Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | May 07, 2019 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | Great Ajax Corp. | |
Entity Central Index Key | 0001614806 | |
Trading Symbol | ajx | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Entity Common Stock, Shares Outstanding | 18,964,556 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | |
ASSETS | |||
Cash and cash equivalents | $ 41,542 | $ 55,146 | |
Cash held in trust | 23 | 24 | |
Mortgage loans, net | [1],[2] | 1,313,677 | 1,310,873 |
Property held-for-sale, net | [3] | 18,580 | 19,402 |
Rental property, net | 19,242 | 17,635 | |
Investments at fair value | 152,083 | 146,811 | |
Investments in beneficial interests | 30,809 | 22,086 | |
Receivable from servicer | 18,746 | 14,587 | |
Investments in affiliates | 8,904 | 8,653 | |
Prepaid expenses and other assets | 12,576 | 7,654 | |
Total assets | 1,616,182 | 1,602,871 | |
Liabilities: | |||
Secured borrowings, net | [1],[2],[4] | 593,121 | 610,199 |
Borrowings under repurchase transactions | 560,404 | 534,089 | |
Convertible senior notes, net | [4] | 117,838 | 117,525 |
Management fee payable | 951 | 881 | |
Accrued expenses and other liabilities | 7,193 | 5,898 | |
Total liabilities | 1,279,507 | 1,268,592 | |
Commitments and contingencies – see Note 8 | |||
Equity: | |||
Preferred stock $0.01 par value; 25,000,000 shares authorized, none issued or outstanding | 0 | 0 | |
Common stock $0.01 par value; 125,000,000 shares authorized, 18,967,223 shares at March 31, 2019 and 18,909,874 shares at December 31, 2018 issued and outstanding | 190 | 189 | |
Additional paid-in capital | 261,527 | 260,427 | |
Treasury stock | (310) | (270) | |
Retained earnings | 41,372 | 41,063 | |
Accumulated other comprehensive loss | (178) | (575) | |
Equity attributable to stockholders | 302,601 | 300,834 | |
Non-controlling interests | [5] | 34,074 | 33,445 |
Total equity | 336,675 | 334,279 | |
Total liabilities and equity | $ 1,616,182 | $ 1,602,871 | |
[1] | As of March 31, 2019, balances for Mortgage loans, net includes $370.5 million and Secured borrowings, net of deferred costs includes $227.3 million from the 50% and 63% owned joint ventures, respectively. As of December 31, 2018, balances for Mortgage loans, net include $377.0 million and Secured borrowings, net of deferred costs includes $231.9 million from a 50% and 63% owned joint ventures, all of which the Company consolidates under U.S. GAAP. | ||
[2] | Mortgage loans net include $883.1 million and $897.8 million of loans at March 31, 2019 and December 31, 2018, respectively, transferred to securitization trusts that are variable interest entities (“VIEs”); these loans can only be used to settle obligations of the VIEs. Secured borrowings consist of notes issued by VIEs that can only be settled with the assets and cash flows of the VIEs. The creditors do not have recourse to the primary beneficiary (Great Ajax Corp.). See Note 9 — Debt. Mortgage loans, net include $1.3 million and $1.2 million of allowance for loan losses at March 31, 2019 and December 31, 2018, respectively. | ||
[3] | Property held-for-sale, net, includes valuation allowances of $1.9 million and $1.8 million at March 31, 2019 and December 31, 2018, respectively. | ||
[4] | Secured borrowings and Convertible senior notes are presented net of deferred issuance costs. | ||
[5] | Non-controlling interests includes $20.9 million at March 31, 2019, from 50% and 63% owned joint ventures. Non-controlling interests includes $20.4 million at December 31, 2018, from a 50% and 63% owned joint ventures, which the Company consolidates under U.S. GAAP. |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | |
Preferred stock par value per share (in dollars per share) | $ 0.01 | $ 0.01 | |
Preferred stock shares authorized (in shares) | 25,000,000 | 25,000,000 | |
Preferred stock shares issued (in shares) | 0 | 0 | |
Preferred stock shares outstanding (in shares) | 0 | 0 | |
Common stock par value per share (in dollars per share) | $ 0.01 | $ 0.01 | |
Common stock shares authorized (in shares) | 125,000,000 | 125,000,000 | |
Common stock shares issued (in shares) | 18,967,223 | 18,909,874 | |
Common stock shares outstanding (in shares) | 18,967,223 | 18,909,874 | |
Mortgage loans | $ 883,100 | $ 897,800 | |
Property held-for-sale, valuation allowances | 1,900 | 1,800 | |
Secured borrowings, net | [1],[2],[3] | 593,121 | 610,199 |
Noncontrolling interest | [4] | 34,074 | 33,445 |
Financing Receivable, Allowance for Credit Losses | $ 1,318 | 1,164 | |
2018-C | |||
Noncontrolling Interest, Ownership Percentage by Parent | 63.00% | ||
Consolidated Entities | |||
Mortgage loans | $ 370,500 | 377,000 | |
Secured borrowings, net | 227,300 | 231,900 | |
Noncontrolling interest | $ 20,900 | $ 20,400 | |
2017-D | |||
Noncontrolling Interest, Ownership Percentage by Parent | 50.00% | ||
[1] | As of March 31, 2019, balances for Mortgage loans, net includes $370.5 million and Secured borrowings, net of deferred costs includes $227.3 million from the 50% and 63% owned joint ventures, respectively. As of December 31, 2018, balances for Mortgage loans, net include $377.0 million and Secured borrowings, net of deferred costs includes $231.9 million from a 50% and 63% owned joint ventures, all of which the Company consolidates under U.S. GAAP. | ||
[2] | Mortgage loans net include $883.1 million and $897.8 million of loans at March 31, 2019 and December 31, 2018, respectively, transferred to securitization trusts that are variable interest entities (“VIEs”); these loans can only be used to settle obligations of the VIEs. Secured borrowings consist of notes issued by VIEs that can only be settled with the assets and cash flows of the VIEs. The creditors do not have recourse to the primary beneficiary (Great Ajax Corp.). See Note 9 — Debt. Mortgage loans, net include $1.3 million and $1.2 million of allowance for loan losses at March 31, 2019 and December 31, 2018, respectively. | ||
[3] | Secured borrowings and Convertible senior notes are presented net of deferred issuance costs. | ||
[4] | Non-controlling interests includes $20.9 million at March 31, 2019, from 50% and 63% owned joint ventures. Non-controlling interests includes $20.4 million at December 31, 2018, from a 50% and 63% owned joint ventures, which the Company consolidates under U.S. GAAP. |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
INCOME | ||
Interest income | $ 29,452 | $ 25,591 |
Interest expense | (15,685) | (12,494) |
Net interest income | 13,767 | 13,097 |
Provision for loan losses | (154) | 0 |
Net interest income after provision for loan losses | 13,613 | 13,097 |
Income from investments in affiliates | 461 | 192 |
Other income | 1,110 | 1,454 |
Total income | 15,184 | 14,743 |
EXPENSE | ||
Related party expense – loan servicing fees | 2,506 | 2,469 |
Related party expense – management fee | 1,688 | 1,532 |
Loan transaction expense | 69 | 355 |
Professional fees | 862 | 609 |
Real estate operating expenses | 786 | 449 |
Other expense | 1,081 | 991 |
Total expense | 6,992 | 6,405 |
Income before provision for income taxes | 8,192 | 8,338 |
Provision for income taxes | 71 | 16 |
Consolidated net income | 8,121 | 8,322 |
Less: consolidated net income attributable to the non-controlling interest | (791) | (657) |
Consolidated net income attributable to common stockholders | $ 7,330 | $ 7,665 |
Basic earnings per common share (in dollars per share) | $ 0.39 | $ 0.41 |
Diluted earnings per common share (in dollars per share) | $ 0.36 | $ 0.38 |
Weighted average shares - basic (in shares) | 18,811,713 | 18,508,089 |
Weighted average shares - diluted (in shares) | 27,829,448 | 26,395,158 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPRHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | ||
Consolidated net income attributable to common stockholders | $ 7,330 | $ 7,665 |
Other comprehensive income/(loss): | ||
Net unrealized gain/(loss) on investments, net of non-controlling interest | 397 | (110) |
Income tax expense related to items of other comprehensive income | 0 | 0 |
Comprehensive income | $ 7,727 | $ 7,555 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Consolidated net income | $ 8,121 | $ 8,322 |
Adjustments to reconcile net income to net cash from operating activities | ||
Stock-based management fee and compensation expense | 1,029 | 985 |
Non-cash interest income accretion | (10,891) | (9,917) |
Discount accretion on investment in debt securities | (1,155) | (43) |
Gain on sale of property held-for-sale | (103) | (582) |
Gain on sale of securities | (8) | 0 |
Depreciation of property | 106 | 22 |
Impairment of real estate owned | 475 | 408 |
Provision for loan losses | 154 | 0 |
Amortization of debt discount and prepaid financing costs | 1,281 | 1,348 |
Undistributed income from investment in affiliates | (461) | (192) |
Net change in operating assets and liabilities | ||
Prepaid expenses and other assets | (798) | 1,504 |
Receivable from servicer | (4,160) | (1,751) |
Accrued expenses, management fee payable, and other liabilities | (1,366) | 819 |
Net cash from operating activities | (5,044) | (715) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchase of mortgage loan pools and related balances | (7,205) | (17,566) |
Acquisition of Commercial loans | (17,793) | 0 |
Principal paydowns on mortgage loans | 28,765 | 30,100 |
Principal paydowns on debt securities held as investments | 11,941 | 0 |
Draws on SBC loans | 0 | (117) |
Loans purchase deposit | 0 | (50) |
Purchase of securities | (64,014) | 0 |
Proceeds from sale of securities | 39,635 | 0 |
Purchase of rental property | (2,300) | (3,463) |
Proceeds from sale of property held-for-sale | 5,131 | 4,807 |
Renovations of rental property | 77 | 0 |
Investment in Great Ajax FS LLC, including warrants | 0 | (1,072) |
Distribution from affiliates | 170 | 185 |
Net cash from investing activities | (5,593) | 12,824 |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from repurchase transactions | 67,463 | 13,315 |
Repayments on repurchase transactions | (45,483) | (18,566) |
Repayments on secured borrowings | (17,837) | (32,431) |
Deferred financing costs | 0 | (83) |
Sale of common stock pursuant to dividend reinvestment plan | 72 | 52 |
Distribution to non-controlling interest | (162) | (2,067) |
Dividends paid on common stock | (7,021) | (5,606) |
Net cash from financing activities | (2,968) | (45,386) |
NET CHANGE IN CASH, CASH EQUIVALENTS, AND CASH HELD IN TRUST | (13,605) | (33,277) |
CASH, CASH EQUIVALENTS AND CASH HELD IN TRUST, beginning of period | 55,170 | 80,762 |
CASH, CASH EQUIVALENTS AND CASH HELD IN TRUST, end of period | 41,565 | 47,485 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ||
Cash paid for interest | 15,469 | 13,643 |
SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES | ||
Net transfer of loans to rental property or property held-for-sale | 4,171 | 3,958 |
Issuance of common stock for management fee and compensation expense | 1,029 | 985 |
Issuance of shares for investment in Great Ajax FS LLC | 0 | 629 |
Non-cash adjustments to basis in mortgage loans | 5 | 188 |
Unrealized gain/(loss) on available for sale securities, net of non-controlling interest and tax | 397 | (110) |
Treasury stock received through distributions from investment in Manager | 40 | 0 |
Total cash and cash equivalents and restricted cash shown on the consolidated Statements of Cash Flows | $ 55,170 | $ 80,762 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Thousands | Total | Total Stockholders’ Equity | Common Stock | Treasury stock | Additional Paid-in Capital | Retained Earnings | Accumulated other comprehensive loss | Non-controlling Interest |
Beginning balance (in shares) at Dec. 31, 2017 | 18,588,228 | |||||||
Beginning balance at Dec. 31, 2017 | $ 317,438 | $ 290,356 | $ 186 | $ 0 | $ 254,847 | $ 35,556 | $ (233) | $ 27,082 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income | 7,665 | 7,665 | ||||||
Issuance of shares for Great Ajax FS LLC (in shares) | 45,938 | |||||||
Issuance of shares to Great Ajax FS LLC | 629 | 629 | $ 1 | 628 | ||||
Consolidated net income | 8,322 | 657 | ||||||
Issuance of shares under dividend reinvestment plan (in shares) | 3,838 | |||||||
Issuance of shares under dividend reinvestment plan | 52 | 52 | 52 | |||||
Stock-based management fee expense (in shares) | 48,654 | |||||||
Stock-based management fee expense | 763 | 763 | $ 0 | 763 | ||||
Stock-based compensation expense (in shares) | (238) | |||||||
Stock-based compensation expense | 222 | 222 | 222 | |||||
Dividends and distributions | (7,673) | (5,606) | (5,606) | (2,067) | ||||
Other comprehensive Income/(loss) | (110) | (110) | (110) | |||||
Treasury stock | 0 | |||||||
Ending balance (in shares) at Mar. 31, 2018 | 18,686,420 | |||||||
Ending balance at Mar. 31, 2018 | $ 319,643 | 293,971 | $ 187 | 0 | 256,512 | 37,615 | (343) | 25,672 |
Beginning balance (in shares) at Dec. 31, 2018 | 18,909,874 | 18,909,874 | ||||||
Beginning balance at Dec. 31, 2018 | $ 334,279 | 300,834 | $ 189 | (270) | 260,427 | 41,063 | (575) | 33,445 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income | 7,330 | 7,330 | ||||||
Consolidated net income | 8,121 | 791 | ||||||
Issuance of shares under dividend reinvestment plan (in shares) | 5,321 | |||||||
Issuance of shares under dividend reinvestment plan | 72 | 72 | 72 | |||||
Stock-based management fee expense (in shares) | 52,556 | |||||||
Stock-based management fee expense | 728 | 728 | $ 1 | 727 | ||||
Stock-based compensation expense (in shares) | 2,424 | |||||||
Stock-based compensation expense | 301 | 301 | 301 | |||||
Dividends and distributions | (7,183) | (7,021) | (7,021) | (162) | ||||
Other comprehensive Income/(loss) | $ 397 | 397 | 397 | |||||
Treasury stock (in shares) | (2,952) | |||||||
Treasury stock | $ (40) | (40) | (40) | |||||
Ending balance (in shares) at Mar. 31, 2019 | 18,967,223 | 18,967,223 | ||||||
Ending balance at Mar. 31, 2019 | $ 336,675 | $ 302,601 | $ 190 | $ (310) | $ 261,527 | $ 41,372 | $ (178) | $ 34,074 |
Organization and Basis of Prese
Organization and Basis of Presentation | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation | Organization and Basis of Presentation Great Ajax Corp., a Maryland corporation (the “Company”), is an externally managed real estate company formed on January 30, 2014, and capitalized on March 28, 2014, by its then sole stockholder, Aspen Yo (“Aspen”), a company affiliated with Aspen Capital, the trade name for the Aspen group of companies. The Company was formed to facilitate capital raising activities and to operate as a mortgage real estate investment trust (“REIT”). The Company primarily targets acquisitions of re-performing loans (“RPLs”) including residential mortgage loans and small balance commercial mortgage loans (“SBC loans”). RPLs are mortgage loans on which at least five of the seven most recent payments have been made, or the most recent payment has been made and accepted pursuant to an agreement, or the full dollar amount, to cover at least five payments has been paid in the last seven months. The SBC loans that the Company intends to opportunistically target, through acquisitions, or originations, generally have a principal balance of up to $5.0 million and are secured by multi-family residential and commercial mixed use retail/residential properties on which at least five of the seven most recent payments have been made, or the most recent payment has been made and accepted pursuant to an agreement, or the full dollar amount, to cover at least five payments has been paid in the last seven months. Additionally, the Company may invest in single-family and smaller commercial properties directly either through a foreclosure event of a loan in our mortgage portfolio or, less frequently, through a direct acquisition. Historically, the Company has also targeted investments in non-performing loans (“NPL”). NPLs are loans on which the most recent three payments have not been made. The Company may acquire NPLs from time to time, either directly or with joint venture partners, and will continue to manage the NPLs on its balance sheet. The Company’s manager is Thetis Asset Management LLC (the “Manager” or “Thetis”), an affiliated company. The Company owns 19.8% of the Manager and 8.0% of Great Ajax FS LLC ("GAFS" or "The Parent of the Servicer") which owns substantially all of the interest in Gregory Funding LLC ("Gregory" or the "Servicer"), the Company's loan and real property servicer that is also an affiliated company. The Company has elected to be taxed as a REIT under the Internal Revenue Code of 1986, as amended (the “Code”). The Company conducts substantially all of its business through its operating partnership, Great Ajax Operating Partnership L.P., a Delaware limited partnership (the “Operating Partnership”), and its subsidiaries. The Company, through a wholly-owned subsidiary, is the sole general partner of the Operating Partnership. GA-TRS is a wholly-owned subsidiary of the Operating Partnership that owns the equity interest in the Manager and the Parent of the Servicer. The Company elected to treat GA-TRS as a taxable REIT subsidiary (“TRS”) under the Code. Great Ajax Funding LLC is a wholly-owned subsidiary of the Operating Partnership formed to act as the depositor of mortgage loans into securitization trusts and to hold the subordinated securities issued by such trusts and any additional trusts the Company may form for additional secured borrowings. The Company generally securitizes its mortgage loans through securitization trusts and retains subordinated securities from the secured borrowings. These trusts are considered to be VIEs, and the Company has determined that it is the primary beneficiary of many of these VIEs. AJX Mortgage Trust I and AJX Mortgage Trust II are wholly-owned subsidiaries of the Operating Partnership formed to hold mortgage loans used as collateral for financings under the Company’s repurchase agreements. In addition, the Company, through its Operating Partnership, holds real estate owned properties (“REO”) acquired upon the foreclosure or other settlement of its owned NPLs, as well as through outright purchases. GAJX Real Estate LLC is a wholly-owned subsidiary of the Operating Partnership formed to own, maintain, improve and sell REO properties purchased by the Company. The Company has elected to treat GAJX Real Estate LLC as a TRS under the Code. In 2018, the Company formed Gaea Real Estate Corp., a wholly-owned subsidiary of the Operating Partnership. The Company has elected to treat Gaea Real Estate Corp. as a TRS under the Code. Also during 2018, the Company formed Gaea Real Estate Operating Partnership, a wholly-owned subsidiary of Gaea RE Corp, to hold investments in commercial real estate assets. The Company also formed BFLD Holdings LLC ("BFLD"), Gaea Commercial Properties LLC, Gaea Commercial Finance LLC and Gaea RE LLC. All entities are wholly-owned subsidiaries with the exception of BFLD, of which 10.0% is owned by a third-party investor. Basis of Presentation and Use of Estimates The consolidated interim financial statements should be read in conjunction with the Company's consolidated Financial Statements and the notes thereto for the period ended December 31, 2018 , included in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission (the "SEC") on March 6, 2019. Interim financial statements are unaudited and prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and pursuant to the requirements for reporting on Form 10-Q and Regulation S-X. In the opinion of management, all adjustments, consisting solely of normal recurring accruals considered necessary for the fair presentation of consolidated financial statements for the interim period presented, have been included. The current period’s results of operations will not necessarily be indicative of results that ultimately may be achieved for the fiscal year ending December 31, 2019 . The consolidated interim financial statements have been prepared in accordance with U.S. GAAP, as contained within the Accounting Standards Codification (“ASC”) of the Financial Accounting Standards Board (“FASB”) and the rules and regulations of the SEC, as applied to interim financial statements. The Company consolidates the results and balances of five subsidiaries with non-controlling ownership interests held by third parties. AS Ajax E II LLC ("AS Ajax E II") holds a 5.0% interest in a Delaware trust that was formed to own residential mortgage loans and residential real estate assets; AS Ajax E II is 53.1% owned by the Company. Ajax Mortgage Loan Trusts 2017-D ("2017-D") and Ajax Mortgage Loan Trusts 2018-C (“2018-C”) are securitization trusts that hold mortgage loans, REO property and secured debt; 2017-D is 50.0% owned by the Company, and 2018-C is 63.0% owned by the Company. BFLD is 90.0% owned by the Company, which holds a single commercial property. The Company recognizes non-controlling interests in its consolidated financial statements for the amounts of the investments and income due to the third-party investors for its consolidated subsidiaries. The Operating Partnership is a majority owned partnership that has a non-controlling ownership interest that is included in non-controlling interests on the consolidated Balance Sheet. As of March 31, 2019 , the Company owned 96.8% of the outstanding operating partnership units ("OP Units") and the remaining 3.2% of the OP Units were owned by an unaffiliated holder. All controlled subsidiaries are included in the Company's consolidated financial statements and all intercompany accounts and transactions have been eliminated in consolidation. The Company’s 19.8% investment in the Manager and 8.0% investment in GAFS are accounted for using the equity method because the Company can exercise influence on the operations of these entities through common officers and directors. There is no traded or quoted price for the interests in the Manager or GAFS since each is privately held. The preparation of consolidated financial statements in conformity with U.S. GAAP requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. The Company considers significant estimates to include expected cash flows from its holdings of mortgage loans and beneficial interests in trusts, and their resolution methods and timelines, including foreclosure costs, eviction costs and property rehabilitation costs. Other significant estimates are fair value measurements, and the net realizable value of REO properties held-for-sale. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Mortgage loans Purchased mortgage loans are initially recorded at the purchase price, net of any acquisition fees or costs at the time of acquisition and are considered asset acquisitions. As part of the determination of the bid price for mortgage loans, the Company uses a proprietary discounted cash flow valuation model to project expected cash flows, and considers alternate loan resolution probabilities, including liquidation or conversion to REO. Observable inputs to the model include interest rates, loan amounts, status of payments and property types. Unobservable inputs to the model include discount rates, forecast of future home prices, alternate loan resolution probabilities, resolution timelines, the value of underlying properties and other economic and demographic data. Loans acquired with deterioration in credit quality The loans acquired by the Company have generally suffered some credit deterioration subsequent to origination. As a result, the Company is required to account for the mortgage loans pursuant to ASC 310-30, Accounting for Loans with Deterioration in Credit Quality . The Company’s recognition of interest income for loans within the scope of ASC 310-30 is based upon its having a reasonable expectation of the amount and timing of the cash flows expected to be collected. When the timing and amount of cash flows expected to be collected are reasonably estimable, the Company uses expected cash flows to apply the effective interest method of income recognition. Under ASC 310-30, acquired loans may be aggregated and accounted for as a pool of loans if the loans have common risk characteristics. A pool is accounted for as a single asset with a single composite interest rate and an aggregate expectation of cash flows. RPLs have been determined to have common risk characteristics and are accounted for as a single loan pool for loans acquired within each three-month calendar quarter. Similarly, NPLs have been determined to have common risk characteristics and are accounted for as a single non-performing pool for loans acquired within each three-month calendar quarter. Excluded from the aggregate pools are loans that pay in full subsequent to the acquisition closing date but prior to pooling. Any gain or loss on these loans is recognized as Interest income in the period the loan pays in full. The Company’s accounting for loans under ASC 310-30 gives rise to an accretable yield and a non-accretable amount. The excess of all undiscounted cash flows expected to be collected at acquisition over the initial investment in the loans is the accretable yield. Cash flows expected at acquisition include all cash flows directly related to the acquired loan, including those expected from the underlying collateral. The Company recognizes the accretable yield as Interest income on a prospective level yield basis over the life of the pool. The excess of a loan’s contractually required payments over the amount of cash flows expected at the acquisition is the non-accretable amount. The Company’s expectation of the amount of undiscounted cash flows expected to be collected is evaluated at the end of each calendar quarter. If the Company expects to collect greater cash flows over the life of the pool, the accretable yield amount increases and the expected yield to maturity is adjusted on a prospective basis. A provision for loan losses is established when the Company estimates it will not collect all amounts previously estimated to be collectible. Management assesses the credit quality of the portfolio and the adequacy of loan loss reserves on a quarterly basis, or more frequently as necessary. Significant judgment is required in this analysis. Depending on the expected recovery of its investment, the Company considers the estimated net recoverable value of the loan pools as well as other factors, such as the fair value of the underlying collateral. When a loan pool is determined to be impaired, the amount of loss accrual is calculated by comparing the recorded investment to the value determined by discounting the expected future cash flows at the loan pool’s effective interest rate or the fair value of the underlying collateral. Because these determinations are based upon projections of future economic events, which are inherently subjective, the amounts ultimately realized may differ materially from the carrying value as of the reporting date. The Company’s mortgage loans are secured by real estate. The Company monitors the credit quality of the mortgage loans in its portfolio on an ongoing basis, principally by considering loan payment activity or delinquency status. In addition, the Company assesses the expected cash flows from the mortgage loans, the fair value of the underlying collateral and other factors, and evaluates whether and when it becomes probable that all amounts contractually due will not be collected. Borrower payments on the Company’s mortgage loans are classified as principal, interest, payments of fees, or escrow deposits. Amounts applied as interest on the borrower account are similarly classified as interest for accounting purposes and are classified as operating cash flows in the Company’s consolidated Statement of Cash Flows. Amounts applied as principal on the borrower account including amounts contractually due from borrowers that exceed the Company’s basis in loans purchased at a discount, are similarly classified as principal for accounting purposes and are classified as investing cash flows in the consolidated Statement of Cash Flows as required under U.S. GAAP. Amounts received as payments of fees are recorded in Other income and classified as operating cash flows in the consolidated Statement of Cash Flows. Escrow deposits are recorded on the Servicer’s Balance Sheet and do not impact the Company’s cash flow. Loans acquired or originated that have not experienced a deterioration in credit quality The Company also acquires and originates small balance commercial loans that have not experienced a deterioration in credit quality. The Company recognizes any related loan discount and deferred expenses pursuant to ASC 310-20 by amortizing these amounts over the life of the loan. Accrual of interest on individual loans is discontinued when management believes that, after considering economic and business conditions and collection efforts, the borrower’s financial condition is such that collection of interest is doubtful. The Company’s policy is to stop accruing interest when a loan’s delinquency exceeds 90 days. All interest accrued but not collected for loans that are placed on non-accrual status or subsequently charged-off are reversed against Interest income. Income is subsequently recognized on the cash basis until, in management’s judgment, the borrower’s ability to make periodic principal and interest payments returns and future payments are reasonably assured, in which case the loan is returned to accrual status. An individual loan is considered to be impaired when, based on current events and conditions, it is probable the Company will be unable to collect all amounts due (both principal and interest) according to the contractual terms of the loan agreement. Impaired loans are carried at the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s market price, or the fair value of the collateral if the loan is collateral dependent. For individual loans, a troubled debt restructuring is a formal restructuring of a loan where, for economic or legal reasons related to the borrower’s financial difficulties, a concession that would not otherwise be considered is granted to the borrower. The concession may be granted in various forms, including providing a below-market interest rate, a reduction in the loan balance or accrued interest, an extension of the maturity date, or a combination of these. An individual loan that has had a troubled debt restructuring is considered to be impaired and is subject to the relevant accounting for impaired loans. Loans are tested quarterly for impairment and impairment reserves are recorded to the extent the net realizable value of the underlying collateral falls below net book value. If necessary, an allowance for loan losses is established through a provision for loan losses charged to expenses. The allowance is an amount that the Manager believes will be adequate to absorb probable losses on existing loans that may become uncollectible, based on evaluations of the collectability of loans. Investments at Fair Value The Company’s Investments at Fair Value as of March 31, 2019 and December 31, 2018 consist of investments in Senior and Subordinate Notes issued by joint ventures which the Company forms with third party institutional accredited investors. The Company recognizes income on the debt securities using the effective interest method. Additionally, the debt securities are classified as available for sale and are carried at fair value with changes in fair value reflected in the Company's consolidated Statements of Comprehensive Income. Investments in Beneficial Interests The Company’s Investments in Beneficial Interests as of March 31, 2019 and December 31, 2018 consist of investments in the trust certificates issued by joint ventures that the Company forms with third party institutional accredited investors. The trust certificates represent the residual interest of any special purpose entity formed to facilitate the investment. The Company recognizes income using the effective interest method and assess each Beneficial Interest for impairment on a quarterly basis. Real Estate The Company acquires REO properties directly through purchases, or through conversion of mortgage loans such as when it forecloses on the borrower and takes title to the underlying property or the borrower surrenders the deed in lieu of foreclosure. Property is recorded at cost if purchased, or at the present value of future cash flows if obtained through foreclosure by the Company. Property that the Company expects to actively market for sale is classified as held-for-sale. Property held-for-sale is carried at the lower of its acquisition basis or net realizable value (fair market value less expected selling costs, and any additional costs necessary to prepare the property for sale). Fair market value is determined based on broker price opinions (“BPOs”), appraisals, or other market indicators of fair value including list price or contract price, if listed or under contract for sale at the balance sheet date. Net unrealized losses due to changes in market value are recognized through a valuation allowance by charges to income through real estate operating expenses. No depreciation or amortization expense is recognized on properties held-for-sale. Holding costs are generally incurred by the Servicer and are subtracted from the Servicer’s remittance of sale proceeds upon ultimate disposition of properties held-for-sale. Rental property is property not held-for-sale. Rental properties are intended to be held as long-term investments but may eventually be reclassified as held-for-sale. Property that arose through conversions of mortgage loans in the Company's portfolio such as when a mortgage loan is foreclosed upon and the Company takes title to the property or the borrower surrenders the deed in lieu of foreclosure is generally held for investment as rental property if the cash flows from use as a rental exceed the present value of expected cash flows from a sale. The Company also acquires rental properties through direct purchases of properties for its rental portfolio. Depreciation is provided for using the straight-line method over the estimated useful lives of the assets of three to 39 years. The Company performs an impairment analysis for rental property using estimated cash flows if events or changes in circumstances indicate that the carrying value may be impaired, such as prolonged vacancy, identification of materially adverse legal or environmental factors, changes in expected ownership period or a decline in market value to an amount less than cost. This analysis is performed at the property level. The cash flows are estimated based on a number of assumptions that are subject to economic and market uncertainties including, among others, demand for rental properties, competition for customers, changes in market rental rates, costs to operate each property and expected ownership periods. Renovations are performed by the Servicer, and those costs are then reimbursed to the Servicer. Any renovations on properties which the Company elects to hold as rental properties are capitalized as part of the property’s basis and depreciated over the remaining estimated useful life of the property. The Company may perform property renovations to maximize the value of a property for either its rental strategy or for resale. Secured Borrowings The Company, through securitization trusts which are VIEs, issues callable debt secured by its mortgage loans in the ordinary course of business. The secured borrowings facilitated by the trusts are structured as debt financings, and the mortgage loans used as collateral remain on the Company’s consolidated Balance Sheet as the Company is the primary beneficiary of the securitization trusts. These secured borrowing VIEs are structured as pass through entities that receive principal and interest on the underlying mortgages and distribute those payments to the holders of the notes. The Company’s exposure to the obligations of the VIEs is generally limited to its investments in the entities; the creditors do not have recourse to the primary beneficiary. Coupon interest expense on the debt is recognized using the accrual method of accounting. Deferred issuance costs, including original issue discount and debt issuance costs, are carried on the Company’s consolidated Balance Sheets as a deduction from Secured borrowings, and are amortized to interest expense on an effective yield basis based on the underlying cash flow of the mortgage loans serving as collateral. The Company assumes the debt will be called at the specified call date for purposes of amortizing discount and issuance costs because the Company believes it will have the intent and ability to call the debt on the call date. Changes in the actual or projected underlying cash flows are reflected in the timing and amount of deferred issuance cost amortization. Repurchase Facilities The Company enters into repurchase financing facilities under which it nominally sells assets to a counterparty and simultaneously enters into an agreement to repurchase the sold assets at a price equal to the sold amount plus an interest factor. Despite being legally structured as sales and subsequent repurchases, repurchase transactions are generally accounted for as debt secured by the underlying assets. At the maturity of a repurchase financing, unless the repurchase financing is renewed, the Company is required to repay the borrowing including any accrued interest and concurrently receives back its pledged collateral from the lender. The repurchase financings are treated as collateralized financing transactions; pledged assets are recorded as assets in the Company’s consolidated Balance Sheets, and the debt is recognized at the contractual amount. Interest is recorded at the contractual amount on an accrual basis. Costs associated with the set-up of a repurchasing contract are recorded as deferred issuance cost at inception and amortized over the contractual life of the agreement. Any draw fees associated with individual transactions and any facility fees assessed on the amounts outstanding are recorded as deferred costs when incurred and amortized over the contractual life of the related borrowing. Convertible Senior Notes On April 25, 2017 , the Company completed the public offer and sale of $87.5 million in aggregate principal amount of its convertible senior notes (the “notes”) due 2024, with follow-on offerings of an additional $20.5 million and $15.9 million , respectively, in aggregate principal amount completed on August 18, 2017 and November 19, 2018 , respectively, which, combined with the notes from the April offering form a single series of securities. The notes bear interest at a rate of 7.25% per annum, payable quarterly in arrears on January 15, April 15, July 15 and October 15 of each year. The notes will mature on April 30, 2024 , unless earlier converted or redeemed. During certain periods and subject to certain conditions the notes will be convertible by their holders into shares of the Company’s common stock at a conversion rate of 1.6554 shares of common stock per $25.00 principal amount of the notes, which represents a conversion price of approximately $15.10 per share of common stock. The conversion rate, and thus the conversion price, may be subject to adjustment under certain circumstances. Coupon interest on the notes is recognized using the accrual method of accounting. Discount and deferred issuance costs are carried on the Company’s consolidated Balance Sheets as a deduction from the notes, and are amortized to interest expense on an effective yield basis through April 30, 2023 , the date at which the notes can be converted. The Company assumes the debt will be converted at the specified conversion date for purposes of amortizing issuance costs because the Company believes such conversion will be in the economic interest of the holders. A cumulative discount of $3.2 million , representing the fair value of the embedded conversion feature, was recorded to stockholders' equity. No sinking fund has been established for redemption of the principal. Management Fee and Expense Reimbursement The Company is a party to the Management Agreement with the Manager, which has a 15 -year term expiring on March 5, 2034 . Under the Management Agreement, the Manager implements the Company’s business strategy and manages the Company’s business and investment activities and day-to-day operations, subject to oversight by the Company’s Board of Directors. Among other services, the Manager provides the Company with a management team and necessary administrative and support personnel. Additionally, the Company pays directly for the internal audit function that reports directly to the Audit Committee and the Board of Directors. The Company does not currently have any employees that it pays directly and does not expect to have any employees that it pays directly in the foreseeable future. Each of the Company’s executive officers is an employee or officer, or both, of the Manager or the Servicer. Under the Second Amended and Restated Management Agreement by and between the Company and the Manager dated as of March 5, 2019 , the Company pays a quarterly base management fee based on its stockholders’ equity, including equity equivalents such as the Company's issuance of convertible senior notes, and may be required to pay a quarterly and annual incentive management fee based on its cash distributions to its stockholders and increases in the Company’s book value. Manager fees are expensed in the quarter incurred and the portion payable in common stock is included in stockholders’ equity at quarter end. See Note 10 — Related party transactions. Servicing Fees The Company is also a party to Servicing Agreements (the "Servicing Agreements") with the Servicer. Under the Servicing Agreements by and between the Company and its joint ventures and the Servicer, the Servicer receives an annual servicing fee ranging from 0.42% annually of the Unpaid Principal Balance (“UPB”) to 1.25% annually of UPB. The servicing fee is based upon the status of the loan at acquisition. For certain of the Company’s secured borrowings, the servicing fee rate for is reduced, on a loan-by-loan basis, when the loan meets certain performance criteria which varies joint venture by joint venture. Servicing fees are paid monthly. A change in status from RPL to NPL does not cause a change in the servicing fee rate. Servicing fees for the Company’s real property assets that were previously RPLs that are not held in joint ventures are the greater of (i) the servicing fee applicable to the underlying mortgage loan prior to foreclosure, or (ii) 1.00% annually of the fair market value of the REO as reasonably determined by the Manager or 1.00% annually of the purchase price of any REO otherwise purchased by the Company. The servicing fee for NPLs not held in joint ventures that convert to real property assets does not change. The Servicer is reimbursed for all customary, reasonable and necessary out-of-pocket costs and expenses incurred in the performance of its obligations, including the actual cost of any repairs and renovations undertaken on the Company’s behalf. The total fees incurred by the Company for these services will be dependent upon the UPB and type of mortgage loans that the Servicer services, property values, previous UPB of the relevant loan, and the number of REO properties. The Servicing Agreement will automatically renew for successive one-year terms, subject to prior written notice of non-renewal. In certain cases, the Company may be obligated to pay a termination fee. The Management Agreement will automatically terminate at the same time as the Servicing Agreement if the Servicing Agreement is terminated for any reason. See Note 10 - Related party transactions. Stock-based Payments A portion of the management fee is payable in cash, and a portion of the management fee is in shares of the Company’s common stock, which are issued to the Manager in a private placement and are restricted securities under the Securities Act of 1933, as amended (the “Securities Act”). The number of shares issued to the Manager are determined based on the average of the closing prices of the Company's common stock on the New York Stock Exchange ("NYSE") on the five business days preceding the most recent regular quarterly dividend to holders of the common stock is paid. Management fees paid in common stock are recognized as an expense in the quarter incurred and recorded in stockholders' equity at quarter end. The shares vest immediately upon issuance. The Manager has agreed to hold any shares of common stock received by it as payment of the base management fee for at least three years from the date such shares of common stock are received. Under the Company’s 2014 Director Equity Plan (the “Director Plan”), the Company may make stock-based awards to its directors. The Director Plan is designed to promote the Company’s interests by attracting and retaining qualified and experienced individuals for service as non-employee directors. The Director Plan is administered by the Company’s Board of Directors. The total number of shares of common stock or other stock-based award, including grants of long-term incentive plan units (“LTIP Units”) from the Operating Partnership, available for issuance under the Director Plan is 78,000 shares. The Company issued to each of its independent directors restricted stock awards of 2,000 shares of its common stock upon joining the Board of Directors, which are subject to a one -year vesting period. The Company also periodically issues additional restricted stock awards to its independent directors under the Director Plan. In addition, through March 31, 2019, each of the Company’s independent directors received an annual fee of $75,000 , payable quarterly, 50% in shares of the Company’s common stock and 50% in cash. The annual fee was increased to $100,000 , 40% of which is payable in shares of the Company's common stock and 60% in cash, to be effective as of April 1, 2019 . Stock-based expense for the directors’ annual fee is expensed as earned, in equal quarterly amounts during the year, and recorded in stockholders' equity at quarter end. In June 2016, the Company’s stockholders approved the 2016 Equity Incentive Plan (the “2016 Plan”) to attract and retain non-employee directors, executive officers, key employees and service providers, including officers and employees of the Company’s affiliates. The 2016 Plan authorized the issuance of up to 5% of the Company’s outstanding shares from time to time on a fully diluted basis (assuming, if applicable, the exercise of all outstanding options and the conversion of all warrants and convertible senior notes, including OP Units and any LTIP Units, into shares of common stock). Grants of restricted stock under the 2016 Plan use grant date fair value of the stock as the basis for measuring the cost of the grant. The cost of grants of restricted stock to employees of the Company’s affiliates had previously been determined using the stock price as of the date at which the counterparty's performance is complete. However, pursuant to the issuance and early adoption of ASU 2018-07 in June 2018, the Company used the grant date fair value of the stock as the basis for measuring the cost of the grant. Forfeitures of granted shares are accounted for in the period in which they occur. The share grants vest over three years, with one third of the shares vesting on each of the first, second and third anniversaries of the grant date. The shares may not be sold until the third anniversary of the grant date. Directors’ Fees The expense related to directors’ fees is accrued, and the portion payable in common stock is reflected in consolidated Stockholders’ equity in the period in which it is incurred. Variable Interest Entities In the normal course of business, the Company enters into various types of transactions with special purpose entities, which have primarily consisted of trusts established for the Company’s secured borrowings (See “Secured Borrowings” above and Note 9 to the consolidated Financial Statements). Additionally, from time to time, the Company may enter into joint ventures with unrelated entities, which also generally involves the formation of a special purpose entity. The Company evaluates each transaction and its resulting beneficial interest to determine if the entity formed pursuant to the transaction should be classified as a VIE. If an entity created in a transaction meets the definition of a VIE and the Company determines that it or a consolidated subsidiary is the primary beneficiary, the Company will include the entity in its consolidated financial statements. Cash and Cash Equivalents Highly liquid investments with an original maturity of three months or less when purchased are considered cash equivalents. The Company generally maintains cash and cash equivalents at insured banking institutions with minimum assets of $1 billion. Certain account balances exceed Federal Deposit Insurance Corporation (“FDIC”) insurance coverage and, as a result, there is a concentration of credit risk related to amounts on deposit in excess of FDIC insurance coverage. Cash Held in Trust Cash held in trust consists of restricted cash balances either legally due to lenders or held in trust for the benefit of the Company's secured borrowers, and is segregated from the Company’s other cash deposits. Cash held in trust is not available to the Company for any purposes other than the settlement of existing obligations. Earnings per Share The Company grants restricted shares that entitle the recipients to receive dividend equivalents during the vesting period on a basis equivalent to the dividends paid to holders of common shares. Unvested share-based compensation awards containing non-forfeitable rights to receive dividends or dividend equivalents (collectively, “dividends”) are classified as “participating securities” and are included in the basic earnings per share calculation using the two-class method. Under the two-class method, all earnings (distributed and undistributed) are allocated to common shares and participating securities, based on their respective rights to receive dividends. Basic earnings per share is determined by dividing net income available to common shareholders, reduced by income attributable to the participating securities, by the weighted-average common shares outstanding during the period. Diluted earnings per share is determined by dividing net income attributable to diluted shareholders, which adds back to net income the interest expense, net of applicable income taxes, on the Company’s convertible senior notes, by the weighted-average common shares outstanding, assuming all dilutive securities, including stock grants, shares that would be issued in the event that OP Units are redeemed for shares of common stock of the Company, shares issued in respect of the stock-based portion of the base fee payable to the Manager and independent directors, and shares that would be issued in the event of conversion of the Company’s outstanding convertible senior notes were issued. In the event the Company were to record a net loss, potentially dilutive securities would be excluded from the diluted loss per share calculation, as their effect on loss per share would be anti-dilutive. Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value hierarchy has been established that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value: • Level 1 — Quoted prices in active markets for identical assets or liabilities. • Level 2 — Observable inputs other than Level 1 prices, such as quoted prices for similar assets and liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The degree of judgment utilized in measuring fair value generally correlates to the level of pricing observability. Assets and liabilities with readily available actively quoted prices or for which fair value can be measured from actively quoted prices generally will have a higher degree of pricing observability and a lesser degree of judgment utilized in measuring fair value. Conversely, assets and liabilities rarely traded or not quoted will generally have little or no pricing observability and a higher degree of judgment utilized in measuring fair value. Pricing observability is impacted by a number of factors, including the type of asset or liability, whether it is new to the market and not yet established, and the characteristics specific to the transaction. The fair value of mortgage loans is estimated using the Manager’s proprietary pricing model which estimates expected cash flows with the discount rate used in the present value calculation representing the estimated effective yield of the loan. The Company reviews its discount rates periodically to ensure the assumptions used to calculate fair value are in line with market conditions. The Company’s Investments at fair value are carried at fair value with changes in fair value of equity securities reflected in the Company’s consolidated Statements of Income. Fair values of the Company's investments in debt securities are derived from estimates provided by banking institutions that are compared against available reference data from recent transactions and the Company's proprietary valuation model. The fair value of the Company's Beneficial interests are derived from estimates provided by banking institutions that are compared for reasonableness against analyses from the Company's proprietary valuation model. The Company calculates the fair value for the secured borrowings on its consolidated balance sheets issued by consolidated securitization trusts by using the Company’s proprietary pricing model to estimate the cash flows expected to be generated from the underlying collateral with the discount rate used in the present value calculation representing an estimate of the average rate for debt instruments with similar durations and risk factors. The Company’s borrowings under its repurchase agreements are short-term in nature, and the Manager believes it can renew the current borrowing arrangements on similar terms in the future. Accordingly, the carrying value of these borrowings approximates fair value. The Company’s convertible senior notes are traded on the NYSE |
Mortgage Loans
Mortgage Loans | 3 Months Ended |
Mar. 31, 2019 | |
Mortgage Loans on Real Estate [Abstract] | |
Mortgage Loans | Mortgage Loans The following table presents information regarding the carrying value for the mortgage loan categories of RPL loan pools, NPL loan pools and SBC loans as of March 31, 2019 and December 31, 2018 ($ in thousands): Loan portfolio basis by asset type March 31, 2019 December 31, 2018 Residential RPL loan pools $ 1,228,968 $ 1,242,207 SBC loan pools 21,127 21,203 SBC loans non-pooled 1 28,605 11,140 Residential NPL loan pools 34,977 36,323 Total $ 1,313,677 $ 1,310,873 (1) SBC loans not pooled are accounted for under ASC 310-20 versus ASC 310-30 for our loan pools. Included on the Company’s consolidated Balance Sheets as of March 31, 2019 and December 31, 2018 are approximately $1.3 billion and $1.3 billion , respectively, of RPLs, NPLs, and SBCs. RPLs and NPLs are categorized at acquisition. The carrying value of all loans reflects the original investment amount, plus accrual of interest income and discount, less principal and interest cash flows received. The carrying values at March 31, 2019 for the Company's loans in the table above are reduced by an allowance for loan losses of $1.3 million , reflected in the totals for each line in the table above. The Company had $1.2 million allowance for loan losses at December 31, 2018 . For the three months ended March 31, 2019 the Company recognized $0.2 million provision for loan loss. For the three months ended March 31, 2018 , the Company recognized no provision for loan loss. For the three month periods ended March 31, 2019 and 2018 , the Company accreted $26.4 million and $25.2 million , respectively, into interest income with respect to its RPL, NPL and SBC loan pools. The Company’s RPL loan acquisitions during the three month periods ended March 31, 2019 consisted of 38 purchased RPLs with UPB of $8.5 million . Comparatively during the three months ended March 31, 2018 , the Company acquired 87 RPLs with UPB of $19.7 million . No NPLs were directly purchased during the three months ended March 31, 2019 and 2018 . The Company acquired 19 SBC loans, with no deterioration in credit quality that are not accounted for by pooling, with $17.8 million of UPB for the three months ended March 31, 2019 and no SBC loans, similarly not pooled for accounting, were acquired during the three months ended 2018 . The following table presents information regarding the accretable yield and non-accretable amount for purchased loan pools acquired during the following periods ($ in thousands): Three months ended March 31, 2019 Three months ended March 31, 2018 Re-performing Non-performing Re-performing Non-performing Contractually required principal and interest $ 14,966 $ — $ 31,623 $ — Non-accretable amount (5,500 ) — (9,574 ) — Expected cash flows to be collected 9,466 — 22,049 — Accretable yield (2,261 ) — (4,483 ) — Fair value at acquisition $ 7,205 $ — $ 17,566 $ — The Company determines the accretable yield on new acquisitions by comparing the expected cash flows from the Company’s proprietary cash flow model to the remaining contractual cash flows at acquisition. The difference between the expected cash flows and the portfolio acquisition price is accretable yield. The difference between the remaining contractual cash flows and the expected cash flows is the non-accretable amount. Accretable yield and accretion amounts do not include any of the interest income on unpooled SBC loans at March 31, 2019 and 2018 ($ in thousands): Three months ended March 31, 2019 Three months ended March 31, 2018 Re-performing Non-performing Re-performing Non-performing Balance at beginning of period $ 311,806 $ 6,459 $ 344,141 $ 7,370 Accretable yield additions 2,261 — 4,483 — Accretion (26,072 ) (330 ) (24,502 ) (715 ) Reclassification from (to) non-accretable amount, net 8,333 (1,281 ) (6,603 ) (370 ) Balance at end of period $ 296,328 $ 4,848 $ 317,519 $ 6,285 During the three months ended March 31, 2019 , the Company reclassified a net $7.1 million from non-accretable amount to accretable yield, consisting of a $8.3 million transfer from non-accretable amount to accretable yield for RPLs, and a $1.3 million transfer from accretable yield to non-accretable amount for NPLs. Comparatively, during the three months ended March 31, 2018 , the Company reclassified a net $7.0 million from accretable yield to non-accretable amount, consisting of a $6.6 million transfer from accretable yield to non-accretable amount for its RPLs and $0.4 million from accretable yield to non-accretable amount on NPLs. The Company recalculates the amount of accretable yield and non-accretable amount on a quarterly basis. Reclassifications between the two categories are primarily based upon changes in expected cash flows and actual prepayments, including payoffs in full or in part. Additionally, the accretable yield and non-accretable amounts are revised when loans are reclassified to REO because the future expected cash flows are removed from the pool. The reclassification in the first quarter of 2019 and 2018 is based on an updated assessment of projected loan cash flows as compared to the projection at December 31, 2018 and December 31, 2017, respectively. This is offset by the removal of the accretable yield for loans that are removed from the pool at foreclosure and for loan payoffs, both in full or in part, prior to modeled expectations. The Company performs an analysis of its expectation of the amount of undiscounted cash flows expected to be collected from its mortgage loan pools at the end of each calendar quarter. If the Company expects to collect greater cash flows over the life of the pool, the accretable yield amount increases and the expected yield to maturity is adjusted on a prospective basis. An allowance for loan losses is established when it is probable the Company will not collect all amounts previously estimated to be collectible. Management assesses the credit quality of the portfolio and the adequacy of loan loss reserves on a quarterly basis, or more frequently as necessary. During the quarter ended March 31, 2019 , the Company recorded an impairment of $0.2 million of the value of five of its NPL pools acquired in 2014, 2015 and 2016. No impairment was recorded for the quarter ended March 31, 2018 . An analysis of the balance in the allowance for loan losses account follows ($ in thousands): Three months ended March 31, 2019 2018 Allowance for loan losses, beginning of period $ (1,164 ) $ — Provision for loan losses (154 ) — Allowance for loan losses, end of period $ (1,318 ) $ — The following table sets forth the carrying value of the Company’s mortgage loans, and related unpaid principal balance by delinquency status as of March 31, 2019 and December 31, 2018 ($ in thousands): March 31, 2019 December 31, 2018 Number of loans Carrying value Unpaid principal balance Number of loans Carrying value Unpaid principal balance Current 4,031 $ 781,289 $ 864,758 3,929 $ 757,276 $ 848,551 30 960 166,180 183,499 1,006 167,286 185,742 60 667 113,418 125,095 711 123,078 136,586 90 1,104 195,211 220,436 1,188 200,419 231,063 Foreclosure 256 57,579 76,595 277 62,814 79,777 Mortgage loans 7,018 $ 1,313,677 $ 1,470,383 7,111 $ 1,310,873 $ 1,481,719 |
Real Estate Assets, Net
Real Estate Assets, Net | 3 Months Ended |
Mar. 31, 2019 | |
Real Estate [Abstract] | |
Real Estate Assets, Net | Real Estate Assets, Net The Company acquires REO either through direct purchases of properties for its rental portfolio or through conversions of mortgage loans in its portfolio such as when a mortgage loan is foreclosed upon and the Company takes title to the property on the foreclosure date or the borrower surrenders the deed in lieu of foreclosure. Rental Property As of March 31, 2019 , the Company owned 20 REO properties with an aggregate carrying value of $19.2 million held for investment as rentals, at which time 16 properties were rented. One property was acquired as an RPL but transitioned to foreclosure prior to boarding by the Servicer, one was acquired through foreclosure and nine were transferred from Property held-for-sale, where all nine were acquired through foreclosures. The remaining rental properties were directly purchased. As of December 31, 2018 , the Company owned 21 REO properties with a carrying value of $17.6 million held for use as rentals, at which time 16 were rented. One property was acquired as an RPL but transitioned to foreclosure prior to boarding by the Servicer, one was acquired through foreclosures, and 12 were transferred from Property held-for-sale, where all 12 were acquired through foreclosures. The remaining rental properties were directly purchased. Property Held-for-Sale The Company classifies REO as held-for-sale if the REO is expected to be actively marketed for sale. As of March 31, 2019 and December 31, 2018 , the Company’s net investments in REO held-for-sale were $18.6 million and $19.4 million , respectively, which include balances of $0.9 million and $2.2 million , respectively, for properties undergoing renovation or which are otherwise in the process of being brought to market. For the three months ended March 31, 2019 and 2018 , all of the additions to REO held-for-sale were acquired through foreclosure or deed in lieu of foreclosure, and reclassified out of the mortgage loan portfolio. The following table presents the activity in the Company’s carrying value of property held-for-sale for the three months ended March 31, 2019 and 2018 ($ in thousands): Three months ended March 31, 2019 2018 Property Held-for-sale Count Amount Count Amount Balance at beginning of period 102 $ 19,402 136 $ 24,947 Transfers from mortgage loans 26 4,171 27 3,958 Adjustments to record at lower of cost or fair value — (475 ) — (408 ) Disposals (33 ) (5,028 ) (27 ) (4,226 ) Transfer from Rental property 3 880 4 440 Transfers to Rental property (1 ) (293 ) (4 ) (942 ) Other — (77 ) — — Balance at end of period 97 $ 18,580 136 $ 23,769 Dispositions During the three months ended March 31, 2019 and 2018 , the Company sold 33 and 27 REO properties, respectively, realizing net gains of approximately $0.1 million and $0.6 million , respectively. These amounts are included in Other income on the Company's consolidated Statements of Income. The Company recorded lower of cost or net realizable value adjustments in Real estate operating expense for the three months ended March 31, 2019 and 2018 of $0.5 million and $0.4 million , respectively. |
Investments
Investments | 3 Months Ended |
Mar. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments The Company holds investments in various debt securities and beneficial interests which are the net residual interest of the Company’s investments in securitization trusts. The Company's debt securities and beneficial interests are issued by securitization trusts, which are VIE's, that the Company has sponsored but which the Company does not consolidate since it has determined it is not the primary beneficiary. (See Note 10 - Related party transactions). The Company models the expected cash flows from the underlying loan pools held by the trusts using it's Manager's proprietary pricing model, and believes any unrealized losses to be temporary. The following table presents information regarding the Company's investments in debt securities and investments in beneficial interests ($ in thousands): As of March 31, 2019 Basis 1 Gross unrealized gains Gross unrealized losses Carrying value (fair value) Debt securities $ 152,261 $ 410 $ (588 ) $ 152,083 Beneficial interests in securitization trusts 30,809 — — 30,809 Total investments $ 183,070 $ 410 $ (588 ) $ 182,892 As of December 31, 2018 Basis 1 Gross unrealized gains Gross unrealized losses Carrying value (fair value) Debt securities $ 147,386 $ 250 $ (825 ) $ 146,811 Beneficial interests in securitization trusts 22,086 — — 22,086 Total investments $ 169,472 $ 250 $ (825 ) $ 168,897 (1) Basis amount is net of any realized amortized costs and principal paydowns. In October 2016, the Company purchased subordinate debt securities for $6.3 million from Oileus Residential Loan Trust. These securities were sold during the fourth quarter of 2018 for a gain of $0.2 million . During the first quarter of 2019 , the Company acquired $64.0 million in notes and beneficial interests issued by joint ventures between the Company and third party institutional investors. Each joint venture issued senior notes and beneficial interests, which are trust certificates representing the residual investment of the trust. In certain transactions, the joint ventures also issued subordinate notes. The Company acquired $50.0 million in senior notes and $4.6 million in subordinate notes, collectively “the Notes.” The Notes are accounted for as debt securities and carried at fair value. The carrying value of the Notes is also impacted by any amortized discount and principal paydowns on the underlying mortgage loans held in the trust. As of March 31, 2019 , the Company recorded a gross unrealized gain of $0.4 million and a gross unrealized loss of $0.6 million in accumulated other comprehensive income and carried the Notes on the Company’s consolidated Balance Sheet at a fair value of $152.1 million . As of December 31, 2018 , the Company recorded a gross unrealized gain of $0.3 million and a gross unrealized loss of $0.8 million in accumulated other comprehensive income and carried the Notes on the Company's consolidated Balance Sheet at fair value of $146.8 million . During the first quarter of 2019 , the Company sold senior notes issued by certain joint ventures for total proceeds of $39.6 million and recognized a gain of $8,000 , net of transaction fees. The Company also acquired $9.5 million in beneficial interests issued by joint ventures during the first quarter of 2019 . The Company accounts for its investments in the Beneficial Interests at amortized cost and assesses its investment in Beneficial Interests for impairment on a quarterly basis. As of March 31, 2019 , the Investments in Beneficial Interests were carried on the Company's consolidated Balance Sheet at $30.8 million . For the year ended December 31, 2018 , the Investments in Beneficial Interests were carried on the Company's consolidated Balance Sheet at $22.1 million . |
Fair Value
Fair Value | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Fair Value The following tables set forth the fair value of financial assets and liabilities by level within the fair value hierarchy as of March 31, 2019 and December 31, 2018 ($ in thousands): Level 1 Level 2 Level 3 March 31, 2019 Carrying value Quoted prices in active markets Observable inputs other than Level 1 prices Unobservable inputs Financial assets Mortgage loans, net $ 1,313,677 $ — $ — $ 1,447,047 Investments in debt securities at fair value $ 152,083 $ — $ 152,083 $ — Investments in beneficial interests $ 30,809 $ — $ 30,809 $ — Investment in Manager $ 1,254 $ — $ — $ 5,710 Investment in AS Ajax E $ 1,004 $ — $ 1,246 $ — Investment in GAFS, including warrants $ 2,972 $ — $ — $ 3,320 Financial liabilities Secured borrowings, net $ 593,121 $ — $ — $ 591,237 Borrowings under repurchase transactions $ 560,404 $ — $ 560,404 $ — Convertible senior notes, net $ 117,838 $ 123,850 $ — $ — Level 1 Level 2 Level 3 December 31, 2018 Carrying value Quoted prices in active markets Observable inputs other than Level 1 prices Unobservable inputs Financial assets Mortgage loans, net $ 1,310,873 $ — $ — $ 1,448,895 Investments in debt securities at fair value $ 146,811 $ — $ 146,811 $ — Investments in beneficial interests $ 22,086 $ — $ 22,086 $ — Investment in Manager $ 1,016 $ — $ — $ 5,231 Investment in AS Ajax E $ 1,037 $ — $ 1,239 $ — Investment in GAFS, including warrants $ 2,844 $ — $ — $ 3,320 Financial liabilities Secured borrowings, net $ 610,199 $ — $ — $ 610,217 Borrowings under repurchase transactions $ 534,089 $ — $ 534,089 $ — Convertible senior notes, net $ 117,525 $ 118,103 $ — $ — The fair value of mortgage loans is estimated using the Manager’s proprietary pricing model which estimates expected cash flows with the discount rate used in the present value calculation representing the estimated effective yield of the loan. The value of transfers of mortgage loans to REO is based upon the present value of future expected cash flows of the loans being transferred. The Company values its Investments in debt securities and beneficial interests using estimates provided by banking institutions for its debt securities and beneficial interests. The Company also relies on its Manager's proprietary pricing model to estimate the underlying cash flows expected to be collected on these investments as a comparison to the estimates received from banking institutions (See Note 5 - Investments). The Company's investment in the Manager is valued by applying an earnings multiple to expected earnings. The Company’s investment in AS Ajax E is valued using estimates provided by banking institutions. The fair value of the Company's investment in GAFS is presented by applying an earnings multiple to expected earnings. The fair value of secured borrowings is estimated using the Manager’s proprietary pricing model which estimates expected cash flows of the underlying mortgage loans which collateralize the debt, and which drive the cash flows used to make interest payments. The discount rate used in the present value calculation of the mortgage loans used as collateral, therefore, represents the estimated effective yield on the secured debt. The discount rate is then applied to the face value of the secured debt to derive the debt's fair value. The Company’s borrowings under repurchase agreements are short-term in nature, and the Company’s management believes it can renew the current borrowing arrangements on similar terms in the future. Accordingly, the carrying value of these borrowings approximates fair value. The Company’s convertible senior notes are traded on the NYSE; the debt’s fair value is determined from the NYSE closing price on the Balance Sheet date. The carrying values of its Cash and cash equivalents, Cash held in trust, Receivable from servicer, Prepaid expenses and other assets, Management fee payable and Accrued expenses and other liabilities are equal to or approximate fair value. Non-financial assets Property held-for-sale is carried at the lower of its acquisition basis or net realizable value. Fair market value is determined based on appraisals, broker price opinions, or other market indicators of fair value. Since net unrealized losses due to changes in market value are recognized through a valuation allowance by charges to income, aggregate fair value for the Company’s REO Property is stated as its carrying value. The following tables set forth the fair value of non-financial assets by level within the fair value hierarchy as of March 31, 2019 and December 31, 2018 ($ in thousands): Level 1 Level 2 Level 3 March 31, 2019 Carrying value Current quarter fair value adjustment recognized in the consolidated Statements of Income Quoted prices in active markets Observable inputs other than Level 1 prices Unobservable inputs Non-financial assets Property held-for-sale $ 18,580 $ 475 $ — $ — $ 18,580 Level 1 Level 2 Level 3 December 31, 2018 Carrying value Fiscal year 2018 fair value adjustment recognized in the consolidated Statements of Income Quoted prices in active markets Observable inputs other than Level 1 prices Unobservable inputs Non-financial assets Property held-for-sale $ 19,402 $ 2,700 $ — $ — $ 19,402 |
Affiliates
Affiliates | 3 Months Ended |
Mar. 31, 2019 | |
Investments in and Advances to Affiliates, Schedule of Investments [Abstract] | |
Affiliates | Affiliates Unconsolidated Affiliates During 2018, the Company acquired an 8.0% ownership interest in GAFS. The acquisition was completed in two transactions. January 26, 2018 was the initial closing date wherein the Company acquired a 4.9% interest in GAFS and three warrants, each exercisable for a 2.45% interest in GAFS upon payment of additional consideration, in exchange for consideration of $1.1 million of cash and 45,938 shares of the Company’s common stock with a value of approximately $0.6 million . On May 29, 2018 the additional closing was completed wherein the Company acquired an additional 3.1% interest in GAFS and three warrants, each exercisable for a 1.55% interest in GAFS, in exchange for consideration of $0.7 million of cash and 29,063 shares of the Company's common stock with a value of approximately $0.4 million . The Company accounts for its investment in GAFS using the equity method. Upon the closing of the Company’s original private placement in July 2014, the Company received a 19.8% equity interest in the Manager, a privately held company for which there is no public market for its securities. The Company accounts for its investment in the Manager using the equity method. On March 14, 2016, the Company formed AS Ajax E LLC to hold an equity interest in a Delaware trust formed to own residential mortgage loans and residential real estate assets. AS Ajax E LLC owns a 5% equity interest in Ajax E Master Trust which holds a portfolio of RPLs. At the time of the original investment, the Company held a 24.2% interest in AS Ajax E LLC. In October 2016, additional capital contributions were made by third parties, and the Company’s ownership interest in AS Ajax E was reduced to a lower percentage of the total. At both March 31, 2019 and December 31, 2018 , the Company’s interest in AS Ajax E LLC was approximately 16.5% . The Company accounts for its investment using the equity method. The table below shows the net income, assets and liabilities for the Company’s unconsolidated affiliates at 100% , and at the Company’s share ($ in thousands): Net income, assets and liabilities of unconsolidated affiliates at 100% Three months ended March 31, Net income at 100% 2019 2018 Great Ajax FS LLC $ 1,600 $ 115 Thetis Asset Management LLC $ 1,408 $ 652 AS Ajax E LLC $ 76 $ 69 March 31, 2019 December 31, 2018 Assets and Liabilities at 100% Assets Liabilities Assets Liabilities Great Ajax FS LLC $ 40,670 $ 16,942 $ 74,164 $ 52,184 Thetis Asset Management LLC $ 9,705 $ 2,209 $ 8,604 $ 2,136 AS Ajax E LLC $ 6,213 $ 2 $ 6,424 $ 13 Net income, assets and liabilities of unconsolidated affiliates at the Company's share Three months ended March 31, Net income at the Company's share 2019 2018 Thetis Asset Management LLC $ 279 $ 129 Great Ajax FS LLC (1) $ 128 $ 9 AS Ajax E LLC $ 13 $ 11 March 31, 2019 December 31, 2018 Assets and Liabilities at the Company's share Assets Liabilities Assets Liabilities Great Ajax FS LLC $ 3,254 $ 1,355 $ 5,933 $ 4,175 Thetis Asset Management LLC $ 1,922 $ 437 $ 1,704 $ 423 AS Ajax E LLC $ 1,025 $ — $ 1,060 $ 2 (1) Net income at the Company's share is not directly proportionate to Net income at 100% due to the timing of the Company's acquisition during the quarter ended March 31, 2018 . Consolidated affiliates The Company consolidates the results and balances of securitization trusts which are established to provide debt financing to the Company by securitizing pools of mortgage loans. These trusts are considered to be VIE’s, and the Company has determined that it is the primary beneficiary of the VIE’s. See Note 9 - Debt. The Company also consolidates the activities and balances of its controlled affiliates, which include AS Ajax E II, which was established to hold an equity interest in a Delaware trust formed to own residential mortgage loans and residential real estate assets. As of March 31, 2019 , AS Ajax E II LLC was 53.1% owned by the Company, with the remainder held by third parties. 2017-D and 2018-C are securitization trusts formed to hold mortgage loans, REO property and secured debt. As of March 31, 2019 , 2017-D is 50% owned by a third-party institutional investor. As of March 31, 2019 2018-C was 63.0% owned by the Company, with the remainder held by third-party institutional investors. As of March 31, 2019 BFLD was 90.0% owned by the Company, with the remainder held by third-party institutional investors. The Company consolidates the results and balances of AS Ajax E II LLC, 2017-D, 2018-C and BFLD in its consolidated financial statements, and recognizes a non-controlling interest on its consolidated Balance Sheet for the amount of the investment due to the third party investors. Additionally, non-controlling interests in the earnings of AS Ajax E II LLC, 2017-D, 2018-C and BFLD are recognized in the Company’s consolidated Statement of Income, which consists of the proportionate amount of income attributable to the third party investors. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The Company regularly enters into agreements to acquire additional mortgage loans and mortgage-related assets, subject to continuing diligence on such assets and other customary closing conditions. There can be no assurance that the Company will acquire any or all of the mortgage loans identified in any acquisition agreement as of the date of these consolidated financial statements, and it is possible that the terms of such acquisitions may change. At March 31, 2019 , the Company had commitments to purchase, subject to due diligence, 88 mortgage loans secured by single-family residences with aggregate UPB of $18.1 million . The Company will only acquire loans that meet the acquisition criteria for its own portfolios, or those of its third party institutional co-investors. See Note 15 - Subsequent Events, for remaining open acquisitions as of the filing date. Litigation, Claims and Assessments From time to time, the Company may be involved in various claims and legal actions arising in the ordinary course of business. As of March 31, 2019 , the Company was not a party to, and its properties were not subject to, any pending or threatened legal proceedings that individually or in the aggregate, are expected to have a material impact on its financial condition, results of operations or cash flows. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Debt | Debt Repurchase Agreements The Company has entered into two repurchase facilities whereby the Company, through two wholly-owned Delaware trusts (the “Trusts”) acquires pools of mortgage loans which are then sold by the Trusts, as “Seller” to two separate counterparties, the “buyer” or “buyers.” One facility has a ceiling of $250.0 million and the other $400.0 million at any one time. Upon the time of the initial sale to the buyer, the Trust, with a simultaneous agreement, also agrees to repurchase the pools of mortgage loans from the buyer. Mortgage loans sold under these facilities carry interest calculated based on a spread to one-month LIBOR , which are fixed for the term of the borrowing. The purchase price that the Trust realizes upon the initial sale of the mortgage loans to the buyer can vary between 70% and 85% of the asset’s acquisition price, depending upon the facility being utilized and/or the quality of the underlying collateral. The obligations of a Trust to repurchase these mortgage loans at a future date are guaranteed by the Operating Partnership. The difference between the market value of the asset and the amount of the repurchase agreement is generally the amount of equity in the position and is intended to provide the buyer with some protection against fluctuations in the value of the collateral, and/or a failure by the Company to repurchase the asset and repay the borrowing at maturity. The Company has also entered into two repurchase facilities substantially similar to the mortgage loan repurchase facilities where the pledged assets are the class B bonds and certificates from the Company's secured borrowing transactions. The Company has effective control over the assets subject to all of these transactions; therefore, the Company’s repurchase transactions are accounted for as financing arrangements. The Servicer services these mortgage loans pursuant to the terms of a Servicing Agreement by and among the Servicer and each Buyer which Servicing Agreement has the same fees and expenses terms as the Company’s Servicing Agreement described under Note 10 — Related party transactions. The Operating Partnership, as guarantor, will provide to the buyers a limited guaranty of certain losses incurred by the buyers in connection with certain events and/or the Seller’s obligations under the mortgage loan purchase agreement, following the breach of certain covenants by the Seller, the occurrence of certain bad acts by the Seller, the occurrence of certain insolvency events of the Seller or other events specified in the Guaranty. As security for its obligations under the Guaranty, the guarantor will pledge the Trust Certificate representing the Guarantor’s 100% beneficial interest in the Seller. The following table sets forth the details of the Company’s repurchase transactions and facilities ($ in thousands): March 31, 2019 Maturity Date Origination date Maximum Amount Amount of Percentage of Collateral Coverage Interest Rate April 25, 2019 October 26, 2018 $ 10,549 $ 10,549 $ 15,145 144 % 4.85 % April 25, 2019 October 26, 2018 5,865 5,865 7,630 130 % 4.65 % April 29, 2019 March 28, 2019 8,725 8,725 11,781 135 % 4.35 % April 29, 2019 March 28, 2019 26,367 26,367 35,232 134 % 4.25 % May 8, 2019 November 8, 2018 18,226 18,226 26,599 146 % 4.74 % May 8, 2019 November 8, 2018 10,933 10,933 16,502 151 % 4.84 % June 6, 2019 December 6, 2018 3,786 3,786 4,967 131 % 4.80 % June 6, 2019 February 8, 2019 9,937 9,937 13,181 133 % 4.65 % June 7, 2019 December 7, 2018 50,294 50,294 67,837 135 % 4.47 % June 21, 2019 December 21, 2018 32,393 32,393 41,660 129 % 4.65 % June 21, 2019 December 21, 2018 2,771 2,771 4,050 146 % 4.80 % June 28, 2019 December 28, 2018 8,860 8,860 10,842 122 % 4.64 % July 11, 2019 January 11, 2019 8,956 8,956 13,016 145 % 4.75 % July 12, 2019 July 15, 2016 250,000 192,065 252,645 132 % 4.98 % August 1, 2019 February 1, 2019 14,068 14,068 19,239 137 % 4.81 % September 24, 2019 September 25, 2018 400,000 126,147 132,538 105 % 4.99 % September 25, 2019 March 25, 2019 9,154 9,154 12,243 134 % 4.43 % September 25, 2019 March 25, 2019 11,869 11,869 16,549 139 % 4.58 % September 30, 2019 March 28, 2019 1,638 1,638 2,388 146 % 4.58 % September 30, 2019 March 29, 2019 6,233 6,233 8,330 134 % 4.40 % September 30, 2019 March 29, 2019 1,568 1,568 2,287 146 % 4.55 % Totals $ 892,192 $ 560,404 $ 714,661 128 % 4.81 % December 31, 2018 Maturity Date Origination date Maximum Amount Amount of Percentage of Collateral Coverage Interest Rate January 11, 2019 July 11, 2018 $ 8,956 $ 8,956 $ 12,834 143 % 4.41 % February 1, 2019 August 1, 2018 13,322 13,322 17,174 129 % 4.53 % March 25, 2019 September 25, 2018 6,396 6,396 8,376 131 % 4.34 % March 25, 2019 September 25, 2018 7,020 7,020 10,024 143 % 4.49 % March 28, 2019 September 28, 2018 12,539 12,539 15,846 126 % 4.40 % April 25, 2019 October 26, 2018 10,549 10,549 15,145 144 % 4.85 % April 25, 2019 October 26, 2018 5,865 5,865 7,580 129 % 4.65 % May 8, 2019 November 8, 2018 18,226 18,226 26,036 143 % 4.74 % May 8, 2019 November 8, 2018 10,933 10,933 15,618 143 % 4.84 % June 6, 2019 December 6, 2018 44,224 44,224 58,965 133 % 4.65 % June 6, 2019 December 6, 2018 3,786 3,786 5,408 143 % 4.80 % June 7, 2019 December 7, 2018 50,294 50,294 66,747 133 % 4.47 % June 21, 2019 December 21, 2018 32,393 32,393 43,390 134 % 4.62 % June 21, 2019 December 21, 2018 2,771 2,771 4,050 146 % 4.77 % June 28, 2019 December 28, 2018 8,860 8,860 13,275 150 % 4.64 % July 12, 2019 July 15, 2016 250,000 195,644 258,144 132 % 5.00 % September 24, 2019 September 25, 2018 400,000 102,311 114,852 112 % 4.89 % Totals $ 886,134 $ 534,089 $ 693,464 130 % 4.80 % The guaranty establishes a master netting arrangement; however, the arrangement does not meet the criteria for offsetting within the Company’s consolidated Balance Sheets. A master netting arrangement derives from contractual agreements entered into by two parties to multiple contracts that provides for the net settlement of all contracts covered by the agreements in the event of default under any one contract. The amount outstanding on the Company’s repurchase facilities and the carrying value of the Company’s loans pledged as collateral are presented as gross amounts in the Company’s consolidated balance sheets at March 31, 2019 and December 31, 2018 in the table below ($ in thousands): Gross amounts not offset in balance sheet March 31, 2019 December 31, 2018 Gross amount of recognized liabilities $ 560,404 $ 534,089 Gross amount pledged as collateral 714,661 693,464 Net amount $ 154,257 $ 159,375 Secured Borrowings From inception (January 30, 2014) to March 31, 2019 , the Company has completed 13 secured borrowings for it's own Balance Sheet, not including it's off-balance sheet joint ventures in which it holds investments in various classes of securities, pursuant to Rule 144A under the Securities Act, six of which were outstanding at March 31, 2019 . The secured borrowings are structured as debt financings and not sales through a real estate investment conduit (“REMIC”), and the loans included in the secured borrowings remain on the Company’s consolidated Balance Sheet as the Company is the primary beneficiary of the securitization trusts, which are VIEs. The securitization VIEs are structured as pass through entities that receive principal and interest on the underlying mortgages and distribute those payments to the holders of the notes. The Company’s exposure to the obligations of the VIEs is generally limited to its investments in the entities. The notes that are issued by the securitization trusts are secured solely by the mortgages held by the applicable trusts and not by any of the Company’s other assets. The mortgage loans of the applicable trusts are the only source of repayment and interest on the notes issued by such trusts. The Company does not guarantee any of the obligations of the trusts under the terms of the agreement governing the notes or otherwise. The Company’s secured borrowings are structured with Class A notes, subordinate notes, and trust certificates, which have rights to the residual interests in the mortgages once the notes are repaid. With the exception of the Company’s 2017-D securitization, from which the Company sold a 50% interest in the Class B certificates to third parties and 2018-C securitization, from which the Company sold a 95% interest in the Class A notes and 37% in the Class B notes and trust certificates, the Company has retained the subordinate notes and the trust certificates from the six secured borrowings outstanding at March 31, 2019 . 2017-D secured borrowing contains Class A notes and Class B certificates representing the residual interests in the mortgages held within the securitization trusts subsequent to repayment of the Class A debt. The Company has retained 50% of both the Class A notes and Class B certificates from 2017-D. 2018-C secured borrowing contains Class A notes, Class B notes and trust certificates representing the residual interest in the mortgages held within the securitization trusts subsequent to repayment of the Class A debt. The Company has retained 5% of the Class A notes and 63% of the Class B notes and trust certificates. The Company's 2017-B secured borrowing carries no provision for a step-up in interest rate on any of the Class A, Class B or Class M notes. For all of the Company's secured borrowings the Class A notes are senior, sequential pay, fixed rate notes, and with the exception of 2017-D and 2018-C, as noted above, the Class B notes are subordinate, sequential pay, fixed rate notes. The Class M notes issued under 2017-B are also mezzanine, sequential pay, fixed rate notes. For all of the Company's secured borrowings, except 2017-B, which contains no interest rate step-up, if the Class A notes have not been redeemed by the payment date or otherwise paid in full 36 months after issue, or in the case of 2017-C, 48 months after issue, an interest rate step-up of 300 basis points is triggered. Twelve months after the 300 basis points step up is triggered, an additional 100 basis point step up will be triggered, and an amount equal to the aggregate interest payment amount that accrued and would otherwise be paid to the subordinate notes will be paid as principal to the Class A notes on that date and each subsequent payment date until the Class A notes are paid in full. After the Class A notes are paid in full, the subordinate notes will resume receiving their respective interest payment amounts and any interest that accrued but was not paid while the Class A notes were outstanding. As the holder of the trust certificates, the Company is entitled to receive any remaining amounts in the trusts after the Class A notes and subordinate notes have been paid in full. The following table sets forth the original terms of all notes from our secured borrowings outstanding at March 31, 2019 at their respective cutoff dates: Issuing Trust/Issue Date Interest Rate Step-up Date Security Original Principal Interest Rate Ajax Mortgage Loan Trust 2016-C/ October 2016 October 25, 2019 Class A notes due 2057 $102.6 million 4.00 % April 25, 2020 Class B-1 notes due 2057(1,4) $7.9 million 5.25 % None Class B-2 notes due 2057(1,4) $7.9 million 5.25 % Trust certificates(2) $39.4 million — % Deferred issuance costs $(1.6) million — % Ajax Mortgage Loan Trust 2017-A/ May 2017 May 25, 2020 Class A notes due 2057 $140.7 million 3.47 % November 25, 2020 Class B-1 notes due 2057(1) $15.1 million 5.25 % None Class B-2 notes due 2057(1) $10.8 million 5.25 % Trust certificates(2) $49.8 million — % Deferred issuance costs $(2.0) million — % Ajax Mortgage Loan Trust 2017-B/ December 2017 None Class A notes due 2056 $115.8 million 3.16 % None Class M-1 notes due 2056(3) $9.7 million 3.50 % None Class M-2 notes due 2056(3) $9.5 million 3.50 % None Class B-1 notes due 2056(1) $9.0 million 3.75 % None Class B-2 notes due 2056(1) $7.5 million 3.75 % Trust certificates(2) $14.3 million — % Deferred issuance costs $(1.8) million — % Ajax Mortgage Loan Trust 2017-C/ November 2017 November 25, 2021 Class A notes due 2060 $130.2 million 3.75 % May 25, 2022 Class B-1 notes due 2060(1) $13.0 million 5.25 % Trust certificates(2) $42.8 million — % Deferred issuance costs $(1.7) million — % Ajax Mortgage Loan Trust 2017-D/ December 2017 April 25, 2021 Class A notes due 2057(5) $177.8 million 3.75 % None Class B certificates (5) $44.5 million — % Deferred issuance costs $(1.1) million — % Ajax Mortgage Loan Trust 2018-C/ September 2018 October 25, 2021 Class A notes due 2065(6) $170.5 million 4.36 % April 25, 2022 Class B notes due 2065(6) $15.9 million 5.25 % Trust certificates(6) $40.9 million — % Deferred issuance costs $(2.0) million — % (1) The Class B notes are subordinate, sequential pay, fixed rate notes with Class B-2 notes subordinate to the Class B-1 notes. The Company has retained the Class B notes. (2) The trust certificates issued by the trusts and the beneficial ownership of the trusts are retained by Great Ajax Funding LLC as the depositor. As the holder of the trust certificates, the Company is entitled to receive any remaining amounts in the trusts after the Class A notes, Class M notes, where present, and Class B notes have been paid in full. (3) The Class M notes are subordinate, sequential pay, fixed rate notes with Class M-2 notes subordinate to the Class M-1 notes. The Company has retained the Class M notes. (4) These securities are encumbered under a repurchase agreement. (5) Ajax Mortgage Loan Trust ("AJAXM") 2017-D is a joint venture in which a third party owns 50% of the Class A notes and 50% of the Class B certificates. The Company is required to consolidate 2017-D under GAAP and is reflecting 100% of the mortgage loans, in Mortgage loans, net. 50% of the Class A notes, which are held by the third party, are included in Secured borrowings, net. The 50% portion of the Class A notes retained by the Company have been encumbered under a repurchase agreement. 50% of the Class B certificates are recognized as Non-controlling interest. (6) AJAXM 2018-C is a joint venture in which a third party owns 95% of the Class A notes and 37% of the Class B notes and certificates. The Company is required to consolidate 2018-C under GAAP and is reflecting 100% of the mortgage loans, in Mortgage loans, net. 95% of the Class A notes and 37% of the Class B notes, which are held by the third party, are included in Secured borrowings, net. The 5% portion of the Class A notes retained by the Company have been encumbered under the repurchase agreement. Thirty-seven percent of the Class C certificates are recognized as Non-controlling interest. Servicing for the mortgage loans in the Company’s secured borrowings are provided by the Servicer at servicing fee rates of between 0.42% of outstanding UPB and 1.25% of outstanding UPB at acquisition, and is paid monthly. The determination of RPL or NPL status is based on the status of the loan at acquisition and does not change regardless of the loan’s subsequent performance. The following table sets forth the status of the notes held by others at March 31, 2019 and December 31, 2018 , and the securitization cutoff date ($ in thousands): Balances at March 31, 2019 Balances at December 31, 2018 Original balances at Class of Notes Carrying value of mortgages Bond principal balance Percentage of collateral coverage Carrying value of mortgages Bond principal balance Percentage of collateral coverage Mortgage UPB Bond principal balance 2016-C $ 100,474 $ 66,000 152 % $ 102,563 $ 69,692 147 % $ 157,808 $ 102,575 2017-A 153,884 99,528 155 % 157,033 102,755 153 % 216,413 140,669 2017-B 130,823 97,611 134 % 132,902 99,857 133 % 165,850 115,846 2017-C 144,869 105,803 137 % 146,938 109,616 134 % 185,942 130,159 2017-D 160,945 67,837 (3) 237 % 163,791 69,528 (3) 236 % 203,870 (1) 88,903 2018-C 192,154 161,882 (4) 119 % 194,606 165,051 (4) 118 % 222,181 (2) 167,910 $ 883,149 $ 598,661 (5) 148 % $ 897,833 $ 616,499 (5) 146 % $ 1,152,064 $ 746,062 (1) Includes $26.7 million of cash collateral intended for use in the acquisition of additional mortgage loans. (2) Includes $45.5 million of cash collateral intended for use in the acquisition of additional mortgage loans. (3) The gross amount of senior bonds at March 31, 2019 and December 31, 2018 were $135.7 million and $139.0 million however, only $67.8 million and $69.5 million are reflected in Secured borrowings as the remainder is owned by the Company, respectively. (4) 2018-C contains notes held by the third party institutional investors for senior bonds and class B bonds. The gross amount of the senior and class B bonds at March 31, 2019 were $164.2 million and $15.9 million , however, only $156.0 million and $5.9 million are reflected in Secured borrowings as the remainder is owned by the Company, respectively. The gross amount of the senior and class B bonds at December 31, 2018 were $167.5 million and $15.9 million , however, only $159.2 million and $5.9 million are reflected in Secured borrowings as the remainder is owned by the Company, respectively. (5) This represents the gross amount of Secured borrowings and excludes the impact of deferred issuance costs of $5.5 million and $6.3 million as of March 31, 2019 and December 31, 2018 , respectively. The Company’s obligations under its secured borrowings are not fixed, and the payments on these borrowings are predicated upon cash flows received on the underlying mortgage loans. Convertible Senior Notes On April 25, 2017, the Company completed the issuance and sale of $87.5 million aggregate principal amount of its 7.25% convertible senior notes due 2024 in an underwritten public offering. The net proceeds to the Company from the sale of the notes, after deducting the underwriter's discounts, commissions and offering expenses, were approximately $84.9 million . The carrying amount of the equity component of the transaction was $2.5 million representing the fair value to the notes' owners of the right to convert the notes into shares of the Company's common stock. The notes were issued at a 17.5% conversion premium and bear interest at a rate of 7.25% per year, payable quarterly in arrears on January 15, April 15, July 15 and October 15 of each year, beginning on July 15, 2017. On August 18, 2017, the Company completed the public offer and sale of an additional $20.5 million in aggregate principal amount of its 7.25% Convertible senior notes due 2024 , which combined with the $87.5 million aggregate principal amount from its April offering, form a single series of notes. The net proceeds to the Company from the August 18, 2017 sale of the notes, after deducting the underwriter's discounts, commissions and offering expenses, were approximately $20.5 million . The carrying amount of the equity component of the August transaction was $0.2 million representing the fair value to the notes' owners of the right to convert the notes into shares of the Company's common stock. The notes in the August transaction were issued at a 6.0% conversion premium and bear interest at a rate of 7.25% per year, payable quarterly in arrears on January 15, April 15, July 15 and October 15 of each year, beginning on July 15, 2017. The notes will mature on April 30, 2024 , unless earlier repurchased, redeemed or converted. On November 19, 2018 , the Company completed the public offer and sale of an additional $15.9 million in aggregate principal amount of its 7.25% convertible senior notes due 2024 , which combined with the $108.0 million aggregate principal amount from its August and April offerings in 2017, form a single series of notes. The net proceeds to the Company from the November 19, 2018 sale of the notes, after deducting the underwriter's discounts, commissions and offering expenses, were approximately $15.2 million . The carrying amount of the equity component of the November transaction was $0.5 million representing the fair value to the notes' owners of the right to convert the notes into shares of the Company's common stock. The notes in the November transaction were issued at an 11.43% conversion premium and bear interest at a rate of 7.25% per year, payable quarterly in arrears on January 15, April 15, July 15 and October 15 of each year, beginning on January 15, 2019. The notes will mature on April 30, 2024 , unless earlier repurchased, redeemed or converted. Holders may convert their notes at their option prior to April 30, 2023 only under certain circumstances. In addition, the notes will be convertible irrespective of those circumstances from, and including, April 30, 2023 to, and including, the business day immediately preceding the maturity date. Upon conversion, the Company will pay or deliver, as the case may be, cash, shares of its common stock or a combination of cash and shares of its common stock, at the Company's election. The conversion rate currently equals 1.6554 shares of the Company's common stock per $25.00 principal amount of notes which is equivalent to a conversion price of approximately $15.10 per share of common stock. The conversion rate, and thus the conversion price, may be subject to adjustment under certain circumstances. As of March 31, 2019 , the amount by which the if-converted value falls short of the principal value for the entire series is $11.2 million . The Company may not redeem the notes prior to April 30, 2022 , and may redeem for cash all or any portion of the notes, at its option, on or after April 30, 2022 if the last reported sale price of its common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption at a redemption price equal to 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. No "sinking fund" will be provided for the notes. At March 31, 2019 , the notes' UPB was $123.9 million , and discount and deferred expenses were $6.0 million . Interest expense of $2.6 million was recognized during the quarter ended March 31, 2019 which includes $0.3 million of amortization of discount and deferred expenses, respectively. The discount will be amortized through April 30, 2023 , the date at which the notes can be converted by their holders. The effective interest rate of the notes for the quarter ended March 31, 2019 was 8.99% . |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions The Company’s consolidated Statements of Income included the following significant related party transactions ($ in thousands): Three months ended March 31, Transaction Consolidated Statement of Income location Counterparty 2019 2018 Loan servicing fees Related party expense – loan servicing fees Gregory $ 2,506 $ 2,469 Interest income Interest income Various non-consolidated joint ventures 2,416 131 Management fee Related party expense – management fee Thetis 1,688 1,532 Income from equity investment Income from investments in affiliates Thetis 279 129 Income from equity investment Income from investments in affiliates Great Ajax FS 128 9 Due diligence and related loan acquisition costs Loan transaction expense Gregory — 89 Expense reimbursements Other fees and expenses Gregory — 32 The Company’s consolidated Balance Sheets included the following significant related party balances ($ in thousands): As of March 31, 2019 Transaction Consolidated Balance Sheet location Counterparty Amount Receivables from Servicer Receivable from Servicer Gregory $ 18,746 Management fee payable Management fee payable Thetis 951 Expense reimbursements Prepaid expenses and other assets Thetis 82 Expense reimbursements Accrued expenses and other liabilities 2018-E 34 Expense reimbursements receivable Prepaid expenses and other assets Gregory 12 Expense reimbursement receivable Prepaid expenses and other assets 2018-A 10 Expense reimbursement receivable Prepaid expenses and other assets 2018-D 10 Expense reimbursement receivable Prepaid expenses and other assets 2018-B 5 As of December 31, 2018 Transaction Consolidated Balance Sheet location Counterparty Amount Receivables from Servicer Receivable from Servicer Gregory $ 14,587 Management fee payable Management fee payable Thetis 881 Expense reimbursements Accrued expenses and other liabilities Thetis 16 Expense reimbursements receivable Prepaid expenses and other assets Gregory 11 Expense reimbursements receivable Prepaid expenses and other assets 2018-A 2 Expense reimbursements receivable Prepaid expenses and other assets 2018-B 2 In October 2016, the Company purchased subordinate debt securities for $6.3 million from Oileus Residential Loan Trust. These securities were sold during the fourth quarter of 2018 for a gain of $0.2 million . In September and October 2018, the Company purchased mortgage loans from two related party trusts which were incorporated into its 2018-C securitization, with UPB of $52.8 million and $50.1 million , respectively, acquired for $47.4 million and $45.1 million , respectively. During 2019 and 2018, the Company acquired $64.0 million and $175.3 million , respectively, in notes and beneficial interests issued by joint ventures between the Company and third party institutional accredited investors. Each joint venture issued senior notes and beneficial interests, which are trust certificates representing the residual balance of the trust after the outstanding debt obligations have been settled. In certain transactions, the joint venture also issued subordinate notes. In 2019, the Company acquired $50.0 million in senior notes and $4.6 million in subordinate notes. In 2018, the Company acquired $144.1 million in senior notes and $9.4 million in subordinate notes. The notes are accounted for as debt securities carried at fair value. As of March 31, 2019 and December 31, 2018 , the Notes were carried on the Company’s consolidated Balance Sheet at a fair value of $152.1 million and $146.8 million , respectively. The Company also acquired $9.5 million and $21.8 million in beneficial interests issued by joint ventures in 2019 and 2018, respectively. As of March 31, 2019 , and December 31, 2018 the Investments in Beneficial Interests were carried on the Company's consolidated Balance Sheet at $30.8 million and $22.1 million , respectively. Management Agreement The Company is a party to the Management Agreement with the Manager, which expires on March 5, 2034 . Under the Management Agreement, the Manager implements the Company’s business strategy and manages the Company’s business and investment activities and day-to-day operations, subject to oversight by the Company’s Board of Directors. Among other services, the Manager, directly or through affiliates, provides the Company with a management team and necessary administrative and support personnel. The Company does not currently have any employees that it pays directly and does not expect to have any employees that it pays directly in the foreseeable future. Each of the Company’s executive officers is an employee or officer, or both, of the Manager or the Servicer. Under the Management Agreement, the Company pays both a base management fee and an incentive fee to the Manager. The base management fee equals 1.5% of the Company's stockholders’ equity, including equity equivalents such as the Company's recent issuance of convertible senior notes, per annum and calculated and payable quarterly in arrears. The initial $1.0 million of the quarterly base management fee will be payable 75% in cash and 25% in shares of the Company’s common stock. Any amount of the base management fee in excess of $1.0 million will be payable in shares of the Company’s common stock until payment is 50% in cash and 50% in shares (the “50/50 split”). Any remaining amount of the quarterly base management fee after the 50/50 split threshold is reached will be payable in equal amounts of cash and shares. The base management fee currently exceeds the 50/50 split threshold, and the Company is currently paying the management fee 50% in cash and 50% in shares. The Manager has agreed to hold any shares of common stock received by it as payment of the base management fee for at least three years from the date such shares of common stock are received. The Manager is also entitled to an incentive fee, payable quarterly and calculated in arrears, which, through the end of 2018, was calculated as 20% of the amount by which total dividends on common stock and distributions on OP units exceeded 8% of book value on a per share basis. The Company’s Board of Directors approved the Second Amended and Restated Management Agreement (“the Amendment”) with the Manager, effective as of March 5, 2019, wherein the incentive fee was restructured into both a quarterly and annual component. A quarterly incentive fee is payable to the Manager if the sum of the Company’s dividends on its common stock, its distributions on its externally-held operating partnership units and its increase in book value, all relative to the applicable quarter and calculated per-share on an annualized basis, exceed 8% . The Manager will also be entitled to an annual Incentive fee if the sum of the Company’s quarterly cash dividends on its common stock, special cash dividends on its common stock and distributions on its externally-held operating partnership units within the applicable calendar year exceed 8% of the Company’s book value per share as of the end of the calendar year. However, no incentive fee will be payable to the Manager with respect to any calendar quarter unless the Company’s cumulative core earnings, defined as U.S. GAAP net income or loss less non-cash equity compensation, unrealized gains or losses from mark-to-market adjustments, one-time adjustments to earnings resulting from changes to U.S. GAAP, and certain other non-cash items, is greater than zero for the most recently completed eight calendar quarters. In the event that the payment of the quarterly base management fee has not reached the 50/50 split, all of the incentive fee will be payable in shares of the Company’s common stock until the 50/50 split occurs. In the event that the total payment of the quarterly base management fee and the incentive fee has reached the 50/50 split, 20% of the remaining incentive fee is payable in shares of the Company’s common stock and 80% of the remaining incentive fee is payable in cash. In the first quarter of 2019 the Company recorded an expense of $0.2 million for an incentive fee payable to the Manager. The Company also reimburses the Manager for all third-party, out-of-pocket costs incurred by the Manager for managing its business, including third-party due diligence and valuation consultants, legal expenses, auditors and other financial services. The reimbursement obligation is not subject to any dollar limitation. Expenses are reimbursed in cash on a monthly basis. The Company will be required to pay the Manager a termination fee in the event that the Management Agreement is terminated as a result of (i) a termination by the Company without cause, (ii) its decision not to renew the Management Agreement upon the determination of at least two thirds of the Company’s independent directors for reasons including the failure to agree on revised compensation, (iii) a termination by the Manager as a result of the Company becoming regulated as an “investment company” under the Investment Company Act of 1940, as amended (the “Investment Company Act”) (other than as a result of the acts or omissions of the Manager in violation of investment guidelines approved by the Company’s Board of Directors), or (iv) a termination by the Manager if the Company defaults in the performance of any material term of the Management Agreement (subject to a notice and cure period). The termination fee will be equal to twice the combined base fee and incentive fees payable to the Manager during the 12-month period ended as of the end of the most recently completed fiscal quarter prior to the date of termination. Servicing Agreement The Company is also a party to the Servicing Agreement, expiring July 8, 2029, with the Servicer. The Company’s overall servicing costs under the Servicing Agreement will vary based on the types of assets serviced. Servicing fees range from 0.42% to 1.25% annually UPB at acquisition (or the fair market value or purchase price of REO), and are paid monthly. The servicing fee is based upon the status of the loan at acquisition. For certain of the Company’s secured borrowings, the Servicing fee rate is reduced, on a loan-by-loan basis, when the loan meets certain performance criteria. Servicing fees are paid monthly. Otherwise, a change in status from RPL to NPL does not cause a change in the servicing fee rate. Servicing fees for the Company’s real property assets that were previously RPLs that are not held in joint ventures are the greater of (i) the servicing fee applicable to the underlying mortgage loan prior to foreclosure, or (ii) 1.00% annually of the fair market value of the REO as reasonably determined by the Manager or 1.00% annually of the purchase price of any REO otherwise purchased by the Company. The servicing fee for NPLs that convert to real property assets does not change. For the joint ventures, a conversion from a loan to a real property asset does not cause a change in servicing fee rate. The Servicer is reimbursed for all customary, reasonable and necessary out-of-pocket costs and expenses incurred in the performance of its obligations, including the actual cost of any repairs and renovations undertaken on the Company’s behalf. The total fees incurred by the Company for these services will be dependent upon the UPB and type of mortgage loans that the Servicer services, property values, previous UPB of the relevant loan, and the number of REO properties. If the Servicing Agreement has been terminated other than for cause and/or the Servicer terminates the servicing agreement, the Company will be required to pay a termination fee equal to the aggregate servicing fees payable under the servicing agreement for the immediate preceding 12-month period. Trademark Licenses Aspen has granted the Company a non-exclusive, non-transferable, non-sublicensable, royalty-free license to use the name “Great Ajax” and the related logo. The Company also has a similar license to use the name “Thetis.” The agreement has no specified term. If the Management Agreement expires or is terminated, the trademark license agreement will terminate within 30 days. In the event that this agreement is terminated, all rights and licenses granted thereunder, including, but not limited to, the right to use “Great Ajax” in its name will terminate. Aspen also granted to the Manager a substantially identical non-exclusive, non-transferable, non-sublicensable, royalty-free license use of the name “Thetis.” |
Stock-based Payments and Direct
Stock-based Payments and Director Fees | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-based Payments and Director Fees | Stock-based Payments and Director Fees Pursuant to the terms of the Management Agreement, the Company pays a portion of the base fee to the Manager in shares of its common stock with the number of shares determined based on the average of the closing prices of its common stock on the NYSE on the five business days preceding the date on which the most recent regular quarterly dividend to holders of its common stock is paid. The Company recognized a base management fee to the Manager for the quarter ended March 31, 2019 of $1.6 million , of which the Company recorded $0.7 million in expense, payable in 59,574 shares of its common stock. The Company also recorded an incentive fee of $0.2 million , of which $31,000 is payable in 2,727 shares of its common stock. The shares issued to the Manager are restricted securities subject to transfer restrictions, and were issued in private placement transactions, with 62,301 shares still issuable at March 31, 2019 . See Note 10 — Related party transactions. In addition, each of the Company’s independent directors received an annual retainer of $75,000 , payable quarterly, half of which was paid in shares of the Company’s common stock on the same basis as the stock portion of the management fee payable to the Manager and half in cash. The annual fee was increased to $100,000 , 40% of which is payable in shares of the Company's common stock and 60% in cash, to be effective as of April 1, 2019 . The following table sets forth the Company’s stock-based management fees and independent director fees ($ in thousands except share amounts): Stock-based Management Fees and Director Fees For the three months ended March 31, 2019 2018 Number of shares Amount of expense recognized (1) Number of shares Amount of expense recognized (1) Management fees 62,301 $ 728 49,156 $ 763 Independent director fees 2,764 38 2,416 38 Totals 65,065 $ 766 51,572 $ 801 (1) All management fees and independent director fees are fully expensed in the period in which the underlying expense is incurred. Restricted Stock Each independent director is issued a restricted stock award of 2,000 shares of the Company’s common stock subject to a one -year vesting period upon initial appointment to the Company’s Board. On August 17, 2016, the Company granted 153,000 shares of restricted stock to employees of its Manager and Servicer, which was reduced in 2017 by forfeitures of 4,000 shares and in 2018 by forfeitures of 2,666 shares. On July 24, 2017, the Company granted 39,000 shares of restricted stock to employees of its Manager and Servicer, and on July 31, 2018, the Company granted 36,500 shares of restricted stock to employees of its Manager and Servicer. The shares vest over three years , with one third of the shares vesting on each of the first, second and third anniversaries of the grant date. The shares may not be sold until the third anniversary of the grant date. The 2017 grant also includes a provision whereby the shares vest automatically upon the death of the grantee. Grants of restricted stock use grant date fair value of the stock as the basis for measuring the cost of the grant. In the first quarter of 2018, the Company’s Board of Directors approved a grant of 3,000 shares of stock to each independent director, with subsequent issuance in the second quarter of 2018. Half of the shares vested immediately upon issuance and the other half are subject to a one -year vesting period. The following table sets forth the activity in the Company’s restricted stock plans ($ in thousands, except per share amounts): Total Grants Current period activity Non-vested shares at March 31, 2019 Fully-vested shares at March 31, 2019 Three months ended March 31, 2019 Total shares granted Total expected cost of grant Shares granted during the year Grant expense recognized for the three months ended March 31, 2019 Shares Per share grant date fair value Shares Per share grant date fair value Directors’ Grants 2018 (1) 12,000 $ 162 — $ 14 — $ 13.48 12,000 $ 13.48 Employee and Service Provider Grant 2016 (2,5) 146,334 1,976 — 163 47,889 13.50 98,445 13.50 Employee and Service Provider Grant, granted 2017 (3) 39,000 544 — 45 26,000 13.95 13,000 13.95 Employee and Service Provider Grant, granted 2018 (4) 36,500 496 — 41 36,500 13.58 — — Totals 233,834 $ 3,178 — $ 263 110,389 $ 13.63 123,445 $ 13.55 (1) Half of the 12,000 shares granted vested immediately on the grant date while the remaining shares vest ratably over a one -year period. Grant is fully vested at March 31, 2019 . (2) Vesting is ratable over three -year period from grant date. Weighted average remaining life of grant at March 31, 2019 is 0.4 years . (3) Vesting is ratable over three -year period from grant date. Weighted average remaining life of grant at March 31, 2019 is 1.3 years . (4) Vesting is ratable over three -year period from grant date. Weighted average remaining life of grant at March 31, 2019 is 2.4 years . (5) Total is shown net of 2017 forfeitures of 4,000 shares and 2018 forfeitures of 2,666 . Total Grants Current period activity Non-vested shares at March 31, 2018 Fully-vested shares at March 31, 2018 Three months ended March 31, 2018 Total shares granted Total expected cost of grant Shares granted during the year Grant expense recognized for the three months ended March 31, 2018 Shares Per share grant date fair value Shares Per share grant date fair value Directors’ Grants 2017 and earlier (1) 10,000 $ 146 — $ — — $ — 10,000 $ 14.61 Employee and Service Provider Grant 2016 (2,4) 146,334 1,978 — 140 96,667 13.50 49,667 13.50 Employee and Service Provider Grant 2017 (3) 39,000 538 — 45 39,000 13.95 — — Totals 195,334 $ 2,662 — $ 185 135,667 $ 13.83 59,667 $ 13.69 (1) Vesting period is one -year from grant date. Grant is fully vested at March 31, 2018 . (2) Vesting is ratable over three -year period from grant date. Weighted average remaining life of grant at March 31, 2018 is 1.4 years . (3) Vesting is ratable over three -year period from grant date. Weighted average remaining life of grant at March 31, 2018 is 2.3 years . (4) Total is shown net of 2017 forfeitures of 4,000 shares and 2018 forfeitures of 2,666 . |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes As a REIT, the Company must meet certain organizational and operational requirements including the requirement to distribute at least 90% of its annual REIT taxable income to its stockholders. As a REIT, the Company generally will not be subject to U.S. federal income tax to the extent the Company distributes its REIT taxable income to its stockholders and provided the Company satisfies the REIT requirements including certain asset, income, distribution and stock ownership tests. If the Company fails to qualify as a REIT, and does not qualify for certain statutory relief provisions, it will be subject to U.S. federal, state and local income taxes and may be precluded from qualifying as a REIT for the subsequent four taxable years following the year in which it lost its REIT qualification. The Company’s consolidated Financial Statements include the operations of three TRS entities, GA-TRS, GAJX Real Estate LLC and Gaea RE Corp., which are subject to U.S. federal, state and local income taxes on their taxable income. For the three months ended March 31, 2019 , the Company’s consolidated taxable income was $2.0 million ; and provisions for income taxes of $0.1 million . For the three months ended March 31, 2018 , the Company’s consolidated taxable income was $6.8 million ; and provisions for income taxes of $16,000 . The Company recognized no deferred income tax assets or liabilities on its consolidated Balance Sheets at March 31, 2019 or 2018 . The Company also recorded no interest or penalties for either the three months ended March 31, 2019 or 2018 . |
Earnings per Share
Earnings per Share | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Earnings per Share The following table sets forth the components of basic and diluted EPS ($ in thousands, except per share): Three months ended March 31, 2019 Income Shares Per Share Basic EPS Consolidated net income attributable to common stockholders $ 7,330 18,811,713 Allocation of earnings to participating restricted shares (84 ) — Consolidated net income attributable to unrestricted common stockholders $ 7,246 18,811,713 $ 0.39 Effect of dilutive securities Operating Partnership units 239 624,106 Restricted stock grants and Manager and director fee shares 84 217,316 Interest expense (add back) and assumed conversion of shares from convertible senior notes 2,549 8,176,313 Diluted EPS Consolidated net income attributable to common stockholders and dilutive securities $ 10,118 27,829,448 $ 0.36 Three months ended March 31, 2018 Income Shares Per Share Basic EPS Consolidated net income attributable to common stockholders $ 7,665 18,508,089 Allocation of earnings to participating restricted shares (88 ) — Consolidated net income attributable to unrestricted common stockholders $ 7,577 18,508,089 $ 0.41 Effect of dilutive securities Operating Partnership units 259 624,106 Restricted stock grants and Manager and director fee shares 88 215,747 Interest expense (add back) and assumed conversion of shares from convertible senior notes 2,142 7,047,216 Diluted EPS Consolidated net income attributable to common stockholders and dilutive securities $ 10,066 26,395,158 $ 0.38 |
Equity
Equity | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Equity | Equity Common stock As of March 31, 2019 and December 31, 2018 the Company had 18,967,223 and 18,909,874 shares, respectively, of $0.01 par value common stock outstanding with 125,000,000 shares authorized at each period end. Preferred stock The Company had no shares of preferred stock outstanding at March 31, 2019 and December 31, 2018 . There were 25,000,000 shares authorized as of March 31, 2019 and December 31, 2018 . Treasury stock As of March 31, 2019 the Company held 23,229 shares of treasury stock received through a distribution of the Company's shares previously held by its Manager. The Company held 20,277 shares of treasury stock at December 31, 2018 . Dividend Reinvestment Plan The Company sponsors a dividend reinvestment plan through which stockholders may purchase additional shares of the Company’s common stock by reinvesting some or all of the cash dividends received on shares of the Company’s common stock. During the three months ended March 31, 2019 and 2018 , 5,321 and 3,838 shares, respectively, were issued under the plan for total proceeds of approximately $0.1 million and $0.1 million , respectively. At-the-Market Offering The Company has entered into an equity distribution agreement under which the Company may sell shares of its common stock having an aggregate offering price of up to $50.0 million from time to time in any method permitted by law deemed to be an “at the market” offering as defined in Rule 415 under the Securities Act of 1933, as amended, or the Securities Act. During the three months ended March 31, 2019 and 2018 , no shares were sold under the at-the-market program. Accumulated Other Comprehensive Loss The Company recognizes temporary holding gains or losses on its investment in debt securities as components of Other comprehensive loss. Accumulated other comprehensive loss at March 31, 2019 and December 31, 2018 was as follows ($ in thousands): Investments in securities: March 31, 2019 December 31, 2018 Unrealized gains $ 410 $ 250 Unrealized losses (588 ) (825 ) Accumulated other comprehensive loss $ (178 ) $ (575 ) Non-controlling Interest At March 31, 2019 , the Company had non-controlling interests attributable to ownership interests by five legal entities. The Company’s Operating Partnership, which is majority-owned by the Company, had 624,106 partnership units held by an independent third party at March 31, 2019 and December 31, 2018 . The Company consolidates the assets, liabilities, revenues and expenses of the Operating Partnership. During the year ended December 31, 2017, the Company established AS Ajax E II LLC, to purchase and hold an investment in a Delaware trust which holds single family residential real estate loans, SBC loans and other real estate assets. AS Ajax E II LLC is 46.9% held by third parties. As of March 31, 2019 the Company has retained 53.1% of AS Ajax E II LLC and consolidates the assets, liabilities, revenues and expenses of the entity. During the year ended December 31, 2017, the Company established 2017-D, a securitization trust, which is 50% held by an institutional investor. As of March 31, 2019 the Company has retained 50% of 2017-D and consolidates the assets, liabilities, revenues and expenses of the trust. During the year ended December 31, 2018, the Company established 2018-C, a securitization trust, which is 37.0% held by an institutional investor. As of March 31, 2019 the Company has retained 63.0% of 2018-C and consolidates the assets, liabilities, revenues and expenses of the trust. During the year ended December 31, 2018, the Company established BFLD, to purchase and hold REO property, which is 10.0% held by a third party. As of March 31, 2019 the Company has retained 90.0% of BFLD and consolidates the assets, liabilities, revenues and expenses of the entity. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent events | Subsequent Events Loan Acquisitions Since quarter end the Company acquired 66 residential RPLs with aggregate UPB of $13.9 million in two transactions from two sellers for our own account. The RPLs were acquired at 87.9% of UPB and the estimated market value of the underlying collateral is $21.1 million . The purchase price equaled 57.8% of the estimated market value of the underlying collateral. Additionally, the Company has also agreed to acquire, subject to due diligence, 106 residential RPLs, with UPB of $21.3 million in four transactions from four different sellers. The purchase price of the residential RPLs equals 84.2% of UPB and 55.9% of the estimated market value of the underlying collateral of $32.2 million . We also agreed to acquire two SBC loans with UPB of $0.7 million . The purchase price of the SBC loans equals 99.0% of UPB. The Company also agreed to acquire three commercial properties for an aggregate purchase price of $7.1 million in three separate transactions from three different sellers. Dividend Declaration On April 30, 2019 , the Company’s Board of Directors declared a dividend of $0.32 per share, to be paid on May 31, 2019 to stockholders of record as of May 17, 2019 . Management Fees On May 8, 2019 , the Company issued 62,301 shares of its common stock to the Manager in payment of the portion of the base management fee which is payable in common stock for the first quarter of 2019 in a private transaction. The management fee expense associated with these shares was recorded as an expense in the first quarter of 2019 . Directors’ Retainer On May 8, 2019 , the Company issued to each of its four independent directors 691 shares of its common stock in payment of half of their quarterly director fees for the first quarter of 2019 . |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Mortgage Loans | Mortgage loans Purchased mortgage loans are initially recorded at the purchase price, net of any acquisition fees or costs at the time of acquisition and are considered asset acquisitions. As part of the determination of the bid price for mortgage loans, the Company uses a proprietary discounted cash flow valuation model to project expected cash flows, and considers alternate loan resolution probabilities, including liquidation or conversion to REO. Observable inputs to the model include interest rates, loan amounts, status of payments and property types. Unobservable inputs to the model include discount rates, forecast of future home prices, alternate loan resolution probabilities, resolution timelines, the value of underlying properties and other economic and demographic data. |
Loans Acquired with Deterioration in Credit Quality | Loans acquired with deterioration in credit quality The loans acquired by the Company have generally suffered some credit deterioration subsequent to origination. As a result, the Company is required to account for the mortgage loans pursuant to ASC 310-30, Accounting for Loans with Deterioration in Credit Quality . The Company’s recognition of interest income for loans within the scope of ASC 310-30 is based upon its having a reasonable expectation of the amount and timing of the cash flows expected to be collected. When the timing and amount of cash flows expected to be collected are reasonably estimable, the Company uses expected cash flows to apply the effective interest method of income recognition. Under ASC 310-30, acquired loans may be aggregated and accounted for as a pool of loans if the loans have common risk characteristics. A pool is accounted for as a single asset with a single composite interest rate and an aggregate expectation of cash flows. RPLs have been determined to have common risk characteristics and are accounted for as a single loan pool for loans acquired within each three-month calendar quarter. Similarly, NPLs have been determined to have common risk characteristics and are accounted for as a single non-performing pool for loans acquired within each three-month calendar quarter. Excluded from the aggregate pools are loans that pay in full subsequent to the acquisition closing date but prior to pooling. Any gain or loss on these loans is recognized as Interest income in the period the loan pays in full. The Company’s accounting for loans under ASC 310-30 gives rise to an accretable yield and a non-accretable amount. The excess of all undiscounted cash flows expected to be collected at acquisition over the initial investment in the loans is the accretable yield. Cash flows expected at acquisition include all cash flows directly related to the acquired loan, including those expected from the underlying collateral. The Company recognizes the accretable yield as Interest income on a prospective level yield basis over the life of the pool. The excess of a loan’s contractually required payments over the amount of cash flows expected at the acquisition is the non-accretable amount. The Company’s expectation of the amount of undiscounted cash flows expected to be collected is evaluated at the end of each calendar quarter. If the Company expects to collect greater cash flows over the life of the pool, the accretable yield amount increases and the expected yield to maturity is adjusted on a prospective basis. A provision for loan losses is established when the Company estimates it will not collect all amounts previously estimated to be collectible. Management assesses the credit quality of the portfolio and the adequacy of loan loss reserves on a quarterly basis, or more frequently as necessary. Significant judgment is required in this analysis. Depending on the expected recovery of its investment, the Company considers the estimated net recoverable value of the loan pools as well as other factors, such as the fair value of the underlying collateral. When a loan pool is determined to be impaired, the amount of loss accrual is calculated by comparing the recorded investment to the value determined by discounting the expected future cash flows at the loan pool’s effective interest rate or the fair value of the underlying collateral. Because these determinations are based upon projections of future economic events, which are inherently subjective, the amounts ultimately realized may differ materially from the carrying value as of the reporting date. The Company’s mortgage loans are secured by real estate. The Company monitors the credit quality of the mortgage loans in its portfolio on an ongoing basis, principally by considering loan payment activity or delinquency status. In addition, the Company assesses the expected cash flows from the mortgage loans, the fair value of the underlying collateral and other factors, and evaluates whether and when it becomes probable that all amounts contractually due will not be collected. Borrower payments on the Company’s mortgage loans are classified as principal, interest, payments of fees, or escrow deposits. Amounts applied as interest on the borrower account are similarly classified as interest for accounting purposes and are classified as operating cash flows in the Company’s consolidated Statement of Cash Flows. Amounts applied as principal on the borrower account including amounts contractually due from borrowers that exceed the Company’s basis in loans purchased at a discount, are similarly classified as principal for accounting purposes and are classified as investing cash flows in the consolidated Statement of Cash Flows as required under U.S. GAAP. Amounts received as payments of fees are recorded in Other income and classified as operating cash flows in the consolidated Statement of Cash Flows. Escrow deposits are recorded on the Servicer’s Balance Sheet and do not impact the Company’s cash flow. |
Loans acquired or originated that have not experienced a deterioration in credit quality | Loans acquired or originated that have not experienced a deterioration in credit quality The Company also acquires and originates small balance commercial loans that have not experienced a deterioration in credit quality. The Company recognizes any related loan discount and deferred expenses pursuant to ASC 310-20 by amortizing these amounts over the life of the loan. Accrual of interest on individual loans is discontinued when management believes that, after considering economic and business conditions and collection efforts, the borrower’s financial condition is such that collection of interest is doubtful. The Company’s policy is to stop accruing interest when a loan’s delinquency exceeds 90 days. All interest accrued but not collected for loans that are placed on non-accrual status or subsequently charged-off are reversed against Interest income. Income is subsequently recognized on the cash basis until, in management’s judgment, the borrower’s ability to make periodic principal and interest payments returns and future payments are reasonably assured, in which case the loan is returned to accrual status. An individual loan is considered to be impaired when, based on current events and conditions, it is probable the Company will be unable to collect all amounts due (both principal and interest) according to the contractual terms of the loan agreement. Impaired loans are carried at the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s market price, or the fair value of the collateral if the loan is collateral dependent. For individual loans, a troubled debt restructuring is a formal restructuring of a loan where, for economic or legal reasons related to the borrower’s financial difficulties, a concession that would not otherwise be considered is granted to the borrower. The concession may be granted in various forms, including providing a below-market interest rate, a reduction in the loan balance or accrued interest, an extension of the maturity date, or a combination of these. An individual loan that has had a troubled debt restructuring is considered to be impaired and is subject to the relevant accounting for impaired loans. Loans are tested quarterly for impairment and impairment reserves are recorded to the extent the net realizable value of the underlying collateral falls below net book value. If necessary, an allowance for loan losses is established through a provision for loan losses charged to expenses. The allowance is an amount that the Manager believes will be adequate to absorb probable losses on existing loans that may become uncollectible, based on evaluations of the collectability of loans. |
Investments in Securities | Investments at Fair Value The Company’s Investments at Fair Value as of March 31, 2019 and December 31, 2018 consist of investments in Senior and Subordinate Notes issued by joint ventures which the Company forms with third party institutional accredited investors. The Company recognizes income on the debt securities using the effective interest method. Additionally, the debt securities are classified as available for sale and are carried at fair value with changes in fair value reflected in the Company's consolidated Statements of Comprehensive Income. Investments in Beneficial Interests The Company’s Investments in Beneficial Interests as of March 31, 2019 and December 31, 2018 consist of investments in the trust certificates issued by joint ventures that the Company forms with third party institutional accredited investors. The trust certificates represent the residual interest of any special purpose entity formed to facilitate the investment. The Company recognizes income using the effective interest method and assess each Beneficial Interest for impairment on a quarterly basis. |
Real Estate | Real Estate The Company acquires REO properties directly through purchases, or through conversion of mortgage loans such as when it forecloses on the borrower and takes title to the underlying property or the borrower surrenders the deed in lieu of foreclosure. Property is recorded at cost if purchased, or at the present value of future cash flows if obtained through foreclosure by the Company. Property that the Company expects to actively market for sale is classified as held-for-sale. Property held-for-sale is carried at the lower of its acquisition basis or net realizable value (fair market value less expected selling costs, and any additional costs necessary to prepare the property for sale). Fair market value is determined based on broker price opinions (“BPOs”), appraisals, or other market indicators of fair value including list price or contract price, if listed or under contract for sale at the balance sheet date. Net unrealized losses due to changes in market value are recognized through a valuation allowance by charges to income through real estate operating expenses. No depreciation or amortization expense is recognized on properties held-for-sale. Holding costs are generally incurred by the Servicer and are subtracted from the Servicer’s remittance of sale proceeds upon ultimate disposition of properties held-for-sale. Rental property is property not held-for-sale. Rental properties are intended to be held as long-term investments but may eventually be reclassified as held-for-sale. Property that arose through conversions of mortgage loans in the Company's portfolio such as when a mortgage loan is foreclosed upon and the Company takes title to the property or the borrower surrenders the deed in lieu of foreclosure is generally held for investment as rental property if the cash flows from use as a rental exceed the present value of expected cash flows from a sale. The Company also acquires rental properties through direct purchases of properties for its rental portfolio. Depreciation is provided for using the straight-line method over the estimated useful lives of the assets of three to 39 years. The Company performs an impairment analysis for rental property using estimated cash flows if events or changes in circumstances indicate that the carrying value may be impaired, such as prolonged vacancy, identification of materially adverse legal or environmental factors, changes in expected ownership period or a decline in market value to an amount less than cost. This analysis is performed at the property level. The cash flows are estimated based on a number of assumptions that are subject to economic and market uncertainties including, among others, demand for rental properties, competition for customers, changes in market rental rates, costs to operate each property and expected ownership periods. Renovations are performed by the Servicer, and those costs are then reimbursed to the Servicer. Any renovations on properties which the Company elects to hold as rental properties are capitalized as part of the property’s basis and depreciated over the remaining estimated useful life of the property. The Company may perform property renovations to maximize the value of a property for either its rental strategy or for resale. |
Secured Borrowings | Secured Borrowings The Company, through securitization trusts which are VIEs, issues callable debt secured by its mortgage loans in the ordinary course of business. The secured borrowings facilitated by the trusts are structured as debt financings, and the mortgage loans used as collateral remain on the Company’s consolidated Balance Sheet as the Company is the primary beneficiary of the securitization trusts. These secured borrowing VIEs are structured as pass through entities that receive principal and interest on the underlying mortgages and distribute those payments to the holders of the notes. The Company’s exposure to the obligations of the VIEs is generally limited to its investments in the entities; the creditors do not have recourse to the primary beneficiary. Coupon interest expense on the debt is recognized using the accrual method of accounting. Deferred issuance costs, including original issue discount and debt issuance costs, are carried on the Company’s consolidated Balance Sheets as a deduction from Secured borrowings, and are amortized to interest expense on an effective yield basis based on the underlying cash flow of the mortgage loans serving as collateral. The Company assumes the debt will be called at the specified call date for purposes of amortizing discount and issuance costs because the Company believes it will have the intent and ability to call the debt on the call date. Changes in the actual or projected underlying cash flows are reflected in the timing and amount of deferred issuance cost amortization. |
Repurchase Facilities | Repurchase Facilities The Company enters into repurchase financing facilities under which it nominally sells assets to a counterparty and simultaneously enters into an agreement to repurchase the sold assets at a price equal to the sold amount plus an interest factor. Despite being legally structured as sales and subsequent repurchases, repurchase transactions are generally accounted for as debt secured by the underlying assets. At the maturity of a repurchase financing, unless the repurchase financing is renewed, the Company is required to repay the borrowing including any accrued interest and concurrently receives back its pledged collateral from the lender. The repurchase financings are treated as collateralized financing transactions; pledged assets are recorded as assets in the Company’s consolidated Balance Sheets, and the debt is recognized at the contractual amount. Interest is recorded at the contractual amount on an accrual basis. Costs associated with the set-up of a repurchasing contract are recorded as deferred issuance cost at inception and amortized over the contractual life of the agreement. Any draw fees associated with individual transactions and any facility fees assessed on the amounts outstanding are recorded as deferred costs when incurred and amortized over the contractual life of the related borrowing. |
Convertible senior notes | Convertible Senior Notes On April 25, 2017 , the Company completed the public offer and sale of $87.5 million in aggregate principal amount of its convertible senior notes (the “notes”) due 2024, with follow-on offerings of an additional $20.5 million and $15.9 million , respectively, in aggregate principal amount completed on August 18, 2017 and November 19, 2018 , respectively, which, combined with the notes from the April offering form a single series of securities. The notes bear interest at a rate of 7.25% per annum, payable quarterly in arrears on January 15, April 15, July 15 and October 15 of each year. The notes will mature on April 30, 2024 , unless earlier converted or redeemed. During certain periods and subject to certain conditions the notes will be convertible by their holders into shares of the Company’s common stock at a conversion rate of 1.6554 shares of common stock per $25.00 principal amount of the notes, which represents a conversion price of approximately $15.10 per share of common stock. The conversion rate, and thus the conversion price, may be subject to adjustment under certain circumstances. Coupon interest on the notes is recognized using the accrual method of accounting. Discount and deferred issuance costs are carried on the Company’s consolidated Balance Sheets as a deduction from the notes, and are amortized to interest expense on an effective yield basis through April 30, 2023 , the date at which the notes can be converted. The Company assumes the debt will be converted at the specified conversion date for purposes of amortizing issuance costs because the Company believes such conversion will be in the economic interest of the holders. A cumulative discount of $3.2 million , representing the fair value of the embedded conversion feature, was recorded to stockholders' equity. No sinking fund has been established for redemption of the principal. |
Management Fee and Expense Reimbursement | Management Fee and Expense Reimbursement The Company is a party to the Management Agreement with the Manager, which has a 15 -year term expiring on March 5, 2034 . Under the Management Agreement, the Manager implements the Company’s business strategy and manages the Company’s business and investment activities and day-to-day operations, subject to oversight by the Company’s Board of Directors. Among other services, the Manager provides the Company with a management team and necessary administrative and support personnel. Additionally, the Company pays directly for the internal audit function that reports directly to the Audit Committee and the Board of Directors. The Company does not currently have any employees that it pays directly and does not expect to have any employees that it pays directly in the foreseeable future. Each of the Company’s executive officers is an employee or officer, or both, of the Manager or the Servicer. Under the Second Amended and Restated Management Agreement by and between the Company and the Manager dated as of March 5, 2019 , the Company pays a quarterly base management fee based on its stockholders’ equity, including equity equivalents such as the Company's issuance of convertible senior notes, and may be required to pay a quarterly and annual incentive management fee based on its cash distributions to its stockholders and increases in the Company’s book value. Manager fees are expensed in the quarter incurred and the portion payable in common stock is included in stockholders’ equity at quarter end. See Note 10 — Related party transactions. |
Servicing Fees | Servicing Fees The Company is also a party to Servicing Agreements (the "Servicing Agreements") with the Servicer. Under the Servicing Agreements by and between the Company and its joint ventures and the Servicer, the Servicer receives an annual servicing fee ranging from 0.42% annually of the Unpaid Principal Balance (“UPB”) to 1.25% annually of UPB. The servicing fee is based upon the status of the loan at acquisition. For certain of the Company’s secured borrowings, the servicing fee rate for is reduced, on a loan-by-loan basis, when the loan meets certain performance criteria which varies joint venture by joint venture. Servicing fees are paid monthly. A change in status from RPL to NPL does not cause a change in the servicing fee rate. Servicing fees for the Company’s real property assets that were previously RPLs that are not held in joint ventures are the greater of (i) the servicing fee applicable to the underlying mortgage loan prior to foreclosure, or (ii) 1.00% annually of the fair market value of the REO as reasonably determined by the Manager or 1.00% annually of the purchase price of any REO otherwise purchased by the Company. The servicing fee for NPLs not held in joint ventures that convert to real property assets does not change. The Servicer is reimbursed for all customary, reasonable and necessary out-of-pocket costs and expenses incurred in the performance of its obligations, including the actual cost of any repairs and renovations undertaken on the Company’s behalf. The total fees incurred by the Company for these services will be dependent upon the UPB and type of mortgage loans that the Servicer services, property values, previous UPB of the relevant loan, and the number of REO properties. The Servicing Agreement will automatically renew for successive one-year terms, subject to prior written notice of non-renewal. In certain cases, the Company may be obligated to pay a termination fee. The Management Agreement will automatically terminate at the same time as the Servicing Agreement if the Servicing Agreement is terminated for any reason. See Note 10 - Related party transactions. |
Stock-based Payments | Stock-based Payments A portion of the management fee is payable in cash, and a portion of the management fee is in shares of the Company’s common stock, which are issued to the Manager in a private placement and are restricted securities under the Securities Act of 1933, as amended (the “Securities Act”). The number of shares issued to the Manager are determined based on the average of the closing prices of the Company's common stock on the New York Stock Exchange ("NYSE") on the five business days preceding the most recent regular quarterly dividend to holders of the common stock is paid. Management fees paid in common stock are recognized as an expense in the quarter incurred and recorded in stockholders' equity at quarter end. The shares vest immediately upon issuance. The Manager has agreed to hold any shares of common stock received by it as payment of the base management fee for at least three years from the date such shares of common stock are received. Under the Company’s 2014 Director Equity Plan (the “Director Plan”), the Company may make stock-based awards to its directors. The Director Plan is designed to promote the Company’s interests by attracting and retaining qualified and experienced individuals for service as non-employee directors. The Director Plan is administered by the Company’s Board of Directors. The total number of shares of common stock or other stock-based award, including grants of long-term incentive plan units (“LTIP Units”) from the Operating Partnership, available for issuance under the Director Plan is 78,000 shares. The Company issued to each of its independent directors restricted stock awards of 2,000 shares of its common stock upon joining the Board of Directors, which are subject to a one -year vesting period. The Company also periodically issues additional restricted stock awards to its independent directors under the Director Plan. In addition, through March 31, 2019, each of the Company’s independent directors received an annual fee of $75,000 , payable quarterly, 50% in shares of the Company’s common stock and 50% in cash. The annual fee was increased to $100,000 , 40% of which is payable in shares of the Company's common stock and 60% in cash, to be effective as of April 1, 2019 . Stock-based expense for the directors’ annual fee is expensed as earned, in equal quarterly amounts during the year, and recorded in stockholders' equity at quarter end. In June 2016, the Company’s stockholders approved the 2016 Equity Incentive Plan (the “2016 Plan”) to attract and retain non-employee directors, executive officers, key employees and service providers, including officers and employees of the Company’s affiliates. The 2016 Plan authorized the issuance of up to 5% of the Company’s outstanding shares from time to time on a fully diluted basis (assuming, if applicable, the exercise of all outstanding options and the conversion of all warrants and convertible senior notes, including OP Units and any LTIP Units, into shares of common stock). Grants of restricted stock under the 2016 Plan use grant date fair value of the stock as the basis for measuring the cost of the grant. The cost of grants of restricted stock to employees of the Company’s affiliates had previously been determined using the stock price as of the date at which the counterparty's performance is complete. However, pursuant to the issuance and early adoption of ASU 2018-07 in June 2018, the Company used the grant date fair value of the stock as the basis for measuring the cost of the grant. Forfeitures of granted shares are accounted for in the period in which they occur. The share grants vest over three years, with one third of the shares vesting on each of the first, second and third anniversaries of the grant date. The shares may not be sold until the third anniversary of the grant date. |
Directors' fees | Directors’ Fees The expense related to directors’ fees is accrued, and the portion payable in common stock is reflected in consolidated Stockholders’ equity in the period in which it is incurred. |
Variable Interest Entities | Variable Interest Entities In the normal course of business, the Company enters into various types of transactions with special purpose entities, which have primarily consisted of trusts established for the Company’s secured borrowings (See “Secured Borrowings” above and Note 9 to the consolidated Financial Statements). Additionally, from time to time, the Company may enter into joint ventures with unrelated entities, which also generally involves the formation of a special purpose entity. The Company evaluates each transaction and its resulting beneficial interest to determine if the entity formed pursuant to the transaction should be classified as a VIE. If an entity created in a transaction meets the definition of a VIE and the Company determines that it or a consolidated subsidiary is the primary beneficiary, the Company will include the entity in its consolidated financial statements. |
Cash and Cash Equivalents | Cash and Cash Equivalents Highly liquid investments with an original maturity of three months or less when purchased are considered cash equivalents. The Company generally maintains cash and cash equivalents at insured banking institutions with minimum assets of $1 billion. Certain account balances exceed Federal Deposit Insurance Corporation (“FDIC”) insurance coverage and, as a result, there is a concentration of credit risk related to amounts on deposit in excess of FDIC insurance coverage. |
Cash Held in Trust | Cash Held in Trust Cash held in trust consists of restricted cash balances either legally due to lenders or held in trust for the benefit of the Company's secured borrowers, and is segregated from the Company’s other cash deposits. Cash held in trust is not available to the Company for any purposes other than the settlement of existing obligations. |
Earnings per Share | Earnings per Share The Company grants restricted shares that entitle the recipients to receive dividend equivalents during the vesting period on a basis equivalent to the dividends paid to holders of common shares. Unvested share-based compensation awards containing non-forfeitable rights to receive dividends or dividend equivalents (collectively, “dividends”) are classified as “participating securities” and are included in the basic earnings per share calculation using the two-class method. Under the two-class method, all earnings (distributed and undistributed) are allocated to common shares and participating securities, based on their respective rights to receive dividends. Basic earnings per share is determined by dividing net income available to common shareholders, reduced by income attributable to the participating securities, by the weighted-average common shares outstanding during the period. Diluted earnings per share is determined by dividing net income attributable to diluted shareholders, which adds back to net income the interest expense, net of applicable income taxes, on the Company’s convertible senior notes, by the weighted-average common shares outstanding, assuming all dilutive securities, including stock grants, shares that would be issued in the event that OP Units are redeemed for shares of common stock of the Company, shares issued in respect of the stock-based portion of the base fee payable to the Manager and independent directors, and shares that would be issued in the event of conversion of the Company’s outstanding convertible senior notes were issued. In the event the Company were to record a net loss, potentially dilutive securities would be excluded from the diluted loss per share calculation, as their effect on loss per share would be anti-dilutive. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value hierarchy has been established that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value: • Level 1 — Quoted prices in active markets for identical assets or liabilities. • Level 2 — Observable inputs other than Level 1 prices, such as quoted prices for similar assets and liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The degree of judgment utilized in measuring fair value generally correlates to the level of pricing observability. Assets and liabilities with readily available actively quoted prices or for which fair value can be measured from actively quoted prices generally will have a higher degree of pricing observability and a lesser degree of judgment utilized in measuring fair value. Conversely, assets and liabilities rarely traded or not quoted will generally have little or no pricing observability and a higher degree of judgment utilized in measuring fair value. Pricing observability is impacted by a number of factors, including the type of asset or liability, whether it is new to the market and not yet established, and the characteristics specific to the transaction. The fair value of mortgage loans is estimated using the Manager’s proprietary pricing model which estimates expected cash flows with the discount rate used in the present value calculation representing the estimated effective yield of the loan. The Company reviews its discount rates periodically to ensure the assumptions used to calculate fair value are in line with market conditions. The Company’s Investments at fair value are carried at fair value with changes in fair value of equity securities reflected in the Company’s consolidated Statements of Income. Fair values of the Company's investments in debt securities are derived from estimates provided by banking institutions that are compared against available reference data from recent transactions and the Company's proprietary valuation model. The fair value of the Company's Beneficial interests are derived from estimates provided by banking institutions that are compared for reasonableness against analyses from the Company's proprietary valuation model. The Company calculates the fair value for the secured borrowings on its consolidated balance sheets issued by consolidated securitization trusts by using the Company’s proprietary pricing model to estimate the cash flows expected to be generated from the underlying collateral with the discount rate used in the present value calculation representing an estimate of the average rate for debt instruments with similar durations and risk factors. The Company’s borrowings under its repurchase agreements are short-term in nature, and the Manager believes it can renew the current borrowing arrangements on similar terms in the future. Accordingly, the carrying value of these borrowings approximates fair value. The Company’s convertible senior notes are traded on the NYSE under the ticker symbol "AJXA"; the debt’s fair value is determined from the closing price on the balance sheet date. Property held-for-sale is carried at the lower of its acquisition basis or net realizable value. Net realizable value is determined based on broker price opinions, appraisals, or other market indicators of fair value, which are then reduced by anticipated selling costs. Net unrealized losses due to changes in market value are recognized through a valuation allowance by charges to income. |
Income Taxes | Income Taxes The Company elected REIT status upon the filing of its 2014 income tax return, and has conducted its operations in order to satisfy and maintain eligibility for REIT status. Accordingly, the Company does not believe it will be subject to U.S. federal income tax from the year ended December 31, 2014 forward on the portion of the Company’s REIT taxable income that is distributed to the Company’s stockholders as long as certain asset, income and stock ownership tests are met. If the Company fails to qualify as a REIT in any taxable year, it generally will not be permitted to qualify for treatment as a REIT for U.S. federal income tax purposes for the four taxable years following the year during which qualification is lost. In addition, notwithstanding the Company’s qualification as a REIT, it may also have to pay certain state and local income taxes, because not all states and localities treat REITs in the same manner that they are treated for U.S. federal income tax purposes. The Company’s consolidated Financial Statements include the operations of three TRS entities, GA-TRS, GAJX Real Estate LLC and Gaea Real Estate Corp., which are subject to U.S. federal, state and local income taxes on their taxable income. Income from these three entities and any other TRS that the Company forms will be subject to U.S. federal and state income taxes. Deferred tax assets and liabilities are recognized for the future tax consequences or benefits attributable to differences between the carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted rates expected to apply to taxable income in the years in which management expects those temporary differences to be recovered or settled. The effect on deferred taxes of a change in tax rates is recognized in income in the period in which the change occurs. Subject to the Company’s judgment, it reduces a deferred tax asset by a valuation allowance if it is “more-likely-than-not” that some or all of the deferred tax asset will not be realized. Tax laws are complex and subject to different interpretations by the taxpayer and respective governmental taxing authorities. Significant judgment is required in evaluating tax positions, and the Company recognizes tax benefits only if it is more likely than not that a tax position will be sustained upon examination by the appropriate taxing authority. The Company evaluates tax positions taken in its consolidated financial statements under the interpretation for accounting for uncertainty in income taxes. As a result of this evaluation, the Company may recognize a tax benefit from an uncertain tax position only if it is “more-likely-than-not” that the tax position will be sustained on examination by taxing authorities. The Company’s tax returns remain subject to examination and consequently, the taxability of the distributions and other tax positions taken by the Company may be subject to change. Distributions to stockholders generally will be primarily taxable as long-term capital gain, although a portion of such distributions may be designated as ordinary income or qualified dividend income, or may constitute a return of capital. The Company furnishes annually to each stockholder a statement setting forth distributions paid during the preceding year and their U.S. federal income tax treatment. |
Segment Information | Segment Information The Company’s primary business is acquiring, investing in and managing a portfolio of mortgage loans. The Company operates in a single segment focused on re-performing mortgages, and to a lesser extent non-performing mortgages and real property. |
Reclassifications | Reclassifications Certain immaterial amounts in the Company’s 2018 consolidated Financial Statements have been reclassified to conform to the current period presentation. These reclassifications had no effect on previously reported net income or equity. |
Recently Adopted and Issued Accounting Standards | Recently Adopted Accounting Standards In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which establishes a right-of-use model for lessee accounting which results in the recognition of most leased assets and lease liabilities on the balance sheet of the lessee. Lessor accounting was not significantly changed by this ASU. This ASU is effective for annual periods, and interim periods therein, beginning after December 15, 2018 by applying a modified retrospective approach. Early adoption is permitted. In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842) - Targeted Improvements , which provides an optional transition method of applying the new leases standard at the adoption date by recognizing a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. It also provides lessors with a practical expedient to not separate non-lease revenue components from the associated lease component if certain conditions are met. Additionally, only incremental direct leasing costs may be capitalized under the new guidance. Any indirect incremental leasing costs must be expensed as incurred. In December 2018, the FASB issued ASU 2018-20, Leases (Topic 842) - Narrow Scope Improvements for Lessors which addresses lessor accounting for certain lessor costs associated with leased assets. ASU 2018-20 requires lessors to report amounts such as sales taxes reimbursed by a lessee and other similar reimbursed costs as lease revenue. In March 2019, the FASB issued ASU 2019-01, Leases (Topic 842) - Codification Improvements, which (1) addresses the fair value of leased assets by reinstating the exception in Topic 842 for lessors that are not manufacturers or dealers, allowing those lessors to use their cost of the asset, reflecting any volume or trade discounts that may apply, as the fair value of the underlying asset; (2) addresses the presentation on the statement of cash flows of sales type and direct financing leases by allowing depository and lending institutions to present principal payments received under leases in the investing section of the statement of cash flows, as opposed to the operating section, as otherwise required by Topic 842; and (3) the amendments in this update clarify the Board's original intent with regard to transition disclosures related to accounting changes and error corrections, and explicitly provide an exception to the paragraph 250-10-50-3 interim disclosure requirements in the Topic 842 transition disclosure requirements which would have required disclosure of various items for the current annual period and any prior annual periods retroactively adjusted. The Company has not identified any contracts under which it is a lessee. For leases where it is the lessor, the Company has elected not to separate non-lease components from lease components outlined in ASU 2018-11. The Company adopted ASU 2016-02, and amendments in ASU 2018-11 and ASU 2018-20 in its first quarter of 2019 with no effect on its consolidated assets or liabilities, consolidated net income or equity or cash flows on the date of adoption. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows - Classification of Certain Cash Receipts and Cash Payments . ASU 2016-15 provides guidance on the presentation and classification of specific cash flow items to improve consistency within the statement of cash flows. This guidance is effective for fiscal years, and interim periods within those fiscal years beginning after December 15, 2017, with early adoption permitted. The Company adopted ASU 2016-15 in 2018 with no effect on its consolidated assets or liabilities, consolidated net income or equity or cash flows. In June 2018, the FASB issued ASU No. 2018-07, Stock Compensation (Topic 718) - Improvements to Nonemployee Share-based Payment Accounting. ASU 2018-07 simplifies the accounting for share-based payment transactions for acquiring goods and services from nonemployees. This guidance is effective for fiscal years, and interim periods within those fiscal years beginning after December 15, 2019, with early adoption permitted, but no earlier than an entity's adoption of Topic 606. The Company elected to early-adopt ASU 2018-07 in 2018. The cumulative effect on prior periods arising from the adoption was $0.1 million and is reflected as an adjustment to the Company's consolidated Balance Sheet at March 31, 2018. In August 2018, the SEC issued a final rule to amend certain disclosure requirements that were redundant, duplicative, overlapping or superseded by other SEC disclosure requirements, U.S. GAAP or IFRS. Among other changes, the amendments generally eliminated or otherwise reduced certain disclosure requirements of various SEC rules and regulations. However, in some cases, the amendments require additional information to be disclosed, including changes in stockholders’ equity in interim periods. On September 25, 2018, the SEC released guidance advising it will not object to a registrant adopting the requirement to include changes in stockholders’ equity in the Form 10-Q for the first quarter beginning after the effective date of the rule - e.g. for a calendar year-end company, the first quarter of fiscal year 2019. The Company adopted the SEC’s final rule in the first quarter of 2019 with no effect on its consolidated assets or liabilities, consolidated net income or equity or cash flows on the date of adoption. Recently Issued Accounting Standards In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses . The main objective of this guidance is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity. To achieve this, the amendments in this guidance replace the incurred loss impairment methodology in current U.S. GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. Specifically, the amendments in this guidance require a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. 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. An entity must use judgment in determining the relevant information and estimation methods that are appropriate in its circumstances. This guidance is effective for interim and annual reporting periods beginning after December 15, 2019, with early adoption permitted, beginning with fiscal years after December 15, 2018. The Company is currently evaluating the impact on its consolidated financial statements and related disclosures. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement . The amendments in this update modify the disclosure requirements on fair value measurements in Topic 820, Fair Value Measurement, based on the concepts in the concepts statement, including the consideration of costs and benefits. This guidance is effective for interim and annual reporting periods beginning after December 15, 2019, with early adoption permitted, including early adoption of any removed or modified disclosures addressed in this update and delay of additional disclosures until their effective date. The Company is currently evaluating the impact on its consolidated financial statements and related disclosures. In August 2018, the FASB issued ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer's Accounting for Fees Paid in a Cloud Computing Arrangement . The amendments in this update align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software and hosting arrangements that include an internal-use software license. This guidance is effective for interim and annual reporting periods beginning after December 15, 2019, with early adoption permitted, including adoption in any interim period. The Company is currently evaluating the impact on its consolidated financial statements and related disclosures. |
Mortgage Loans (Tables)
Mortgage Loans (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Mortgage Loans on Real Estate [Abstract] | |
Schedule of loan portfolio basis by asset type | The following table presents information regarding the carrying value for the mortgage loan categories of RPL loan pools, NPL loan pools and SBC loans as of March 31, 2019 and December 31, 2018 ($ in thousands): Loan portfolio basis by asset type March 31, 2019 December 31, 2018 Residential RPL loan pools $ 1,228,968 $ 1,242,207 SBC loan pools 21,127 21,203 SBC loans non-pooled 1 28,605 11,140 Residential NPL loan pools 34,977 36,323 Total $ 1,313,677 $ 1,310,873 (1) SBC loans not pooled are accounted for under ASC 310-20 versus ASC 310-30 for our loan pools. |
Schedule of contractually required payments and estimated cash flows expected to be collected | The following table presents information regarding the accretable yield and non-accretable amount for purchased loan pools acquired during the following periods ($ in thousands): Three months ended March 31, 2019 Three months ended March 31, 2018 Re-performing Non-performing Re-performing Non-performing Contractually required principal and interest $ 14,966 $ — $ 31,623 $ — Non-accretable amount (5,500 ) — (9,574 ) — Expected cash flows to be collected 9,466 — 22,049 — Accretable yield (2,261 ) — (4,483 ) — Fair value at acquisition $ 7,205 $ — $ 17,566 $ — |
Schedule of accretable yield | The difference between the remaining contractual cash flows and the expected cash flows is the non-accretable amount. Accretable yield and accretion amounts do not include any of the interest income on unpooled SBC loans at March 31, 2019 and 2018 ($ in thousands): Three months ended March 31, 2019 Three months ended March 31, 2018 Re-performing Non-performing Re-performing Non-performing Balance at beginning of period $ 311,806 $ 6,459 $ 344,141 $ 7,370 Accretable yield additions 2,261 — 4,483 — Accretion (26,072 ) (330 ) (24,502 ) (715 ) Reclassification from (to) non-accretable amount, net 8,333 (1,281 ) (6,603 ) (370 ) Balance at end of period $ 296,328 $ 4,848 $ 317,519 $ 6,285 |
Allowance for loan losses | An analysis of the balance in the allowance for loan losses account follows ($ in thousands): Three months ended March 31, 2019 2018 Allowance for loan losses, beginning of period $ (1,164 ) $ — Provision for loan losses (154 ) — Allowance for loan losses, end of period $ (1,318 ) $ — |
Schedule of carrying value of mortgage loans and related UPB by delinquency status | The following table sets forth the carrying value of the Company’s mortgage loans, and related unpaid principal balance by delinquency status as of March 31, 2019 and December 31, 2018 ($ in thousands): March 31, 2019 December 31, 2018 Number of loans Carrying value Unpaid principal balance Number of loans Carrying value Unpaid principal balance Current 4,031 $ 781,289 $ 864,758 3,929 $ 757,276 $ 848,551 30 960 166,180 183,499 1,006 167,286 185,742 60 667 113,418 125,095 711 123,078 136,586 90 1,104 195,211 220,436 1,188 200,419 231,063 Foreclosure 256 57,579 76,595 277 62,814 79,777 Mortgage loans 7,018 $ 1,313,677 $ 1,470,383 7,111 $ 1,310,873 $ 1,481,719 |
Real Estate Assets, Net (Tables
Real Estate Assets, Net (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Real Estate [Abstract] | |
Schedule of activity in the Company's carrying value held-for-sale | The following table presents the activity in the Company’s carrying value of property held-for-sale for the three months ended March 31, 2019 and 2018 ($ in thousands): Three months ended March 31, 2019 2018 Property Held-for-sale Count Amount Count Amount Balance at beginning of period 102 $ 19,402 136 $ 24,947 Transfers from mortgage loans 26 4,171 27 3,958 Adjustments to record at lower of cost or fair value — (475 ) — (408 ) Disposals (33 ) (5,028 ) (27 ) (4,226 ) Transfer from Rental property 3 880 4 440 Transfers to Rental property (1 ) (293 ) (4 ) (942 ) Other — (77 ) — — Balance at end of period 97 $ 18,580 136 $ 23,769 |
Investments (Tables)
Investments (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Available-for-sale Securities | The following table presents information regarding the Company's investments in debt securities and investments in beneficial interests ($ in thousands): As of March 31, 2019 Basis 1 Gross unrealized gains Gross unrealized losses Carrying value (fair value) Debt securities $ 152,261 $ 410 $ (588 ) $ 152,083 Beneficial interests in securitization trusts 30,809 — — 30,809 Total investments $ 183,070 $ 410 $ (588 ) $ 182,892 As of December 31, 2018 Basis 1 Gross unrealized gains Gross unrealized losses Carrying value (fair value) Debt securities $ 147,386 $ 250 $ (825 ) $ 146,811 Beneficial interests in securitization trusts 22,086 — — 22,086 Total investments $ 169,472 $ 250 $ (825 ) $ 168,897 (1) Basis amount is net of any realized amortized costs and principal paydowns. |
Fair Value (Tables)
Fair Value (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of fair value of financial assets and liabilities | The following tables set forth the fair value of non-financial assets by level within the fair value hierarchy as of March 31, 2019 and December 31, 2018 ($ in thousands): Level 1 Level 2 Level 3 March 31, 2019 Carrying value Current quarter fair value adjustment recognized in the consolidated Statements of Income Quoted prices in active markets Observable inputs other than Level 1 prices Unobservable inputs Non-financial assets Property held-for-sale $ 18,580 $ 475 $ — $ — $ 18,580 Level 1 Level 2 Level 3 December 31, 2018 Carrying value Fiscal year 2018 fair value adjustment recognized in the consolidated Statements of Income Quoted prices in active markets Observable inputs other than Level 1 prices Unobservable inputs Non-financial assets Property held-for-sale $ 19,402 $ 2,700 $ — $ — $ 19,402 The following tables set forth the fair value of financial assets and liabilities by level within the fair value hierarchy as of March 31, 2019 and December 31, 2018 ($ in thousands): Level 1 Level 2 Level 3 March 31, 2019 Carrying value Quoted prices in active markets Observable inputs other than Level 1 prices Unobservable inputs Financial assets Mortgage loans, net $ 1,313,677 $ — $ — $ 1,447,047 Investments in debt securities at fair value $ 152,083 $ — $ 152,083 $ — Investments in beneficial interests $ 30,809 $ — $ 30,809 $ — Investment in Manager $ 1,254 $ — $ — $ 5,710 Investment in AS Ajax E $ 1,004 $ — $ 1,246 $ — Investment in GAFS, including warrants $ 2,972 $ — $ — $ 3,320 Financial liabilities Secured borrowings, net $ 593,121 $ — $ — $ 591,237 Borrowings under repurchase transactions $ 560,404 $ — $ 560,404 $ — Convertible senior notes, net $ 117,838 $ 123,850 $ — $ — Level 1 Level 2 Level 3 December 31, 2018 Carrying value Quoted prices in active markets Observable inputs other than Level 1 prices Unobservable inputs Financial assets Mortgage loans, net $ 1,310,873 $ — $ — $ 1,448,895 Investments in debt securities at fair value $ 146,811 $ — $ 146,811 $ — Investments in beneficial interests $ 22,086 $ — $ 22,086 $ — Investment in Manager $ 1,016 $ — $ — $ 5,231 Investment in AS Ajax E $ 1,037 $ — $ 1,239 $ — Investment in GAFS, including warrants $ 2,844 $ — $ — $ 3,320 Financial liabilities Secured borrowings, net $ 610,199 $ — $ — $ 610,217 Borrowings under repurchase transactions $ 534,089 $ — $ 534,089 $ — Convertible senior notes, net $ 117,525 $ 118,103 $ — $ — |
Affiliates (Tables)
Affiliates (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Investments in and Advances to Affiliates, Schedule of Investments [Abstract] | |
Schedule of assets and liabilities for the Company's unconsolidated affiliates at 100%, and at the Company's share | The table below shows the net income, assets and liabilities for the Company’s unconsolidated affiliates at 100% , and at the Company’s share ($ in thousands): Net income, assets and liabilities of unconsolidated affiliates at 100% Three months ended March 31, Net income at 100% 2019 2018 Great Ajax FS LLC $ 1,600 $ 115 Thetis Asset Management LLC $ 1,408 $ 652 AS Ajax E LLC $ 76 $ 69 March 31, 2019 December 31, 2018 Assets and Liabilities at 100% Assets Liabilities Assets Liabilities Great Ajax FS LLC $ 40,670 $ 16,942 $ 74,164 $ 52,184 Thetis Asset Management LLC $ 9,705 $ 2,209 $ 8,604 $ 2,136 AS Ajax E LLC $ 6,213 $ 2 $ 6,424 $ 13 Net income, assets and liabilities of unconsolidated affiliates at the Company's share Three months ended March 31, Net income at the Company's share 2019 2018 Thetis Asset Management LLC $ 279 $ 129 Great Ajax FS LLC (1) $ 128 $ 9 AS Ajax E LLC $ 13 $ 11 March 31, 2019 December 31, 2018 Assets and Liabilities at the Company's share Assets Liabilities Assets Liabilities Great Ajax FS LLC $ 3,254 $ 1,355 $ 5,933 $ 4,175 Thetis Asset Management LLC $ 1,922 $ 437 $ 1,704 $ 423 AS Ajax E LLC $ 1,025 $ — $ 1,060 $ 2 (1) Net income at the Company's share is not directly proportionate to Net income at 100% due to the timing of the Company's acquisition during the quarter ended March 31, 2018 . |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of details of repurchase agreement | The following table sets forth the details of the Company’s repurchase transactions and facilities ($ in thousands): March 31, 2019 Maturity Date Origination date Maximum Amount Amount of Percentage of Collateral Coverage Interest Rate April 25, 2019 October 26, 2018 $ 10,549 $ 10,549 $ 15,145 144 % 4.85 % April 25, 2019 October 26, 2018 5,865 5,865 7,630 130 % 4.65 % April 29, 2019 March 28, 2019 8,725 8,725 11,781 135 % 4.35 % April 29, 2019 March 28, 2019 26,367 26,367 35,232 134 % 4.25 % May 8, 2019 November 8, 2018 18,226 18,226 26,599 146 % 4.74 % May 8, 2019 November 8, 2018 10,933 10,933 16,502 151 % 4.84 % June 6, 2019 December 6, 2018 3,786 3,786 4,967 131 % 4.80 % June 6, 2019 February 8, 2019 9,937 9,937 13,181 133 % 4.65 % June 7, 2019 December 7, 2018 50,294 50,294 67,837 135 % 4.47 % June 21, 2019 December 21, 2018 32,393 32,393 41,660 129 % 4.65 % June 21, 2019 December 21, 2018 2,771 2,771 4,050 146 % 4.80 % June 28, 2019 December 28, 2018 8,860 8,860 10,842 122 % 4.64 % July 11, 2019 January 11, 2019 8,956 8,956 13,016 145 % 4.75 % July 12, 2019 July 15, 2016 250,000 192,065 252,645 132 % 4.98 % August 1, 2019 February 1, 2019 14,068 14,068 19,239 137 % 4.81 % September 24, 2019 September 25, 2018 400,000 126,147 132,538 105 % 4.99 % September 25, 2019 March 25, 2019 9,154 9,154 12,243 134 % 4.43 % September 25, 2019 March 25, 2019 11,869 11,869 16,549 139 % 4.58 % September 30, 2019 March 28, 2019 1,638 1,638 2,388 146 % 4.58 % September 30, 2019 March 29, 2019 6,233 6,233 8,330 134 % 4.40 % September 30, 2019 March 29, 2019 1,568 1,568 2,287 146 % 4.55 % Totals $ 892,192 $ 560,404 $ 714,661 128 % 4.81 % December 31, 2018 Maturity Date Origination date Maximum Amount Amount of Percentage of Collateral Coverage Interest Rate January 11, 2019 July 11, 2018 $ 8,956 $ 8,956 $ 12,834 143 % 4.41 % February 1, 2019 August 1, 2018 13,322 13,322 17,174 129 % 4.53 % March 25, 2019 September 25, 2018 6,396 6,396 8,376 131 % 4.34 % March 25, 2019 September 25, 2018 7,020 7,020 10,024 143 % 4.49 % March 28, 2019 September 28, 2018 12,539 12,539 15,846 126 % 4.40 % April 25, 2019 October 26, 2018 10,549 10,549 15,145 144 % 4.85 % April 25, 2019 October 26, 2018 5,865 5,865 7,580 129 % 4.65 % May 8, 2019 November 8, 2018 18,226 18,226 26,036 143 % 4.74 % May 8, 2019 November 8, 2018 10,933 10,933 15,618 143 % 4.84 % June 6, 2019 December 6, 2018 44,224 44,224 58,965 133 % 4.65 % June 6, 2019 December 6, 2018 3,786 3,786 5,408 143 % 4.80 % June 7, 2019 December 7, 2018 50,294 50,294 66,747 133 % 4.47 % June 21, 2019 December 21, 2018 32,393 32,393 43,390 134 % 4.62 % June 21, 2019 December 21, 2018 2,771 2,771 4,050 146 % 4.77 % June 28, 2019 December 28, 2018 8,860 8,860 13,275 150 % 4.64 % July 12, 2019 July 15, 2016 250,000 195,644 258,144 132 % 5.00 % September 24, 2019 September 25, 2018 400,000 102,311 114,852 112 % 4.89 % Totals $ 886,134 $ 534,089 $ 693,464 130 % 4.80 % |
Schedule of amount outstanding on repurchase transactions and carrying value collateral | The amount outstanding on the Company’s repurchase facilities and the carrying value of the Company’s loans pledged as collateral are presented as gross amounts in the Company’s consolidated balance sheets at March 31, 2019 and December 31, 2018 in the table below ($ in thousands): Gross amounts not offset in balance sheet March 31, 2019 December 31, 2018 Gross amount of recognized liabilities $ 560,404 $ 534,089 Gross amount pledged as collateral 714,661 693,464 Net amount $ 154,257 $ 159,375 |
Schedule of securitization of notes | The following table sets forth the original terms of all notes from our secured borrowings outstanding at March 31, 2019 at their respective cutoff dates: Issuing Trust/Issue Date Interest Rate Step-up Date Security Original Principal Interest Rate Ajax Mortgage Loan Trust 2016-C/ October 2016 October 25, 2019 Class A notes due 2057 $102.6 million 4.00 % April 25, 2020 Class B-1 notes due 2057(1,4) $7.9 million 5.25 % None Class B-2 notes due 2057(1,4) $7.9 million 5.25 % Trust certificates(2) $39.4 million — % Deferred issuance costs $(1.6) million — % Ajax Mortgage Loan Trust 2017-A/ May 2017 May 25, 2020 Class A notes due 2057 $140.7 million 3.47 % November 25, 2020 Class B-1 notes due 2057(1) $15.1 million 5.25 % None Class B-2 notes due 2057(1) $10.8 million 5.25 % Trust certificates(2) $49.8 million — % Deferred issuance costs $(2.0) million — % Ajax Mortgage Loan Trust 2017-B/ December 2017 None Class A notes due 2056 $115.8 million 3.16 % None Class M-1 notes due 2056(3) $9.7 million 3.50 % None Class M-2 notes due 2056(3) $9.5 million 3.50 % None Class B-1 notes due 2056(1) $9.0 million 3.75 % None Class B-2 notes due 2056(1) $7.5 million 3.75 % Trust certificates(2) $14.3 million — % Deferred issuance costs $(1.8) million — % Ajax Mortgage Loan Trust 2017-C/ November 2017 November 25, 2021 Class A notes due 2060 $130.2 million 3.75 % May 25, 2022 Class B-1 notes due 2060(1) $13.0 million 5.25 % Trust certificates(2) $42.8 million — % Deferred issuance costs $(1.7) million — % Ajax Mortgage Loan Trust 2017-D/ December 2017 April 25, 2021 Class A notes due 2057(5) $177.8 million 3.75 % None Class B certificates (5) $44.5 million — % Deferred issuance costs $(1.1) million — % Ajax Mortgage Loan Trust 2018-C/ September 2018 October 25, 2021 Class A notes due 2065(6) $170.5 million 4.36 % April 25, 2022 Class B notes due 2065(6) $15.9 million 5.25 % Trust certificates(6) $40.9 million — % Deferred issuance costs $(2.0) million — % (1) The Class B notes are subordinate, sequential pay, fixed rate notes with Class B-2 notes subordinate to the Class B-1 notes. The Company has retained the Class B notes. (2) The trust certificates issued by the trusts and the beneficial ownership of the trusts are retained by Great Ajax Funding LLC as the depositor. As the holder of the trust certificates, the Company is entitled to receive any remaining amounts in the trusts after the Class A notes, Class M notes, where present, and Class B notes have been paid in full. (3) The Class M notes are subordinate, sequential pay, fixed rate notes with Class M-2 notes subordinate to the Class M-1 notes. The Company has retained the Class M notes. (4) These securities are encumbered under a repurchase agreement. (5) Ajax Mortgage Loan Trust ("AJAXM") 2017-D is a joint venture in which a third party owns 50% of the Class A notes and 50% of the Class B certificates. The Company is required to consolidate 2017-D under GAAP and is reflecting 100% of the mortgage loans, in Mortgage loans, net. 50% of the Class A notes, which are held by the third party, are included in Secured borrowings, net. The 50% portion of the Class A notes retained by the Company have been encumbered under a repurchase agreement. 50% of the Class B certificates are recognized as Non-controlling interest. (6) AJAXM 2018-C is a joint venture in which a third party owns 95% of the Class A notes and 37% of the Class B notes and certificates. The Company is required to consolidate 2018-C under GAAP and is reflecting 100% of the mortgage loans, in Mortgage loans, net. 95% of the Class A notes and 37% of the Class B notes, which are held by the third party, are included in Secured borrowings, net. The 5% portion of the Class A notes retained by the Company have been encumbered under the repurchase agreement. Thirty-seven percent of the Class C certificates are recognized as Non-controlling interest. |
Schedule of status of mortgage loans | The following table sets forth the status of the notes held by others at March 31, 2019 and December 31, 2018 , and the securitization cutoff date ($ in thousands): Balances at March 31, 2019 Balances at December 31, 2018 Original balances at Class of Notes Carrying value of mortgages Bond principal balance Percentage of collateral coverage Carrying value of mortgages Bond principal balance Percentage of collateral coverage Mortgage UPB Bond principal balance 2016-C $ 100,474 $ 66,000 152 % $ 102,563 $ 69,692 147 % $ 157,808 $ 102,575 2017-A 153,884 99,528 155 % 157,033 102,755 153 % 216,413 140,669 2017-B 130,823 97,611 134 % 132,902 99,857 133 % 165,850 115,846 2017-C 144,869 105,803 137 % 146,938 109,616 134 % 185,942 130,159 2017-D 160,945 67,837 (3) 237 % 163,791 69,528 (3) 236 % 203,870 (1) 88,903 2018-C 192,154 161,882 (4) 119 % 194,606 165,051 (4) 118 % 222,181 (2) 167,910 $ 883,149 $ 598,661 (5) 148 % $ 897,833 $ 616,499 (5) 146 % $ 1,152,064 $ 746,062 (1) Includes $26.7 million of cash collateral intended for use in the acquisition of additional mortgage loans. (2) Includes $45.5 million of cash collateral intended for use in the acquisition of additional mortgage loans. (3) The gross amount of senior bonds at March 31, 2019 and December 31, 2018 were $135.7 million and $139.0 million however, only $67.8 million and $69.5 million are reflected in Secured borrowings as the remainder is owned by the Company, respectively. (4) 2018-C contains notes held by the third party institutional investors for senior bonds and class B bonds. The gross amount of the senior and class B bonds at March 31, 2019 were $164.2 million and $15.9 million , however, only $156.0 million and $5.9 million are reflected in Secured borrowings as the remainder is owned by the Company, respectively. The gross amount of the senior and class B bonds at December 31, 2018 were $167.5 million and $15.9 million , however, only $159.2 million and $5.9 million are reflected in Secured borrowings as the remainder is owned by the Company, respectively. (5) This represents the gross amount of Secured borrowings and excludes the impact of deferred issuance costs of $5.5 million and $6.3 million as of March 31, 2019 and December 31, 2018 , respectively. |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Related Party Transactions [Abstract] | |
Schedule of related party transactions | The Company’s consolidated Statements of Income included the following significant related party transactions ($ in thousands): Three months ended March 31, Transaction Consolidated Statement of Income location Counterparty 2019 2018 Loan servicing fees Related party expense – loan servicing fees Gregory $ 2,506 $ 2,469 Interest income Interest income Various non-consolidated joint ventures 2,416 131 Management fee Related party expense – management fee Thetis 1,688 1,532 Income from equity investment Income from investments in affiliates Thetis 279 129 Income from equity investment Income from investments in affiliates Great Ajax FS 128 9 Due diligence and related loan acquisition costs Loan transaction expense Gregory — 89 Expense reimbursements Other fees and expenses Gregory — 32 The Company’s consolidated Balance Sheets included the following significant related party balances ($ in thousands): As of March 31, 2019 Transaction Consolidated Balance Sheet location Counterparty Amount Receivables from Servicer Receivable from Servicer Gregory $ 18,746 Management fee payable Management fee payable Thetis 951 Expense reimbursements Prepaid expenses and other assets Thetis 82 Expense reimbursements Accrued expenses and other liabilities 2018-E 34 Expense reimbursements receivable Prepaid expenses and other assets Gregory 12 Expense reimbursement receivable Prepaid expenses and other assets 2018-A 10 Expense reimbursement receivable Prepaid expenses and other assets 2018-D 10 Expense reimbursement receivable Prepaid expenses and other assets 2018-B 5 As of December 31, 2018 Transaction Consolidated Balance Sheet location Counterparty Amount Receivables from Servicer Receivable from Servicer Gregory $ 14,587 Management fee payable Management fee payable Thetis 881 Expense reimbursements Accrued expenses and other liabilities Thetis 16 Expense reimbursements receivable Prepaid expenses and other assets Gregory 11 Expense reimbursements receivable Prepaid expenses and other assets 2018-A 2 Expense reimbursements receivable Prepaid expenses and other assets 2018-B 2 |
Stock-based Payments and Dire_2
Stock-based Payments and Director Fees (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of management fees and director fees | The following table sets forth the Company’s stock-based management fees and independent director fees ($ in thousands except share amounts): Stock-based Management Fees and Director Fees For the three months ended March 31, 2019 2018 Number of shares Amount of expense recognized (1) Number of shares Amount of expense recognized (1) Management fees 62,301 $ 728 49,156 $ 763 Independent director fees 2,764 38 2,416 38 Totals 65,065 $ 766 51,572 $ 801 (1) All management fees and independent director fees are fully expensed in the period in which the underlying expense is incurred. |
Schedule of activity in restricted stock | The following table sets forth the activity in the Company’s restricted stock plans ($ in thousands, except per share amounts): Total Grants Current period activity Non-vested shares at March 31, 2019 Fully-vested shares at March 31, 2019 Three months ended March 31, 2019 Total shares granted Total expected cost of grant Shares granted during the year Grant expense recognized for the three months ended March 31, 2019 Shares Per share grant date fair value Shares Per share grant date fair value Directors’ Grants 2018 (1) 12,000 $ 162 — $ 14 — $ 13.48 12,000 $ 13.48 Employee and Service Provider Grant 2016 (2,5) 146,334 1,976 — 163 47,889 13.50 98,445 13.50 Employee and Service Provider Grant, granted 2017 (3) 39,000 544 — 45 26,000 13.95 13,000 13.95 Employee and Service Provider Grant, granted 2018 (4) 36,500 496 — 41 36,500 13.58 — — Totals 233,834 $ 3,178 — $ 263 110,389 $ 13.63 123,445 $ 13.55 (1) Half of the 12,000 shares granted vested immediately on the grant date while the remaining shares vest ratably over a one -year period. Grant is fully vested at March 31, 2019 . (2) Vesting is ratable over three -year period from grant date. Weighted average remaining life of grant at March 31, 2019 is 0.4 years . (3) Vesting is ratable over three -year period from grant date. Weighted average remaining life of grant at March 31, 2019 is 1.3 years . (4) Vesting is ratable over three -year period from grant date. Weighted average remaining life of grant at March 31, 2019 is 2.4 years . (5) Total is shown net of 2017 forfeitures of 4,000 shares and 2018 forfeitures of 2,666 . Total Grants Current period activity Non-vested shares at March 31, 2018 Fully-vested shares at March 31, 2018 Three months ended March 31, 2018 Total shares granted Total expected cost of grant Shares granted during the year Grant expense recognized for the three months ended March 31, 2018 Shares Per share grant date fair value Shares Per share grant date fair value Directors’ Grants 2017 and earlier (1) 10,000 $ 146 — $ — — $ — 10,000 $ 14.61 Employee and Service Provider Grant 2016 (2,4) 146,334 1,978 — 140 96,667 13.50 49,667 13.50 Employee and Service Provider Grant 2017 (3) 39,000 538 — 45 39,000 13.95 — — Totals 195,334 $ 2,662 — $ 185 135,667 $ 13.83 59,667 $ 13.69 (1) Vesting period is one -year from grant date. Grant is fully vested at March 31, 2018 . (2) Vesting is ratable over three -year period from grant date. Weighted average remaining life of grant at March 31, 2018 is 1.4 years . (3) Vesting is ratable over three -year period from grant date. Weighted average remaining life of grant at March 31, 2018 is 2.3 years . (4) Total is shown net of 2017 forfeitures of 4,000 shares and 2018 forfeitures of 2,666 . |
Earnings per Share (Tables)
Earnings per Share (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Components of basic and diluted earnings per share | The following table sets forth the components of basic and diluted EPS ($ in thousands, except per share): Three months ended March 31, 2019 Income Shares Per Share Basic EPS Consolidated net income attributable to common stockholders $ 7,330 18,811,713 Allocation of earnings to participating restricted shares (84 ) — Consolidated net income attributable to unrestricted common stockholders $ 7,246 18,811,713 $ 0.39 Effect of dilutive securities Operating Partnership units 239 624,106 Restricted stock grants and Manager and director fee shares 84 217,316 Interest expense (add back) and assumed conversion of shares from convertible senior notes 2,549 8,176,313 Diluted EPS Consolidated net income attributable to common stockholders and dilutive securities $ 10,118 27,829,448 $ 0.36 Three months ended March 31, 2018 Income Shares Per Share Basic EPS Consolidated net income attributable to common stockholders $ 7,665 18,508,089 Allocation of earnings to participating restricted shares (88 ) — Consolidated net income attributable to unrestricted common stockholders $ 7,577 18,508,089 $ 0.41 Effect of dilutive securities Operating Partnership units 259 624,106 Restricted stock grants and Manager and director fee shares 88 215,747 Interest expense (add back) and assumed conversion of shares from convertible senior notes 2,142 7,047,216 Diluted EPS Consolidated net income attributable to common stockholders and dilutive securities $ 10,066 26,395,158 $ 0.38 |
Equity (Tables)
Equity (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Schedule of accumulated other comprehensive income | The Company recognizes temporary holding gains or losses on its investment in debt securities as components of Other comprehensive loss. Accumulated other comprehensive loss at March 31, 2019 and December 31, 2018 was as follows ($ in thousands): Investments in securities: March 31, 2019 December 31, 2018 Unrealized gains $ 410 $ 250 Unrealized losses (588 ) (825 ) Accumulated other comprehensive loss $ (178 ) $ (575 ) |
Organization and Basis of Pre_2
Organization and Basis of Presentation (Details Textuals) | 3 Months Ended |
Mar. 31, 2019USD ($)payment | |
Organization And Basis Of Presentation [Line Items] | |
Number of payments made on RPL mortgage loans (at least) | 5 |
Number of recent payments made on RPL mortgage loans | 7 |
Number of payments made on NPL mortgage loans | 3 |
Percentage of outstanding OP units owned | 96.80% |
Percentage of outstanding OP owned by an unaffiliated holder | 3.20% |
Maximum | |
Organization And Basis Of Presentation [Line Items] | |
Principal balance of small balance commercial mortgage loans (up to) | $ | $ 5,000,000 |
Delaware Trust | |
Organization And Basis Of Presentation [Line Items] | |
Ownership percentage | 5.00% |
2018-C | |
Organization And Basis Of Presentation [Line Items] | |
Noncontrolling Interest, Ownership Percentage by Parent | 63.00% |
2017-D | |
Organization And Basis Of Presentation [Line Items] | |
Percentage of ownership interests in joint venture | 50.00% |
Noncontrolling Interest, Ownership Percentage by Parent | 50.00% |
AS Ajax E II LLC | |
Organization And Basis Of Presentation [Line Items] | |
Percentage of ownership interests in joint venture | 53.10% |
Banfield | |
Organization And Basis Of Presentation [Line Items] | |
Noncontrolling Interest, Ownership Percentage by Parent | 90.00% |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Narrative (Details) | Apr. 01, 2019USD ($) | Aug. 18, 2017USD ($) | Apr. 25, 2017USD ($) | Jun. 07, 2016 | Feb. 28, 2018 | Mar. 31, 2019USD ($)$ / sharesshares | Dec. 31, 2018USD ($) | Nov. 19, 2018USD ($) | Mar. 31, 2018USD ($) |
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Amortization of debt discount | $ 3,200,000 | ||||||||
Minimum | |||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Estimated useful lives of an assets | 3 years | ||||||||
Maximum | |||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Estimated useful lives of an assets | 39 years | ||||||||
Management Agreement | Thetis | |||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Terms of agreement | 15 years | ||||||||
Servicing Agreement | Gregory | Minimum | |||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Servicing fees percentage | 0.42% | ||||||||
Servicing Agreement | Gregory | Maximum | |||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Servicing fees percentage | 1.25% | ||||||||
Amended And Restated Management Agreement [Member] | Thetis | |||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Period of common shares held as base management fee (at least) | 3 years | ||||||||
2014 Director Equity Plan | |||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Number of shares available under for distribution (in shares) | shares | 78,000 | ||||||||
Vesting period | 1 year | ||||||||
Annual Retainer Received In Shares | 50.00% | ||||||||
Annual Retainer Received In Cash | 50.00% | ||||||||
2014 Director Equity Plan | Restricted stock | |||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Number of shares issued to independent directors (in shares) | shares | 2,000 | ||||||||
Annual retainer amount | $ 75,000 | ||||||||
2016 Equity Incentive Plan | |||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Vesting period | 3 years | ||||||||
Fraction of award vesting period | 0.3333 | 0.50 | |||||||
Percentage of outstanding shares on a fully diluted basis (up to) | 5.00% | ||||||||
Accounting Standards Update 2018-07 [Member] | |||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Cumulative effect on balance sheet | $ 100,000 | ||||||||
Scenario, Forecast | 2014 Director Equity Plan | |||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Annual Retainer Received In Shares | 40.00% | ||||||||
Annual Retainer Received In Cash | 60.00% | ||||||||
Scenario, Forecast | 2014 Director Equity Plan | Restricted stock | |||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Annual retainer amount | $ 100,000 | ||||||||
Convertible Notes Payable | |||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Aggregate principal | $ 87,500,000 | ||||||||
Additional aggregate principal | $ 20,500,000 | $ 15,900,000 | |||||||
Interest Rate | 7.25% | 7.25% | 7.25% | ||||||
Principal amount of note (in dollars per share) | $ / shares | $ 25 | ||||||||
Conversion premium - Convertible senior notes | $ 200,000 | $ 2,500,000 | |||||||
Amortization of debt discount | $ 300,000 | ||||||||
Convertible Notes Payable | Common Stock | |||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Conversion rate | 1.6554 | ||||||||
Conversion price (in dollars per share) | $ / shares | $ 15.10 |
Mortgage Loans - Schedule of Lo
Mortgage Loans - Schedule of Loan Portfolio Basis by Asset Type (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | |
Mortgage Loans on Real Estate [Line Items] | |||
Mortgage loans, net | [1],[2] | $ 1,313,677 | $ 1,310,873 |
SBC loan pools | |||
Mortgage Loans on Real Estate [Line Items] | |||
Mortgage loans, net | 21,127 | 21,203 | |
SBC loans non-pooled | |||
Mortgage Loans on Real Estate [Line Items] | |||
Mortgage loans, net | 28,605 | 11,140 | |
Residential RPL loan pools | |||
Mortgage Loans on Real Estate [Line Items] | |||
Mortgage loans, net | 1,228,968 | 1,242,207 | |
Non-performing loans | |||
Mortgage Loans on Real Estate [Line Items] | |||
Mortgage loans, net | $ 34,977 | $ 36,323 | |
[1] | As of March 31, 2019, balances for Mortgage loans, net includes $370.5 million and Secured borrowings, net of deferred costs includes $227.3 million from the 50% and 63% owned joint ventures, respectively. As of December 31, 2018, balances for Mortgage loans, net include $377.0 million and Secured borrowings, net of deferred costs includes $231.9 million from a 50% and 63% owned joint ventures, all of which the Company consolidates under U.S. GAAP. | ||
[2] | Mortgage loans net include $883.1 million and $897.8 million of loans at March 31, 2019 and December 31, 2018, respectively, transferred to securitization trusts that are variable interest entities (“VIEs”); these loans can only be used to settle obligations of the VIEs. Secured borrowings consist of notes issued by VIEs that can only be settled with the assets and cash flows of the VIEs. The creditors do not have recourse to the primary beneficiary (Great Ajax Corp.). See Note 9 — Debt. Mortgage loans, net include $1.3 million and $1.2 million of allowance for loan losses at March 31, 2019 and December 31, 2018, respectively. |
Mortgage Loans - Narrative (Det
Mortgage Loans - Narrative (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Mar. 31, 2019USD ($)loan | Dec. 31, 2018USD ($)loan | Mar. 31, 2018USD ($)loan | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | ||
Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, net | [1],[2] | $ 1,313,677 | $ 1,310,873 | $ 1,310,873 | ||
Financing Receivable, Allowance for Credit Losses | 1,318 | $ 1,164 | $ 0 | 1,164 | $ 0 | |
Current period additions to allowance account | 154 | 1,200 | ||||
Interest income | $ 26,400 | 25,200 | ||||
Number of loans | loan | 7,018 | 7,111 | ||||
Reclassification from (to) non-accretable amount, net | $ 7,100 | (7,000) | ||||
Provision for loan losses | (154) | $ 0 | ||||
SBC loans acquired at or near origination | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, net | $ 28,605 | $ 11,140 | 11,140 | |||
Number of loans | loan | 19 | 0 | ||||
Aggregate unpaid principal balance of mortgage loans on real estate | $ 17,800 | |||||
SBC | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, net | 21,127 | 21,203 | 21,203 | |||
Re-performing loans | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, net | $ 1,228,968 | 1,242,207 | 1,242,207 | |||
Number of mortgage loans on real estate | loan | 38 | 87 | ||||
Aggregate unpaid principal balance of mortgage loans on real estate | $ 8,500 | $ 19,700 | ||||
Reclassification from (to) non-accretable amount, net | 8,333 | $ (6,603) | ||||
Non-performing loans | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, net | $ 34,977 | $ 36,323 | $ 36,323 | |||
Number of mortgage loans on real estate | loan | 0 | 0 | ||||
Reclassification from (to) non-accretable amount, net | $ (1,281) | $ (370) | ||||
[1] | As of March 31, 2019, balances for Mortgage loans, net includes $370.5 million and Secured borrowings, net of deferred costs includes $227.3 million from the 50% and 63% owned joint ventures, respectively. As of December 31, 2018, balances for Mortgage loans, net include $377.0 million and Secured borrowings, net of deferred costs includes $231.9 million from a 50% and 63% owned joint ventures, all of which the Company consolidates under U.S. GAAP. | |||||
[2] | Mortgage loans net include $883.1 million and $897.8 million of loans at March 31, 2019 and December 31, 2018, respectively, transferred to securitization trusts that are variable interest entities (“VIEs”); these loans can only be used to settle obligations of the VIEs. Secured borrowings consist of notes issued by VIEs that can only be settled with the assets and cash flows of the VIEs. The creditors do not have recourse to the primary beneficiary (Great Ajax Corp.). See Note 9 — Debt. Mortgage loans, net include $1.3 million and $1.2 million of allowance for loan losses at March 31, 2019 and December 31, 2018, respectively. |
Mortgage Loans - Schedule of Ac
Mortgage Loans - Schedule of Accretable and Non-Accretable Amounts (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Re-performing loans | ||
Mortgage Loans on Real Estate [Line Items] | ||
Contractually required principal and interest | $ 14,966 | $ 31,623 |
Non-accretable amount | (5,500) | (9,574) |
Expected cash flows to be collected | 9,466 | 22,049 |
Accretable yield | (2,261) | (4,483) |
Fair value at acquisition | 7,205 | 17,566 |
Non-performing loans | ||
Mortgage Loans on Real Estate [Line Items] | ||
Contractually required principal and interest | 0 | 0 |
Non-accretable amount | 0 | 0 |
Expected cash flows to be collected | 0 | 0 |
Accretable yield | 0 | 0 |
Fair value at acquisition | $ 0 | $ 0 |
Mortgage Loans - Schedule of Ch
Mortgage Loans - Schedule of Change in Accretable Yield (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward] | ||
Reclassification from (to) non-accretable amount, net | $ 7,100 | $ (7,000) |
Re-performing loans | ||
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward] | ||
Balance at beginning of period | 311,806 | 344,141 |
Accretable yield additions | 2,261 | 4,483 |
Accretion | (26,072) | (24,502) |
Reclassification from (to) non-accretable amount, net | 8,333 | (6,603) |
Balance at end of period | 296,328 | 317,519 |
Non-performing loans | ||
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward] | ||
Balance at beginning of period | 6,459 | 7,370 |
Accretable yield additions | 0 | 0 |
Accretion | (330) | (715) |
Reclassification from (to) non-accretable amount, net | (1,281) | (370) |
Balance at end of period | $ 4,848 | $ 6,285 |
Mortgage Loans - Allowance for
Mortgage Loans - Allowance for loan losses (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2019USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2018USD ($) | |
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||
Allowance for loan losses, beginning of period | $ (1,164) | $ 0 | $ 0 |
Provision for loan losses | (154) | (1,200) | |
Provision for loan losses | $ (154) | 0 | |
Number of pools of provision for loan losses | 5 | ||
Allowance for loan losses, end of period | $ (1,318) | $ 0 | $ (1,164) |
Mortgage Loans - Schedule of Ca
Mortgage Loans - Schedule of Carrying Value of Mortgage Loans (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019USD ($)loan | Dec. 31, 2018USD ($)loan | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Number of loans | loan | 7,018 | 7,111 | |
Carrying value | [1],[2] | $ 1,313,677 | $ 1,310,873 |
Unpaid principal balance | $ 1,470,383 | $ 1,481,719 | |
Current | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Number of loans | loan | 4,031 | 3,929 | |
Carrying value | $ 781,289 | $ 757,276 | |
Unpaid principal balance | $ 864,758 | $ 848,551 | |
30 | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Number of loans | loan | 960 | 1,006 | |
Carrying value | $ 166,180 | $ 167,286 | |
Unpaid principal balance | $ 183,499 | $ 185,742 | |
60 | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Number of loans | loan | 667 | 711 | |
Carrying value | $ 113,418 | $ 123,078 | |
Unpaid principal balance | $ 125,095 | $ 136,586 | |
90 | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Number of loans | loan | 1,104 | 1,188 | |
Carrying value | $ 195,211 | $ 200,419 | |
Unpaid principal balance | $ 220,436 | $ 231,063 | |
Foreclosure | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Number of loans | loan | 256 | 277 | |
Carrying value | $ 57,579 | $ 62,814 | |
Unpaid principal balance | $ 76,595 | $ 79,777 | |
[1] | As of March 31, 2019, balances for Mortgage loans, net includes $370.5 million and Secured borrowings, net of deferred costs includes $227.3 million from the 50% and 63% owned joint ventures, respectively. As of December 31, 2018, balances for Mortgage loans, net include $377.0 million and Secured borrowings, net of deferred costs includes $231.9 million from a 50% and 63% owned joint ventures, all of which the Company consolidates under U.S. GAAP. | ||
[2] | Mortgage loans net include $883.1 million and $897.8 million of loans at March 31, 2019 and December 31, 2018, respectively, transferred to securitization trusts that are variable interest entities (“VIEs”); these loans can only be used to settle obligations of the VIEs. Secured borrowings consist of notes issued by VIEs that can only be settled with the assets and cash flows of the VIEs. The creditors do not have recourse to the primary beneficiary (Great Ajax Corp.). See Note 9 — Debt. Mortgage loans, net include $1.3 million and $1.2 million of allowance for loan losses at March 31, 2019 and December 31, 2018, respectively. |
Real Estate Assets, Net - Narra
Real Estate Assets, Net - Narrative (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Mar. 31, 2019USD ($)property | Mar. 31, 2018USD ($)property | Dec. 31, 2018USD ($)property | Dec. 31, 2017USD ($) | |||
Real Estate [Line Items] | ||||||
Number of properties owned | property | 20 | 21 | ||||
Aggregate carrying value REO properties | $ 19,200 | $ 17,600 | ||||
Number of REO properties held for rental | property | 16 | 16 | ||||
Rental property, net | $ 19,242 | $ 17,635 | ||||
Number of properties acquired through foreclosure | property | 1 | 1 | ||||
Number of properties transferred from property held for sale | property | 9 | 12 | ||||
Property held-for-sale, net | $ 18,580 | [1] | $ 23,769 | $ 19,402 | [1] | $ 24,947 |
Real Estate Held For Sale Improvements | $ 900 | $ 2,200 | ||||
Number of held-for-sale residential properties disposed | property | 33 | 27 | ||||
Gain (loss) on sale of property | $ 103 | $ 582 | ||||
Real Estate Impairment | 500 | 400 | ||||
Other Income | ||||||
Real Estate [Line Items] | ||||||
Gain (loss) on sale of property | $ 100 | $ 600 | ||||
[1] | Property held-for-sale, net, includes valuation allowances of $1.9 million and $1.8 million at March 31, 2019 and December 31, 2018, respectively. |
Real Estate Assets, Net - Sched
Real Estate Assets, Net - Schedule of ROE Held-For-Sale (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019USD ($)property | Mar. 31, 2018USD ($)property | ||
Real Estate Held For Sale [Roll Forward] | |||
Balance at beginning of period | property | 102 | 136 | |
Balance at beginning of year | $ | $ 19,402 | [1] | $ 24,947 |
Transfers from mortgage loans, count | property | 26 | 27 | |
Transfers from mortgage loans | $ | $ 4,171 | $ 3,958 | |
Adjustments to record at lower of cost or fair value, count | property | 0 | 0 | |
Adjustments to record at lower of cost or fair value | $ | $ (475) | $ (408) | |
Disposals, count | property | (33) | (27) | |
Disposals | $ | $ (5,028) | $ (4,226) | |
Number of properties transferred from held-for-sale to rental | property | (1) | (4) | |
Properties transferred from held-for-sale to rental | $ | $ (293) | $ (942) | |
Number of properties transferred from rental to held-for-sale | property | 3 | 4 | |
Properties transferred from rental to held-for-sale | $ | $ 880 | $ 440 | |
Other, count | property | 0 | 0 | |
Other | $ | $ (77) | $ 0 | |
Balance at end of year, count | property | 97 | 136 | |
Balance at end of period | $ | $ 18,580 | [1] | $ 23,769 |
[1] | Property held-for-sale, net, includes valuation allowances of $1.9 million and $1.8 million at March 31, 2019 and December 31, 2018, respectively. |
Investments (Details)
Investments (Details) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Oct. 31, 2016USD ($) | Mar. 31, 2019USD ($)loan | Dec. 31, 2018USD ($)loan | Mar. 31, 2018USD ($) | Dec. 31, 2018USD ($) | ||
Available-for-sale Securities, Amortized Cost Basis [Abstract] | ||||||
Investment in debt securities - Basis | $ 152,261,000 | $ 147,386,000 | $ 147,386,000 | |||
Available-for-sale Securities, Gross Unrealized Gain (Loss) [Abstract] | ||||||
Investment in debt securities - Gross unrealized gains | 410,000 | 250,000 | 250,000 | |||
Available-for-sale Securities [Abstract] | ||||||
Investment in debt securities | 152,083,000 | 146,811,000 | 146,811,000 | |||
Investment in debt securities - Gross unrealized loss | (588,000) | $ (825,000) | (825,000) | |||
Proceeds from Sale of Available-for-sale Securities, Debt | 39,635,000 | $ 0 | ||||
Gain (Loss) on Sale of Securities, Net | $ 8,000 | |||||
Number of loans | loan | 7,018 | 7,111 | ||||
Secured Debt | [1],[2],[3] | $ 593,121,000 | $ 610,199,000 | 610,199,000 | ||
Purchase of debt securities | 64,014,000 | $ 0 | ||||
Investments in beneficial interests | 30,809,000 | 22,086,000 | 22,086,000 | |||
Oileus Residential Loan Trust | ||||||
Available-for-sale Securities [Abstract] | ||||||
Purchase of debt securities | $ 6,300,000 | |||||
Available-for-sale Securities, Gross Realized Gains | 200,000 | |||||
Senior Notes | ||||||
Available-for-sale Securities [Abstract] | ||||||
Investment in debt securities | 50,000,000 | 144,100,000 | 144,100,000 | |||
Subordinated Debt | ||||||
Available-for-sale Securities [Abstract] | ||||||
Investment in debt securities | 4,600,000 | 9,400,000 | 9,400,000 | |||
Accumulated Net Investment Gain (Loss) Attributable to Noncontrolling Interest | ||||||
Available-for-sale Securities, Amortized Cost Basis [Abstract] | ||||||
Investment in beneficial interests - Basis | 183,070,000 | 169,472,000 | 169,472,000 | |||
Available-for-sale Securities, Gross Unrealized Gain (Loss) [Abstract] | ||||||
Investment in beneficial interests - Gross unrealized gains | 250,000 | 250,000 | ||||
Investment in beneficial interests - Gross unrealized loss | (825,000) | (825,000) | ||||
Available-for-sale Securities [Abstract] | ||||||
Investment in beneficial interests | 182,892,000 | 168,897,000 | 168,897,000 | |||
Beneficial interests | ||||||
Available-for-sale Securities, Amortized Cost Basis [Abstract] | ||||||
Investment in beneficial interests - Basis | 30,809,000 | 22,086,000 | 22,086,000 | |||
Available-for-sale Securities, Gross Unrealized Gain (Loss) [Abstract] | ||||||
Investment in beneficial interests - Gross unrealized gains | 0 | 0 | 0 | |||
Investment in beneficial interests - Gross unrealized loss | 0 | 0 | 0 | |||
Available-for-sale Securities [Abstract] | ||||||
Investment in beneficial interests | 30,809,000 | 22,086,000 | 22,086,000 | |||
Beneficial interests | ||||||
Available-for-sale Securities [Abstract] | ||||||
Investments in beneficial interests | $ 9,500,000 | $ 21,800,000 | $ 21,800,000 | |||
[1] | As of March 31, 2019, balances for Mortgage loans, net includes $370.5 million and Secured borrowings, net of deferred costs includes $227.3 million from the 50% and 63% owned joint ventures, respectively. As of December 31, 2018, balances for Mortgage loans, net include $377.0 million and Secured borrowings, net of deferred costs includes $231.9 million from a 50% and 63% owned joint ventures, all of which the Company consolidates under U.S. GAAP. | |||||
[2] | Mortgage loans net include $883.1 million and $897.8 million of loans at March 31, 2019 and December 31, 2018, respectively, transferred to securitization trusts that are variable interest entities (“VIEs”); these loans can only be used to settle obligations of the VIEs. Secured borrowings consist of notes issued by VIEs that can only be settled with the assets and cash flows of the VIEs. The creditors do not have recourse to the primary beneficiary (Great Ajax Corp.). See Note 9 — Debt. Mortgage loans, net include $1.3 million and $1.2 million of allowance for loan losses at March 31, 2019 and December 31, 2018, respectively. | |||||
[3] | Secured borrowings and Convertible senior notes are presented net of deferred issuance costs. |
Fair Value - Schedule of Assets
Fair Value - Schedule of Assets and Liabilities at Fair Value (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | |
Consolidated balance sheet at fair value disclosure (assets) | |||
Mortgage loans, net | [1],[2] | $ 1,313,677 | $ 1,310,873 |
Investment in debt securities | 152,083 | 146,811 | |
Investments in beneficial interests | 30,809 | 22,086 | |
Not recognized on consolidated balance sheet at fair value (liabilities) | |||
Secured borrowings, net | [1],[2],[3] | 593,121 | 610,199 |
Borrowings under repurchase transactions | 560,404 | 534,089 | |
Convertible senior notes, net | [3] | 117,838 | 117,525 |
Level 1 Quoted prices in active markets | |||
Consolidated balance sheet at fair value disclosure (assets) | |||
Mortgage loans, net fair value | 0 | 0 | |
Investment In Debt Securities, Fairvalue Disclosure | 0 | 0 | |
Not recognized on consolidated balance sheet at fair value (liabilities) | |||
Secured borrowings, fair value | 0 | 0 | |
Borrowings under repurchase agreement, fair value | 0 | 0 | |
Convertible senior notes, net, fair value | 123,850 | 118,103 | |
Level 2 Observable inputs other than Level 1 prices | |||
Consolidated balance sheet at fair value disclosure (assets) | |||
Mortgage loans, net fair value | 0 | 0 | |
Investment In Debt Securities, Fairvalue Disclosure | 152,083 | 146,811 | |
Not recognized on consolidated balance sheet at fair value (liabilities) | |||
Secured borrowings, fair value | 0 | 0 | |
Borrowings under repurchase agreement, fair value | 560,404 | 534,089 | |
Convertible senior notes, net, fair value | 0 | 0 | |
Level 3 Unobservable inputs | |||
Consolidated balance sheet at fair value disclosure (assets) | |||
Mortgage loans, net fair value | 1,447,047 | 1,448,895 | |
Investment In Debt Securities, Fairvalue Disclosure | 0 | 0 | |
Not recognized on consolidated balance sheet at fair value (liabilities) | |||
Secured borrowings, fair value | 591,237 | 610,217 | |
Borrowings under repurchase agreement, fair value | 0 | 0 | |
Convertible senior notes, net, fair value | 0 | 0 | |
Investment in Manager | |||
Consolidated balance sheet at fair value disclosure (assets) | |||
Investments In affiliates | 1,254 | 1,016 | |
Investment in Manager | Level 1 Quoted prices in active markets | |||
Consolidated balance sheet at fair value disclosure (assets) | |||
Fair Value Adjustment | 0 | 0 | |
Investment in Manager | Level 2 Observable inputs other than Level 1 prices | |||
Consolidated balance sheet at fair value disclosure (assets) | |||
Fair Value Adjustment | 0 | 0 | |
Investment in Manager | Level 3 Unobservable inputs | |||
Consolidated balance sheet at fair value disclosure (assets) | |||
Fair Value Adjustment | 5,710 | 5,231 | |
Investment in AS Ajax E | |||
Consolidated balance sheet at fair value disclosure (assets) | |||
Investments In affiliates | 1,004 | 1,037 | |
Investment in AS Ajax E | Level 1 Quoted prices in active markets | |||
Consolidated balance sheet at fair value disclosure (assets) | |||
Fair Value Adjustment | 0 | 0 | |
Investment in AS Ajax E | Level 2 Observable inputs other than Level 1 prices | |||
Consolidated balance sheet at fair value disclosure (assets) | |||
Fair Value Adjustment | 1,246 | 1,239 | |
Investment in AS Ajax E | Level 3 Unobservable inputs | |||
Consolidated balance sheet at fair value disclosure (assets) | |||
Fair Value Adjustment | 0 | 0 | |
Investment in GAFS | |||
Consolidated balance sheet at fair value disclosure (assets) | |||
Investments In affiliates | 2,972 | 2,844 | |
Investment in GAFS | Level 1 Quoted prices in active markets | |||
Consolidated balance sheet at fair value disclosure (assets) | |||
Fair Value Adjustment | 0 | 0 | |
Investment in GAFS | Level 2 Observable inputs other than Level 1 prices | |||
Consolidated balance sheet at fair value disclosure (assets) | |||
Fair Value Adjustment | 0 | 0 | |
Investment in GAFS | Level 3 Unobservable inputs | |||
Consolidated balance sheet at fair value disclosure (assets) | |||
Fair Value Adjustment | 3,320 | 3,320 | |
Beneficial interests | |||
Consolidated balance sheet at fair value disclosure (assets) | |||
Investment in beneficial interests | 30,809 | 22,086 | |
Beneficial interests | Level 1 Quoted prices in active markets | |||
Consolidated balance sheet at fair value disclosure (assets) | |||
Investments, Fair Value Disclosure | 0 | 0 | |
Beneficial interests | Level 2 Observable inputs other than Level 1 prices | |||
Consolidated balance sheet at fair value disclosure (assets) | |||
Investments, Fair Value Disclosure | 30,809 | 22,086 | |
Beneficial interests | Level 3 Unobservable inputs | |||
Consolidated balance sheet at fair value disclosure (assets) | |||
Investments, Fair Value Disclosure | $ 0 | $ 0 | |
[1] | As of March 31, 2019, balances for Mortgage loans, net includes $370.5 million and Secured borrowings, net of deferred costs includes $227.3 million from the 50% and 63% owned joint ventures, respectively. As of December 31, 2018, balances for Mortgage loans, net include $377.0 million and Secured borrowings, net of deferred costs includes $231.9 million from a 50% and 63% owned joint ventures, all of which the Company consolidates under U.S. GAAP. | ||
[2] | Mortgage loans net include $883.1 million and $897.8 million of loans at March 31, 2019 and December 31, 2018, respectively, transferred to securitization trusts that are variable interest entities (“VIEs”); these loans can only be used to settle obligations of the VIEs. Secured borrowings consist of notes issued by VIEs that can only be settled with the assets and cash flows of the VIEs. The creditors do not have recourse to the primary beneficiary (Great Ajax Corp.). See Note 9 — Debt. Mortgage loans, net include $1.3 million and $1.2 million of allowance for loan losses at March 31, 2019 and December 31, 2018, respectively. | ||
[3] | Secured borrowings and Convertible senior notes are presented net of deferred issuance costs. |
Fair Value - Schedule of Non Fi
Fair Value - Schedule of Non Financial Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Property held-for-sale, net | $ 18,580 | [1] | $ 19,402 | [1] | $ 23,769 | $ 24,947 |
Level 1 Quoted prices in active markets | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Property held-for-sale, net | 0 | 0 | ||||
Level 2 Observable inputs other than Level 1 prices | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Property held-for-sale, net | 0 | 0 | ||||
Level 3 Unobservable inputs | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Property held-for-sale, net | 18,580 | 19,402 | ||||
Carrying value | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Property held-for-sale, net | 18,580 | 19,402 | ||||
Current period ended fair value adjustment recognized in the consolidated Statements of Income | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Property held-for-sale, net | $ 475 | $ 2,700 | ||||
[1] | Property held-for-sale, net, includes valuation allowances of $1.9 million and $1.8 million at March 31, 2019 and December 31, 2018, respectively. |
Affiliates - Narrative (Details
Affiliates - Narrative (Details) $ in Millions | May 29, 2018USD ($)warrantshares | Jan. 26, 2018USD ($)warrantshares | Dec. 31, 2018transaction | Mar. 31, 2019 | Mar. 14, 2016 |
2017-D | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Percentage of ownership interests in joint venture | 50.00% | ||||
Noncontrolling Interest, Ownership Percentage by Parent | 50.00% | ||||
2018-C | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Noncontrolling Interest, Ownership Percentage by Parent | 63.00% | ||||
Banfield | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Noncontrolling Interest, Ownership Percentage by Parent | 90.00% | ||||
Thetis | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership percentage | 19.80% | ||||
AS Ajax E LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership percentage | 16.50% | 16.50% | 24.20% | ||
Ajax E Master Trust | AS Ajax E LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership percentage | 5.00% | ||||
Unconsolidated Affiliates | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership percentage | 100.00% | ||||
Great Ajax FS LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership percentage | 8.00% | ||||
Number of transactions | transaction | 2 | ||||
Percentage of equity interest at closing date | 3.10% | 4.90% | |||
Number of warrants | warrant | 3 | 3 | |||
Percentage of warrants exercisable | 1.55% | 2.45% | |||
Cash payment in business acquisition | $ 0.7 | $ 1.1 | |||
Number of shares (in shares) | shares | 29,063 | 45,938 | |||
Common stock value | $ 0.4 | $ 0.6 |
Affiliates - Schedule of Net In
Affiliates - Schedule of Net Income, Assets and Liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Schedule of Equity Method Investments [Line Items] | |||
Net income at the Company's share | $ 461 | $ 192 | |
Assets at Company share | 1,616,182 | $ 1,602,871 | |
Liabilities at Company share | 1,279,507 | 1,268,592 | |
Thetis | |||
Schedule of Equity Method Investments [Line Items] | |||
Net income at 100% | 1,408 | 652 | |
Assets | 9,705 | 8,604 | |
Liabilities | 2,209 | 2,136 | |
Net income at the Company's share | 279 | 129 | |
Assets at Company share | 1,922 | 1,704 | |
Liabilities at Company share | 437 | 423 | |
Great Ajax FS LLC | |||
Schedule of Equity Method Investments [Line Items] | |||
Net income at 100% | 1,600 | 115 | |
Assets | 40,670 | 74,164 | |
Liabilities | 16,942 | 52,184 | |
Net income at the Company's share | 128 | 9 | |
Assets at Company share | 3,254 | 5,933 | |
Liabilities at Company share | 1,355 | 4,175 | |
AS Ajax E LLC | |||
Schedule of Equity Method Investments [Line Items] | |||
Net income at 100% | 76 | 69 | |
Assets | 6,213 | 6,424 | |
Liabilities | 2 | 13 | |
Net income at the Company's share | 13 | $ 11 | |
Assets at Company share | 1,025 | 1,060 | |
Liabilities at Company share | $ 0 | $ 2 |
Commitments and Contingencies (
Commitments and Contingencies (Details Textuals) - Re-performing loans - Purchase commitment - One-to-four family residences $ in Millions | 3 Months Ended |
Mar. 31, 2019USD ($)loan | |
Mortgage Loans on Real Estate [Line Items] | |
Number of mortgage loans on real estate | loan | 88 |
Aggregate unpaid principal balance of mortgage loans on real estate | $ | $ 18.1 |
Debt - Narrative (Details)
Debt - Narrative (Details) | Jan. 25, 2019 | Nov. 19, 2018USD ($) | Aug. 18, 2017USD ($) | Apr. 25, 2017USD ($) | Mar. 31, 2019USD ($)DaysecuritizationtrustcounterpartyFacility$ / shares | Mar. 31, 2018USD ($) | Dec. 31, 2018USD ($) | Mar. 31, 2019USD ($)securitization$ / shares |
Debt Instrument [Line Items] | ||||||||
Percentage of guarantors beneficial interest | 100.00% | 100.00% | ||||||
Number of securitizations completed | securitization | 13 | |||||||
Number of securitizations outstanding | securitization | 6 | 6 | ||||||
Percentage of interests in trust certificates sold to third parties | 50.00% | |||||||
Interest expense | $ 15,685,000 | $ 12,494,000 | ||||||
Amortization of debt discount | $ 3,200,000 | |||||||
Debt Instrument, Basis Spread on Variable Rate | 100.00% | |||||||
Class A Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Period after issue | 36 months | |||||||
Convertible Notes Payable | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal | $ 87,500,000 | |||||||
Interest Rate | 7.25% | 7.25% | 7.25% | 7.25% | ||||
Proceeds from sale of convertible senior notes | $ 20,500,000 | $ 84,900,000 | ||||||
Conversion premium - Convertible senior notes | 200,000 | $ 2,500,000 | ||||||
Percentage of notes convertible to common stock | 17.50% | |||||||
Additional aggregate principal | $ 15,900,000 | $ 20,500,000 | ||||||
Conversion premium | 6.00% | |||||||
Principal amount of note (in dollars per share) | $ / shares | $ 25 | |||||||
If-converted value in excess of principal | $ 11,200,000 | |||||||
Threshold percentage of stock price trigger (at least) | 130.00% | |||||||
Threshold trading days (at least) | Day | 20 | |||||||
Threshold consecutive trading days | Day | 30 | |||||||
Redemption price, percentage | 100.00% | |||||||
Unamortized discount | $ 6,000,000 | $ 6,000,000 | ||||||
Amortization of debt discount | $ 300,000 | |||||||
Interest rate, effective percentage | 8.99% | 8.99% | ||||||
Master Repurchase Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest Rate | 4.81% | 4.80% | 4.81% | |||||
Master Repurchase Agreement | Delaware Trust | Mortgage loans | ||||||||
Debt Instrument [Line Items] | ||||||||
Number of facilities repurchased | Facility | 2 | |||||||
Number of wholly-owned Delaware trusts | trust | 2 | |||||||
Number of counterparties | counterparty | 2 | |||||||
Ceiling for each repurchase facility | $ 250,000,000 | $ 250,000,000 | ||||||
Master Repurchase Agreement | Delaware Trust | Mortgage loans | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Percentage of purchase price for each mortgage loan or REO | 70.00% | |||||||
Master Repurchase Agreement | Delaware Trust | Mortgage loans | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Percentage of purchase price for each mortgage loan or REO | 85.00% | |||||||
Master Repurchase Agreement | Delaware Trust | Mortgages One | ||||||||
Debt Instrument [Line Items] | ||||||||
Ceiling for each repurchase facility | $ 400,000,000 | $ 400,000,000 | ||||||
Gregory | Servicing Agreement | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Servicing fees percentage | 0.42% | |||||||
Gregory | Servicing Agreement | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Servicing fees percentage | 1.25% | |||||||
Common Stock | Convertible Notes Payable | ||||||||
Debt Instrument [Line Items] | ||||||||
Conversion rate | 1.6554 | |||||||
Conversion price (in dollars per share) | $ / shares | $ 15.10 | $ 15.10 | ||||||
2018-C | Class A Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Percentage of Interest retained by the Company | 5.00% | |||||||
2018-C | Mortgage loans | Class B Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal | $ 15,900,000 | $ 15,900,000 | $ 15,900,000 | |||||
2018-C | Mortgage loans | Class A Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal | $ 164,200,000 | 167,500,000 | 164,200,000 | |||||
Ajax Mortgage Loan Trust 2018 C September 2018 | ||||||||
Debt Instrument [Line Items] | ||||||||
Percentage of Interests Sold to Third Parties | 37.00% | |||||||
Ajax Mortgage Loan Trust 2018 C September 2018 | Class A Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Percentage of Interests Sold to Third Parties | 95.00% | |||||||
Ajax Mortgage Loan Trust 2018 C September 2018 | Mortgage loans | Class B Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal | $ 15,900,000 | $ 15,900,000 | ||||||
Interest Rate | 5.25% | 5.25% | ||||||
Ajax Mortgage Loan Trust 2018 C September 2018 | Mortgage loans | Class A Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal | $ 170,500,000 | $ 170,500,000 | ||||||
Interest Rate | 4.36% | 4.36% | ||||||
2017-C | ||||||||
Debt Instrument [Line Items] | ||||||||
Period after issue | 48 months | |||||||
2017-D | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt Instrument, Basis Spread on Variable Rate | 300.00% | |||||||
2017-D | Mortgage loans | Class A Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal | $ 135,700,000 | $ 139,000,000 | $ 135,700,000 | |||||
Convertible Notes Payable | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal | $ 108,000,000 | |||||||
Interest Rate | 7.25% | |||||||
Proceeds from sale of convertible senior notes | $ 15,200,000 | |||||||
Conversion premium - Convertible senior notes | $ 500,000 | |||||||
Conversion premium | 11.43% | |||||||
Unpaid principal balance | 123,900,000 | $ 123,900,000 | ||||||
Interest expense | $ 2,600,000 |
Debt - Schedule of Repurchase T
Debt - Schedule of Repurchase Transactions and Facilities (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2018 | |
Debt Instrument [Line Items] | ||
Amount of Collateral | $ 714,661 | $ 693,464 |
Master Repurchase Agreement | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | 892,192 | 886,134 |
Amount Outstanding | 560,404 | 534,089 |
Amount of Collateral | $ 714,661 | $ 693,464 |
Percentage of Collateral Coverage | 128.00% | 130.00% |
Interest Rate | 4.81% | 4.80% |
Master Repurchase Agreement | January 11, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 8,956 | |
Amount Outstanding | 8,956 | |
Amount of Collateral | $ 12,834 | |
Percentage of Collateral Coverage | 143.00% | |
Interest Rate | 4.41% | |
Master Repurchase Agreement | June 7, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 50,294 | $ 50,294 |
Amount Outstanding | 50,294 | 50,294 |
Amount of Collateral | $ 67,837 | $ 66,747 |
Percentage of Collateral Coverage | 135.00% | 133.00% |
Interest Rate | 4.47% | 4.47% |
Master Repurchase Agreement | June 28, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 8,860 | $ 8,860 |
Amount Outstanding | 8,860 | 8,860 |
Amount of Collateral | $ 10,842 | $ 13,275 |
Percentage of Collateral Coverage | 122.00% | 150.00% |
Interest Rate | 4.64% | 4.64% |
Master Repurchase Agreement | July 12 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 250,000 | $ 250,000 |
Amount Outstanding | 192,065 | 195,644 |
Amount of Collateral | $ 252,645 | $ 258,144 |
Percentage of Collateral Coverage | 132.00% | 132.00% |
Interest Rate | 4.98% | 5.00% |
Master Repurchase Agreement | September 24, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 400,000 | $ 400,000 |
Amount Outstanding | 126,147 | 102,311 |
Amount of Collateral | $ 132,538 | $ 114,852 |
Percentage of Collateral Coverage | 105.00% | 112.00% |
Interest Rate | 4.99% | 4.89% |
Master Repurchase Agreement | February 1, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 13,322 | |
Amount Outstanding | 13,322 | |
Amount of Collateral | $ 17,174 | |
Percentage of Collateral Coverage | 129.00% | |
Interest Rate | 4.53% | |
Master Repurchase Agreement | March 28, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 12,539 | |
Amount Outstanding | 12,539 | |
Amount of Collateral | $ 15,846 | |
Percentage of Collateral Coverage | 126.00% | |
Interest Rate | 4.40% | |
Master Repurchase Agreement | July 11, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 8,956 | |
Amount Outstanding | 8,956 | |
Amount of Collateral | $ 13,016 | |
Percentage of Collateral Coverage | 145.00% | |
Interest Rate | 4.75% | |
Master Repurchase Agreement | August 1, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 14,068 | |
Amount Outstanding | 14,068 | |
Amount of Collateral | $ 19,239 | |
Percentage of Collateral Coverage | 137.00% | |
Interest Rate | 4.81% | |
Master Repurchase Agreement | September 25, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 11,869 | |
Amount Outstanding | 11,869 | |
Amount of Collateral | $ 16,549 | |
Percentage of Collateral Coverage | 139.00% | |
Interest Rate | 4.58% | |
Class B 1 Notes | Master Repurchase Agreement | April 25, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 10,549 | |
Amount Outstanding | 10,549 | |
Amount of Collateral | $ 15,145 | |
Percentage of Collateral Coverage | 144.00% | |
Interest Rate | 4.85% | |
Class A Notes | Master Repurchase Agreement | April 25, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 5,865 | $ 5,865 |
Amount Outstanding | 5,865 | 5,865 |
Amount of Collateral | $ 7,630 | $ 7,580 |
Percentage of Collateral Coverage | 130.00% | 129.00% |
Interest Rate | 4.65% | 4.65% |
Class A Notes | Master Repurchase Agreement | April 29, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 26,367 | |
Amount Outstanding | 26,367 | |
Amount of Collateral | $ 35,232 | |
Percentage of Collateral Coverage | 134.00% | |
Interest Rate | 4.25% | |
Class A Notes | Master Repurchase Agreement | June 6, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 3,786 | $ 44,224 |
Amount Outstanding | 3,786 | 44,224 |
Amount of Collateral | $ 4,967 | $ 58,965 |
Percentage of Collateral Coverage | 131.00% | 133.00% |
Interest Rate | 4.80% | 4.65% |
Class A Notes | Master Repurchase Agreement | June 21, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 32,393 | $ 32,393 |
Amount Outstanding | 32,393 | 32,393 |
Amount of Collateral | $ 41,660 | $ 43,390 |
Percentage of Collateral Coverage | 129.00% | 134.00% |
Interest Rate | 4.65% | 4.62% |
Class A Notes | Master Repurchase Agreement | March 25, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 6,396 | |
Amount Outstanding | 6,396 | |
Amount of Collateral | $ 8,376 | |
Percentage of Collateral Coverage | 131.00% | |
Interest Rate | 4.34% | |
Class A Notes | Master Repurchase Agreement | September 25, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 9,154 | |
Amount Outstanding | 9,154 | |
Amount of Collateral | $ 12,243 | |
Percentage of Collateral Coverage | 134.00% | |
Interest Rate | 4.43% | |
Class B Notes | Master Repurchase Agreement | May 8, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 18,226 | $ 18,226 |
Amount Outstanding | 18,226 | 18,226 |
Amount of Collateral | $ 26,599 | $ 26,036 |
Percentage of Collateral Coverage | 146.00% | 143.00% |
Interest Rate | 4.74% | 4.74% |
Class B Notes | Master Repurchase Agreement | June 6, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 9,937 | $ 3,786 |
Amount Outstanding | 9,937 | 3,786 |
Amount of Collateral | $ 13,181 | $ 5,408 |
Percentage of Collateral Coverage | 133.00% | 143.00% |
Interest Rate | 4.65% | 4.80% |
Class B Notes | Master Repurchase Agreement | June 21, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 2,771 | $ 2,771 |
Amount Outstanding | 2,771 | 2,771 |
Amount of Collateral | $ 4,050 | $ 4,050 |
Percentage of Collateral Coverage | 146.00% | 146.00% |
Interest Rate | 4.80% | 4.77% |
Class B Notes | Master Repurchase Agreement | March 25, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 7,020 | |
Amount Outstanding | 7,020 | |
Amount of Collateral | $ 10,024 | |
Percentage of Collateral Coverage | 143.00% | |
Interest Rate | 4.49% | |
Class B-1 Certificates | Master Repurchase Agreement | April 25, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 10,549 | |
Amount Outstanding | 10,549 | |
Amount of Collateral | $ 15,145 | |
Percentage of Collateral Coverage | 144.00% | |
Interest Rate | 4.85% | |
2018-D | Class A Notes | Master Repurchase Agreement | April 29, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 8,725 | |
Amount Outstanding | 8,725 | |
Amount of Collateral | $ 11,781 | |
Percentage of Collateral Coverage | 135.00% | |
Interest Rate | 4.35% | |
2017-B | Class B Notes | Master Repurchase Agreement | May 8, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 10,933 | $ 10,933 |
Amount Outstanding | 10,933 | 10,933 |
Amount of Collateral | $ 16,502 | $ 15,618 |
Percentage of Collateral Coverage | 151.00% | 143.00% |
Interest Rate | 4.84% | 4.84% |
2019-A | Class B Notes | Master Repurchase Agreement | September 30, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 1,638 | |
Amount Outstanding | 1,638 | |
Amount of Collateral | $ 2,388 | |
Percentage of Collateral Coverage | 146.00% | |
Interest Rate | 4.58% | |
2019-B | Class A Notes | Master Repurchase Agreement | September 30, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 6,233 | |
Amount Outstanding | 6,233 | |
Amount of Collateral | $ 8,330 | |
Percentage of Collateral Coverage | 134.00% | |
Interest Rate | 4.40% | |
2019-B | Class B Notes | Master Repurchase Agreement | September 30, 2019 | ||
Debt Instrument [Line Items] | ||
Maximum Borrowing Capacity | $ 1,568 | |
Amount Outstanding | 1,568 | |
Amount of Collateral | $ 2,287 | |
Percentage of Collateral Coverage | 146.00% | |
Interest Rate | 4.55% | |
Mortgage loans | ||
Debt Instrument [Line Items] | ||
Percentage of Collateral Coverage | 148.00% | 146.00% |
Mortgage loans | 2018-C | ||
Debt Instrument [Line Items] | ||
Cash collateral for borrowed securities | $ 45,500 | |
Percentage of Collateral Coverage | 119.00% | 118.00% |
Mortgage loans | 2018-C | Class A Notes | ||
Debt Instrument [Line Items] | ||
Original Principal | $ 164,200 | $ 167,500 |
Mortgage loans | 2018-C | Class B Notes | ||
Debt Instrument [Line Items] | ||
Original Principal | $ 15,900 | $ 15,900 |
Mortgage loans | 2017-B | ||
Debt Instrument [Line Items] | ||
Percentage of Collateral Coverage | 134.00% | 133.00% |
Debt - Schedule of Netting Agre
Debt - Schedule of Netting Agreement (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Debt Disclosure [Abstract] | ||
Gross amount of recognized liabilities | $ 560,404 | $ 534,089 |
Gross amount pledged as collateral | 714,661 | 693,464 |
Net amount | $ 154,257 | $ 159,375 |
Debt - Schedule of Securitizati
Debt - Schedule of Securitization Notes Outstanding (Details) - Mortgage loans - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Debt Instrument [Line Items] | ||
Deferred issuance costs | $ (5,500,000) | $ (6,300,000) |
Ajax Mortgage Loan Trust 2017-D/ December 2017 | ||
Debt Instrument [Line Items] | ||
Percentage of ownership interests in joint venture | 50.00% | |
Reflection of required consolidation | 100.00% | |
Class A Notes | 2018-C | ||
Debt Instrument [Line Items] | ||
Original Principal | $ 164,200,000 | 167,500,000 |
Securities Borrowed, Liability | 156,000,000 | 159,200,000 |
Class A Notes | Ajax Mortgage Loan Trust 2016-C/ October 2016 | ||
Debt Instrument [Line Items] | ||
Original Principal | $ 102,600,000 | |
Interest Rate | 4.00% | |
Class A Notes | Ajax Mortgage Loan Trust 2017-A/ May 2017 | ||
Debt Instrument [Line Items] | ||
Original Principal | $ 140,700,000 | |
Interest Rate | 3.47% | |
Class A Notes | Ajax Mortgage Loan Trust 2017-B/ December 2017 | ||
Debt Instrument [Line Items] | ||
Original Principal | $ 115,800,000 | |
Interest Rate | 3.163% | |
Class A Notes | Ajax Mortgage Loan Trust 2017-C/ November 2017 | ||
Debt Instrument [Line Items] | ||
Original Principal | $ 130,200,000 | |
Interest Rate | 3.75% | |
Class A Notes | Ajax Mortgage Loan Trust 2017-D/ December 2017 | ||
Debt Instrument [Line Items] | ||
Original Principal | $ 177,800,000 | |
Interest Rate | 3.75% | |
Ownership percentage | 50.00% | |
Class A Notes | Ajax Mortgage Loan Trust 2018-C/ September 2018 | ||
Debt Instrument [Line Items] | ||
Original Principal | $ 170,500,000 | |
Interest Rate | 4.36% | |
Class B Notes | 2018-C | ||
Debt Instrument [Line Items] | ||
Original Principal | $ 15,900,000 | 15,900,000 |
Securities Borrowed, Liability | 5,900,000 | $ 5,900,000 |
Class B Notes | Ajax Mortgage Loan Trust 2018-C/ September 2018 | ||
Debt Instrument [Line Items] | ||
Original Principal | $ 15,900,000 | |
Interest Rate | 5.25% | |
Class B 1 Notes | Ajax Mortgage Loan Trust 2016-C/ October 2016 | ||
Debt Instrument [Line Items] | ||
Original Principal | $ 7,900,000 | |
Interest Rate | 5.25% | |
Class B 1 Notes | Ajax Mortgage Loan Trust 2017-A/ May 2017 | ||
Debt Instrument [Line Items] | ||
Original Principal | $ 15,100,000 | |
Interest Rate | 5.25% | |
Class B 1 Notes | Ajax Mortgage Loan Trust 2017-B/ December 2017 | ||
Debt Instrument [Line Items] | ||
Original Principal | $ 9,000,000 | |
Interest Rate | 3.75% | |
Class B 1 Notes | Ajax Mortgage Loan Trust 2017-C/ November 2017 | ||
Debt Instrument [Line Items] | ||
Original Principal | $ 13,000,000 | |
Interest Rate | 5.25% | |
Class B 2 Notes | Ajax Mortgage Loan Trust 2016-C/ October 2016 | ||
Debt Instrument [Line Items] | ||
Original Principal | $ 7,900,000 | |
Interest Rate | 5.25% | |
Class B 2 Notes | Ajax Mortgage Loan Trust 2017-A/ May 2017 | ||
Debt Instrument [Line Items] | ||
Original Principal | $ 10,800,000 | |
Interest Rate | 5.25% | |
Class B 2 Notes | Ajax Mortgage Loan Trust 2017-B/ December 2017 | ||
Debt Instrument [Line Items] | ||
Original Principal | $ 7,500,000 | |
Interest Rate | 3.75% | |
Trust Certificate | Ajax Mortgage Loan Trust 2016-C/ October 2016 | ||
Debt Instrument [Line Items] | ||
Original principal, trust certificates | $ 39,400,000 | |
Interest Rate | 0.00% | |
Trust Certificate | Ajax Mortgage Loan Trust 2017-A/ May 2017 | ||
Debt Instrument [Line Items] | ||
Original principal, trust certificates | $ 49,800,000 | |
Interest Rate | 0.00% | |
Trust Certificate | Ajax Mortgage Loan Trust 2017-B/ December 2017 | ||
Debt Instrument [Line Items] | ||
Original principal, trust certificates | $ 14,300,000 | |
Interest Rate | 0.00% | |
Trust Certificate | Ajax Mortgage Loan Trust 2017-C/ November 2017 | ||
Debt Instrument [Line Items] | ||
Original principal, trust certificates | $ 42,800,000 | |
Interest Rate | 0.00% | |
Trust Certificate | Ajax Mortgage Loan Trust 2018-C/ September 2018 | ||
Debt Instrument [Line Items] | ||
Original principal, trust certificates | $ 40,900,000 | |
Interest Rate | 0.00% | |
Deferred issuance costs | Ajax Mortgage Loan Trust 2016-C/ October 2016 | ||
Debt Instrument [Line Items] | ||
Interest Rate | 0.00% | |
Deferred issuance costs | $ (1,600,000) | |
Deferred issuance costs | Ajax Mortgage Loan Trust 2017-A/ May 2017 | ||
Debt Instrument [Line Items] | ||
Interest Rate | 0.00% | |
Deferred issuance costs | $ (2,000,000) | |
Deferred issuance costs | Ajax Mortgage Loan Trust 2017-B/ December 2017 | ||
Debt Instrument [Line Items] | ||
Interest Rate | 0.00% | |
Deferred issuance costs | $ (1,800,000) | |
Deferred issuance costs | Ajax Mortgage Loan Trust 2017-C/ November 2017 | ||
Debt Instrument [Line Items] | ||
Interest Rate | 0.00% | |
Deferred issuance costs | $ (1,700,000) | |
Deferred issuance costs | Ajax Mortgage Loan Trust 2017-D/ December 2017 | ||
Debt Instrument [Line Items] | ||
Interest Rate | 0.00% | |
Deferred issuance costs | $ (1,100,000) | |
Deferred issuance costs | Ajax Mortgage Loan Trust 2018-C/ September 2018 | ||
Debt Instrument [Line Items] | ||
Interest Rate | 0.00% | |
Deferred issuance costs | $ (2,000,000) | |
Class M1 Notes | Ajax Mortgage Loan Trust 2017-B/ December 2017 | ||
Debt Instrument [Line Items] | ||
Original Principal | $ 9,700,000 | |
Interest Rate | 3.50% | |
Class M2 Notes | Ajax Mortgage Loan Trust 2017-B/ December 2017 | ||
Debt Instrument [Line Items] | ||
Original Principal | $ 9,500,000 | |
Interest Rate | 3.50% | |
Class B Certificates | Ajax Mortgage Loan Trust 2017-D/ December 2017 | ||
Debt Instrument [Line Items] | ||
Original principal, trust certificates | $ 44,500,000 | |
Interest Rate | 0.00% | |
Ownership percentage | 50.00% |
Debt - Schedule of Status of No
Debt - Schedule of Status of Notes and Securitizations (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2018 | |
Debt Instrument [Line Items] | ||
Carrying value of mortgages | $ 883,149 | $ 897,833 |
Mortgage loans | ||
Debt Instrument [Line Items] | ||
Bond principal balance | $ 598,661 | $ 616,499 |
Percentage of collateral coverage | 148.00% | 146.00% |
Original balances at securitization cutoff date Mortgage UPB | $ 1,152,064 | |
Original balances at securitization cutoff date Bond principal balance | 746,062 | |
Debt issuance costs, net | 5,500 | $ 6,300 |
Mortgage loans | 2016-C | ||
Debt Instrument [Line Items] | ||
Carrying value of mortgages | 100,474 | 102,563 |
Bond principal balance | $ 66,000 | $ 69,692 |
Percentage of collateral coverage | 152.00% | 147.00% |
Original balances at securitization cutoff date Mortgage UPB | $ 157,808 | |
Original balances at securitization cutoff date Bond principal balance | 102,575 | |
Mortgage loans | 2017-A | ||
Debt Instrument [Line Items] | ||
Carrying value of mortgages | 153,884 | $ 157,033 |
Bond principal balance | $ 99,528 | $ 102,755 |
Percentage of collateral coverage | 155.00% | 153.00% |
Original balances at securitization cutoff date Mortgage UPB | $ 216,413 | |
Original balances at securitization cutoff date Bond principal balance | 140,669 | |
Mortgage loans | 2017-B | ||
Debt Instrument [Line Items] | ||
Carrying value of mortgages | 130,823 | $ 132,902 |
Bond principal balance | $ 97,611 | $ 99,857 |
Percentage of collateral coverage | 134.00% | 133.00% |
Original balances at securitization cutoff date Mortgage UPB | $ 165,850 | |
Original balances at securitization cutoff date Bond principal balance | 115,846 | |
Mortgage loans | 2017-C | ||
Debt Instrument [Line Items] | ||
Carrying value of mortgages | 144,869 | $ 146,938 |
Bond principal balance | $ 105,803 | $ 109,616 |
Percentage of collateral coverage | 137.00% | 134.00% |
Original balances at securitization cutoff date Mortgage UPB | $ 185,942 | |
Original balances at securitization cutoff date Bond principal balance | 130,159 | |
Mortgage loans | 2017-D | ||
Debt Instrument [Line Items] | ||
Carrying value of mortgages | 160,945 | $ 163,791 |
Bond principal balance | $ 67,837 | $ 69,528 |
Percentage of collateral coverage | 237.00% | 236.00% |
Original balances at securitization cutoff date Mortgage UPB | $ 203,870 | |
Original balances at securitization cutoff date Bond principal balance | 88,903 | |
Cash collateral for borrowed securities | 26,700 | |
Mortgage loans | 2018-C | ||
Debt Instrument [Line Items] | ||
Carrying value of mortgages | 192,154 | $ 194,606 |
Bond principal balance | $ 161,882 | $ 165,051 |
Percentage of collateral coverage | 119.00% | 118.00% |
Original balances at securitization cutoff date Mortgage UPB | $ 222,181 | |
Original balances at securitization cutoff date Bond principal balance | 167,910 | |
Cash collateral for borrowed securities | 45,500 | |
Class A Notes | Mortgage loans | 2017-D | ||
Debt Instrument [Line Items] | ||
Original Principal | 135,700 | $ 139,000 |
Secured borrowings | 67,800 | 69,500 |
Class A Notes | Mortgage loans | 2018-C | ||
Debt Instrument [Line Items] | ||
Original Principal | 164,200 | 167,500 |
Secured borrowings | 156,000 | 159,200 |
Class B Notes | Mortgage loans | 2018-C | ||
Debt Instrument [Line Items] | ||
Original Principal | 15,900 | 15,900 |
Secured borrowings | $ 5,900 | $ 5,900 |
Related Party Transactions - Sc
Related Party Transactions - Schedule Statement of Income of Related Party Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Related Party Transaction [Line Items] | ||
Related party expense – loan servicing fees | $ 2,506 | $ 2,469 |
Related party expense – management fee | 1,688 | 1,532 |
Interest Income | ||
Related Party Transaction [Line Items] | ||
Amount of transaction | 2,416 | 131 |
Gregory | Loan transaction expense | ||
Related Party Transaction [Line Items] | ||
Amount of transaction | 0 | 89 |
Gregory | Other fees and expenses | ||
Related Party Transaction [Line Items] | ||
Amount of transaction | 0 | 32 |
Thetis | Income from investments in affiliate | ||
Related Party Transaction [Line Items] | ||
Amount of transaction | 279 | 129 |
Great Ajax FS | Income from investments in affiliate | ||
Related Party Transaction [Line Items] | ||
Amount of transaction | $ 128 | $ 9 |
Related Party Transactions - _2
Related Party Transactions - Schedule of Balance Sheet of Related Party Transaction (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Gregory | Prepaid expenses and ather assets | ||
Related Party Transaction [Line Items] | ||
Amount of transaction | $ 12 | $ 11 |
Gregory | Receivable from Servicer | ||
Related Party Transaction [Line Items] | ||
Amount of transaction | 18,746 | 14,587 |
2018-D | Prepaid expenses and ather assets | ||
Related Party Transaction [Line Items] | ||
Amount of transaction | 10 | |
2018-B | Prepaid expenses and ather assets | ||
Related Party Transaction [Line Items] | ||
Amount of transaction | 5 | 2 |
2018-A | Prepaid expenses and ather assets | ||
Related Party Transaction [Line Items] | ||
Amount of transaction | 10 | 2 |
Thetis | Prepaid expenses and ather assets | ||
Related Party Transaction [Line Items] | ||
Amount of transaction | 82 | |
Thetis | Management Fee Payable | ||
Related Party Transaction [Line Items] | ||
Amount of transaction | 951 | 881 |
Thetis | Accrued expenses and other liabilities | ||
Related Party Transaction [Line Items] | ||
Amount of transaction | $ 16 | |
2018-E | Accrued expenses and other liabilities | ||
Related Party Transaction [Line Items] | ||
Amount of transaction | $ 34 |
Related party Transactions - Na
Related party Transactions - Narrative (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Oct. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Oct. 31, 2016USD ($) | Mar. 31, 2019USD ($)calender | Mar. 31, 2018USD ($) | Dec. 31, 2018USD ($) | |
Related Party Transaction [Line Items] | ||||||
Management fee payable | $ 951 | $ 881 | ||||
Period of termination of license agreement | 30 days | |||||
Purchase of debt securities | $ 64,014 | $ 0 | ||||
Investment In Securities | 64,000 | 175,300 | ||||
Investment in debt securities | 152,083 | 146,811 | ||||
Investments in beneficial interests | 30,809 | 22,086 | ||||
Residential RPL loan pools | ||||||
Related Party Transaction [Line Items] | ||||||
Mortgage Loans On Real Estate Commitments To Purchase Or Sell Unpaid Principal Balance | $ 8,500 | $ 19,700 | ||||
Thetis | Management Agreement | ||||||
Related Party Transaction [Line Items] | ||||||
Base management fee percentage | 1.50% | |||||
Thetis | Amended And Restated Management Agreement | ||||||
Related Party Transaction [Line Items] | ||||||
Percentage of Independent Directors | 66.67% | |||||
Management fee payable | $ 1,000 | |||||
Percentage of base management fees payable in cash | 75.00% | |||||
Percentage of base management fee payable in shares of common stock | 25.00% | |||||
Percentage in excess of base management fees payable in cash | 50.00% | |||||
Percentage in excess of base management fees payable in shares | 50.00% | |||||
Period of common shares held as base management fee (at least) | 3 years | |||||
Percentage of remaining incentive fee payable in common stock | 20.00% | |||||
Percentage of remaining incentive fee in excess of book value | 8.00% | |||||
Number of calender quarters | calender | 8 | |||||
Percentage of remaining incentive fee payable in cash | 80.00% | |||||
Incentive Fee Expense | $ 200 | |||||
Gregory | Servicing Agreement | Minimum [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Servicing fees percentage | 0.42% | |||||
Gregory | Servicing Agreement | Maximum [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Servicing fees percentage | 1.25% | |||||
Oileus Residential Loan Trust | ||||||
Related Party Transaction [Line Items] | ||||||
Purchase of debt securities | $ 6,300 | |||||
Available-for-sale Securities, Gross Realized Gains | 200 | |||||
2018-C | ||||||
Related Party Transaction [Line Items] | ||||||
Purchase of debt securities | $ 45,100 | $ 47,400 | ||||
Mortgage Loans On Real Estate Commitments To Purchase Or Sell Unpaid Principal Balance | $ 50,100 | $ 52,800 | ||||
Beneficial interests | ||||||
Related Party Transaction [Line Items] | ||||||
Investments in beneficial interests | $ 9,500 | 21,800 | ||||
Senior Notes | ||||||
Related Party Transaction [Line Items] | ||||||
Investment in debt securities | 50,000 | 144,100 | ||||
Subordinated Debt | ||||||
Related Party Transaction [Line Items] | ||||||
Investment in debt securities | $ 4,600 | $ 9,400 |
Stock-based Payments and Dire_3
Stock-based Payments and Director Fees - Narrative (Details) - USD ($) | Apr. 01, 2019 | Jul. 24, 2017 | Aug. 17, 2016 | Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Management fees | $ 1,600,000 | ||||||
Number of shares (in shares) | 65,065 | 51,572 | |||||
Share-based Compensation | $ 766,000 | $ 801,000 | |||||
Annual retainer amount | $ 75,000 | ||||||
Restricted stock | Employees | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of restricted stock awards issued to independent directors (in shares) | 39,000 | 153,000 | |||||
Vesting period | 3 years | ||||||
2014 Director Equity Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period | 1 year | ||||||
Annual Retainer Received In Shares | 50.00% | ||||||
Annual Retainer Received In Cash | 50.00% | ||||||
2014 Director Equity Plan | Restricted stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Annual Retainer Received In Shares And Cash Amount | $ 75,000 | ||||||
Long term incentive plan | Restricted stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of shares forfeited (in shares) | 2,666 | 4,000 | |||||
Long term incentive plan | Initial public offering | Restricted stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of restricted stock awards issued to independent directors (in shares) | 2,000 | ||||||
Vesting period | 1 year | ||||||
Management fee | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Amount of expense recognized | $ 700,000 | ||||||
Number of shares (in shares) | 62,301 | 49,156 | |||||
Share-based Compensation | $ 728,000 | $ 763,000 | |||||
Incentive Fees | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-based Compensation | $ 200,000 | ||||||
Common Stock | Management fee | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of shares (in shares) | 59,574 | ||||||
Common Stock | Incentive Fees | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of shares (in shares) | 2,727 | ||||||
Share-based Compensation | $ 31,000 | ||||||
Scenario, Forecast | 2014 Director Equity Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Annual Retainer Received In Shares | 40.00% | ||||||
Annual Retainer Received In Cash | 60.00% | ||||||
Scenario, Forecast | 2014 Director Equity Plan | Restricted stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Annual Retainer Received In Shares And Cash Amount | $ 100,000 |
Stock-based Payments and Dire_4
Stock-based Payments and Director Fees - Schedule of Management Fees and Director Fees (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares (in shares) | 65,065 | 51,572 |
Amount of expense recognized | $ 766 | $ 801 |
Management fees | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares (in shares) | 62,301 | 49,156 |
Amount of expense recognized | $ 728 | $ 763 |
Independent director fees | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares (in shares) | 2,764 | 2,416 |
Amount of expense recognized | $ 38 | $ 38 |
Stock-based Payments and Dire_5
Stock-based Payments and Director Fees - Schedule of Restricted Stock Plans (Details) - Restricted stock - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total shares granted (in shares) | 233,834 | 195,334 | ||
Total expected cost of grant | $ 3,178 | $ 2,662 | ||
Shares granted during the year (in shares) | 0 | 0 | ||
Grant expense recognized | $ 263 | $ 185 | ||
Shares, nonvested (in shares) | 110,389 | 135,667 | ||
Per share grant fair value (in dollars per share) | $ 13.63 | $ 13.83 | ||
Shares, fully vested (in shares) | 123,445 | 59,667 | ||
Per share grant date fair value (in dollars per share) | $ 13.55 | $ 13.69 | ||
Director | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares granted during the year (in shares) | 3,000 | |||
Vesting period | 1 year | |||
Directors’ Grants | Director | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total shares granted (in shares) | 12,000 | 10,000 | ||
Total expected cost of grant | $ 162 | $ 146 | ||
Shares granted during the year (in shares) | 0 | 0 | ||
Grant expense recognized | $ 14 | $ 0 | ||
Shares, nonvested (in shares) | 0 | 0 | ||
Per share grant fair value (in dollars per share) | $ 13.48 | $ 0 | ||
Shares, fully vested (in shares) | 12,000 | 10,000 | ||
Per share grant date fair value (in dollars per share) | $ 13.48 | $ 14.61 | ||
Vesting period | 1 year | |||
Employee And Service Provider Grants | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total shares granted (in shares) | 146,334 | 146,334 | ||
Total expected cost of grant | $ 1,976 | $ 1,978 | ||
Shares granted during the year (in shares) | 0 | 0 | ||
Grant expense recognized | $ 163 | $ 140 | ||
Shares, nonvested (in shares) | 47,889 | 96,667 | ||
Per share grant fair value (in dollars per share) | $ 13.50 | $ 13.50 | ||
Shares, fully vested (in shares) | 98,445 | 49,667 | ||
Per share grant date fair value (in dollars per share) | $ 13.50 | $ 13.50 | ||
Vesting period | 3 years | |||
Weighted average remaining contractual terms | 4 months 24 days | 1 year 4 months 24 days | ||
Employee and Service Provider Second Option | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total shares granted (in shares) | 39,000 | 39,000 | ||
Total expected cost of grant | $ 544 | $ 538 | ||
Shares granted during the year (in shares) | 0 | 0 | ||
Grant expense recognized | $ 45 | $ 45 | ||
Shares, nonvested (in shares) | 26,000 | 39,000 | ||
Per share grant fair value (in dollars per share) | $ 13.95 | $ 13.95 | ||
Shares, fully vested (in shares) | 13,000 | 0 | ||
Per share grant date fair value (in dollars per share) | $ 13.95 | $ 0 | ||
Weighted average remaining contractual terms | 1 year 3 months 18 days | 2 years 3 months 18 days | ||
Employee and Service Provider Grants Third Option | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total shares granted (in shares) | 36,500 | |||
Total expected cost of grant | $ 496 | |||
Shares granted during the year (in shares) | 0 | |||
Grant expense recognized | $ 41 | |||
Shares, nonvested (in shares) | 36,500 | |||
Per share grant fair value (in dollars per share) | $ 13.58 | |||
Shares, fully vested (in shares) | 0 | |||
Per share grant date fair value (in dollars per share) | $ 0 | |||
Weighted average remaining contractual terms | 2 years 4 months 24 days | |||
Long Term Incentive Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares forfeited (in shares) | 2,666 | 4,000 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) | 3 Months Ended | |
Mar. 31, 2019USD ($)year | Mar. 31, 2018USD ($) | |
Income Tax Disclosure [Abstract] | ||
Distribution Percentage Of Real Estate Investment Trust Taxable Income | 90.00% | |
Number Of Taxable Years | year | 4 | |
Taxable income | $ 2,000,000 | $ 6,800,000 |
Provision for income taxes | 71,000 | 16,000 |
Deferred income tax assets | 0 | 0 |
Deferred income tax liabilities | 0 | 0 |
Income tax interest and penalties recorded | $ 0 | $ 0 |
Earnings per Share - Schedule o
Earnings per Share - Schedule of Components of Basic and Diluted EPS (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Basic EPS | ||
Consolidated net income attributable to common stockholders | $ 7,330 | $ 7,665 |
Allocation of earnings to participating restricted shares | (84) | (88) |
Consolidated net income attributable to unrestricted common stockholders | 7,246 | 7,577 |
Effect of dilutive securities | ||
Operating Partnership units | 239 | 259 |
Restricted stock grants and Manager and director fee shares | 84 | 88 |
Interest expense (add back) and assumed conversion of shares from convertible senior notes | 2,549 | 2,142 |
Diluted EPS | ||
Consolidated net income attributable to common stockholders and dilutive securities | $ 10,118 | $ 10,066 |
Basic EPS | ||
Consolidated net income attributable to unrestricted common stockholders (in shares) | 18,811,713 | 18,508,089 |
Allocation of earnings to participating restricted shares (in shares) | 0 | 0 |
Effect of dilutive securities | ||
Operating Partnership units (in shares) | 624,106 | 624,106 |
Restricted stock grants and Manager and director fee shares (in shares) | 217,316 | 215,747 |
Interest expense (add back) and assumed conversion of shares from convertible senior notes (in shares) | 8,176,313 | 7,047,216 |
Diluted EPS | ||
Consolidated net income attributable to common stockholders and dilutive securities (in shares) | 27,829,448 | 26,395,158 |
Per Share Amount | ||
Consolidated net income attributable to unrestricted common stockholders (in dollars per share) | $ 0.39 | $ 0.41 |
Consolidated net income attributable to common stockholders and dilutive securities (in dollars per share) | $ 0.36 | $ 0.38 |
Equity - Narrative (Details)
Equity - Narrative (Details) | 3 Months Ended | |||
Mar. 31, 2019USD ($)transaction$ / sharesshares | Mar. 31, 2018USD ($)shares | Dec. 31, 2018$ / sharesshares | Dec. 31, 2017shares | |
Class of Stock [Line Items] | ||||
Common stock shares outstanding (in shares) | 18,967,223 | 18,909,874 | ||
Common stock par value per share (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | ||
Common stock shares authorized (in shares) | 125,000,000 | 125,000,000 | ||
Preferred stock shares outstanding (in shares) | 0 | 0 | ||
Preferred stock shares authorized (in shares) | 25,000,000 | 25,000,000 | ||
Treasury Stock, Shares | 23,229 | 20,277 | ||
Sale of common stock pursuant to dividend reinvestment plan | $ | $ 72,000 | $ 52,000 | ||
Number of transactions | transaction | 5 | |||
Operating partnership units | 624,106 | 624,106 | ||
At-the-Market Program | ||||
Class of Stock [Line Items] | ||||
Common stock authorized | $ | $ 50,000,000 | |||
Proceeds from issuance of common stock | $ | $ 0 | $ 0 | ||
Common Stock | ||||
Class of Stock [Line Items] | ||||
Common stock shares outstanding (in shares) | 18,967,223 | 18,686,420 | 18,909,874 | 18,588,228 |
Issuance of shares under dividend reinvestment plan (in shares) | 5,321 | 3,838 | ||
Sale of common stock pursuant to dividend reinvestment plan | $ | $ 100,000 | $ 100,000 | ||
2017-D | ||||
Class of Stock [Line Items] | ||||
Ownership percentage by noncontrolling owners | 50.00% | |||
Percentage of ownership interests in joint venture | 50.00% | |||
AS Ajax E II LLC | ||||
Class of Stock [Line Items] | ||||
Ownership percentage by noncontrolling owners | 46.90% | |||
Percentage of ownership interests in joint venture | 53.10% | |||
2018-C | ||||
Class of Stock [Line Items] | ||||
Ownership percentage by noncontrolling owners | 37.00% | |||
Banfield | ||||
Class of Stock [Line Items] | ||||
Ownership percentage by noncontrolling owners | 10.00% |
Equity - Schedule of Accumulate
Equity - Schedule of Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2018 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Accumulated other comprehensive loss | $ (178) | $ (575) |
AOCI Attributable to Parent | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Accumulated other comprehensive loss | (178) | (575) |
Accumulated Net Investment Gain (Loss) Attributable to Parent | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Unrealized gains | 410 | 250 |
Unrealized losses | $ (588) | $ (825) |
Subsequent Events - Narrative (
Subsequent Events - Narrative (Details) $ / shares in Units, $ in Millions | 1 Months Ended | 3 Months Ended | ||
May 08, 2019USD ($)transactionloansellerDirectorshares | Mar. 31, 2019USD ($)loanshares | Mar. 31, 2018USD ($)loanshares | Apr. 30, 2019$ / shares | |
Common Stock | ||||
Subsequent Event [Line Items] | ||||
Shares Issued During Period Stock Based Management Fee Expense | shares | 52,556 | 48,654 | ||
Re-performing loans | ||||
Subsequent Event [Line Items] | ||||
Number of mortgage loans on real estate | loan | 38 | 87 | ||
Aggregate unpaid principal balance of mortgage loans on real estate | $ 8.5 | $ 19.7 | ||
Subsequent Event | Board of Directors | ||||
Subsequent Event [Line Items] | ||||
Dividends payable, amount per share (in dollars per share) | $ / shares | $ 0.32 | |||
Subsequent Event | Common Stock | ||||
Subsequent Event [Line Items] | ||||
Number of independent directors | Director | 4 | |||
Number of shares issued in payment of half of their quarterly director fees (in shares) | shares | 691 | |||
Subsequent Event | Common Stock | Thetis | ||||
Subsequent Event [Line Items] | ||||
Shares Issued During Period Stock Based Management Fee Expense | shares | 62,301 | |||
Subsequent Event | Two Sellers | ||||
Subsequent Event [Line Items] | ||||
Number of transaction | transaction | 2 | |||
Number of sellers | seller | 2 | |||
Subsequent Event | Four Sellers | ||||
Subsequent Event [Line Items] | ||||
Number of transaction | transaction | 4 | |||
Number of sellers | seller | 4 | |||
Subsequent Event | Re-performing loans | Two Sellers | ||||
Subsequent Event [Line Items] | ||||
Number of mortgage loans on real estate | loan | 66 | |||
Aggregate unpaid principal balance of mortgage loans on real estate | $ 13.9 | |||
Percentage of unpaid principal balance of loan acquired | 87.90% | |||
Percentage of estimated market value of the underlying collateral | 57.80% | |||
Estimated market value of the underlying collateral | $ 21.1 | |||
Subsequent Event | Re-performing loans | Four Sellers | ||||
Subsequent Event [Line Items] | ||||
Number of mortgage loans on real estate | loan | 106 | |||
Aggregate unpaid principal balance of mortgage loans on real estate | $ 21.3 | |||
Percentage of unpaid principal balance of loan acquired | 84.20% | |||
Percentage of estimated market value of the underlying collateral | 55.90% | |||
Estimated market value of the underlying collateral | $ 32.2 | |||
Subsequent Event | SBC | ||||
Subsequent Event [Line Items] | ||||
Number of mortgage loans on real estate | loan | 2 | |||
Aggregate unpaid principal balance of mortgage loans on real estate | $ 0.7 | |||
Percentage of unpaid principal balance of loan acquired | 99.00% | |||
Subsequent Event | commercial building | ||||
Subsequent Event [Line Items] | ||||
Number of transaction | transaction | 3 | |||
Number of sellers | seller | 3 | |||
Number of real estate properties purchased | seller | 3 | |||
Purchase price | $ 7.1 |