | (10,189) | 175,355 | 146,193 | 217,236 | 154,882 | 58,014 | 170,851 | 40,602 | 528,595 | 424,349 | 118,169 | |||
Gain on sale of originated mortgage loans, net | 43,285 | 45,732 | 0 | 0 | 89,017 | 0 | 0 | |||||||
Other income (loss) | (128,671) | (83,298) | (96,812) | 264,524 | 66,488 | 87,145 | 57,847 | (3,694) | (44,257) | 207,786 | 62,337 | |||
Operating expenses | 189,727 | 192,107 | 119,753 | 107,817 | 97,716 | 117,060 | 139,360 | 68,441 | 609,404 | 422,577 | 174,210 | |||
Income (Loss) Before Income Taxes | (58,620) | 199,040 | 183,228 | 607,452 | 346,945 | 272,334 | 420,247 | 142,754 | 931,100 | 1,182,280 | 621,627 | |||
Income tax (benefit) expense | (67,474) | 3,563 | (2,608) | (6,912) | 46,575 | 32,613 | 82,844 | 5,596 | (73,431) | 167,628 | 38,911 | |||
Net Income (Loss) | 8,854 | 195,477 | 185,836 | 614,364 | 300,370 | 239,721 | 337,403 | 137,158 | 1,004,531 | 1,014,652 | 582,716 | |||
Noncontrolling Interests in Income of Consolidated Subsidiaries | 8,506 | 10,869 | 11,078 | 10,111 | 12,068 | 13,600 | 15,671 | 15,780 | 40,564 | 57,119 | 78,263 | |||
Net income (loss) attributable to common stockholders | $ 348 | $ 184,608 | $ 174,758 | $ 604,253 | $ 288,302 | $ 226,121 | $ 321,732 | $ 121,378 | $ 963,967 | $ 957,533 | $ 504,453 | |||
Net Income Per Share of Common Stock | ||||||||||||||
Basic (in dollars per share) | $ 0 | $ 0.54 | $ 0.52 | $ 1.83 | $ 0.94 | $ 0.74 | $ 1.05 | $ 0.42 | $ 2.82 | $ 3.17 | $ 2.12 | |||
Diluted (in dollars per share) | $ 0 | $ 0.54 | $ 0.51 | $ 1.81 | $ 0.93 | $ 0.73 | $ 1.04 | $ 0.42 | $ 2.81 | $ 3.15 | $ 2.12 | |||
Weighted Average Number of Shares of Common Stock Outstanding | ||||||||||||||
Basic (in shares) | 358,044,646 | 340,044,440 | 336,311,253 | 330,384,856 | 307,361,309 | 307,361,309 | 307,344,874 | 286,600,324 | 341,268,923 | 302,238,065 | 238,122,665 | |||
Diluted (in shares) | 358,509,094 | 340,868,403 | 339,538,503 | 333,380,436 | 310,388,102 | 309,207,345 | 309,392,512 | 288,241,188 | 343,137,361 | 304,381,388 | 238,486,772 | |||
Dividends declared per Share of Common Stock (in dollars per share) | $ 0.50 | $ 0.50 | $ 0.50 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.5 | $ 0.48 | $ 2 | $ 1.98 | $ 1.84 |