Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2021 | Oct. 29, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | OCWEN FINANCIAL CORPORATION | |
Entity Central Index Key | 0000873860 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 1-13219 | |
Entity Incorporation, State or Country Code | FL | |
Entity Tax Identification Number | 65-0039856 | |
Entity Address, Address Line One | 1661 Worthington Road, Suite 100 | |
Entity Address, City or Town | West Palm Beach, | |
Entity Address, State or Province | FL | |
Entity Address, Postal Zip Code | 33409 | |
City Area Code | 561 | |
Local Phone Number | 682-8000 | |
Entity Filer Category | Accelerated Filer | |
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2021 | |
Document Transition Report | false | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Emerging Growth Company | false | |
Entity Small Business | true | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 9,200,752 | |
Title of 12(b) Security | Common Stock, $0.01 Par Value | |
Trading Symbol | OCN | |
Security Exchange Name | NYSE |
UNAUDITED CONSOLIDATED BALANCE
UNAUDITED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Assets | ||
Cash and cash equivalents | $ 236,072 | $ 284,802 |
Restricted cash (amounts related to variable interest entities (VIEs) of $9,417 and $16,791) | 85,277 | 72,463 |
Mortgage servicing rights (MSRs), at fair value | 2,176,260 | 1,294,817 |
Advances, net (amounts related to VIEs of $594,645 and $651,576) | 739,596 | 828,239 |
Loans held for sale ($921,621 and $366,364 carried at fair value) (amounts related to VIEs of $461,827 and $0) | 933,700 | 387,836 |
Loans held for investment, at fair value (amounts related to VIEs of $8,004 and $9,770) | 7,108,730 | 7,006,897 |
Receivables, net | 183,090 | 187,665 |
Premises and equipment, net | 15,122 | 16,925 |
Investment in equity method investee | 19,794 | 0 |
Other assets ($22,158 and $25,476 carried at fair value) (amounts related to VIEs of $1,988 and $4,544) | 542,597 | 571,483 |
Total assets | 12,040,238 | 10,651,127 |
Liabilities | ||
Home Equity Conversion Mortgage-Backed Securities (HMBS) related borrowings, at fair value | 6,782,564 | 6,772,711 |
Other financing liabilities, at fair value (amounts related to VIEs of $8,004 and $9,770) | 710,911 | 576,722 |
Advance match funded liabilities (related to VIEs) | 516,572 | 581,288 |
Mortgage loan warehouse facilities | 1,069,170 | 451,713 |
MSR financing facilities, net | 945,744 | 437,672 |
Senior secured term loan, net | 0 | 179,776 |
Senior notes, net | 612,658 | 311,898 |
Other liabilities ($20,518 and $4,638 carried at fair value) | 932,748 | 923,975 |
Total liabilities | 11,570,367 | 10,235,755 |
Commitments and Contingencies (Notes 21 and 22) | ||
Ocwen Financial Corporation (Ocwen) stockholders’ equity | ||
Common stock, $.01 par value; 13,333,333 shares authorized; 9,189,030 and 8,687,750 shares issued and outstanding at September 30, 2021 and December 31, 2020, respectively. | 92 | 87 |
Additional paid-in capital | 591,839 | 556,062 |
Accumulated deficit | (111,909) | (131,682) |
Accumulated other comprehensive loss, net of income taxes | (10,151) | (9,095) |
Total stockholders’ equity | 469,871 | 415,372 |
Total liabilities and stockholders’ equity | $ 12,040,238 | $ 10,651,127 |
UNAUDITED CONSOLIDATED BALANC_2
UNAUDITED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Restricted cash | $ 85,277 | $ 72,463 |
Advances | 739,596 | 828,239 |
Loans held for sale, at fair value | 921,621 | 366,364 |
Loans held for investment, at fair value (amounts related to VIEs of $8,004 and $9,770) | 7,108,730 | 7,006,897 |
Other assets, at fair value | 22,158 | 25,476 |
Other assets | 542,597 | 571,483 |
Other financing liabilities, at fair value (amounts related to VIEs of $8,004 and $9,770) | 710,911 | 576,722 |
Other liabilities, fair value | $ 20,518 | $ 4,638 |
Common Stock, Par or Stated Value Per Share | $ 0.01 | |
Common stock, shares authorized | 13,333,333 | |
Common stock, shares, outstanding | 9,189,030 | 8,687,750 |
Residential Mortgage Backed Securitization Trusts | ||
Loans held for investment, at fair value (amounts related to VIEs of $8,004 and $9,770) | $ 8,004 | $ 9,770 |
Other financing liabilities, at fair value (amounts related to VIEs of $8,004 and $9,770) | 8,004 | 9,770 |
Variable Interest Entity, Primary Beneficiary | ||
Restricted cash | 9,417 | 16,791 |
Advances | 594,645 | 651,576 |
Loans held for sale, at fair value | 461,827 | 0 |
Other assets | $ 1,988 | $ 4,544 |
UNAUDITED CONSOLIDATED STATEMEN
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Revenue | ||||
Servicing and subservicing fees | $ 206,585 | $ 181,722 | $ 562,764 | $ 568,445 |
Reverse mortgage revenue, net | 5,035 | 14,499 | 56,162 | 51,055 |
Gain on loans held for sale, net | 59,702 | 45,886 | 108,136 | 92,764 |
Other revenue, net | 11,779 | 6,928 | 29,078 | 17,637 |
Total revenue | 283,101 | 249,035 | 756,140 | 729,901 |
MSR valuation adjustments, net | (6,320) | (33,814) | (57,562) | (231,368) |
Operating expenses | ||||
Compensation and benefits | 68,960 | 69,648 | 209,413 | 195,393 |
Servicing and origination | 27,932 | 22,930 | 82,044 | 60,547 |
Professional services | 18,379 | 28,361 | 61,245 | 77,816 |
Technology and communications | 14,737 | 15,850 | 41,050 | 47,154 |
Occupancy and equipment | 8,962 | 9,572 | 25,699 | 37,677 |
Other expenses | 6,466 | 3,161 | 15,422 | 12,958 |
Total operating expenses | 145,436 | 149,522 | 434,873 | 431,545 |
Other income (expense) | ||||
Interest income | 7,869 | 3,801 | 15,993 | 12,762 |
Interest expense | (40,623) | (26,815) | (102,591) | (83,557) |
Pledged MSR liability expense | (91,160) | (57,404) | (168,820) | (105,684) |
Loss on extinguishment of debt | 0 | 0 | (15,458) | 0 |
Earnings of equity method investee | 932 | 0 | 1,282 | 0 |
Other, net | 1,900 | 3,345 | 5,554 | 4,616 |
Total other expense, net | (121,082) | (77,073) | (264,040) | (171,863) |
Income (loss) before income taxes | 10,263 | (11,374) | (335) | (104,875) |
Income tax benefit | (11,289) | (1,954) | (20,108) | (71,920) |
Net income (loss) | $ 21,552 | $ (9,420) | $ 19,773 | $ (32,955) |
Earnings (loss) per share | ||||
Basic (in USD per share) | $ 2.35 | $ (1.09) | $ 2.21 | $ (3.76) |
Diluted (in USD per share) | $ 2.29 | $ (1.09) | $ 2.13 | $ (3.76) |
Weighted average common shares outstanding | ||||
Basic (in shares) | 9,189,030 | 8,669,550 | 8,960,696 | 8,770,102 |
Diluted (in shares) | 9,401,858 | 8,669,550 | 9,270,751 | 8,770,102 |
UNAUDITED CONSOLIDATED STATEM_2
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 21,552 | $ (9,420) | $ 19,773 | $ (32,955) |
Other comprehensive income (loss), net of income taxes: | ||||
Change in unfunded pension plan obligation liability | (386) | 47 | (1,119) | 139 |
Other | 18 | 42 | 63 | 118 |
Comprehensive income (loss) | $ 21,184 | $ (9,331) | $ 18,717 | $ (32,698) |
UNAUDITED CONSOLIDATED STATEM_3
UNAUDITED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | (Accumulated Deficit) Retained Earnings | Accumulated Other Comprehensive Loss, Net of Income Taxes |
Beginning Balance at Dec. 31, 2019 | $ 412,011 | $ 90 | $ 558,057 | $ (138,542) | $ (7,594) |
Beginning Balance (in shares) at Dec. 31, 2019 | 8,990,816 | ||||
Net income (loss) | (32,955) | (32,955) | |||
Cumulative effect of adoption of Financial Accounting Standards Board (FASB) Accounting Standards Update (ASU) No. 2016-13 | 47,038 | 47,038 | |||
Repurchase of common stock | (4,605) | $ (4) | (4,601) | ||
Repurchase of common stock (in shares) | (377,484) | ||||
Additional shares issued on reverse stock split rounding | 4,692 | ||||
Equity-based compensation and other | 2,721 | $ 1 | 2,720 | ||
Equity-based compensation and other (in shares) | 54,248 | ||||
Other comprehensive income, net of income taxes | 257 | 257 | |||
Ending Balance at Sep. 30, 2020 | 424,467 | $ 87 | 556,176 | (124,459) | (7,337) |
Ending Balance (in shares) at Sep. 30, 2020 | 8,672,272 | ||||
Beginning Balance at Jun. 30, 2020 | 432,769 | $ 87 | 555,147 | (115,039) | (7,426) |
Beginning Balance (in shares) at Jun. 30, 2020 | 8,667,260 | ||||
Net income (loss) | (9,420) | (9,420) | |||
Additional shares issued on reverse stock split rounding | 4,692 | ||||
Equity-based compensation and other | 1,029 | $ 0 | 1,029 | ||
Equity-based compensation and other (in shares) | 320 | ||||
Other comprehensive income, net of income taxes | 89 | 89 | |||
Ending Balance at Sep. 30, 2020 | 424,467 | $ 87 | 556,176 | (124,459) | (7,337) |
Ending Balance (in shares) at Sep. 30, 2020 | 8,672,272 | ||||
Beginning Balance at Dec. 31, 2020 | $ 415,372 | $ 87 | 556,062 | (131,682) | (9,095) |
Beginning Balance (in shares) at Dec. 31, 2020 | 8,687,750 | 8,687,750 | |||
Net income (loss) | $ 19,773 | 19,773 | |||
Issuance of common stock, value | 12,169 | $ 4 | 12,165 | ||
Issuance of common stock, shares | 426,705 | ||||
Issuance of common stock warrants, net of issuance costs | 19,956 | 19,956 | |||
Equity-based compensation and other | 3,657 | $ 1 | 3,656 | ||
Equity-based compensation and other (in shares) | 74,575 | ||||
Other comprehensive income, net of income taxes | (1,056) | (1,056) | |||
Ending Balance at Sep. 30, 2021 | $ 469,871 | $ 92 | 591,839 | (111,909) | (10,151) |
Ending Balance (in shares) at Sep. 30, 2021 | 9,189,030 | 9,189,030 | |||
Beginning Balance at Jun. 30, 2021 | $ 447,100 | $ 92 | 590,252 | (133,461) | (9,783) |
Beginning Balance (in shares) at Jun. 30, 2021 | 9,189,030 | ||||
Net income (loss) | 21,552 | 21,552 | |||
Equity-based compensation and other | 1,587 | $ 0 | 1,587 | ||
Equity-based compensation and other (in shares) | 0 | ||||
Other comprehensive income, net of income taxes | (368) | (368) | |||
Ending Balance at Sep. 30, 2021 | $ 469,871 | $ 92 | $ 591,839 | $ (111,909) | $ (10,151) |
Ending Balance (in shares) at Sep. 30, 2021 | 9,189,030 | 9,189,030 |
UNAUDITED CONSOLIDATED STATEM_4
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Cash flows from operating activities | ||
Net income (loss) | $ 19,773 | $ (32,955) |
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities: | ||
MSR valuation adjustments, net | 57,562 | 231,368 |
Loss (gain) on sale of MSRs, net | 64 | (48) |
Provision for bad debts | 16,069 | 18,801 |
Depreciation | 7,527 | 15,398 |
Amortization of debt issuance costs and discount | 5,438 | 5,335 |
Equity-based compensation expense | 3,697 | 2,392 |
Loss on extinguishment of debt | 15,458 | 0 |
Loss (gain) on valuation of Pledged MSR financing liability | 71,273 | (21,314) |
Net gain on valuation of loans held for investment and HMBS-related borrowings | (9,993) | (14,410) |
Earnings of equity method investee | (1,282) | 0 |
Gain on loans held for sale, net | (108,136) | (92,764) |
Origination and purchase of loans held for sale | (12,987,522) | (4,378,999) |
Proceeds from sale and collections of loans held for sale | 12,411,398 | 4,259,127 |
Changes in assets and liabilities: | ||
Decrease in advances, net | 69,868 | 210,688 |
Decrease in receivables and other assets, net | 9,659 | 105,023 |
Decrease (increase) in other liabilities | 9,582 | (47,981) |
Other, net | (3,271) | (11,622) |
Net cash (used in) provided by operating activities | (412,836) | 248,039 |
Cash flows from investing activities | ||
Origination of loans held for investment | (1,214,772) | (867,702) |
Principal payments received on loans held for investment | 1,172,011 | 619,486 |
Purchase of MSRs | (785,194) | (82,990) |
Investment in equity method investee | (18,512) | 0 |
Other, net | 1,086 | 3,090 |
Net cash used in investing activities | (845,381) | (328,116) |
Cash flows from financing activities | ||
Repayment of advance match funded liabilities, net | (64,716) | (99,031) |
Repayment of other financing liabilities | (62,076) | (84,185) |
Proceeds from mortgage loan warehouse facilities, net | 617,457 | 109,538 |
Proceeds from MSR financing facilities | 680,711 | 128,641 |
Repayment of MSR financing facilities | (170,500) | (208,996) |
Repayment of Senior notes | (319,156) | 0 |
Proceeds from issuance of Senior notes and warrants | 647,944 | 0 |
Repayment of senior secured term loan (SSTL) borrowings | (188,700) | (136,066) |
Payment of debt issuance costs | (16,173) | (7,522) |
Proceeds from sale of MSRs accounted for as secured financing | 130,024 | 0 |
Proceeds from sale of Home Equity Conversion Mortgages (HECM, or reverse mortgages) accounted for as a financing (HMBS-related borrowings) | 1,119,742 | 885,987 |
Repayment of HMBS-related borrowings | (1,161,609) | (613,026) |
Issuance of common stock | 9,878 | 0 |
Repurchase of common stock | 0 | (4,605) |
Other, net | (525) | (32) |
Net cash provided by (used in) financing activities | 1,222,301 | (29,297) |
Net decrease in cash, cash equivalents and restricted cash | (35,916) | (109,374) |
Cash, cash equivalents and restricted cash at beginning of year | 357,265 | 492,340 |
Cash, cash equivalents and restricted cash at end of period | 321,349 | 382,966 |
Supplemental non-cash investing and financing activities: | ||
Right-of-use asset | 3,955 | 2,608 |
Lease liability | 3,955 | 2,597 |
Transfers of loans held for sale to real estate owned (REO) | 5,312 | 2,554 |
Transfer from loans held for investment to loans held for sale | 2,898 | 1,900 |
MSRs | 0 | (263,344) |
Financing liability - MSRs pledged | 0 | (263,344) |
Deconsolidation of mortgage-backed securitization trusts (VIEs), Loans held for investment | 0 | (10,715) |
Deconsolidation of mortgage-backed securitization trusts (VIEs), Other financing liabilities | 0 | (9,519) |
Recognition of future draw commitments for HECM loans at fair value upon adoption of FASB ASU No. 2016-13 | 0 | 47,038 |
Cash proceeds received | 4,409 | 0 |
Equity / cash balance held by subsidiary upon sale | (5,250) | 0 |
Cash and cash equivalents | 236,072 | 321,455 |
Debt service accounts | 13,271 | 14,873 |
Other restricted cash | $ 72,006 | $ 46,638 |
Organization and Basis of Prese
Organization and Basis of Presentation | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation | Note 1 - Organization and Basis of Presentation Organization Ocwen Financial Corporation (NYSE: OCN) (Ocwen, OFC, we, us and our) is a non-bank mortgage servicer and originator providing solutions to homeowners, investors and others through its primary operating subsidiary, PHH Mortgage Corporation (PMC). We are headquartered in West Palm Beach, Florida with offices and operations in the United States (U.S.), the United States Virgin Islands (USVI), India and the Philippines. Ocwen is a Florida corporation organized in February 1988. Ocwen directly or indirectly owns all of the outstanding common stock of its operating subsidiaries, including PMC since its acquisition on October 4, 2018, Ocwen Financial Solutions Private Limited (OFSPL) and Ocwen USVI Services, LLC (OVIS). Effective May 3, 2021, Ocwen holds a 15% equity interest in MAV Canopy HoldCo I, LLC (MAV Canopy) that invests in mortgage servicing assets through its licensed mortgage subsidiary MSR Asset Vehicle LLC (MAV). See Note 10 - Investment in Equity Method Investee for additional information. We perform servicing activities related to our own MSR portfolio (primary) and on behalf of other servicers (subservicing), the largest being New Residential Investment Corp. (NRZ), and investors (primary and master servicing), including the Federal National Mortgage Association (Fannie Mae) and Federal Home Loan Mortgage Corporation (Freddie Mac) (collectively referred to as GSEs), the Government National Mortgage Association (Ginnie Mae, and together with the GSEs, the Agencies) and private-label securitizations (PLS, or non-Agency). As a subservicer or primary servicer, we may be required to make advances for certain property tax and insurance premium payments, default and property maintenance payments and principal and interest payments on behalf of delinquent borrowers to mortgage loan investors before recovering them from borrowers. Most, but not all, of our subservicing agreements provide for us to be reimbursed for any such advances by the owner of the servicing rights. Advances made by us as primary servicer are generally recovered from the borrower or the mortgage loan investor. As master servicer, we collect mortgage payments from primary servicers and distribute the funds to investors in the mortgage-backed securities. To the extent the primary servicer does not advance the scheduled principal and interest, as master servicer we are responsible for advancing the shortfall, subject to certain limitations. We source our servicing portfolio through multiple channels, including retail, wholesale, correspondent, flow MSR purchase agreements, the Agency Cash Window programs and bulk MSR purchases. We originate, sell and securitize conventional (conforming to the underwriting standards of Fannie Mae or Freddie Mac; collectively referred to as Agency or GSE) loans and government-insured (Federal Housing Administration (FHA) or Department of Veterans Affairs (VA)) forward mortgage loans, generally with servicing retained. The GSEs or Ginnie Mae guarantee these mortgage securitizations. We originate and purchase Home Equity Conversion Mortgage (HECM) loans, or reverse mortgages, that are mostly insured by the FHA and we are an approved issuer of Home Equity Conversion Mortgage-Backed Securities (HMBS) that are guaranteed by Ginnie Mae. We had a total of approximately 5,200 employees at September 30, 2021 of which approximately 3,200 were located in India and approximately 400 were based in the Philippines. Our operations in India and the Philippines primarily provide internal support services, principally to our loan servicing business and our corporate functions. Of our foreign-based employees, approximately 67% were engaged in supporting our loan servicing operations as of September 30, 2021. Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in conformity with the instructions of the Securities and Exchange Commission (SEC) to Form 10-Q and SEC Regulation S-X, Article 10, Rule 10-01 for interim financial statements. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America (GAAP) for complete financial statements. In our opinion, the accompanying unaudited consolidated financial statements contain all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation. The results of operations and other data for the three and nine months ended September 30, 2021 are not necessarily indicative of the results that may be expected for any other interim period or for the year ending December 31, 2021. The unaudited consolidated financial statements presented herein should be read in conjunction with the audited consolidated financial statements and related notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2020. In August 2020, Ocwen implemented a reverse stock split of its shares of common stock in a ratio of one-for-15. The number of shares, loss per share amounts, repurchase price per share amounts, and Common stock and Additional paid-in capital balances have been retroactively adjusted for all periods presented in this Quarterly Report on Form 10-Q to give effect to the reverse stock split as if it occurred at the beginning of the first period presented. See Note 14 – Equity for additional information. Use of Estimates and Assumptions The preparation of financial statements in conformity with GAAP requires that management make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Such estimates and assumptions include, but are not limited to, those that relate to fair value measurements, income taxes and the provision for losses that may arise from contingencies including litigation proceedings. In developing estimates and assumptions, management uses all available information; however, actual results could materially differ from those estimates and assumptions. Recently Adopted Accounting Standards Income Taxes (ASC Topic 740): Simplifying the Accounting for Income Taxes (ASU 2019-12) The FASB issued this ASU to Accounting Standards Codification (ASC) Topic 740, Income Taxes, as part of its overall simplification initiative to reduce costs and complexity of applying accounting standards while maintaining or improving the usefulness of the information provided to users of financial statements. Amendments include the removal of certain exceptions to the general principles of ASC Topic 740 in such areas as intraperiod tax allocation, year to date losses in interim periods and deferred tax liabilities related to outside basis differences. Amendments also include simplification in other areas such as interim recognition of enactment of tax laws or rate changes and accounting for a franchise tax (or similar tax) that is partially based on income. Our adoption of this standard on January 1, 2021 did not have a material impact on our consolidated financial statements. Debt—Debt with Conversion and Other Options and Derivatives and Hedging—Contracts in Entity's Own Equity—Accounting for Convertible Instruments and Contracts in an Entity's Own Equity (ASU 2020-06) The amendments in this ASU simplify the accounting for certain financial instruments with characteristics of liabilities and equity by reducing the number of accounting models for convertible debt and convertible preferred stock instruments. In addition, this ASU amended the derivative guidance for the “own stock” scope exception and certain aspects when calculating earnings per share. The amendments in this ASU affect entities that issue convertible instruments and/or contracts in an entity’s own equity. The amendments in this ASU are effective on January 1, 2022, with early adoption permitted on January 1, 2021. Our early adoption of this standard on January 1, 2021 did not have a material impact on our consolidated financial statements. Investments—Equity Securities (ASC Topic 321), Investments—Equity Method and Joint Ventures (ASC Topic 323), and Derivatives and Hedging (ASC Topic 815) (ASU 2020-01) The amendments in this ASU affect all entities that apply the guidance in ASC Topics 321, 323, and 815 and (1) elect to apply the measurement alternative or (2) enter into a forward contract or purchase an option to purchase securities that, upon settlement of the forward contract or exercise of the purchased option, would be accounted for under the equity method of accounting. The amendments clarify that forward or option contracts to purchase investments that will be accounted for using the equity method that do not meet the definition of a derivative under ASC Topic 815 are in the scope of ASC Topic 321. Therefore, when the purchase contract is considered a forward or option contract in the scope of this guidance, the investor would account for changes in the contract’s fair value prior to closing through earnings, unless the contract qualifies for the measurement alternative and it is elected. If the measurement alternative is elected, the change in the fair value of the contract would be reflected in earnings upon closing. In addition, if there are observable transactions or impairments before closing, the guidance would require remeasurement of the contract to fair value. The guidance in this ASU also specifies that when applying the measurement alternative in ASC Topic 321, observable transactions include those transactions by the investor that result in the application or discontinuation of the equity method of accounting. The amendments under this ASU are effective prospectively. Our adoption of this standard on January 1, 2021 did not have a material impact on our consolidated financial statements. Accounting Standards Issued but Not Yet Adopted Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options (a consensus of the FASB Emerging Issues Task Force) (ASU 2021-04) The amendments in this ASU provide the following guidance for a modification or an exchange of a freestanding equity-classified written call option that is not within the scope of another Topic: (1) treat a modification of the terms or conditions or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange as an exchange of the original instrument for a new instrument, (2) measure the effect of a modification or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange and (3) recognize the effect of a modification or an exchange of a freestanding equity-classified written call option to compensate for goods or services in accordance with the guidance in ASC Topic 718. In a multiple-element transaction (for example, one that includes both debt financing and equity financing), the total effect of the modification should be allocated to the respective elements in the transaction. The amendments in this ASU are effective for us on January 1, 2022. We do not anticipate that the adoption of this standard will have a material impact on our consolidated financial statements. |
Securitizations and Variable In
Securitizations and Variable Interest Entities | 9 Months Ended |
Sep. 30, 2021 | |
Transfers and Servicing [Abstract] | |
Securitizations and Variable Interest Entities | Note 2 – Securitizations and Variable Interest Entities We securitize, sell and service forward and reverse residential mortgage loans and regularly transfer financial assets in connection with asset-backed financing arrangements. We have aggregated these transfers of financial assets and asset-backed financing arrangements using special purpose entities (SPEs) or variable interest entities (VIEs) into the following groups: (1) securitizations of residential mortgage loans, (2) financings of loans held for sale, (3) financings of advances and (4) MSR financings. Financing transactions that do not use SPEs or VIEs are disclosed in Note 12 – Borrowings. Securitizations of Residential Mortgage Loans Transfers of Forward Loans We sell or securitize forward loans that we originate or purchase from third parties, generally in the form of mortgage-backed securities guaranteed by the GSEs or Ginnie Mae. Securitization typically occurs within 30 days of loan closing or purchase. We act only as a fiduciary and do not have a variable interest in the securitization trusts. As a result, we account for these transactions as sales upon transfer. The following table presents a summary of cash flows received from and paid to securitization trusts related to transfers of loans accounted for as sales that were outstanding: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Proceeds received from securitizations $ 5,823,765 $ 2,364,829 $ 12,220,596 $ 4,256,082 Servicing fees collected (1) 16,440 12,561 43,968 35,204 Purchases of previously transferred assets, net of claims reimbursed (6,065) (2,061) (16,085) (6,338) $ 5,834,140 $ 2,375,329 $ 12,248,479 $ 4,284,948 (1) We receive servicing fees based upon the securitized loan balances and certain ancillary fees, all of which are reported in Servicing and subservicing fees in the unaudited consolidated statements of operations. In connection with these transfers, we retained MSRs of $66.4 million and $136.5 million during the three and nine months ended September 30, 2021, respectively, and $22.1 million and $37.8 million during the three and nine months ended September 30, 2020, respectively. We securitize forward residential mortgage loans involving the GSEs and loans insured by the FHA or VA through Ginnie Mae. Certain obligations arise from the agreements associated with our transfers of loans. Under these agreements, we may be obligated to repurchase the loans, or otherwise indemnify or reimburse the investor or insurer for losses incurred due to material breach of contractual representations and warranties. The following table presents the carrying amounts of our assets that relate to our continuing involvement with forward loans that we have transferred with servicing rights retained as well as an estimate of our maximum exposure to loss including the UPB of the transferred loans: September 30, 2021 December 31, 2020 Carrying value of assets MSRs, at fair value $ 281,161 $ 137,029 Advances 133,994 143,361 UPB of loans transferred (1) 26,724,676 18,062,856 Maximum exposure to loss $ 27,139,831 $ 18,343,246 (1) Includes $5.3 billion and $4.1 billion of loans delivered to Ginnie Mae as of September 30, 2021 and December 31, 2020, respectively, and includes loan modifications delivered through the Ginnie Mae Early Buyout Program (EBO). At September 30, 2021 and December 31, 2020, 4.3% and 6.8%, respectively, of the transferred residential loans that we service were 60 days or more past due, including 60 days or more past due loans under forbearance. This includes 13.1% and 17.1%, respectively, of loans delivered to Ginnie Mae that are 60 days or more past due. Transfers of Reverse Mortgages We pool HECM loans into HMBS that we sell into the secondary market with servicing rights retained or we sell the loans to third parties with servicing rights released. We have determined that loan transfers in the HMBS program do not meet the definition of a participating interest and the servicing requirements require the issuer/servicer to absorb some level of interest rate risk, cash flow timing risk and incidental credit risk. As a result, the transfers of the HECM loans do not qualify for sale accounting, and therefore, we account for these transfers as financings. Under this accounting treatment, the HECM loans are classified as Loans held for investment, at fair value, on our unaudited consolidated balance sheets. Holders of participating interests in the HMBS have no recourse against the assets of Ocwen, except with respect to standard representations and warranties and our contractual obligation to service the HECM loans and the HMBS. Financing of Loans Held for Sale using SPEs We entered into a warehouse mortgage loan financing facility with a third-party lender involving an SPE (trust). This facility is structured as a gestation repurchase facility whereby Agency mortgage loans are transferred by PMC to the trust for collateralization purposes. We have designed the trust to facilitate the third party financing facility and have determined that the trust is a VIE for which we are the primary beneficiary. Therefore, we have included the trust in our consolidated financial statements. The table below presents the carrying value and classification of the assets and liabilities of the loans held for sale financing facility: September 30, 2021 Mortgage loans (Loans held for sale, at fair value) $ 461,827 Outstanding borrowings (Mortgage loan warehouse facilities) 465,018 Financings of Advances using SPEs Match funded advances, i.e., advances that are pledged as collateral to our advance facilities, result from our transfers of residential loan servicing advances to SPEs in exchange for cash. We consolidate these SPEs because we have determined that Ocwen is the primary beneficiary of the SPEs. These SPEs issue debt supported by collections on the transferred advances, and we refer to this debt as Advance match funded liabilities. Holders of the debt issued by the SPEs have recourse only to the assets of the SPE for satisfaction of the debt. The table below presents the carrying value and classification of the assets and liabilities of the advance financing facilities: September 30, 2021 December 31, 2020 Match funded advances (Advances, net) $ 594,645 $ 651,576 Debt service accounts (Restricted cash) 7,241 14,195 Unamortized deferred lender fees (Other assets) 1,783 4,253 Prepaid interest (Other assets) 205 291 Advance match funded liabilities 516,572 581,288 MSR Financings using SPEs In 2019, we entered into a financing facility with a third-party secured by certain Fannie Mae and Freddie Mac MSRs (Agency MSRs). Two SPEs (trusts) were established in connection with this facility. We determined that the trusts are VIEs for which we are the primary beneficiary. Therefore, we have included the trusts in our consolidated financial statements. We have the power to direct the activities of the VIEs that most significantly impact the VIE’s economic performance given that we are the servicer of the Agency MSRs that result in cash flows to the trusts. In addition, we have designed the trusts at inception to facilitate the third-party funding facility under which we have the obligation to absorb the losses of the VIEs that could be potentially significant to the VIEs. The table below presents the carrying value and classification of the assets and liabilities of the Agency MSR financing facility: September 30, 2021 December 31, 2020 MSRs pledged (MSRs, at fair value) $ 649,202 $ 476,371 Unamortized deferred lender fees (Other assets) 2,290 1,183 Debt service account (Restricted cash) 104 211 Outstanding borrowings (MSR financing facilities, net) 349,298 210,755 In 2019, we issued Ocwen Excess Spread-Collateralized Notes, Series 2019-PLS1 Class A (PLS Notes) secured by certain of PMC’s private label MSRs (PLS MSRs). An SPE, PMC PLS ESR Issuer LLC (PLS Issuer), was established in this connection as a wholly owned subsidiary of PMC. Ocwen guarantees the obligations of PLS Issuer under the facility. We determined that PLS Issuer is a VIE for which we are the primary beneficiary. Therefore, we have included PLS Issuer in our consolidated financial statements. We have the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance given that we are the servicer of the MSRs that result in cash flows to PLS Issuer. In addition, PMC has designed PLS Issuer at inception to facilitate the funding for general corporate purposes. Separately, in return for the participation interests, PMC received the proceeds from issuance of the PLS Notes. PMC is the sole member of PLS Issuer, thus PMC has the obligation to absorb the losses of the VIE that could be potentially significant to the VIE. The table below presents the carrying value and classification of the assets and liabilities of the PLS Notes facility: September 30, 2021 December 31, 2020 MSRs pledged (MSRs, at fair value) $ 103,082 $ 129,204 Debt service account (Restricted cash) 2,071 2,385 Outstanding borrowings (MSR financing facilities, net) 48,243 68,313 Unamortized debt issuance costs (MSR financing facilities, net) 506 894 |
Fair Value
Fair Value | 9 Months Ended |
Sep. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Note 3 – Fair Value Fair value is estimated based on a hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs. Observable inputs are inputs that reflect the assumptions that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs are inputs that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The fair value hierarchy prioritizes the inputs to valuation techniques into three broad levels whereby the highest priority is given to Level 1 inputs and the lowest to Level 3 inputs. The carrying amounts and the estimated fair values of our financial instruments and certain of our nonfinancial assets measured at fair value on a recurring or non-recurring basis or disclosed, but not measured, at fair value are as follows: September 30, 2021 December 31, 2020 Level Carrying Value Fair Value Carrying Value Fair Value Financial assets Loans held for sale Loans held for sale, at fair value (a) (e) 3, 2 $ 921,621 $ 921,621 $ 366,364 $ 366,364 Loans held for sale, at lower of cost or fair value (b) 3 12,079 12,079 21,472 21,472 Total Loans held for sale $ 933,700 $ 933,700 $ 387,836 $ 387,836 Loans held for investment Loans held for investment - Reverse mortgages (a) 3 $ 7,100,726 $ 7,100,726 $ 6,997,127 $ 6,997,127 Loans held for investment - Restricted for securitization investors (a) 3 8,004 8,004 9,770 9,770 Total loans held for investment $ 7,108,730 $ 7,108,730 $ 7,006,897 $ 7,006,897 Advances, net (c) 3 $ 739,596 $ 739,596 $ 828,239 $ 828,239 Receivables, net (c) 3 183,090 183,090 187,665 187,665 Mortgage-backed securities (a) 3 1,618 1,618 2,019 2,019 Corporate bonds (a) 2 211 211 211 211 Investment in equity method investee (c) 3 19,794 19,794 — — Financial liabilities: Advance match funded liabilities (c) 3 $ 516,572 $ 515,405 $ 581,288 $ 581,997 Financing liabilities: HMBS-related borrowings (a) 3 $ 6,782,564 $ 6,782,564 $ 6,772,711 $ 6,772,711 Other financing liabilities Financing liability -Transferred MSR liability (a) 3 702,907 702,907 566,952 566,952 Financing liability - Owed to securitization investors (a) 3 8,004 8,004 9,770 9,770 Total Other financing liabilities 710,911 710,911 576,722 576,722 Senior secured term loan (c) (d) 2 $ — $ — $ 179,776 $ 184,639 Mortgage loan warehouse facilities (c) 3 1,069,170 1,069,170 451,713 451,713 MSR financing facilities (c) (d) 3 945,744 918,217 437,672 406,860 Senior notes: Senior notes (c) (d) (f) 2 392,190 403,490 311,898 320,879 OFC Senior notes due 2027 (c) (d) (f) 3 220,468 258,805 — — Total Senior notes $ 612,658 $ 662,295 $ 311,898 $ 320,879 September 30, 2021 December 31, 2020 Level Carrying Value Fair Value Carrying Value Fair Value Derivative financial instrument assets (liabilities) Interest rate lock commitments (a) 3 $ 14,030 $ 14,030 $ 22,706 $ 22,706 Forward trades - Loans held for sale (a) 2 421 421 (50) (50) TBA / Forward mortgage-backed securities (MBS) trades (a) 1 (11,227) (11,227) (4,554) (4,554) Interest rate swap futures (a) 1 (8,236) (8,236) 504 504 TBA forward Pipeline trades (a) 1 5,262 5,262 — — Other 3 (438) (438) — — MSRs (a) 3 $ 2,176,260 $ 2,176,260 $ 1,294,817 $ 1,294,817 (a) Measured at fair value on a recurring basis. (b) Measured at fair value on a non-recurring basis. (c) Disclosed, but not measured, at fair value. (d) The carrying values are net of unamortized debt issuance costs and discount. See Note 12 – Borrowings for additional information . (e) Loans repurchased from Ginnie Mae securitizations with a fair value of $210.8 million and $51.1 million at September 30, 2021 and December 31, 2020, respectively, are classified as Level 3. The remaining balance of loans held for sale at fair value is classified as Level 2. (f) On March 4, 2021, PMC completed the issuance and sale of $400.0 million aggregate principal amount of senior secured notes. Fair value is based on valuation data obtained from a pricing service. Therefore, these notes are classified as Level 2. Additionally on March 4, 2021 and May 3, 2021, Ocwen completed the private placement of $199.5 million and $85.5 million, respectively, aggregate principal amount of senior secured second lien notes. These notes are classified as Level 3. See Note 12 – Borrowings for additional information. The following tables present a reconciliation of the changes in fair value of Level 3 assets and liabilities that we measure at fair value on a recurring basis: Loans Held for Investment - Restricted for Securitization Investors Financing Liability - Owed to Securitization Investors Loans Held for Sale - Fair Value Mortgage-Backed Securities IRLCs Three months ended September 30, 2021 Beginning balance $ 8,680 $ (8,680) $ 138,842 $ 1,607 $ 17,437 Cumulative effect of fair value election — — — — Purchases, issuances, sales and settlements Purchases — — 136,996 — — Issuances — — — — 184,995 Sales — — (64,032) — — Settlements (676) 676 — — — Transfers (to) from: Loans held for sale, at fair value — — — — (182,783) Receivables, net — — (558) — — (676) 676 72,406 — 2,212 Change in fair value included in earnings — — (496) 11 (5,619) Transfers in and / or out of Level 3 — — — — — Ending balance $ 8,004 $ (8,004) $ 210,752 $ 1,618 $ 14,030 Loans Held for Investment - Restricted for Securitization Investors Financing Liability - Owed to Securitization Investors Loans Held for Sale - Fair Value Mortgage-Backed Securities IRLCs Three months ended September 30, 2020 Beginning balance $ 11,664 $ (11,664) $ 25,950 $ 1,726 $ 17,818 Purchases, issuances, sales and settlements Purchases — — 45,445 — — Issuances — — — — 87,311 Sales — — (45,723) — — Settlements (652) 652 356 — (77,785) Transfers (to) from: Receivables, net — — 157 — — (652) 652 235 — 9,526 Change in fair value included in earnings — — 224 424 (4,665) Ending balance $ 11,012 $ (11,012) $ 26,409 $ 2,150 $ 22,679 Loans Held for Investment - Restricted for Securitization Investors Financing Liability - Owed to Securitization Investors Loans Held for Sale - Fair Value Mortgage-backed Securities IRLCs Nine Months Ended September 30, 2021 Beginning balance $ 9,770 $ (9,770) $ 51,072 $ 2,019 $ 22,706 Purchases, issuances, sales and settlements Purchases — — 303,117 — — Issuances — — — — 446,751 Sales — — (135,088) — — Settlements (1,766) 1,766 — — — Transfers (to) from: Loans held for sale, at fair value — — — — (425,169) Other assets — — (377) — — Receivables, net — — (1,113) — — (1,766) 1,766 166,539 — 21,582 Change in fair value included in earnings — — (6,859) (401) (30,258) Ending balance $ 8,004 $ (8,004) $ 210,752 $ 1,618 $ 14,030 Loans Held for Investment - Restricted for Securitization Investors Financing Liability - Owed to Securitization Investors Loans Held for Sale - Fair Value Mortgage-backed Securities IRLCs Nine Months Ended September 30, 2020 Beginning balance $ 23,342 $ (22,002) $ — $ 2,075 $ — Purchases, issuances, sales and settlements Purchases — — 103,955 — — Issuances — — — — 144,931 Deconsolidation of mortgage-backed securitization trusts (10,715) 9,519 — — — Sales — — (104,273) — — Settlements (1,615) 1,615 (70) — — Transfers (to) from: Loans held for sale, at fair value — — — — (128,224) Receivables, net — — (113) — — (12,330) 11,134 (501) — 16,707 Change in fair value included in earnings — (144) 1,328 75 (4,506) Transfers in and / or out of Level 3 — — 25,582 — 10,478 Ending balance $ 11,012 $ (11,012) $ 26,409 $ 2,150 $ 22,679 A rollforward of the beginning and ending balances of Loans Held for Investment and HMBS-related borrowings, MSRs and Financing liability - MSRs pledged that we measure at fair value on a recurring and non-recurring basis is provided in Note 5 – Reverse Mortgages, Note 7 – Mortgage Servicing and Note 8 — MSR Transfers Not Qualifying for Sale Accounting, respectively. During the nine months ended September 30, 2021, there have been no changes to the methodologies that we use in estimating fair values or classifications under the valuation hierarchy as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2020. The significant unobservable assumptions that we make to estimate the fair value of significant assets and liabilities classified as Level 3 and measured at fair value on a recurring or non-recurring basis are provided below. Loans Held for Sale The fair value of loans we purchased from Ginnie Mae guaranteed securitizations is estimated using both observable and unobservable inputs, including published forward Ginnie Mae prices or existing sale contracts, as well as estimated default, prepayment, and discount rates. The significant unobservable input in estimating fair value is the estimated default rate. Accordingly, these repurchased Ginnie Mae loans are classified as Level 3 within the valuation hierarchy. Loans Held for Investment - Reverse Mortgages Reverse mortgage loans held for investment are carried at fair value and classified as Level 3 within the valuation hierarchy. Significant unobservable assumptions include voluntary prepayment speeds, defaults and discount rate. The conditional prepayment speed assumption displayed in the table below is inclusive of voluntary (repayment or payoff) and involuntary (inactive/delinquent status and default) prepayments. The discount rate assumption is primarily based on an assessment of current market yields on reverse mortgage loan and tail securitizations, expected duration of the asset and current market interest rates. Significant unobservable assumptions September 30, December 31, Life in years Range 1.1 to 8.0 0.9 to 8.0 Weighted average 5.6 5.9 Conditional prepayment rate, including voluntary and involuntary prepayments Range 11.0% to 35.5% 10.6% to 28.8% Weighted average 16.2 % 15.4 % Discount rate 2.5 % 1.9 % Significant increases or decreases in any of these assumptions in isolation could result in a significantly lower or higher fair value, respectively. The effects of changes in the assumptions used to value the securitized loans held for investment, excluding future draw commitments, are partially offset by the effects of changes in the assumptions used to value the HMBS-related borrowings that are associated with these loans. MSRs MSRs are carried at fair value and classified within Level 3 of the valuation hierarchy. The fair value is determined using the mid-point of the range of prices provided by third-party valuation experts, without adjustment, except in the event we have a potential or completed sale, including transactions where we have executed letters of intent, in which case the fair value of the MSRs is recorded at the estimated sale price. A change in the valuation inputs or assumptions may result in a significantly higher or lower fair value measurement. Changes in market interest rates predominantly impact the fair value of Agency MSRs via prepayment speeds by altering the borrower refinance incentive and the non-Agency MSRs due to the impact on advance funding costs. The significant unobservable assumptions used in the valuation of these MSRs include prepayment speeds, delinquency rates, cost to service and discount rates. Significant unobservable assumptions September 30, 2021 December 31, 2020 Agency Non-Agency Agency Non-Agency Weighted average prepayment speed 9.0 % 12.0 % 11.8 % 11.5 % Weighted average lifetime delinquency rate 1.4 % 12.8 % 3.0 % 28.0 % Weighted average discount rate 8.6 % 11.2 % 9.2 % 11.4 % Weighted average cost to service (in dollars) $ 72 $ 209 $ 79 $ 270 Because the mortgages underlying these MSRs permit the borrowers to prepay the loans, the value of the MSRs generally tends to diminish in periods of declining interest rates, an improving housing market or expanded product availability (as prepayments increase) and increase in periods of rising interest rates, a deteriorating housing market or reduced product availability (as prepayments decrease). The following table summarizes the estimated change in the value of the MSRs as of September 30, 2021 given hypothetical increases in lifetime prepayments and yield assumptions: Adverse change in fair value 10% 20% Weighted average prepayment speeds $ (65,965) $ (128,151) Weighted average discount rate (53,571) (103,573) Investment in Equity Method Investee Our investment in equity method investee is accounted for using the equity method and classified as Level 3 within the valuation hierarchy. The assets, including MSRs and MSR related assets, and liabilities of the investee are carried at fair value or a value that approximates fair value. Accordingly, the investee’s net asset value approximates its fair value, and its earnings or losses reflect the change in its net asset value, resulting in our recorded investment approximating fair value. See Note 10 - Investment in Equity Method Investee for further details. Financing Liabilities HMBS-Related Borrowings HMBS-related borrowings are carried at fair value and classified as Level 3 within the valuation hierarchy. These borrowings are not actively traded, and therefore, quoted market prices are not available. Significant unobservable assumptions include yield spread and discount rate. The yield spread and discount rate assumption for these liabilities are primarily based on an assessment of current market yields for newly issued HMBS, expected duration and current market interest rates. Significant unobservable assumptions September 30, December 31, Life in years Range 1.1 to 8.0 0.9 to 8.0 Weighted average 5.6 5.9 Conditional prepayment rate Range 11.0% to 35.5% 10.6% to 28.8% Weighted average 16.2 % 15.4 % Discount rate 2.3 % 1.7 % Significant increases or decreases in any of these assumptions in isolation could result in a significantly higher or lower fair value, respectively. The effects of changes in the assumptions used to value the HMBS-related borrowings are partially offset by the effects of changes in the assumptions used to value the associated pledged loans held for investment, excluding future draw commitments. MSRs Pledged Liabilities These MSR pledged liabilities carried at fair value and classified as Level 3 within the valuation hierarchy. We determine the fair value of the pledged MSR liability consistent with the mid-point of the range of prices provided by third-party valuation experts for the related MSR, considering retained cash flows. Significant unobservable assumptions September 30, December 31, Weighted average prepayment speed 11.2 % 11.5 % Weighted average delinquency rate 11.2 % 29.8 % Weighted average discount rate 10.7 % 11.4 % Weighted average cost to service (in dollars) $ 199 $ 287 Significant increases or decreases in these assumptions in isolation would result in a significantly higher or lower fair value. Derivative Financial Instruments |
Loans Held for Sale
Loans Held for Sale | 9 Months Ended |
Sep. 30, 2021 | |
Receivables [Abstract] | |
Loans Held for Sale | Note 4 – Loans Held for Sale Loans Held for Sale - Fair Value Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Beginning balance $ 680,866 $ 253,037 $ 366,364 $ 208,752 Originations and purchases 6,366,795 2,429,977 12,987,522 4,378,999 Proceeds from sales (6,098,495) (2,317,579) (12,362,149) (4,190,355) Principal collections (22,334) (5,721) (39,037) (21,479) Transfers from (to): Loans held for investment, at fair value 1,220 781 2,898 1,900 Receivables, net (7,625) (14,723) (25,151) (62,949) REO (Other assets) (1,767) (1,713) (5,312) (2,554) Gain (loss) on sale of loans 1,793 17,509 (13,006) 45,762 Increase (decrease) in fair value of loans (5,336) 4,220 (6,025) 1,925 Other 6,504 1,178 15,517 6,965 Ending balance (1) $ 921,621 $ 366,966 $ 921,621 $ 366,966 (1) At September 30, 2021 and 2020, the balances include $(9.3) million and $(5.8) million, respectively, of fair value adjustments. Loans Held for Sale - Lower of Cost or Fair Value Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Beginning balance - before Valuation Allowance $ 20,278 $ 31,880 $ 27,652 $ 73,160 Proceeds from sales (2,916) 891 (9,583) (45,974) Principal collections (415) (514) (629) (1,319) Transfers from (to): Receivables, net (444) — (936) 61 Gain (loss) on sale of loans 35 (1,141) 549 474 Other 123 (1,220) (392) 3,494 Ending balance - before Valuation Allowance 16,661 29,896 16,661 29,896 Beginning balance - Valuation Allowance $ (5,124) $ (6,400) $ (6,180) $ (6,643) (Provision for) reversal of valuation allowance 602 45 1,582 (1,084) Transfer to (from) Liability for indemnification obligations (Other liabilities) (60) (42) 16 (117) Sales of loans — 166 — 1,613 Ending balance - Valuation Allowance (4,582) (6,231) (4,582) (6,231) Ending balance, net $ 12,079 $ 23,665 $ 12,079 $ 23,665 Gain on Loans Held for Sale, Net Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Gain on sales of loans, net MSRs retained on transfers of forward mortgage loans $ 66,420 $ 22,096 $ 136,482 $ 37,785 Gain (loss) on sale of forward mortgage loans (1) (2,601) 11,897 (25,440) 35,201 Gain on sale of repurchased Ginnie Mae loans 3,962 4,663 12,277 11,036 67,781 38,656 123,319 84,022 Change in fair value of IRLCs (4,135) 4,828 (9,225) 16,876 Change in fair value of loans held for sale (3,491) 3,061 (3,323) 3,367 Loss on economic hedge instruments (2) 780 179 592 (10,141) Other (1,233) (838) (3,227) (1,360) $ 59,702 $ 45,886 $ 108,136 $ 92,764 (1) Includes $22.5 million gain in the three and nine months ended September 30, 2021 related to loans purchased through the exercise of our servicer call rights with respect to certain Non-Agency trusts and sold, servicing release, in the three months ended September 30, 2021. |
Reverse Mortgages
Reverse Mortgages | 9 Months Ended |
Sep. 30, 2021 | |
Receivables [Abstract] | |
Reverse Mortgages | Note 5 – Reverse Mortgages Three Months Ended September 30, 2021 2020 Loans Held for Investment - Reverse Mortgages HMBS - Related Borrowings Loans Held for Investment - Reverse Mortgages HMBS - Related Borrowings Beginning balance $ 7,112,273 $ (6,823,911) $ 6,718,992 $ (6,477,616) Originations 494,330 — 299,628 — Securitization of HECM loans accounted for as a financing — (452,262) — (295,347) Additional proceeds from securitization of HECM loans and tails — (7,751) — (12,407) Repayments (principal payments received) (449,236) 446,277 (249,372) 247,793 Transfers to: Loans held for sale, at fair value (1,220) — (781) — Receivables, net (84) — 105 — Other assets (121) — (38) — Change in fair value included in earnings (55,216) 55,083 81,396 (68,966) Ending Balance $ 7,100,726 $ (6,782,564) $ 6,849,930 $ (6,606,543) Securitized loans (pledged to HMBS-Related Borrowings) $ 6,874,025 $ (6,782,564) $ 6,715,093 $ (6,606,543) Unsecuritized loans 226,701 134,837 — Total $ 7,100,726 $ 6,849,930 Nine Months Ended September 30, 2021 2020 Loans Held for Investment - Reverse Mortgages HMBS - Related Borrowings Loans Held for Investment - Reverse Mortgages HMBS - Related Borrowings Beginning balance $ 6,997,127 $ (6,772,711) $ 6,269,596 $ (6,063,435) Cumulative effect of fair value election (1) — — 47,038 — Originations 1,214,772 — 867,702 — Securitization of HECM loans accounted for as a financing (incl. realized fair value changes) — (1,119,742) — (885,987) Additional proceeds from securitization of HECM loans and tails — (34,918) — (28,572) Repayments (principal payments received) (1,170,245) 1,161,609 (619,486) 613,026 Transfers to: Loans held for sale, at fair value (2,898) — (1,900) — Receivables, net (169) — (181) — REO (Other assets) (316) — (403) — Change in fair value 62,455 (16,802) 287,564 (241,575) Ending Balance $ 7,100,726 $ (6,782,564) $ 6,849,930 $ (6,606,543) Securitized $ 6,874,025 $ (6,782,564) $ 6,715,093 $ (6,606,543) Unsecuritized 226,701 134,837 $ 7,100,726 $ 6,849,930 (1) In conjunction with the adoption of ASU 2016-13, we elected the fair value option for future draw commitments (tails) on HECM reverse mortgage loans purchased or originated before December 31, 2018, which resulted in the recognition of the fair value of such tails through stockholders’ equity on January 1, 2020. Reverse Mortgage Revenue, net Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Gain on new originations (1) $ 12,900 $ 13,545 $ 46,170 $ 33,156 Change in fair value of securitized loans held for investment and HMBS-related borrowings, net (13,033) (1,115) (517) 12,833 Change in fair value included in earnings, net (133) 12,430 45,653 45,989 Loan fees and other 5,168 2,069 10,509 5,066 $ 5,035 $ 14,499 $ 56,162 $ 51,055 |
Advances
Advances | 9 Months Ended |
Sep. 30, 2021 | |
Advances [Abstract] | |
Advances | Note 6 – Advances September 30, 2021 December 31, 2020 Principal and interest $ 238,071 $ 277,132 Taxes and insurance 331,013 364,593 Foreclosures, bankruptcy, REO and other 177,189 192,787 746,273 834,512 Allowance for losses (6,677) (6,273) Advances, net $ 739,596 $ 828,239 The following table summarizes the activity in net advances: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Beginning balance - before Allowance for Losses $ 768,864 $ 908,829 $ 834,512 $ 1,066,448 Acquisition of advances in connection with the purchase of MSRs — 14 4,495 14 New advances 181,567 198,549 565,284 667,577 Sales of advances (80) (150) (328) (604) Collections of advances and other (204,078) (268,560) (657,690) (894,753) Ending balance - before Allowance for Losses 746,273 838,682 746,273 838,682 Beginning balance - Allowance for Losses $ (6,891) $ (7,820) $ (6,273) $ (9,925) Provision (1,581) (2,173) (5,478) (5,944) Net charge-offs and other 1,795 3,915 5,074 9,791 Ending balance - Allowance for Losses (6,677) (6,078) (6,677) (6,078) Ending balance, net $ 739,596 $ 832,604 $ 739,596 $ 832,604 |
Mortgage Servicing
Mortgage Servicing | 9 Months Ended |
Sep. 30, 2021 | |
Transfers and Servicing [Abstract] | |
Mortgage Servicing | Note 7 – Mortgage Servicing MSRs – At Fair Value Three Months Ended September 30, 2021 2020 Agency Non-Agency Total Agency Non-Agency Total Beginning balance $ 1,408,420 $ 664,098 $ 2,072,518 $ 305,085 $ 739,829 $ 1,044,914 Sales and other transfers — — — — (1) (1) Additions: Recognized on the sale of residential mortgage loans 66,420 — 66,420 22,096 — 22,096 Purchase of MSRs 36,153 — 36,153 32,249 — 32,249 Servicing transfers and adjustments 17 (4,723) (4,706) 16 — 16 Changes in fair value: Changes in valuation inputs or assumptions (2) 6,983 67,836 74,819 (4,731) 13,496 8,765 Realization of expected cash flows (2) (38,186) (30,758) (68,944) (15,051) (23,975) (39,026) Ending balance $ 1,479,807 $ 696,453 $ 2,176,260 $ 339,664 $ 729,349 $ 1,069,013 MSRs – At Fair Value Nine Months Ended September 30, 2021 2020 Agency Non-Agency Total Agency Non-Agency Total Beginning balance $ 578,957 $ 715,860 $ 1,294,817 $ 714,006 $ 772,389 $ 1,486,395 Sales and other transfers — — — — (108) (108) Additions: Recognized on the sale of residential mortgage loans 136,482 — 136,482 37,785 — 37,785 Purchase of MSRs 806,469 — 806,469 78,994 — 78,994 Servicing transfers and adjustments (1) 73 (6,913) (6,840) (263,830) 403 (263,427) Changes in fair value: Changes in valuation inputs or assumptions (2) 47,132 73,306 120,438 (166,546) 23,839 (142,707) Realization of expected cash flows (2) (89,306) (85,800) (175,106) (60,745) (67,174) (127,919) Ending balance $ 1,479,807 $ 696,453 $ 2,176,260 $ 339,664 $ 729,349 $ 1,069,013 (1) Servicing transfers and adjustments include a $263.7 million derecognition of MSRs effective with the February 20, 2020 notice of termination of the subservicing agreement between NRZ and PMC. See Note 8 — MSR Transfers Not Qualifying for Sale Accounting for further information. (2) Effective January 1, 2021, changes in fair value due to actual vs. model variances are presented as Changes in valuation inputs or assumptions. Activity for the three and nine months ended September 30, 2020 in the table above has been recast to conform to current year disclosure, resulting in a $9.1 million and $4.0 million gain, respectively, reclassified from Realization of expected cash flows to Changes in valuation inputs or assumptions. MSR UPB September 30, 2021 June 30, 2021 December 31, 2020 September 30, 2020 Owned MSRs $ 136,316,900 $ 148,882,743 $ 90,174,495 $ 71,301,427 NRZ pledged MSRs (1) 56,141,289 59,038,668 64,061,198 66,782,351 MAV pledged MSRs (1) 13,570,892 — — — Total MSR UPB $ 206,029,081 $ 207,921,411 $ 154,235,693 $ 138,083,778 (1) MSRs subject to sale agreements with NRZ and MAV that do not meet sale accounting criteria. See Note 8 — MSR Transfers Not Qualifying for Sale Accounting. We purchased MSRs with a UPB of $72.2 billion and $9.9 billion during the nine months ended September 30, 2021 and 2020, respectively. Purchases during the nine months ended September 30, 2021 include a bulk MSR acquisition of performing GSE loans from an unrelated third party effective June 1, 2021, with a UPB and fair value of $46.8 billion and $575.3 million, respectively. We sold MSRs with a UPB of $18.0 million and $55.7 million during the nine months ended September 30, 2021 and 2020, respectively, mostly to Freddie Mac under the Voluntary Partial Cancellation (VPC) program for delinquent loans. At September 30, 2021, the S&P Global Ratings, Inc.’s (S&P’s) servicer ratings outlook for PMC is stable. On June 29, 2021, S&P affirmed PMC’s servicer rating as Average, raising management and organization ranking to Above Average. In addition, S&P raised PMC’s master servicer rating from Average to Above Average reflecting the industry experience of PMC’s management, multiple levels of internal controls to monitor operations, and resolution of regulatory actions, amongst other factors mentioned by S&P. On September 28, 2021, Moody’s upgraded the servicer quality (SQ) assessment for PMC as a master servicer of residential mortgage loans from SQ3 to SQ3+, reflecting solid reporting and remitting processes and proactive servicer oversight. On March 24, 2020, Fitch Ratings, Inc. (Fitch) placed all U.S Residential Mortgage Backed Securities (RMBS) servicer ratings on Outlook Negative, resulting from a rapidly evolving economic and operating environment due to the sudden impact of the COVID-19 virus. On April 28, 2021, Fitch affirmed PMC’s servicer ratings and revised its outlook from Negative to Stable as PMC’s performance in this evolving environment has not raised any elevated concerns. According to Fitch, the affirmation and stable outlook reflected PMC’s diligent response to the coronavirus pandemic and its impact on servicing operations, effective enterprise-wide risk environment and compliance management framework, satisfactory loan servicing performance metrics, special servicing expertise, and efficient servicing technology. The ratings also consider the financial condition of PMC’s parent, OFC. Servicing Revenue Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Loan servicing and subservicing fees Servicing $ 103,094 $ 53,410 $ 246,363 $ 161,154 Subservicing 2,867 10,324 8,971 26,143 MAV 1,575 — 1,575 — NRZ 75,034 91,015 233,135 299,089 182,570 154,749 490,044 486,386 Ancillary income Late charges 10,656 11,012 31,335 38,323 Recording fees 3,726 3,900 10,579 9,828 Loan collection fees 2,858 3,047 8,568 10,048 Boarding and deboarding fees 1,627 4,262 6,830 5,619 Custodial accounts (float earnings) 1,234 1,057 3,547 8,787 Other, net 3,914 3,695 11,859 9,454 24,015 26,973 72,720 82,059 $ 206,585 $ 181,722 $ 562,764 $ 568,445 Float balances (balances in custodial accounts, which represent collections of principal and interest that we receive from borrowers) are held in escrow by unaffiliated banks and are excluded from our unaudited consolidated balance sheets. Float balances amounted to $3.3 billion, $1.7 billion and $2.0 billion at September 30, 2021, December 31, 2020 and September 30, 2020, respectively. |
MSR Transfers Not Qualifying fo
MSR Transfers Not Qualifying for Sale Accounting | 9 Months Ended |
Sep. 30, 2021 | |
Transfers and Servicing [Abstract] | |
Rights to MSRs | Note 8 — MSR Transfers Not Qualifying for Sale Accounting MSRs transferred or sold in transactions which did not initially qualify for sale accounting treatment are accounted for as secured financings. Until such time as the transaction qualifies as a sale for accounting purposes, we continue to recognize the MSRs and related financing liability on our unaudited consolidated balance sheets, as well as the full amount of servicing fee collected as revenue and the servicing fee remitted as pledged MSR liability expense in our unaudited consolidated statements of operations. In addition, changes in fair value of the transferred MSRs are recognized in MSR valuation adjustments, net in the unaudited consolidated statements of operations, while changes in fair value of the related MSR financing liability are reported in Pledged MSR liability expense. In June and September 2021, PMC entered into agreements to sell MSR portfolios to MAV. In each such agreement, PMC has been retained as subservicer for the sold portfolio in accordance with the terms of the subservicing agreement entered into on May 3, 2021. The transactions do not qualify for sale accounting treatment predominantly due to the termination restrictions of the subservicing agreement. See Note 10 - Investment in Equity Method Investee. Starting in 2012, Ocwen and PMC entered into agreements to sell MSRs or Rights to MSRs and the related servicing advances to NRZ, and in all cases have been retained by NRZ as subservicer. Due to the length of the non-cancellable term of the subservicing agreements, the transactions did not initially qualify for sale accounting treatment which resulted in such transactions being accounted for as secured financings. In the case of Rights to MSRs transactions with NRZ, legal title was retained by Ocwen, causing the transactions to be accounted for as secured financings. The following table presents selected assets and liabilities recorded on our unaudited consolidated balance sheets in connection with the MSR transfer agreements with NRZ and MAV that do not qualify for sale accounting. Balance Sheets September 30, 2021 December 31, 2020 Transferred MSRs, at fair value NRZ $ 574,020 $ 566,952 MAV 144,893 — $ 718,913 $ 566,952 Other financing liability - Transferred MSR liability (1), at fair value NRZ $ 574,020 $ 566,952 MAV 128,887 — $ 702,907 $ 566,952 Due from NRZ (Receivables) - Subservicing fees and reimbursable expenses $ 2,892 $ 4,611 Due to NRZ (Other liabilities) - Advance collections, servicing fees and other 92,188 94,691 (1) Also referred to as Pledged MSR liability. The following tables present the activity of the transferred MSR liability recorded in connection with the MSR transfer agreements with NRZ and MAV that do not qualify for sale accounting. Three Months Ended September 30, 2021 September 30, 2020 Transferred MSR Liability Original Rights to MSRs Agreements - NRZ MAV Agreements Total Original Rights to MSRs Agreements - NRZ Beginning Balance $ 535,571 $ — $ 535,571 $ 582,558 Sales — 132,003 132,003 — Changes in fair value (2) 63,762 (2,433) 61,329 12,203 Runoff and settlement (21,100) (683) (21,783) (17,452) Calls (1) (4,213) — (4,213) — Ending Balance $ 574,020 $ 128,887 $ 702,907 $ 577,309 Nine Months Ended September 30, 2021 Transferred MSR Liability Original Rights to MSRs Agreements - NRZ MAV Agreements Total Beginning Balance $ 566,952 $ — $ 566,952 Sales — 132,003 132,003 Changes in fair value 73,706 (2,433) 71,273 Runoff and settlement (59,626) (683) (60,309) Calls (1) (7,012) — (7,012) Ending Balance $ 574,020 $ 128,887 $ 702,907 Nine Months Ended September 30, 2020 Transferred MSR Liability Original Rights to MSRs Agreements - NRZ 2017 Agreements and New RMSR Agreements - NRZ PMC MSR Agreements - NRZ Total Beginning Balance $ 603,046 $ 35,445 $ 312,102 $ 950,593 Sales — — (226) (226) Changes in fair value (2) 26,081 903 (40,720) (13,736) Runoff and settlement: (49,150) (35,121) (7,492) (91,763) Derecognition of Pledged MSR financing liability due to termination of PMC MSR Agreements — — (263,664) (263,664) Calls (1) (2,668) (1,227) — (3,895) Ending Balance $ 577,309 $ — $ — $ 577,309 (1) Represents the carrying value of MSRs in connection with call rights exercised by NRZ, for MSRs transferred to NRZ under the 2017 Agreements and New RMSR Agreements (each as defined below), or by Ocwen at NRZ’s direction, for MSRs underlying the Original Rights to MSRs Agreements (as defined below). Ocwen derecognizes the MSRs and the related financing liability upon collapse of the securitization. (2) Effective January 1, 2021, changes in fair value due to actual vs. model variances are presented as Changes in valuation inputs or assumptions. Activity for the three and nine months ended September 30, 2020 in the table above has been recast to conform to current year disclosure, resulting in losses of $1.8 million and $7.6 million, respectively, reclassified from Runoff and settlement to Changes in fair value. The following tables present selected items in our unaudited consolidated statements of operations in connection with the MSR transfer agreements with NRZ and MAV that do not qualify for sale accounting. Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Statements of Operations Servicing fees Servicing fees collected on behalf of NRZ $ 75,034 $ 91,015 $ 233,135 $ 299,089 Servicing fees collected on behalf of MAV 1,001 — $ 1,001 — $ 76,035 $ 91,015 $ 234,136 $ 299,089 Pledged MSR liability expense NRZ (see further details below) $ 93,253 $ 57,404 $ 170,914 $ 105,684 MAV (see further details below) (2,094) — (2,094) — $ 91,160 $ 57,404 $ 168,820 $ 105,684 NRZ Pledged MSR liability expense: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Servicing fees collected on behalf of NRZ $ 75,034 $ 91,015 $ 233,135 $ 299,089 Less: Subservicing fee retained by Ocwen 21,475 25,674 67,987 80,529 Net servicing fees remitted to NRZ 53,559 65,341 165,148 218,560 Less: Reduction (increase) in financing liability Changes in fair value: Original Rights to MSRs Agreements (1) (63,762) (12,202) (73,706) (26,081) 2017 Agreements and New RMSR Agreements — — — (903) PMC MSR Agreements — — — 40,720 (63,762) (12,202) (73,706) 13,736 Runoff and settlement: Original Rights to MSRs Agreements (1) 21,100 17,451 59,627 49,150 2017 Agreements and New RMSR Agreements — — — 35,121 PMC MSR Agreements — — — 7,492 21,100 17,451 59,627 91,763 Other 2,968 2,688 8,313 7,377 Pledged MSR liability expense - NRZ $ 93,253 $ 57,404 $ 170,914 $ 105,684 (1) Effective January 1, 2021, changes in fair value due to actual vs. model variances are presented as Changes in valuation inputs or assumptions. Activity for the three and nine months ended September 30, 2020 in the table above has been recast to conform to current year disclosure, resulting in losses of $1.8 million and $7.6 million, respectively, reclassified from Runoff and settlement to Changes in fair value. MAV Pledged MSR liability expense: Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021 Servicing fees collected on behalf of MAV $ 1,001 $ 1,001 Less: Subservicing fee retained by Ocwen 178 178 Net servicing fees remitted to MAV 823 823 Less: Reduction (increase) in Transferred MSR liability Changes in fair value 2,433 2,433 Runoff and settlement 683 683 3,116 3,116 Other (199) (199) Pledged MSR liability expense - MAV $ (2,094) $ (2,094) The following table presents UPB of loans serviced on behalf of NRZ and MAV for transferred MSRs that did not qualify for sale accounting together with the UPB of loans subserviced on behalf of NRZ and MAV: September 30, 2021 December 31, 2020 NRZ Agreements Ocwen servicer of record (MSR title retained by Ocwen) - Ocwen MSR (1) (2) $ 12,601,689 $ 14,114,602 NRZ servicer of record (MSR title transferred to NRZ) - Ocwen MSR (1) 43,526,008 49,866,082 Ocwen subservicer 2,251,947 3,130,704 58,379,644 67,111,388 MAV Agreements MSR transferred to MAV (1) 13,570,892 — Ocwen subservicer 7,855,112 — 21,426,004 — Total UPB $ 79,805,648 $ 67,111,388 (1) The MSR transfers did not qualify for sale accounting treatment. (2) NRZ’s and MAV’s associated outstanding servicing advances were approximately $493.4 million and $4.5 million, respectively, as of September 30, 2021. NRZ - Ocwen Transactions Prior to the transfer of legal title under the Master Servicing Rights Purchase Agreement dated as of October 1, 2012, as amended, and certain Sale Supplements, as amended (collectively, the Original Rights to MSRs Agreements), Ocwen agreed to service the mortgage loans underlying the MSRs on the economic terms set forth in the Original Rights to MSRs Agreements. After the transfer of legal title as contemplated under the Original Rights to MSRs Agreements, Ocwen was to service the mortgage loans underlying the MSRs as subservicer on substantially the same economic terms. On July 23, 2017 and January 18, 2018, we entered into a series of agreements with NRZ that collectively modify, supplement and supersede the arrangements among the parties as set forth in the Original Rights to MSRs Agreements. The July 23, 2017 agreements, as amended, include a Master Agreement, a Transfer Agreement and the Subservicing Agreement between Ocwen and New Residential Mortgage LLC (NRM), a subsidiary of NRZ, relating to non-Agency loans (the NRM Subservicing Agreement) (collectively, the 2017 Agreements) pursuant to which the parties agreed, among other things, to undertake certain actions to facilitate the transfer from Ocwen to NRZ of Ocwen’s legal title to the remaining MSRs that were subject to the Original Rights to MSRs Agreements and under which Ocwen would subservice mortgage loans underlying the MSRs for an initial term ending July 2022 (the Initial Term). On January 18, 2018, the parties entered into new agreements (including a Servicing Addendum) regarding the Rights to MSRs related to MSRs that remained subject to the Original Rights to MSRs Agreements as of January 1, 2018 and amended the Transfer Agreement (collectively, New RMSR Agreements) to accelerate the implementation of certain parts of our arrangements in order to achieve the intent of the 2017 Agreements sooner. Under the new agreements, following receipt of the required consents and transfer of the MSRs, Ocwen subservices the mortgage loans underlying the transferred MSRs pursuant to the 2017 Agreements and the August 2018 subservicing agreement with NewRez LLC dba Shellpoint Mortgage Servicing (Shellpoint) described below. Ocwen received lump-sum cash payments of $54.6 million and $279.6 million in September 2017 and January 2018 in accordance with the terms of the 2017 Agreements and New RMSR Agreements, respectively. These upfront payments generally represented the net present value of the difference between the future revenue stream Ocwen would have received under the Original Rights to MSRs Agreements and the future revenue stream Ocwen expected to receive under the 2017 Agreements and the New RMSR Agreements. We recognized the cash received as a financing liability that we accounted for at fair value through the term of the original agreements (April 2020). Changes in fair value were recognized in Pledged MSR liability expense in the unaudited consolidated statements of operations. On August 17, 2018, Ocwen and NRZ entered into certain amendments (i) to the New RMSR Agreements to include Shellpoint, a subsidiary of NRZ, as a party to which legal title to the MSRs could be transferred after related consents are received, (ii) to add a Subservicing Agreement between Ocwen and Shellpoint relating to non-Agency loans (the Shellpoint Subservicing Agreement), (iii) to add an Agency Subservicing Agreement between Ocwen and NRM relating to Agency loans (the Agency Subservicing Agreement), and (iv) to conform the New RMSR Agreements and the NRM Subservicing Agreement to certain of the terms of the Shellpoint Subservicing Agreement and the Agency Subservicing Agreement. At any time during the Initial Term, NRZ may terminate the Subservicing Agreements and Servicing Addendum for convenience, subject to Ocwen’s right to receive a termination fee and 180 days’ notice. The termination fee is calculated as specified in the Subservicing Agreements and Servicing Addendum, and is a discounted percentage of the expected revenues that would be owed to Ocwen over the remaining contract term based on certain portfolio run-off assumptions. Following the Initial Term, NRZ may extend the term of the Subservicing Agreements and Servicing Addendum for additional three-month periods by providing proper notice. In addition, the Subservicing Agreements and Servicing Addendum may be terminated by Ocwen without cause on an annual basis (in effect a non-renewal) by providing at least 225 days’ notice in advance of the last day of the Initial Term or the last day of each one-year extension of the applicable terms after the Initial Term. NRZ and Ocwen have the ability to terminate the Subservicing Agreements and Servicing Addendum for cause if certain specified conditions occur. The terminations must be terminations in whole (i.e., cover all the loans under the relevant Subservicing Agreement or Servicing Addendum) and not in part, except for limited circumstances specified in the agreements. In addition, if NRZ terminates any of the NRM or Shellpoint Subservicing Agreements or the Servicing Addendum for cause, the other agreements will also terminate automatically. Under the terms of the Subservicing Agreements and Servicing Addendum, in addition to a base servicing fee, Ocwen receives certain ancillary fees, primarily late fees, loan modification fees and convenience or Speedpay ® fees. We may also receive certain incentive fees or pay penalties tied to various contractual performance metrics. NRZ receives all float earnings and deferred servicing fees related to delinquent borrower payments, as well as being entitled to receive certain REO related income including REO referral commissions. As of September 30, 2021, the UPB of MSRs subject to the Servicing Agreements and the New RMSR Agreements is $58.4 billion, including $12.6 billion for which title has not transferred to NRZ. As the third-party consents required for title to the MSRs to transfer were not obtained by May 31, 2019, the New RMSR Agreements set forth a process under which NRZ’s $12.6 billion Rights to MSRs may (i) be acquired by Ocwen at a price determined in accordance with the terms of the New RMSR Agreements, at the option of Ocwen, or (ii) be sold, together with Ocwen’s title to those MSRs, to a third party in accordance with the terms of the New RMSR Agreements, subject to an additional Ocwen option to acquire at a price based on the winning third-party bid rather than selling to the third party. If the Rights to MSRs are not transferred pursuant to these alternatives, then the Rights to MSRs will remain subject to the New RMSR Agreements. In addition, as noted above, during the Initial Term, NRZ has the right to terminate the $12.6 billion New RMSR Agreements for convenience, in whole but not in part, subject to payment of a termination fee and 180 days’ notice. If NRZ exercises this termination right, NRZ has the option of seeking (i) the transfer of the MSRs through a sale to a third party of its Rights to MSRs (together with a transfer of Ocwen’s title to those MSRs) or (ii) a substitute RMSR arrangement that substantially replicates the Rights to MSRs structure (a Substitute RMSR Arrangement) under which we would transfer title to the MSRs to a successor servicer and NRZ would continue to own the economic rights and obligations related to the MSRs. In the case of option (i), we have a purchase option as specified in the New RMSR Agreements. If NRZ is not able to sell the Rights to MSRs or establish a Substitute RMSR Arrangement with another servicer, NRZ has the right to revoke its termination notice and re-instate the Servicing Addendum or to establish a subservicing arrangement whereby the MSRs remaining subject to the New RMSR Agreements would be transferred to up to three subservicers who would subservice under Ocwen’s oversight. If such a subservicing arrangement were established, Ocwen would receive an oversight fee and reimbursement of expenses. We may also agree on alternative arrangements that are not contemplated under our existing agreements or that are variations of those contemplated under our existing agreements. NRZ - PMC Transactions On December 28, 2016, PMC entered into an agreement to sell substantially all of its MSRs, and the related servicing advances, to NRM (the 2016 PMC Sale Agreement). In connection with this agreement, on December 28, 2016, PMC also entered into a subservicing agreement with NRZ which was subsequently amended and restated as of March 29, 2019 (together with the 2016 PMC Sale Agreement, the PMC MSR Agreements). The PMC subservicing agreement had an initial term of three years from the initial transaction date of June 16, 2017, subject to certain transfer and termination provisions. The MSR sale transaction did not originally achieve sale accounting treatment. On February 20, 2020, we received a notice of termination from NRZ with respect to the PMC servicing agreement. This termination was for convenience and not for cause, and provided for loan deboarding fees to be paid by NRZ. As the sale accounting criteria were met upon the notice of termination, the MSRs and the Rights to MSRs were derecognized from our balance sheet on February 20, 2020 without any gain or loss on derecognition. We serviced these loans until deboarding in October 2020 representing $34.2 billion of UPB, and accounted for them as a subservicing relationship. Accordingly, we recognized subservicing fees associated with the subservicing agreement subsequent to February 20, 2020 and have not reported any servicing fees collected on behalf of, and remitted to NRZ, any change in fair value, runoff and settlement in financing liability thereafter. On September 1, 2020, 133,718 loans representing $18.2 billion of UPB were deboarded and the remaining 136,500 loans representing $16.0 billion of UPB were deboarded on October 1, 2020. |
Receivables
Receivables | 9 Months Ended |
Sep. 30, 2021 | |
Receivables [Abstract] | |
Receivables | Note 9 – Receivables September 30, 2021 December 31, 2020 Servicing-related receivables: Government-insured loan claims - Forward $ 93,717 $ 103,058 Government-insured loan claims - Reverse 34,620 32,887 Due from custodial accounts 25,700 19,393 Reimbursable expenses 5,419 4,970 Subservicing fees and reimbursable expenses - Due from NRZ 2,892 4,611 Subservicing fees and reimbursable expenses - Due from MAV 1,412 — Other 2,167 1,087 165,926 166,006 Income taxes receivable 54,501 57,503 Due from MAV 1,245 — Other receivables 3,093 3,200 224,764 226,709 Allowance for losses (41,674) (39,044) $ 183,090 $ 187,665 At September 30, 2021 and December 31, 2020, the allowance for losses primarily related to receivables of our Servicing business. The allowance for losses related to FHA- or VA-insured loans repurchased from Ginnie Mae guaranteed securitizations (government-insured claims) was $41.1 million and $38.3 million at September 30, 2021 and December 31, 2020, respectively. The government-insured claims that do not exceed HUD, VA or FHA insurance limits are guaranteed by the U.S. government. Allowance for Losses - Government-Insured Loan Claims Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Beginning balance $ 41,216 $ 53,310 $ 38,339 $ 56,868 Provision 2,990 5,055 10,526 12,249 Charge-offs and other, net (3,141) (17,607) (7,800) (28,359) Ending balance $ 41,065 $ 40,758 $ 41,065 $ 40,758 |
Investment in Equity Method Inv
Investment in Equity Method Investee | 9 Months Ended |
Sep. 30, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investment in Equity Method Investee | Note 10 - Investment in Equity Method Investee On December 21, 2020, Ocwen entered into a transaction agreement (the Transaction Agreement) with Oaktree Capital Management L.P. and certain affiliates (collectively Oaktree) to form a strategic relationship to invest in MSRs subserviced by PMC. The parties have agreed to invest their pro rata portions of up to an aggregate of $250.0 million in an intermediate holding company, MAV Canopy, held 15% by Ocwen and 85% by Oaktree. On May 3, 2021, pursuant to the Transaction Agreement, Ocwen contributed MAV, which had total member’s equity and cash balances of approximately $5.0 million, to MAV Canopy, and received 15% of MAV Canopy and cash consideration. MAV is a licensed mortgage servicing company approved to purchase GSE MSRs. PMC and MAV entered into a number of definitive agreements which govern the terms of their business relationship: Subservicing Agreement. Effective May 3, 2021, PMC entered into a subservicing agreement with MAV for exclusive rights to service the mortgage loans underlying MSRs owned by MAV in exchange for a per-loan subservicing fee and certain other ancillary fees. The subservicing agreement will continue until terminated by mutual agreement of the parties or for cause, as defined. If either party terminates the agreement for cause, the other party is required to pay certain fees and costs. Joint Marketing Agreement and Recapture Agreement. Effective May 3, 2021, in conjunction with the subservicing agreement, PMC and MAV entered into a joint marketing agreement and a flow MSR sale agreement (MSR recapture), whereby PMC is entitled to the exclusive right to solicit and refinance borrowers with loans underlying the MSR owned by MAV, and is obligated to transfer to MAV the MSR associated with the loans so originated. The joint marketing agreement and flow MSR sale agreement will continue until terminated by mutual agreement of the parties or for cause, as defined, or at the option of either party if the subservicing agreement is terminated. Administrative Services Agreement: Pursuant to the Transaction Agreement, Ocwen entered into an agreement to provide certain administrative services to MAV, including accounting, treasury, human resources, management information, MSR transaction management support, and certain licensing, regulatory and risk management support. Ocwen is entitled to a fee for such services, subject to an annual cap of $0.5 million. Following the execution of the Transaction Agreement and until the parties have contributed their pro rata portions of the $250.0 million aggregate capital contributions, Ocwen and its affiliates may not acquire, without Oaktree’s prior written approval, GSE MSRs that meet certain underwriting and other criteria (such criteria are referred to as the “buy-box”) unless Ocwen notifies MAV of the opportunity and MAV does not pursue it by submitting a competitive bid to the MSR seller. In addition, until the earlier of (i) the time that MAV has been fully funded and (ii) May 3, 2024 (subject to two annual extensions by mutual agreement), if Ocwen seeks to sell any GSE MSRs that meet the buy-box, Ocwen must first offer such MSRs to MAV before initiating a sale process with a third party. If MAV does not accept Ocwen’s offer, Ocwen may sell the MSRs to a third party on terms no more favorable to the purchaser than those offered to MAV. The price at which Ocwen and its affiliates will offer MSRs to MAV will be based on the valuation of an independent third-party. This first offer provision does not apply to MSRs acquired by PMC prior to May 3, 2021. On June 1, 2021, PMC agreed to sell and MAV agreed to purchase a Fannie Mae MSR portfolio of approximately $4.1 billion, with certain pricing adjustments, subject to MAV obtaining the necessary regulatory approval. MAV has subsequently obtained approval from Fannie Mae and the transaction closed on September 1, 2021. In addition, on September 30, 2021, PMC agreed to sell and MAV agreed to purchase a GSE MSR portfolio of approximately $8.2 billion. Forward Bulk Servicing Rights Purchase and Sale Agreement: On September 9, 2021, PMC and MAV entered into an MSR purchase and sale agreement whereby PMC agreed to sell and MAV agreed to purchase certain Fannie Mae MSRs acquired by PMC on a monthly basis. As of September 30, 2021, PMC sold MSRs with UPB of $1.3 billion to MAV under this agreement. The MSR sale transactions do not qualify for sale accounting and are accounted for as secured borrowings primarily due to the termination restrictions of the subservicing agreement. See Note 8 — MSR Transfers Not Qualifying for Sale Accounting for a summary of transactions under this agreement. We account for our investments in unconsolidated entities using the equity method. These investments include our investment in MAV Canopy in which we hold a significant, but less than controlling, ownership interest. Under the equity method of accounting, investments are initially recorded at cost and thereafter adjusted for additional investments, distributions and the proportionate share of earnings or losses of the investee. We evaluate our equity method investments for impairment when events or changes in circumstances indicate that any other than‐temporary decline in value may have occurred. Under ASC 323, Investments - Equity Method and Joint Ventures, an investment of less than 20 percent of the voting stock of an investee shall lead to a presumption that an investor does not have the ability to exercise significant influence unless such ability can be demonstrated. Ocwen determined it has significant influence over MAV Canopy based on its representation on the MAV Canopy Board of Directors and certain services it provides, amongst other factors. Accordingly, Ocwen deemed it appropriate to account for its investment in MAV Canopy under the equity method. Our investment in MAV Canopy is comprised of following at September 30, 2021: Capital contribution $ 18,512 Earnings of equity method investee 1,282 Investment in equity method investee $ 19,794 MAV Canopy, MAV and Oaktree are deemed related parties to Ocwen. In addition to its investment in MAV Canopy, the subservicing agreement by PMC and the other agreements described above, Ocwen issued common stock, warrants and senior secured notes to Oaktree as described in Note 12 – Borrowings and Note 14 – Equity. The following tables present a summary of our transactions with MAV, MAV Canopy or Oaktree as related parties, as of or for the three and nine months ended September 30, 2021: Balance Sheet MSRs, at fair value (1) $ 144,893 Receivables Reimbursable expenses MSR sales price holdback - (MAV) (1) $ 1,644 Due from MAV 2,657 Transferred MSR liability, at fair value (2) $ 128,887 Other liabilities Due to MAV 226 Revenue Servicing and subservicing fees Servicing fees collected on behalf of MAV (1) $ 1,001 Subservicing fees - Subservicing agreement (MAV) 574 Ancillary fees (MAV) (1) 707 $ 2,282 MSR valuation adjustments, net (MAV) (1) $ (3,116) Other income (expense) Interest expense - OFC senior secured notes (Oaktree) $ (21,351) Pledged MSR liability expense - MAV (1) 2,094 Other income - Administrative services agreement (MAV) 140 Other UPB of MSR transferred by PMC to MAV in the three and nine months ended September 30, 2021 $ 13,683,143 Cash proceeds from transfers of MSRs by PMC to MAV in the three and nine months ended September 30, 2021 $ 130,024 UPB of loans sub-serviced - Subservicing agreement (MAV) as of September 30, 2021 MSR transferred to MAV, not qualifying for sale accounting 13,570,892 Ocwen subservicer 7,855,112 $ 21,426,004 (1) For sales of MSRs to MAV which did not qualify as a sale for accounting purposes, we continue to recognize the MSRs and related pledged MSR liability on our consolidated balance sheets, as well as the full amount of servicing revenue and changes in the fair value of the MSRs and related financing liability in our unaudited consolidated statements of operations. Changes in fair value of the Rights to MSRs are recognized in MSR valuation adjustments, net in the unaudited consolidated statements of operations. Changes in fair value of the MSR related financing liability are reported in Pledged MSR liability expense. |
Other Assets
Other Assets | 9 Months Ended |
Sep. 30, 2021 | |
Other Assets [Abstract] | |
Other Assets | Note 11 – Other Assets September 30, 2021 December 31, 2020 Contingent loan repurchase asset $ 450,385 $ 480,221 Prepaid expenses 21,398 21,176 Derivatives, at fair value 20,329 23,246 Prepaid representation, warranty and indemnification claims - Agency MSR sale 15,173 15,173 REO 8,602 7,771 Prepaid lender fees, net 8,338 9,556 Deferred tax asset, net 3,724 3,543 Mortgage backed securities, at fair value 1,618 2,019 Security deposits 1,173 2,222 Other 11,857 6,556 $ 542,597 $ 571,483 |
Borrowings
Borrowings | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Borrowings | Note 12 – Borrowings Financing Liabilities Outstanding Balance Borrowing Type Collateral Interest Rate Maturity September 30, 2021 December 31, 2020 HMBS-related borrowings, at fair value (1) Loans held for investment 1ML + 242 bps (1) (1) $ 6,782,564 $ 6,772,711 Other financing liabilities, at fair value Original Rights to MSRs Agreements - NRZ MSRs (2) (2) 574,020 566,952 Transferred MSR liability - MAV MSRs (2) (2) 128,887 — 702,907 566,952 Financing liability - Owed to securitization investors, at fair value: Residential Asset Securitization Trust 2003-A11 (RAST 2003-A11) (3) Loans held for investment (3) Oct. 2033 8,004 9,770 Total Other financing liabilities, at fair value 710,911 576,722 $ 7,493,475 $ 7,349,433 (1) Represents amounts due to the holders of beneficial interests in Ginnie Mae guaranteed HMBS that did not qualify for sale accounting treatment of HECM loans. Under this accounting treatment, the HECM loans securitized with Ginnie Mae remain on our consolidated balance sheets and the proceeds from the sale are recognized as a financing liability, which is recorded at fair value consistent with the related HECM loans. The beneficial interests in Ginnie Mae guaranteed HMBS have no maturity dates, and the borrowings mature as the related loans are repaid. Interest rate is a weighted average based on the pass-through rate of the loans. See Note 2 – Securitizations and Variable Interest Entities. (2) Pledged MSR liabilities are recognized due to the accounting treatment of MSR sale transactions with NRZ and MAV that did not qualify as sales for accounting purposes. Under this accounting treatment, the MSRs transferred remain on the consolidated balance sheet and the proceeds from the sale are recognized as a financing liability, which is recorded at fair value consistent with the related MSRs. The financing liability has no contractual maturity or repayment schedule. See Note 8 — MSR Transfers Not Qualifying for Sale Accounting for additional information. (3) Consists of securitization debt certificates due to third parties that represent beneficial interests in trusts that we include in our unaudited consolidated financial statements. Holders of the debt issued by the consolidated securitization trust entities have recourse only to the assets of the SPE for satisfaction of the debt and have no recourse against the assets of Ocwen. Similarly, the general creditors of Ocwen have no claim on the assets of the trusts. Trust pay interest based on fixed rates ranging between 4.25% and 5.75% and a variable rate based on 1ML plus 0.45%, includes certificates that are Principal Only certificates and are not entitled to receive distributions of interest. Advance Match Funded Liabilities Borrowing Capacity September 30, 2021 December 31, 2020 Borrowing Type Maturity (1) Amort. Date (1) Total Available (2) Weighted Average Interest Rate (6) Balance Weighted Average Interest Rate (6) Balance Advance Receivables Backed Notes - Series 2015-VF5 (3) Jun. 2052 Jun. 2022 $ 80,000 $ 54,505 2.14 % $ 25,495 4.26 % $ 89,396 Advance Receivables Backed Notes, Series 2020-T1 (4) Aug. 2052 Aug. 2022 475,000 — 1.49 % 475,000 1.49 % 475,000 Total Ocwen Master Advance Receivables Trust (OMART) 555,000 54,505 1.52 % 500,495 1.93 % 564,396 Ocwen Freddie Advance Funding (OFAF) - Advance Receivables Backed Notes, Series 2015-VF1 (5) Aug. 2052 Aug. 2022 40,000 23,923 2.15 % 16,077 3.26 % 16,892 $ 595,000 $ 78,428 1.54 % $ 516,572 1.96 % $ 581,288 (1) The amortization date of our facilities is the date on which the revolving period ends under each advance facility note and repayment of the outstanding balance must begin if the note is not renewed or extended. The maturity date is the date on which all outstanding balances must be repaid. In all of our advance facilities, there are multiple notes outstanding. After the amortization date for each note, all collections that represent the repayment of advances pledged to the facility must be applied ratably to each outstanding amortizing note to reduce the balance and, as such, the collection of advances allocated to the amortizing note may not be used to fund new advances. (2) Borrowing capacity under the OMART and OFAF facilities is available to us provided that we have sufficient eligible collateral to pledge. At September 30, 2021, none of the available borrowing capacity of the OMART and OFAF advance financing notes could be used based on the amount of eligible collateral. (3) Interest is computed based on the lender’s cost of funds plus a margin of 200 bps. On June 30, 2021, the amortization date was extended by one year to June 30, 2022, the interest rate margin was reduced from 400 bps to 200 bps, and the borrowing capacity was voluntarily reduced to from $250.0 million to $80.0 million. (4) The weighted average rate of the notes at September 30, 2021 is 1.49%, with rates on the individual classes of notes ranging from 1.28% to 5.42%. (5) Interest was computed based on the lender’s cost of funds plus a margin of 300 bps. On June 30, 2021, the amortization date was extended to August 27, 2021. On August 26, 2021, the interest rate was reduced to the lender’s cost of funds plus a margin of 200 bps, the borrowing capacity was voluntarily reduced from $70.0 million to $40.0 million and the amortization date was extended to August 26, 2022. (6) The weighted average interest rate, excluding the effect of the amortization of prepaid lender fees, is computed using the outstanding balance of each respective note and its interest rate at the financial statement date. At September 30, 2021 and December 31, 2020, the balance of unamortized prepaid lender fees was $1.8 million and $4.3 million, respectively, and are included in Other assets in our consolidated balance sheets. Mortgage Loan Warehouse Facilities Available Borrowing Capacity Outstanding Balance Borrowing Type Collateral Interest Rate (1) Maturity Uncommitted Committed (2) September 30, 2021 December 31, 2020 Master repurchase agreement (3) Loans held for sale (LHFS) 1ML + 220 - 375 bps June 2022 $ 115,000 $ 61,282 $ 98,718 $ 195,773 Master repurchase agreement (4) LHFS (forward and reverse) 1ML + 325 bps forward; 1ML + 350 bps reverse Nov. 2021 50,000 124,385 75,615 80,081 Master repurchase agreement (5) N/A SOFR + 190 bps; SOFR floor 25 bps N/A 50,000 — — — Participation agreement (6) LHFS (6) June 2022 203,609 — 96,391 — Master repurchase agreement (6) LHFS (6) June 2022 — 100,000 — 63,281 Master repurchase agreement (7) LHFS (7) June 2022 — 1,000 — — Mortgage warehouse agreement (8) LHFS 1ML + 350 bps; Floor 5.25% Jan. 2022 — 37,681 12,319 11,715 Mortgage warehouse agreement (9) LHFS (reverse) 1ML + 250 bps; 3.25% floor Oct. 2021 28,929 — 146,071 73,134 Mortgage warehouse agreement (10) LHFS (10) N/A 34,962 — 165,038 27,729 Master repurchase agreement (11) LHFS 1ML + 200 bps N/A — — 465,018 — Loan and security agreement (12) HECM (ABO) Prime Rate + 50 bps; Floor 450 bps Apr. 2022 — 20,000 10,000 — Master repurchase agreement (13) LHFS 1ML + 250 bps Oct. 2021 210,000 — — — Total mortgage loan warehouse facilities 2.77% (14) $ 692,500 $ 344,348 $ 1,069,170 $ 451,713 (1) 1ML was 0.08% and 0.14% at September 30, 2021 and December 31, 2020, respectively. Prime Rate was 3.25% as at September 30, 2021. (2) Of the borrowing capacity on mortgage loan warehouse facilities extended on a committed basis, $3.3 million of the available borrowing capacity could be used at September 30, 2021 based on the amount of eligible collateral that could be pledged. (3) The maximum borrowing under this agreement is $275.0 million, of which $160.0 million is available on a committed basis and the remainder is available at the discretion of the lender. On March 31, 2021, we renewed the facility and the maturity date was extended to June 30, 2022. (4) The maximum borrowing under this agreement is $250.0 million, of which $200.0 million is available on a committed basis and the remainder is available on an uncommitted basis. The agreement allows the lender to acquire a 100% beneficial interest in the underlying mortgage loans. (5) The lender provides financing for up to $50.0 million at the discretion of the lender. The agreement has no stated maturity dat e. Interest on this facility is based on the Secured Overnight Financing Rate (SOFR). (6) On June 23, 2021, the facility was renewed for one year to June 23, 2022, the uncommitted borrowing capacity under the participation agreement was increased to $150.0 million and the committed borrowing capacity under the repurchase agreement increased to $100.0 million. The interest rate on repurchase agreement was revised to the stated interest rate of the mortgage loans, less 35 bps with a floor of 3.00% for new originations and less 10 bps with a floor of 3.25% for Ginnie Mae modifications, Ginnie Mae buyouts and RMBS bond clean up loans. The interest rate on the participation agreement was revised to the stated interest rate of the mortgage loans, less 35 bps with a floor of 3.00% for new originations. The agreements allow the lender to acquire a 100% beneficial interest in the underlying mortgage loans. On July 23, 2021, we temporarily increased the borrowing capacity under the participation agreement to $300.0 million until September 15, 2021. On September 14, 2021, the temporary increase in borrowing capacity was extended to November 15, 2021. (7) On June 20, 2021, the facility was renewed for one year to June 23, 2022. (8) Under this agreement, the lender provides financing for up to $50.0 million on a committed basis. On January 15, 2021, the maturity date of this facility was extended to January 15, 2022. (9) Under this agreement, t he lender provides financing for up to $150.0 million on an uncommitted basis. On February 1, 2021, the borrowing capacity was temporarily increased from $100.0 million to $150.0 million until February 28, 2021 when it was reduced to $100.0 million. On March 30, 2021, the borrowing capacity was temporarily increased to $150.0 million effective April 1, 2021 until April 29, 2021 when the increase was made permanent. On September 27, 2021, the borrowing capacity was increased to $175.0 million until maturity. On October 14, 2021, the maturity date of the facility was extended to November 23, 2021. (10) On May 17, 2021, the total borrowing capacity of this facility, all of which is uncommitted, was increased from $100.0 million to $150.0 million through the addition of a $50.0 million participation interest. The agreement has no stated maturity date, however each transaction has a maximum duration of four years. The cost of this line is set at e ach transaction date and is based on the interest rate and type of the collateral. On September 1, 2021, the total borrowing capacity of the facility was increased to $200.0 million. (11) On March 29, 2021, we entered into a repurchase agreement which provides borrowing at our discretion up to a certain maximum amount of capacity on a rolling 30-day committed basis. This facility is structured as a gestation repurchase facility whereby dry Agency mortgage loans are transferred to a trust which trust issues a trust certificate that is pledged as the collateral for the borrowings. See Note 2 – Securitizations and Variable Interest Entities for additional information. On March 31, 2021, the trust issued the first certificate of $50.0 million which was increased to $75.0 million on May 28, 2021 and further increased to $225.0 million on July 29, 2021. The second trust certificate of $50.0 million was issued on April 12, 2021 and increased to $100.0 million on July 13, 2021. Additional trust certificates of $25.0 million and $100.0 million were issued for borrowing on June 25, 2021 and July 23, 2021, respectively, under this agreement. Each certificate is renewed monthly and we reduced the interest rate to 1ML + 200 bps during the monthly certificate renewals in July 2021. (12) On April 29, 2021, we entered into a revolving facility agreement which provides up to $30.0 million of committed borrowing capacity secured by eligible HECM loans that are active buyouts (ABO), as defined in the agreement. (13) On July 23, 2021, we entered into a repurchase agreement warehouse facility with borrowing capacity of $210.0 million. This facility expired in October 2021. (14) Weighted average interest rate at September 30, 2021, excluding the effect of the amortization of prepaid lender fees. At September 30, 2021 and December 31, 2020, unamortized prepaid lender fees were $0.9 million and $2.0 million, respectively, and are included in Other assets in our consolidated balance sheets. MSR financing facilities, net Available Borrowing Capacity Outstanding Balance Borrowing Type Collateral Interest Rate (1) Maturity Uncommitted Committed (2) September 30, 2021 December 31, 2020 Agency MSR financing facility (3) MSRs, Advances 1ML + 325 bps June 2022 $ — $ 75,702 $ 349,298 $ 210,755 Ginnie Mae MSR financing facility (4) MSRs, Advances 1ML + 450 bps; 1ML floor 0.50% Dec. 2021 6,937 — 118,063 112,022 Ocwen Excess Spread-Collateralized Notes, Series 2019-PLS1 (5) MSRs 5.07% Nov. 2024 — — 48,243 68,313 Secured Notes, Ocwen Asset Servicing Income Series, Series 2014-1 (6) MSRs (6) Feb. 2028 — — 41,362 47,476 Agency MSR financing facility - revolving loan (7) MSRs 1yr Swap + 2.50% June 2026 — 7,929 277,071 — Agency MSR financing facility - term loan (7) MSRs 1yr Swap + 2.50% June 2023 — — 112,779 — Total MSR financing facilities 3.68% (8) 6,937 83,631 946,816 438,566 Unamortized debt issuance costs - PLS Notes and Agency MSR financing - term loan (9) (1,072) (894) Total MSR financing facilities, net $ 945,744 $ 437,672 (1) 1ML was 0.08% and 0.14% at September 30, 2021 and December 31, 2020, respectively. 1-year swap rate was 0.19% and 0.19% at September 30, 2021 and December 31, 2020, respectively. (2) Of the borrowing capacity on MSR financing facilities extended on a committed basis, none of the available borrowing capacity could be used at September 30, 2021 based on the amount of eligible collateral that could be pledged. (3) PMC’s obligations under this facility are secured by a lien on the related MSRs. Ocwen guarantees the obligations of PMC under this facility. The maximum amount which we may borrow pursuant to the repurchase agreements is $425.0 million on a committed basis. We also pledged the membership interest of the depositor for our OMART advance financing facility as additional collateral to this facility. See Note 2 – Securitizations and Variable Interest Entities for additional information. We are subject to daily margining requirements under the terms of our MSR financing facilities. Declines in fair value of our MSRs due to declines in market interest rates, assumption updates or other factors require that we provide additional collateral to our lenders under these facilities. On March 31, 2021, the facility was upsized to $350.0 million, the interest rate reduced to 1ML plus 325bps, and the maturity was renewed to June 30, 2022. These changes became effective on April 15, 2021. On June 2, 2021, the facility was temporarily upsized to $425.0 million for a period of 90 calendar days ending no later than September 1, 2021. On August 26, 2021 and later on October 25, 2021, the temporary upsize was extended until November 1, 2021. (4) PMC’s obligations under this facility are secured by a lien on the related Ginnie Mae MSRs and advances. Ocwen guarantees the obligations of PMC under the facility. The borrowing capacity is $125.0 million on an uncommitted basis. See (3) above regarding daily margining requirements. On October 26, 2021, the borrowing capacity was increased to $150.0 million on an uncommitted basis. (5) PLS Issuer’s obligations under the facility are secured by a lien on the related PLS MSRs. Ocwen guarantees the obligations of PLS Issuer under the facility. The Class A PLS Notes issued pursuant to the credit agreement had an initial principal amount of $100.0 million and amortize in accordance with a pre-determined schedule subject to modification under certain events. See Note 2 – Securitizations and Variable Interest Entities for additional information. See (3) above regarding daily margining requirements. (6) OASIS noteholders are entitled to receive a monthly payment equal to the sum of: (a) 21 basis points of the UPB of the reference pool of Freddie Mac mortgages; (b) any termination payment amounts; (c) any excess refinance amounts; and (d) the note redemption amounts, each as defined in the indenture supplement for the notes. Monthly amortization of the liability is estimated using the proportion of monthly projected service fees on the underlying MSRs as a percentage of lifetime projected fees, adjusted for the term of the notes. (7) On June 28, 2021, we entered into a facility which includes a $135.0 million term loan and a $285.0 million revolving loan secured by a lien on PMC’s Agency MSRs. See (3) above regarding daily margining requirements. (8) Weighted average interest rate at September 30, 2021, excluding the effect of the amortization of debt issuance costs and prepaid lender fees. (9) At September 30, 2021, unamortized debt issuance costs included $0.5 million and $0.6 million on the PLS Notes and the Agency MSR financing facility - term loan, respectively. At September 30, 2021 and December 31, 2020, unamortized prepaid lender fees related to revolving type MSR financing facilities were $5.7 million and $3.3 million, respectively, and are included in Other assets in our consolidated balance sheets. Senior Secured Term Loan, net Outstanding Balance Borrowing Type Collateral Interest Rate Maturity September 30, 2021 December 31, 2020 SSTL (1) (1) 1-Month Euro-dollar rate + 600 bps with a Eurodollar floor of 100 bps (1) May 2022 (1) $ — $ 185,000 Unamortized debt issuance costs — (4,867) Discount — (357) $ — $ 179,776 (1) On March 4, 2021, we repaid in full the $185.0 million outstanding principal balance. The prepayment resulted in our recognition of an $8.4 million loss on debt extinguishment, including a prepayment premium of 2% of the outstanding principal balance, or $3.7 million. Senior Notes Interest Rate (1) Maturity Outstanding Balance September 30, 2021 December 31, 2020 PMC Senior Secured Notes 7.875% March 2026 $ 400,000 $ — OFC Senior Secured Notes 12% paid in cash or 13.25% paid-in-kind (see below) March 2027 285,000 — PHH Corporation (PHH) Senior Notes 6.375% August 2021 — 21,543 PMC Senior Secured Notes 8.375% November 2022 — 291,509 Principal balance 685,000 313,052 Discount (2) PMC Senior Secured Notes (1,844) — OFC Senior Secured Notes (3) (55,638) — (57,482) — Unamortized debt issuance costs (2) PMC Senior Secured Notes (5,966) (968) OFC Senior Secured Notes (8,894) — (14,860) (968) Fair value adjustments — (186) $ 612,658 $ 311,898 (1) Excluding the effect of the amortization of debt issuance costs and discount. (2) The discount and debt issuance costs are amortized to interest expense through the maturity of the respective notes. (3) Includes original issue discount (OID) and additional discount related to the concurrent issuance of warrants and common stock. See below for additional information. Redemption of 6.375% Senior Unsecured Notes due 2021 and 8.375% Senior Secured Notes due 2022 On March 4, 2021, we redeemed all of PHH’s outstanding 6.375% Senior Notes due August 2021 at a price of 100% of the principal amount, plus accrued and unpaid interest, and all of PMC’s 8.375% Senior Secured Notes due November 2022 at a price of 102.094% of the principal amount, plus accrued and unpaid interest. The redemption resulted in our recognition of a $7.1 million loss on debt extinguishment. Issuance of 7.875% Senior Secured Notes due 2026 On March 4, 2021, PMC completed the issuance and sale of $400.0 million aggregate principal amount of 7.875% senior secured notes due March 15, 2026 (the PMC Senior Secured Notes) at a discount of $2.1 million. The PMC Senior Secured Notes are guaranteed on a senior secured basis by Ocwen and PHH and were sold in an offering exempt from the registration requirements of the Securities Act of 1933, as amended (the Securities Act). Interest on the PMC Senior Secured Notes accrues at a rate of 7.875% per annum and is payable semi-annually in arrears on March 15 and September 15 of each year, beginning on September 15, 2021. On or after March 15, 2023, PMC may redeem some or all of the PMC Senior Secured Notes at its option at the following redemption prices, plus accrued and unpaid interest, if any, on the notes redeemed to, but excluding, the redemption date if redeemed during the 12-month period beginning on March 15th of the years indicated below: Redemption Year Redemption Price 2023 103.938 % 2024 101.969 2025 and thereafter 100.000 Prior to March 15, 2023, PMC may, on any one or more occasions, redeem some or all of the PMC Senior Secured Notes at its option at a redemption price equal to 100% of the principal amount of the notes being redeemed, plus a “make-whole” premium equal to the greater of (i) 1.0% of the then outstanding principal amount of such note and (ii) the excess of (1) the present value at the redemption date of the sum of (A) the redemption price of the note at March 15, 2023 (such redemption price is set forth in the table above) plus (B) all required interest payments due on such notes through March 15, 2023 (excluding accrued but unpaid interest), such present value to be computed using a discount rate equal to the Treasury Rate (as defined in the indenture governing the PMC Senior Secured Notes (Indenture)) as of such redemption date plus 50 basis points; over (2) the then outstanding principal amount of such notes, plus accrued and unpaid interest, if any, on the notes redeemed to, but excluding, the redemption date. In addition, on or prior to March 15, 2023, PMC may also redeem up to 35.0% of the principal amount of all of the PMC Senior Secured Notes originally issued under the Indenture (including any additional PMC Senior Secured Notes issued under the Indenture) using the net proceeds of certain equity offerings at a redemption price equal to 107.875% of the principal amount thereof, plus accrued and unpaid interest to, but excluding, the date of redemption (subject to the rights of holders of notes on the relevant regular record date to receive interest due on the relevant interest payment date that is on or prior to the applicable date of redemption); provided that: (i) at least 65.0% of the principal amount of all PMC Senior Secured Notes issued under the Indenture remains outstanding immediately after any such redemption; and (ii) PMC makes such redemption not more than 120 days after the consummation of any such equity offering. The Indenture contains customary covenants for debt securities of this type that limit the ability of PHH and its restricted subsidiaries (including PMC) to, among other things, (i) incur or guarantee additional indebtedness, (ii) incur liens, (iii) pay dividends on or make distributions in respect of PHH’s capital stock or make other restricted payments, (iv) make investments, (v) consolidate, merge, sell or otherwise dispose of certain assets, and (vi) enter into transactions with Ocwen’s affiliates. Issuance of OFC Senior Secured Notes On March 4, 2021, Ocwen completed the private placement of $199.5 million aggregate principal amount of senior secured notes (the OFC Senior Secured Notes) with an OID of $24.5 million to certain entities owned by funds and accounts managed by Oaktree Capital Management, L.P. (the Oaktree Investors). Concurrent with the issuance of the OFC Senior Secured Notes, Ocwen issued to the Oaktree Investors warrants to purchase shares of its common stock. The $158.5 million proceeds were allocated to the OFC Senior Secured Notes on a relative fair value basis resulting in an initial discount. On May 3, 2021, Ocwen issued to Oaktree the second tranche of the OFC Senior Secured Notes in an aggregate principal amount of $85.5 million with an OID of $10.5 million. Concurrent with the issuance of the second tranche of OFC Senior Secured Notes, Ocwen issued to the Oaktree Investors shares and warrants to purchase shares of its common stock. The $68.0 million proceeds were allocated to the OFC Senior Secured Notes on a relative fair value basis resulting in an initial discount. See Note 14 – Equity for additional information regarding the issuance of common stock and warrants. The OFC Senior Secured Notes mature on March 4, 2027 with no amortization of principal. Interest is payable quarterly in arrears on the last business day of each March, June, September and December and accrues at the rate of 12% per annum to the extent interest is paid in cash or 13.25% per annum to the extent interest is “paid-in-kind” through an increase in the principal amount or the issuance of additional notes (PIK Interest). Prior to March 4, 2022, all of the interest on the OFC Senior Secured Notes may, at our option, be paid as PIK Interest. On or after March 4, 2022, a minimum amount of interest will be required to be paid in cash equal to the lesser of (i) 7% per annum of the outstanding principal amount of the OFC Senior Secured Notes and (ii) the total amount of unrestricted cash of Ocwen and its subsidiaries less the greater of $125.0 million and the minimum liquidity amounts required by any agency. The OFC Senior Secured Notes are solely the obligation of Ocwen and are secured by a pledge of substantially all of the assets of Ocwen, including a pledge of the equity of Ocwen’s directly held subsidiaries. The lien on Ocwen’s assets securing the OFC Senior Secured Notes is junior to the lien securing Ocwen’s guarantee of the 7.875% PMC Senior Secured Notes described above. The OFC Senior Secured Notes are not guaranteed by any of Ocwen’s subsidiaries nor are they secured by a pledge or lien on any assets of Ocwen’s subsidiaries. Prior to March 4, 2026, we are permitted to redeem the OFC Senior Secured Notes in whole or in part at any time at a redemption price equal to par, plus a make-whole premium, plus accrued and unpaid interest. On and after March 4, 2026, we will be permitted to redeem the OFC Senior Secured Notes in whole or in part at any time at a redemption price equal to par plus accrued and unpaid interest. The OFC Senior Secured Notes have two financial maintenance covenants: (1) a minimum book value of stockholders’ equity of not less than $275.0 million and (2) a minimum amount of unrestricted cash of not less than $50.0 million at any time. The OFC Senior Secured Notes also have affirmative and negative covenants and events of default that are customary for debt securities of this type. Credit Ratings Credit ratings are intended to be an indicator of the creditworthiness of a company’s debt obligation. At September 30, 2021, the S&P issuer credit rating for Ocwen was “B-”. On February 24, 2021, concurrent with the launch of the PMC bond offering, S&P reaffirmed the ratings at B- and changed the outlook from Negative to Stable. Moody’s reaffirmed their ratings of Caa1 and revised their outlook to Stable from Negative on February 24, 2021. It is possible that additional actions by credit rating agencies could have a material adverse impact on our liquidity and funding position, including materially changing the terms on which we may be able to borrow money. Covenants Under the terms of our debt agreements, we are subject to various affirmative and negative covenants. Collectively, these covenants include: • Financial covenants, including, but not limited to, specified levels of net worth and liquidity; • Covenants to operate in material compliance with applicable laws; • Restrictions on our ability to engage in various activities, including but not limited to incurring or guarantying additional forms of debt, paying dividends or making distributions on or purchasing equity interests of Ocwen and its subsidiaries, repurchasing or redeeming capital stock or junior capital, repurchasing or redeeming subordinated debt prior to maturity, issuing preferred stock, selling or transferring assets or making loans or investments or other restricted payments, entering into mergers or consolidations or sales of all or substantially all of the assets of Ocwen and its subsidiaries or of PHH or PMC and their respective subsidiaries, creating liens on assets to secure debt, and entering into transactions with affiliates; • Monitoring and reporting of various specified transactions or events, including specific reporting on defined events affecting collateral underlying certain debt agreements; and • Requirements to provide audited financial statements within specified timeframes, including requirements that Ocwen’s financial statements and the related audit report be unqualified as to going concern. The most restrictive consolidated net worth requirement contained in our debt agreements with borrowings outstanding at September 30, 2021 is a minimum of $275.0 million tangible net worth at Ocwen, as defined in certain of our mortgage warehouse and MSR financing facilities agreements, or, if greater, the minimum requirement at PMC set forth by the Agencies. See Note 20 – Regulatory Requirements. The most restrictive liquidity requirement under our debt agreements with borrowings outstanding at September 30, 2021 is for a minimum of $125.0 million in consolidated liquidity, as defined, under certain of our advance match funded debt and MSR financing facilities agreements. We believe we were in compliance with all of the covenants in our debt agreements as of the date of these unaudited consolidated financial statements. |
Other Liabilities
Other Liabilities | 9 Months Ended |
Sep. 30, 2021 | |
Other Liabilities Disclosure [Abstract] | |
Other Liabilities | Note 13 – Other Liabilities September 30, 2021 December 31, 2020 Contingent loan repurchase liability $ 450,385 $ 480,221 Due to NRZ - Advance collections, servicing fees and other 92,188 94,691 Other accrued expenses 83,397 87,898 Checks held for escheat 44,780 35,654 Accrued legal fees and settlements 44,629 38,932 Liability for indemnification obligations 44,478 41,920 MSR purchase price holdback 40,976 20,923 Servicing-related obligations 32,686 35,237 Derivatives, at fair value 20,518 4,638 Lease liability 20,311 27,393 Liability for uncertain tax positions 16,119 16,188 Liability for unfunded pension obligation 12,026 12,662 Accrued interest payable 6,534 4,915 Liability for unfunded India gratuity plan 6,103 6,051 Other 17,618 16,652 $ 932,748 $ 923,975 |
Equity
Equity | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
Equity | Note 14 – Equity On February 3, 2020, Ocwen’s Board of Directors authorized a share repurchase program for an aggregate amount of up to $5.0 million of Ocwen’s issued and outstanding shares of common stock. During the three months ended March 31, 2020, we completed the repurchase of 377,484 shares of common stock in the open market under this program at prevailing market prices for a total purchase price of $4.5 million for an average price paid per share of $11.90. In addition, Ocwen paid $0.1 million in commissions. The repurchased shares were formally retired as of March 31, 2020. No additional shares were repurchased prior to the program’s expiration on February 3, 2021. Effective August 13, 2020, Ocwen implemented a one-for-15 reverse stock split of all outstanding shares of its common stock and reduced the number of authorized shares of common stock by the same proportion. Shareholders entitled to receive fractional shares of common stock received shares rounded up to the nearest whole share in lieu of such fractional shares, with an aggregate 4,692 additional shares issued. The number of outstanding shares was reduced from 130,013,696 to 8,672,272 and the authorized shares from 200,000,000 to 13,333,333 effective August 13, 2020, with giving effect to the rounding up of fractional shares. The $0.01 par value per share of common stock remained unchanged. As disclosed in Note 12 – Borrowings, concurrent with the issuance of the OFC Senior Secured Notes on March 4, 2021, Ocwen issued to Oaktree warrants to purchase 1,184,768 shares of its common stock (which amount, upon exercise of the warrants, would be equal to 12% of Ocwen’s outstanding common stock as of the date of issuance of such warrants) at an exercise price of $26.82 per share, subject to antidilution adjustments. The warrants may be exercised at any time from the date of issuance through March 4, 2027. While the warrants will not be registered, we entered into a registration rights agreement with Oaktree pursuant to which we will register for resale the shares of common stock issuable upon exercise of the warrants within 18 months after March 4, 2021. On March 4, 2021, the $16.5 million allocated fair value of the warrants was reported as Additional Paid-in Capital in our consolidated balance sheet, net of allocated debt issuance costs of $0.8 million. On May 3, 2021, concurrent with the issuance of the second tranche of OFC Senior Secured Notes described above, and in connection with the closing of the Transaction Agreement dated December 21, 2020 and disclosed in Note 10 - Investment in Equity Method Investee, we issued to Oaktree 426,705 shares of our common stock, representing 4.9% of our outstanding common stock, at a price per share of $23.15 for an aggregate purchase price of $9.9 million, and warrants to purchase 261,248 shares of our common stock (which amount was equal to 3% of Ocwen’s outstanding common stock as of the date of issuance of such warrants) at a price per share of $24.31 in consideration of the transaction. The warrants may be exercised at any time from the date of issuance through May 3, 2025. The issuance of the shares of common stock, warrants, and the shares of common stock issuable upon exercise of the warrants will not be registered under the Securities Act. These securities were or will be (as applicable) issued in a private placement exempt from the registration requirements of the Securities Act. On May 3, 2021, the $12.6 million allocated fair value of the common stock and $4.3 million allocated fair value of the warrants was reported as Common Stock, for face value of common stock issued and Additional Paid-in Capital in our consolidated balance sheet, net of allocated debt issuance costs of $0.5 million. |
Derivative Financial Instrument
Derivative Financial Instruments and Hedging Activities | 9 Months Ended |
Sep. 30, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments and Hedging Activities | Note 15 – Derivative Financial Instruments and Hedging Activities The table below summarizes the fair value, notional and maturity of derivative instruments. The notional amount of our contracts does not represent our exposure to credit loss. None of the derivatives were designated as a hedge for accounting purposes as of or during the nine months ended September 30, 2021 and 2020. September 30, 2021 December 31, 2020 Maturities Notional Fair value Maturities Notional Fair value Derivative Assets (Other assets) Forward sales of Reverse loans Oct. 2021 $ 85,000 $ 762 Jan. 2021 $ 30,000 $ 34 Forward loans IRLCs Not.2021 - Dec.2021 1,222,451 13,407 Apr. 2021 619,713 22,224 Reverse loans IRLCs Oct. 2021 80,486 623 Jan. 2021 11,692 482 TBA forward Pipeline trades Oct.2021 - Dec.2021 1,210,000 5,538 N/A — — Interest rate swap futures N/A — — Mar. 2021 593,500 504 Other N/A — — N/A — 2 Total $ 2,597,937 $ 20,329 $ 1,254,905 $ 23,246 Derivative Liabilities (Other liabilities) Forward sales of Reverse loans Oct. 2021 $ 55,000 $ (341) Jan. 2021 $ 20,000 $ (84) TBA forward Pipeline trades Oct.2021 - Dec.2021 245,000 (276) N/A — — TBA forward MBS trades Oct.2021 - Nov.2021 1,210,000 (11,227) Jan. 2021 400,000 (4,554) Interest rate swap futures Oct.2021 - Dec.2021 952,500 (8,236) N/A — — Other N/A — (438) N/A — — Total $ 2,462,500 $ (20,518) $ 420,000 $ (4,638) The table below summarizes the net gains and losses of our derivative instruments recognized in our consolidated statement of operations. Nine Months Ended September 30, 2021 Nine Months Ended September 30, 2020 Gain / (Loss) Gain / (Loss) Amount Financial Statement Line Amount Financial Statement Line Derivative Forward loans IRLCs $ (8,817) Gain on loans held for sale, net $ 16,860 Gain on loans held for sale, net Reverse loans IRLCs 141 Reverse mortgage revenue, net 940 Reverse mortgage revenue, net TBA forward pipeline trades 592 Gain on loans held for sale, net (Economic hedge) — Gain on loans held for sale, net (Economic hedge) Interest rate swap futures and TBA forward MBS trades — Gain on loans held for sale, net (Economic hedge) (9,564) Gain on loans held for sale, net (Economic hedge) Interest rate swap futures and TBA forward MBS trades (3,310) MSR valuation adjustments, net 39,258 MSR valuation adjustments, net Forward sales of Reverse loans 471 Reverse mortgage revenue, net (62) Reverse mortgage revenue, net Other (439) Gain on loans held for sale, net (561) Gain on loans held for sale, net Total $ (11,362) $ 46,871 Interest Rate Risk MSR Hedging MSRs are carried at fair value with changes in fair value being recorded in earnings in the period in which the changes occur. The fair value of MSRs is subject to changes in market interest rates and prepayment speeds, among other factors. Through May 2021, management maintained a macro-hedging strategy to reduce the volatility of the MSR portfolio attributable to interest rate changes. As a general matter, the impact of interest rates on the fair value of our MSR portfolio is naturally offset by other exposures, including our loan pipeline and our economic MSR value embedded in our reverse mortgage loan portfolio. Our hedging strategy was targeted at mitigating the residual exposure, which we referred to as our net MSR portfolio exposure. We defined our net MSR portfolio exposure as follows: • our more interest rate-sensitive Agency MSR portfolio, • less the Agency MSRs subject to our agreements with NRZ (See Note 8 — MSR Transfers Not Qualifying for Sale Accounting), • less the unsecuritized reverse mortgage loans and tails classified as held for investment, • less the asset value for securitized HECM loans, net of the corresponding HMBS-related borrowings, and • less the net value of our held for sale loan portfolio and lock commitments (pipeline). In the first and second quarters of 2021, we also included in our MSR portfolio the exposure related to expected future MSR bulk acquisitions subject to letters of intent. Effective May 2021, management started hedging its MSR portfolio and its pipeline separately (see below for further description of pipeline hedging ) , effectively ending the macro-hedge strategy previously in place. Under the new MSR hedging strategy, the interest-rate sensitive MSR portfolio exposure is now defined as follows: • Agency MSR portfolio, • expected Agency MSR bulk transactions subject to letters of intent (LOI), • less the Agency MSRs subject to sale agreements with NRZ and MAV (See Note 8 — MSR Transfers Not Qualifying for Sale Accounting), • less the asset value for securitized HECM loans, net of the corresponding HMBS-related borrowings. Our MSR policy’s objective is to provide partial hedge coverage of interest-rate sensitive MSR portfolio exposure, considering market and liquidity conditions. The hedge coverage ratio defined as the ratio of hedge and asset rate sensitivity (referred to as DV01) at the time of measurement is subject to lower and upper thresholds of 40% and 60%, respectively. Accordingly, the changes in fair value of our hedging instruments may not fully offset the changes in fair value of our net MSR portfolio exposure attributable to interest rate changes. Effective October 2021, we refined the scope of the hedge policy to allow for MSRs subject to LOI to be covered under a separate hedge coverage ratio requirement sufficient to preserve the economics of the intended transactions. Our derivative instruments include forward trades of MBS or Agency TBAs with different banking counterparties, exchange-traded interest rate swap futures and interest rate options. These derivative instruments are not designated as accounting hedges. TBAs, or To-Be-Announced securities, are actively traded, forward contracts to purchase or sell Agency MBS on a specific future date. We report changes in fair value of these derivative instruments in MSR valuation adjustments, net in our consolidated statements of operations. The derivative instruments are subject to margin requirements, posted as either initial margin or variation margin. Ocwen may be required to post or may be entitled to receive cash collateral with its counterparties through margin calls, based on daily value changes of the instruments. Changes in market factors, including interest rates, and our credit rating could require us to post additional cash collateral and could have a material adverse impact on our financial condition and liquidity. Pipeline Hedging - Interest Rate Lock Commitments and Loans Held for Sale, at Fair Value In our Originations business, we are exposed to interest rate risk and related price risk during the period from the date of the interest rate lock commitment through (i) the commitment cancellation or expiration date or (ii) through the date of sale of the resulting loan into the secondary mortgage market. Loan commitments for forward loans generally range from 5 to 90 days, with the majority of our commitments to borrowers for 75 days and our commitments to correspondent sellers for 7 days. Loans held for sale are generally funded and sold within 5 to 20 days. This interest rate exposure was not individually hedged until May 2021, but rather used as an offset to our MSR exposure and managed as part of our MSR macro-hedging strategy described above. Effective May 2021, we implemented a new pipeline hedging strategy, whereby the interest rate exposure of loans held for sale and interest rate lock commitments is economically hedged with derivative instruments, including forward sales of Agency “to be announced” securities (TBAs). We report changes in fair value of these derivative instruments as gain or loss on economic hedge instruments within gain on loans held-for-sale in our consolidated statements of operations. Advance Match Funded Liabilities We monitor the effect of increases in interest rates on the interest paid on our variable-rate advance financing debt. Earnings on cash and float balances are a partial offset to our exposure to changes in interest expense. We purchase interest rate caps as economic hedges (not designated as a hedge for accounting purposes) when required by our advance financing arrangements. Foreign Currency Exchange Rate Risk |
Interest Expense
Interest Expense | 9 Months Ended |
Sep. 30, 2021 | |
Other Income and Expenses [Abstract] | |
Interest Expense | Note 16 – Interest Expense Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Senior notes $ 18,483 $ 6,658 $ 44,932 $ 19,977 Mortgage loan warehouse facilities 8,985 3,932 20,673 10,531 MSR financing facilities 8,623 3,919 17,950 12,655 Advance match funded liabilities 2,809 6,565 11,570 19,541 SSTL — 4,395 2,956 15,985 Other 1,723 1,346 4,510 4,868 $ 40,623 $ 26,815 $ 102,591 $ 83,557 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 17 – Income Taxes On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was signed into law. The CARES Act includes several significant business tax provisions that, among other things, temporarily repealed the taxable income limitation for certain net operating losses (NOL) and allows businesses to carry back NOLs arising in 2018, 2019, and 2020 tax years to the five prior tax years, accelerated refunds of previously generated corporate Alternative Minimum Tax (AMT) credits, and adjusted the business interest expense limitation under section 163(j) from 30% to 50% of Adjusted Taxable Income (ATI) for 2019 and 2020 tax years. Based on information available at the time, we estimated that modifications to the tax rules for the carryback of NOLs and business interest expense limitations would result in U.S. and USVI federal net tax refunds of approximately $70.3 million and $1.2 million, respectively, and as such we recognized an income tax benefit of $71.5 million in our unaudited consolidated financial statements for the nine months ended September 30, 2020. The income tax benefit recognized represents the release of valuation allowances against certain NOL and Section 163(j) deferred tax assets that were realized as a result of certain provisions of the CARES Act as well as permanent income tax benefit related to the carryback of NOLs created in a tax year that was subject to U.S. federal tax at 21% to a tax year subject to tax at 35%. We recognized income tax benefit of $11.3 million and $2.0 million for the three months ended September 30, 2021 and 2020, respectively, and $20.1 million and $71.9 million for the nine months ended September 30, 2021 and 2020, respectively, primarily due to income tax benefits recognized under the provisions of the CARES Act and the favorable resolution of various uncertain tax positions during the nine months ended September 30, 2021 and 2020. |
Basic and Diluted Earnings (Los
Basic and Diluted Earnings (Loss) per Share | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Basic and Diluted Earnings (Loss) per Share | Note 18 – Basic and Diluted Earnings (Loss) per Share Basic earnings or loss per share excludes common stock equivalents and is calculated by dividing net income or loss attributable to Ocwen common stockholders by the weighted average number of common shares outstanding during the period. We calculate diluted earnings or loss per share by dividing net income or loss attributable to Ocwen by the weighted average number of common shares outstanding including the potential dilutive common shares related to outstanding restricted stock awards, stock options and warrants as determined using the treasury stock method. For the three and nine months ended September 30, 2020, we have excluded the effect of all stock options, common stock awards and warrants from the computation of diluted loss per share because of the anti-dilutive effect of our reported net loss. Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Basic earnings (loss) per share Net income (loss) $ 21,552 $ (9,420) $ 19,773 $ (32,955) Weighted average shares of common stock 9,189,030 8,669,550 8,960,696 8,770,102 Basic earnings (loss) per share $ 2.35 $ (1.09) $ 2.21 $ (3.76) Diluted earnings (loss) per share Net income (loss) $ 21,552 $ (9,420) $ 19,773 $ (32,955) Weighted average shares of common stock 9,189,030 8,669,550 8,960,696 8,770,102 Effect of dilutive elements Common stock warrants 65,593 — 97,426 — Common stock awards 147,235 — 161,049 — Contingent issuance of common stock — — 51,580 — Dilutive weighted average shares of common stock 9,401,858 8,669,550 9,270,751 8,770,102 Diluted earnings (loss) per share $ 2.29 $ (1.09) $ 2.13 $ (3.76) Stock options and common stock awards excluded from the computation of diluted earnings (loss) per share Anti-dilutive (1) 166,153 193,144 155,213 218,020 Market-based (2) 87,509 125,395 87,509 125,395 (1) Includes stock options that are anti-dilutive because their exercise price was greater than the average market price of Ocwen’s stock, and stock awards that are anti-dilutive based on the application of the treasury stock method. (2) Shares that are issuable upon the achievement of certain market-based performance criteria related to Ocwen’s stock price. |
Business Segment Reporting
Business Segment Reporting | 9 Months Ended |
Sep. 30, 2021 | |
Segment Reporting [Abstract] | |
Business Segment Reporting | Note 19 – Business Segment Reporting Our business segments reflect the internal reporting that we use to evaluate operating performance of services and to assess the allocation of our resources. Our reportable business segments consist of Servicing, Originations, and Corporate Items and Other. During the nine months ended September 30, 2021, there have been no changes to our business segments as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2020. Effective with the fourth quarter of 2020, we have reported the results of Reverse Servicing within the Servicing segment. Previously, the Reverse Servicing business was included in the reported results of the Originations segment. This alignment of our business segments is consistent with a change in the management of the business and a change in the internal management reporting to the chief operating decision maker. Segment results for 2020 have been recast to conform to the current segment presentation. Reverse Servicing generated Revenue and Income (loss) before income taxes of $(0.5) million and $(5.6) million, respectively, for the three months ended September 30, 2020, and $12.1 million and $(0.9) million for the nine months ended September 30, 2020. Reverse Servicing assets consist primarily of securitized Loans held for investment - Reverse Mortgages. Revenues and expenses directly associated with each respective business segments are included in determining its results of operations. We allocate certain expenses incurred by corporate support services that are not directly attributable to a segment to each business segment. We allocate overhead costs incurred by corporate support services to the Servicing and Originations segments which incorporates the utilization of various measurements primarily based on time studies, personnel volumes and service consumption levels. Support services costs not allocated to the Servicing and Originations segments are retained in the Corporate Items and Other segment along with certain other costs including certain litigation and settlement related expenses or recoveries, costs related to our re-engineering initiatives, and other costs related to operating as a public company. We allocate a portion of interest income to each business segment, including interest earned on cash balances. Interest expense on direct asset-backed financings are recorded in the respective Servicing and Originations segments. Beginning in the third quarter of 2020, we began allocating interest expense on corporate debt, including the SSTL and Senior Notes, used to fund servicing advances and other servicing assets from Corporate Items and Other to the Servicing segment. Amortization of debt issuance costs and discount are excluded from the interest expense allocation. The interest expense related to the corporate debt has been allocated to the Servicing segment for periods prior to the third quarter of 2020 to conform to the current period presentation. As a result of our risk management strategy to hedge the interest rate risk of our net MSR portfolio, the fair value changes of third-party derivative instruments were reported within MSR valuation adjustments, net. For management segment reporting purposes, we established inter-segment derivative instruments to transfer the risks and allocate the associated fair value changes of derivatives between Servicing and Originations, and specifically between MSR valuation adjustments, net and Gain on loans held for sale, net (Gain/loss on economic hedge instruments). In the second quarter of 2021, we began separately hedging our MSR portfolio and pipeline. We may, from time to time, establish intersegment derivative instruments between our MSR and pipeline hedging strategies to optimize the use of third-party derivatives. The inter-segment derivative fair value changes are eliminated in the consolidated financial statements in the Corporate Elimination column in the table below. Financial information for our segments is as follows: Three Months Ended September 30, 2021 Results of Operations Servicing Originations Corporate Items and Other Corporate Eliminations (1) Business Segments Consolidated Servicing and subservicing fees $ 205,431 $ 1,155 $ — $ — $ 206,585 Reverse mortgage revenue, net (13,032) 18,067 — — 5,035 Gain on loans held for sale, net (1) 31,555 29,604 — (1,457) 59,702 Other revenue, net 303 9,947 1,529 — 11,779 Revenue 224,257 58,773 1,529 (1,457) 283,101 MSR valuation adjustments, net (1) (10,577) 2,800 — 1,457 (6,320) Operating expenses 80,849 43,498 21,088 — 145,436 Other (expense) income: Interest income 2,416 5,348 105 — 7,869 Interest expense (28,979) (6,711) (4,933) — (40,623) Pledged MSR liability expense (91,120) — (41) — (91,160) Other 1,443 122 1,267 — 2,832 Other expense, net (116,239) (1,241) (3,602) — (121,082) Income (loss) before income taxes $ 16,592 $ 16,833 $ (23,162) $ — $ 10,263 Three Months Ended September 30, 2020 Results of Operations Servicing Originations Corporate Items and Other Corporate Eliminations (1) Business Segments Consolidated Servicing and subservicing fees $ 178,544 $ 3,178 $ — $ — $ 181,722 Reverse mortgage revenue, net (1,116) 15,615 — — 14,499 Gain on loans held for sale, net (1) 6,758 31,295 — 7,833 45,886 Other revenue, net 1,248 4,125 1,555 — 6,928 Revenue 185,434 54,213 1,555 7,833 249,035 MSR valuation adjustments, net (1) (38,351) 12,370 — (7,833) (33,814) Operating expenses 84,639 30,304 34,579 — 149,522 Other (expense) income: Interest income 1,637 1,952 212 — 3,801 Interest expense (22,179) (2,405) (2,231) — (26,815) Pledged MSR liability expense (57,434) — 30 — (57,404) Other 2,178 230 937 — 3,345 Other expense, net (75,798) (223) (1,052) — (77,073) Income (loss) before income taxes $ (13,354) $ 36,056 $ (34,076) $ — $ (11,374) Nine Months Ended September 30, 2021 Results of Operations Servicing Originations Corporate Items and Other Corporate Eliminations (1) Business Segments Consolidated Servicing and subservicing fees $ 556,927 $ 5,837 $ — $ — $ 562,764 Reverse mortgage revenue, net (511) 56,673 — — 56,162 Gain on loans held for sale, net (1) 39,206 94,470 — (25,541) 108,136 Other revenue, net 1,302 23,450 4,326 — 29,078 Revenue 596,924 180,431 4,326 (25,541) 756,140 MSR valuation adjustments, net (1) (103,215) 20,112 — 25,541 (57,562) Operating expenses 247,228 120,514 67,131 — 434,873 Other (expense) income: Interest income 4,905 10,776 312 — 15,993 Interest expense (72,598) (14,963) (15,030) — (102,591) Loss on extinguishment of debt — — (15,458) — (15,458) Pledged MSR liability expense (168,847) — 27 — (168,820) Other 4,787 4 2,045 — 6,836 Other expense, net (231,753) (4,183) (28,104) — (264,040) Income (loss) before income taxes $ 14,728 $ 75,846 $ (90,909) $ — $ (335) Nine Months Ended September 30, 2020 Results of Operations Servicing Originations Corporate Items and Other Corporate Eliminations (1) Business Segments Consolidated Servicing and subservicing fees $ 565,201 $ 3,186 $ 58 $ — $ 568,445 Reverse mortgage revenue, net 12,837 38,218 — — 51,055 Gain on loans held for sale, net (1) 10,768 74,163 — 7,833 92,764 Other revenue, net 3,223 9,234 5,180 — 17,637 Revenue 592,029 124,801 5,238 7,833 729,901 MSR valuation adjustments, net (1) (249,873) 26,338 — (7,833) (231,368) Operating expenses 255,534 78,330 97,681 — 431,545 Other (expense) income: Interest income 6,321 4,733 1,708 — 12,762 Interest expense (69,755) (6,591) (7,211) — (83,557) Pledged MSR liability expense (105,771) — 87 — (105,684) Other 8,300 198 (3,882) — 4,616 Other expense, net (160,905) (1,660) (9,298) — (171,863) Income (loss) before income taxes $ (74,283) $ 71,149 $ (101,741) $ — $ (104,875) (1) Corporate Eliminations for the three and nine months ended September 30, 2021 includes an inter-segment derivatives elimination of $1.5 million and $25.5 million, respectively, with a corresponding offset in MSR valuation adjustments, net; and $7.8 million for the three and nine months ended September 30, 2020. Total Assets Servicing Originations Corporate Items and Other Business Segments Consolidated September 30, 2021 $ 10,790,503 $ 865,011 $ 384,724 $ 12,040,238 December 31, 2020 $ 9,847,603 $ 379,233 $ 424,291 $ 10,651,127 September 30, 2020 $ 9,516,514 $ 437,304 $ 470,033 $ 10,423,851 Depreciation and Amortization Expense Servicing Originations Corporate Items and Other Business Segments Consolidated Three months ended September 30, 2021 Depreciation expense $ 137 $ 77 $ 2,247 $ 2,461 Amortization of debt issuance costs and discount 129 — 2,076 2,205 Three months ended September 30, 2020 Depreciation expense $ 219 $ 31 $ 4,055 $ 4,305 Amortization of debt issuance costs and discount 115 — 1,039 1,154 Nine Months Ended September 30, 2021 Depreciation expense $ 514 $ 125 $ 6,888 $ 7,527 Amortization of debt issuance costs and discount 388 — 5,050 5,438 Nine months ended September 30, 2020 Depreciation expense $ 652 $ 102 $ 14,644 $ 15,398 Amortization of debt issuance costs and discount 343 — 4,992 5,335 |
Regulatory Requirements
Regulatory Requirements | 9 Months Ended |
Sep. 30, 2021 | |
Brokers and Dealers [Abstract] | |
Regulatory Requirements | Note 20 – Regulatory Requirements Our business is subject to extensive regulation and supervision by federal, state, local and foreign governmental authorities, including the Consumer Financial Protection Bureau (CFPB), HUD, the SEC and various state agencies that license and conduct examinations of our servicing and lending activities. In addition, we operate under a number of regulatory settlements that subject us to ongoing reporting and other obligations. From time to time, we also receive requests (including requests in the form of subpoenas and civil investigative demands) from federal, state and local agencies for records, documents and information relating to our servicing and lending activities. The GSEs (and their conservator, the Federal Housing Finance Authority (FHFA)), Ginnie Mae, the United States Treasury Department, various investors, non-Agency securitization trustees and others also subject us to periodic reviews and audits. We must comply with a large number of federal, state and local consumer protection and other laws and regulations, including, among others, the CARES Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act), the Telephone Consumer Protection Act (TCPA), the Gramm-Leach-Bliley Act, the Fair Debt Collection Practices Act (FDCPA), the Real Estate Settlement Procedures Act (RESPA), the Truth in Lending Act (TILA), the Servicemembers Civil Relief Act, the Homeowners Protection Act, the Federal Trade Commission Act, the Fair Credit Reporting Act, the Equal Credit Opportunity Act, as well as individual state and local laws, and federal and local bankruptcy rules. These laws and regulations apply to all facets of our business, including, but not limited to, licensing, loan originations, consumer disclosures, default servicing and collections, foreclosure, filing of claims, registration of vacant or foreclosed properties, handling of escrow accounts, payment application, interest rate adjustments, assessment of fees, loss mitigation, use of credit reports, and safeguarding of non-public personally identifiable information about our customers. These complex requirements can and do change as laws and regulations are enacted, promulgated, amended, interpreted and enforced, and the requirements applicable to our business have been changing especially rapidly in response to the COVID-19 pandemic. In particular, the CFPB promulgated certain amendments to RESPA (Regulation X) that became effective on August 31, 2021 and that impose certain additional COVID-19-related requirements with respect to loss mitigation, early intervention call requirements, and initiating new foreclosures. In addition, the actions of legislative bodies and regulatory agencies relating to a particular matter or business practice may or may not be coordinated or consistent. The general trend among federal, state and local legislative bodies and regulatory agencies as well as state attorneys general has been toward increasing laws, regulations, investigative proceedings and enforcement actions with regard to residential real estate lenders and servicers. In addition, a number of foreign laws and regulations apply to our operations outside of the U.S., including laws and regulations that govern licensing, privacy, employment, safety, payroll and other taxes and insurance and laws and regulations that govern the creation, continuation and the winding up of companies as well as the relationships between shareholders, our corporate entities, the public and the government in these countries. Our foreign subsidiaries are subject to inquiries and examinations from foreign governmental regulators in the countries in which we operate outside of the U.S. Our licensed entities are required to renew their licenses, typically on an annual basis, and to do so they must satisfy the license renewal requirements of each jurisdiction, which generally include financial requirements such as providing audited financial statements and satisfying minimum net worth requirements and non-financial requirements such as satisfactory completion of examinations relating to the licensee’s compliance with applicable laws and regulations. We are also subject to seller/servicer obligations under agreements with the GSEs, HUD, FHA, VA and Ginnie Mae, including capital requirements related to tangible net worth, as defined by the applicable agency, an obligation to provide audited financial statements within 90 days of the applicable entity’s fiscal year end as well as extensive requirements regarding servicing, selling and other matters. We believe our licensed entities were in compliance with all of their minimum net worth requirements at September 30, 2021. Our non-Agency servicing agreements also contain requirements regarding servicing practices and other matters, and a failure to comply with these requirements could have a material adverse impact on our business. The most restrictive of the various net worth requirements for licensing and seller/servicer obligations referenced above is based on the UPB of assets serviced by PMC. Under the applicable formula, the required minimum net worth was $389.2 million at September 30, 2021. PMC’s net worth was $557.7 million at September 30, 2021. The most restrictive of the various liquidity requirements for licensing and seller/servicer obligations referenced above pertains to PMC and was $48.2 million at September 30, 2021. PMC’s liquid assets were $216.6 million at September 30, 2021. We face regulatory and public scrutiny as an organization and have entered into a number of significant settlements with federal and state regulators and state attorneys general that have imposed additional requirements on our business. Our failure to comply with our settlement obligations to our regulators or with applicable federal, state, local and foreign laws, regulations, licensing requirements and agency guidelines could lead to (i) administrative fines, penalties, sanctions or litigation, (ii) loss of our licenses and approvals to engage in our servicing and lending businesses, (iii) governmental investigations and enforcement actions, (iv) civil and criminal liability, including class action lawsuits and actions to recover incentive and other payments made by governmental entities, (v) breaches of covenants and representations under our servicing, debt or other agreements, (vi) additional costs to address these matters and comply with the terms of any resulting resolutions, (vii) suspension or termination of our approved agency seller/servicer status, (viii) inability to raise capital or otherwise fund our operations and (ix) inability to execute on our business strategy, which could have a material adverse impact on our business, reputation, results of operations, liquidity and financial condition. New York Department of Financial Services (NY DFS). We operate pursuant to certain regulatory requirements with the NY DFS, including obligations arising under a consent order entered into in March 2017 (the NY Consent Order) and the terms of the NY DFS’ conditional approval in September 2018 of our acquisition of PHH. The conditional approval includes reporting obligations and record retention and other requirements relating to the transfer of loans collateralized by New York property (New York loans) onto our servicing system, the Financial Services, Inc. (Black Knight) LoanSphere MSP® servicing system (Black Knight MSP) and certain requirements with respect to the evaluation and supervision of management of both Ocwen and PMC. In addition, we were prohibited from boarding any additional loans onto the REALServicing system and we were required to transfer all New York loans off the REALServicing system by April 30, 2020. The conditional approval also restricts our ability to acquire MSRs with respect to New York loans, so that Ocwen may not increase its aggregate portfolio of New York loans serviced or subserviced by Ocwen by more than 2% per year. This restriction will remain in place until the NY DFS determines that all loans serviced on the REALServicing system have been successfully migrated to Black Knight MSP and that Ocwen has developed a satisfactory infrastructure to board sizable portfolios of MSRs. We transferred all loans onto Black Knight MSP in 2019 and no longer service any loans on the REALServicing system. We believe we have complied with all terms of the PHH acquisition conditional approval to date. We continue to work with the NY DFS to address matters they raise with us as well as to fulfill our commitments under the NY Consent Order and PHH acquisition conditional approval. California Department of Financial Protection and Innovation (CA DFPI) . In January 2015 and February 2017, Ocwen Loan Servicing, LLC (OLS) entered into consent orders with the CA DFPI (formerly known as the California Department of Business Oversight) relating to our alleged failure to produce certain information and documents during a routine licensing examination and relating to alleged servicing practices. We have completed all of our obligations under each of these consent orders. In October 2020, we entered into a consent order with the CA DFPI in order to resolve a legacy PHH examination finding and, in conjunction therewith, agreed to pay $62,000 (sixty-two thousand dollars) in penalties. We continue to work with the CA DFPI to address matters they raise with us as well as to fulfill our commitments under the consent order. |
Commitments
Commitments | 9 Months Ended |
Sep. 30, 2021 | |
Other Commitments [Abstract] | |
Commitments | Note 21 — Commitments Unfunded Lending Commitments We have originated floating-rate reverse mortgage loans under which the borrowers have additional borrowing capacity of $2.1 billion at September 30, 2021. This additional borrowing capacity is available on a scheduled or unscheduled payment basis. During the nine months ended September 30, 2021, we funded $147.6 million out of the $2.0 billion borrowing capacity as of December 31, 2020. We also had short-term commitments to lend $1.2 billion and $80.5 million in connection with our forward and reverse mortgage loan IRLCs, respectively, outstanding at September 30, 2021. We finance originated and purchased forward and reverse mortgage loans with repurchase and participation agreements, referred to as warehouse lines. HMBS Issuer Obligations As an HMBS issuer, we are required to purchase loans out of the Ginnie Mae securitization pools once the outstanding principal balance of a reverse mortgage loan is equal to or greater than 98% of the maximum claim amount (MCA repurchases), or when they become inactive (the borrower is deceased, no longer occupies the property or is delinquent on tax and insurance payments). Activity with regard to HMBS repurchases, primarily MCA repurchases, are as follows: Nine Months Ended September 30, 2021 Active Inactive Total Number Amount Number Amount Number Amount Beginning balance 141 $ 29,852 317 $ 56,449 458 $ 86,301 Additions 217 57,684 203 41,956 420 99,640 Recoveries, net (1) (221) (50,748) (130) (18,244) (351) (68,992) Transfers (18) (6,261) 18 6,261 — — Changes in value — 9 — (2,494) — (2,485) Ending balance 119 $ 30,536 408 $ 83,928 527 $ 114,464 (1) Includes amounts received upon assignment of loan to HUD, loan payoff, REO liquidation and claim proceeds less any amounts charged off as unrecoverable. NRZ Relationship |
Contingencies
Contingencies | 9 Months Ended |
Sep. 30, 2021 | |
Loss Contingency [Abstract] | |
Contingencies | Note 22 – Contingencies When we become aware of a matter involving uncertainty for which we may incur a loss, we assess the likelihood of any loss. If a loss contingency is probable and the amount of the loss can be reasonably estimated, we record an accrual for the loss. In such cases, there may be an exposure to potential loss in excess of the amount accrued. Where a loss is not probable but is reasonably possible or where a loss in excess of the amount accrued is reasonably possible, we disclose an estimate of the amount of the loss or range of possible losses for the claim if a reasonable estimate can be made, unless the amount of such reasonably possible loss is not material to our financial position, results of operations or cash flows. If a reasonable estimate of loss cannot be made, we do not accrue for any loss or disclose any estimate of exposure to potential loss even if the potential loss could be material and adverse to our business, reputation, financial condition and results of operations. An assessment regarding the ultimate outcome of any such matter involves judgments about future events, actions and circumstances that are inherently uncertain. The actual outcome could differ materially. Where we have retained external legal counsel or other professional advisers, such advisers assist us in making such assessments. Litigation In the ordinary course of business, we are a defendant in, or a party or potential party to, many threatened and pending legal proceedings, including proceedings brought by regulatory agencies (discussed further under “Regulatory” below), those brought on behalf of various classes of claimants, and those brought derivatively on behalf of Ocwen against certain current or former officers and directors or others. In addition, we may be a party or potential party to threatened or pending legal proceedings brought by fair-housing advocates, commercial counterparties, including claims by counterparties in sales and purchases of loans, MSRs or other assets, parties on whose behalf we service or serviced mortgage loans, parties who provide ancillary services including property preservation and other post-foreclosure related services, and parties who provide or provided consulting or other services to Ocwen. The majority of these proceedings are based on alleged violations of federal, state and local laws and regulations governing our mortgage servicing and lending activities, including, among others, the Dodd-Frank Act, the Gramm-Leach-Bliley Act, the FDCPA, the RESPA, the TILA, the Fair Credit Reporting Act, the Servicemembers Civil Relief Act, the Homeowners Protection Act, the Federal Trade Commission Act, the TCPA, the Equal Credit Opportunity Act, as well as individual state licensing and foreclosure laws and federal and local bankruptcy rules. Such proceedings include wrongful foreclosure and eviction actions, bankruptcy violation actions, payment misapplication actions, allegations of wrongdoing in connection with lender-placed insurance and mortgage reinsurance arrangements, claims relating to our property preservation activities, claims related to REO management, claims relating to our written and telephonic communications with our borrowers such as claims under the TCPA and individual state laws, claims related to our payment, escrow and other processing operations, claims relating to fees imposed on borrowers relating to inspection fees, foreclosure attorneys’ fees, reinstatement fees, foreclosure registration fees, payment processing, payment facilitation or payment convenience fees, claims related to ancillary products marketed and sold to borrowers, claims related to call recordings, claims regarding certifications of our legal compliance related to our participation in certain government programs, claims related to improper occupancy inspections, and claims related to untimely recording of mortgage satisfactions. In some of these proceedings, claims for substantial monetary damages are asserted against us. For example, we are currently a defendant in various matters alleging that (1) certain fees imposed on borrowers relating to payment processing, payment facilitation or payment convenience violate the FDCPA and similar state laws, (2) certain fees we assess on borrowers are improperly assessed and/or marked up improperly in violation of applicable state and federal law, (3) we breached fiduciary duties we purportedly owe to benefit plans due to the discretion we exercise in servicing certain securitized mortgage loans, and (4) certain legacy mortgage reinsurance arrangements violated RESPA. In the future, we are likely to become subject to other private legal proceedings alleging failures to comply with applicable laws and regulations, including putative class actions, in the ordinary course of our business. In view of the inherent difficulty of predicting the outcome of any threatened or pending legal proceedings, particularly where the claimants seek very large or indeterminate damages, including punitive damages, or where the matters present novel legal theories or involve a large number of parties, we generally cannot predict what the eventual outcome of such proceedings will be, what the timing of the ultimate resolution will be, or what the eventual loss, if any, will be. Any material adverse resolution could materially and adversely affect our business, reputation, financial condition, liquidity and results of operations. Where we determine that a loss contingency is probable in connection with a pending or threatened legal proceeding and the amount of our loss can be reasonably estimated, we record an accrual for the loss. We have accrued for losses relating to threatened and pending litigation that we believe are probable and reasonably estimable based on current information regarding these matters. Where we determine that a loss is not probable but is reasonably possible or where a loss in excess of the amount accrued is reasonably possible, we disclose an estimate of the amount of the loss or range of possible losses for the claim if a reasonable estimate can be made, unless the amount of such reasonably possible loss is not material to our financial position, results of operations or cash flows. It is possible that we will incur losses relating to threatened and pending litigation that materially exceed the amount accrued. Our accrual for probable and estimable legal and regulatory matters, including accrued legal fees, was $44.6 million at September 30, 2021. We cannot currently estimate the amount, if any, of reasonably possible losses above amounts that have been recorded at September 30, 2021. As previously disclosed, we are subject to individual lawsuits relating to our FDCPA compliance and putative state law class actions based on the FDCPA and state laws similar to the FDCPA. Ocwen agreed to a settlement in principle of a putative class action , Morris v. PHH Mortgage Corp. , filed in March 2020 in the United States District Court for the Southern District of Florida, alleging that PMC’s and legacy Ocwen’s practices of charging a fee to borrowers who voluntarily use certain optional expedited payment options violates the FDCPA and its state law analogs. Several similar putative class actions have been filed against PMC and Ocwen since July 2019. Following mediation, PMC agreed to the terms of a settlement agreement to resolve all claims in the Morris matter. A motion requesting preliminary approval of the settlement was filed in August 2020. Several third parties, including a group of State Attorneys General, have filed papers opposing preliminary approval, and these third parties could ultimately file objections to the proposed settlement. As a result of this opposition, we have also received requests for information from various states regarding our practices, to which we have responded in due course. Following the preliminary approval hearing, PMC and plaintiffs renegotiated portions of the settlement agreement to address several questions raised by the Court, and subsequently filed a renewed motion for preliminary approval. Ocwen expects final approval of the Morris settlement, if issued before other similar class actions proceed through class certification, will resolve the claims of the majority of the putative class members described in the other similar cases that Ocwen is defending. In a similar lawsuit, Torliatt v. PHH Mortgage Corp. (pending in the Northern District of California), the Court recently held hearings on motions for class certification and summary judgment, but has not yet issued a decision on either. Ocwen cannot guarantee that the proposed settlement in the Morris matter will receive final approval and in the absence of such approval, Ocwen cannot predict the eventual outcome of the Morris proceeding and similar putative class actions. In addition, we continue to be involved in legacy matters arising prior to Ocwen’s October 2018 acquisition of PHH, including a putative class action filed in 2008 in the United States District Court for the Eastern District of California against PHH and related entities alleging that PHH’s legacy mortgage reinsurance arrangements between its captive reinsurer, Atrium Insurance Corporation, and certain mortgage insurance providers violated RESPA. See Munoz v. PHH Mortgage Corp. et al. (Eastern District of California). In June 2015, the court certified a class of borrowers who obtained loans with private mortgage insurance through PHH’s captive reinsurance arrangement between June 2007 and December 2009. PHH has asserted numerous defenses to the merits of the case. In August 2020, the Court granted, in part, Plaintiffs’ Motion for Partial Summary Judgment. The only issue remaining for trial is whether the reinsurance services provided by PHH’s captive reinsurance subsidiary, Atrium, were actually provided in order for the safe harbor provision of RESPA to apply. Following pre-trial conferences held in the first half of 2021, the Court scheduled trial to begin on February 15, 2022. PHH accrued $2.5 million prior to the merger with Ocwen when the case was filed in 2008 and that amount is included in the $44.6 million legal and regulatory accrual referenced above. At this time, Ocwen is unable to predict the outcome of this lawsuit or any additional lawsuits that may be filed, the possible loss or range of loss, if any, associated with the resolution of such lawsuits or the potential impact such lawsuits may have on us or our operations. Ocwen intends to vigorously defend against this lawsuit. If our efforts to defend this lawsuit are not successful, our business, reputation, financial condition liquidity and results of operations could be materially and adversely affected. The same plaintiffs who filed a TCPA class action against Ocwen subsequently filed a similar class action against trustees of RMBS trusts based on vicarious liability for Ocwen’s alleged non-compliance with the TCPA. This class action filed against the trustees has settled, and while the trustees previously have indicated their intent to seek indemnification from Ocwen based on the vicarious liability claims, they have yet to take any formal action. Additional lawsuits have been and may be filed against us in relation to our TCPA compliance. However, a recent Supreme Court decision significantly undercuts the predominant theory of liability under the TCPA, and should provide even greater defenses on which Ocwen can rely when defending existing lawsuits or any additional lawsuits that may be filed. Nevertheless, given the recency of this Supreme Court decision, and the lack of opportunity for lower courts to interpret and apply it, it remains difficult to predict the possible loss or range of loss, if any, above the amount accrued or the potential impact such lawsuits may have on us or our operations. Ocwen intends to vigorously defend against these lawsuits. If our efforts to defend these lawsuits are not successful, our business, reputation, financial condition, liquidity and results of operations could be materially and adversely affected. Ocwen is a defendant in a certified class action in the U.S. District Court in the Eastern District of California where the plaintiffs claim Ocwen marked up fees for property valuations and title searches in violation of California state law. See Weiner v. Ocwen Financial Corp., et al . Ocwen’s motion for summary judgment, filed in June 2019, was denied in May 2020; however, the court ruled that plaintiff’s recoverable damages are limited to out-of-pocket costs, i.e. , the amount of marked-up fees actually paid, rather than the entire cost of the valuation that plaintiffs sought. A jury trial is scheduled to commence March 7, 2022. Ocwen has moved to decertify the class and anticipates a ruling prior to trial. At this time, Ocwen is unable to predict the outcome of this lawsuit or any additional lawsuits that may be filed, the possible loss or range of loss, if any, associated with the resolution of such lawsuits or the potential impact such lawsuits may have on us or our operations. Ocwen intends to vigorously defend against this lawsuit. If our efforts to defend this lawsuit are not successful, our business, financial condition liquidity and results of operations could be materially and adversely affected. Ocwen may have affirmative indemnification rights and/or other claims against third parties related to the allegations in the lawsuit. Although we may pursue these claims, we cannot currently estimate the amount, if any, of recoveries from these third parties. We are currently involved in a dispute with a former subservicing client, HSBC Bank USA, N.A. (HSBC), which filed a complaint in the Supreme Court of the State of New York against PHH. See HSBC Bank USA, N.A. v. PHH Mortgage Corp. (Supreme Court of the State of New York). HSBC’s claims relate to alleged breaches of agreements entered into under a prior subservicing arrangement. We believe we have strong factual and legal defenses to all of HSBC’s claims and are vigorously defending the action. Ocwen is currently unable to predict the outcome of this dispute or estimate the size of any loss which could result from a potential resolution reached through litigation or otherwise. We are also currently involved in three lawsuits pending in the Supreme Court of the State of New York with a purchaser of MSRs, Mr. Cooper (formerly Nationstar Mortgage Holdings Inc.), who alleges breaches of representations and warranties made by PHH in the MSR sale agreements. We are awaiting rulings on motions to dismiss two of these lawsuits. We believe we have strong factual and legal defenses to Mr. Cooper’s claims and are vigorously defending ourselves. Over the past several years, lawsuits have been filed by RMBS trust investors alleging that the trustees and master servicers breached their contractual and statutory duties by (i) failing to require loan servicers to abide by their contractual obligations; (ii) failing to declare that certain alleged servicing events of default under the applicable contracts occurred; and (iii) failing to demand that loan sellers repurchase allegedly defective loans, among other things. Ocwen has received several letters from trustees and master servicers purporting to put Ocwen on notice that the trustees and master servicers may ultimately seek indemnification from Ocwen in connection with the litigations. Ocwen has not yet been impleaded into any of these cases, but it has produced and continues to produce documents to the parties in response to third-party subpoenas. Ocwen has, however, been impleaded as a third-party defendant into five consolidated loan repurchase cases first filed against Nomura Credit & Capital, Inc. in 2012 and 2013. Ocwen is vigorously defending itself in those cases against allegations by the mortgage loan seller-defendant that Ocwen failed to inform its contractual counterparties that it had discovered defective loans in the course of servicing them and had otherwise failed to service the loans in accordance with accepted standards. Ocwen is unable at this time to predict the ultimate outcome of these matters, the possible loss or range of loss, if any, associated with the resolution of these matters or any potential impact they may have on us or our operations. If, however, we were required to compensate claimants for losses related to the alleged loan servicing breaches, then our business, reputation, financial condition, liquidity and results of operations could be adversely affected. In addition, several RMBS trustees have received notices of events of default alleging material failures by servicers to comply with applicable servicing agreements. Although Ocwen has not been sued by an RMBS trustee in response to an event of default notice, there is a risk that Ocwen could be replaced as servicer as a result of said notices, that the trustees could take legal action on behalf of the trust certificate holders, or, under certain circumstances, that the RMBS investors who issue notices of event of default could seek to press their allegations against Ocwen, independent of the trustees. We are unable at this time to predict what, if any, actions any trustee will take in response to an event of default notice, nor can we predict at this time the potential loss or range of loss, if any, associated with the resolution of any event of default notice or the potential impact on our operations. If Ocwen were to be terminated as servicer, or other related legal actions were pursued against Ocwen, it could have an adverse effect on Ocwen’s business, reputation, financial condition, liquidity and results of operations. Regulatory We are subject to a number of ongoing federal and state regulatory examinations, consent orders, inquiries, subpoenas, civil investigative demands, requests for information and other actions. We may also on occasion be subject to foreign regulatory actions in the countries where we operate outside the U.S. Where we determine that a loss contingency is probable in connection with a regulatory matter and the amount of our loss can be reasonably estimated, we record an accrual for the loss. Where we determine that a loss is not probable but is reasonably possible or where a loss in excess of the amount accrued is reasonably possible, we disclose an estimate of the amount of the loss or range of possible losses for the claim if a reasonable estimate can be made, unless the amount of such reasonably possible loss is not material to our financial position, results of operations or cash flows. It is possible that we will incur losses relating to regulatory matters that materially exceed any accrued amount. Predicting the outcome of any regulatory matter is inherently difficult and we generally cannot predict the eventual outcome of any regulatory matter or the eventual loss, if any, associated with the outcome. To the extent that an examination, audit or other regulatory engagement results in an alleged failure by us to comply with applicable laws, regulations or licensing requirements, or if allegations are made that we have failed to comply with applicable laws, regulations or licensing requirements or the commitments we have made in connection with our regulatory settlements (whether such allegations are made through administrative actions such as cease and desist orders, through legal proceedings or otherwise) or if other regulatory actions of a similar or different nature are taken in the future against us, this could lead to (i) administrative fines and penalties and litigation, (ii) loss of our licenses and approvals to engage in our servicing and lending businesses, (iii) governmental investigations and enforcement actions, (iv) civil and criminal liability, including class action lawsuits and actions to recover incentive and other payments made by governmental entities, (v) breaches of covenants and representations under our servicing, debt or other agreements, (vi) damage to our reputation, (vii) inability to raise capital or otherwise fund our operations and (viii) inability to execute on our business strategy. Any of these occurrences could increase our operating expenses and reduce our revenues, hamper our ability to grow or otherwise materially and adversely affect our business, reputation, financial condition, liquidity and results of operations. CFPB In April 2017, the CFPB filed a lawsuit in the federal district court for the Southern District of Florida against Ocwen, Ocwen Mortgage Servicing, Inc. (OMS) and OLS alleging violations of federal consumer financial laws relating to our servicing business dating back to 2014. The CFPB’s claims include allegations regarding (1) the adequacy of Ocwen’s servicing system and integrity of Ocwen’s mortgage servicing data, (2) Ocwen’s foreclosure practices and (3) various purported servicer errors with respect to borrower escrow accounts, hazard insurance policies, timely cancellation of private mortgage insurance, handling of customer complaints, and marketing of optional products. The CFPB alleges violations of laws prohibiting unfair, deceptive or abusive acts or practices, as well as violations of other laws or regulations. The CFPB does not claim specific monetary damages, although it does seek consumer relief, disgorgement of allegedly improper gains, and civil money penalties. The parties participated in mediation in October 2020 and subsequently held additional settlement discussions. However, the parties were unable to reach a resolution of the litigation. On March 4, 2021, the court issued an order granting in part and reserving ruling in part on Ocwen’s motion for summary judgment. In that order, the court granted Ocwen summary judgment on 9 of 10 counts in the CFPB’s amended complaint, finding that the CFPB’s allegations were barred under the principles of claim preclusion or res judicata to the extent those claims are premised on servicing activity occurring prior to February 26, 2017 and are covered by a 2014 Consent Judgment entered by the United States District Court for the District of Columbia. The CFPB subsequently filed its Second Amended Complaint to remove count 10 as well as allegations in counts 1-9 concerning servicing activity that occurred after February 26, 2017. On April 21, 2021, the court entered final judgment in our favor, denied all pending motions as moot, and closed the case. The CFPB thereafter filed a notice of appeal. Appellate briefing concluded August 26, 2021, and oral argument before the Eleventh Circuit is tentatively scheduled during the week of February 8 - 11, 2022. Our current accrual with respect to this matter is included in the $44.6 million legal and regulatory accrual referenced above. The outcome of the matters raised by the CFPB, whether through negotiated settlements, court rulings or otherwise, could potentially involve monetary fines or penalties or additional restrictions on our business and could have a material adverse impact on our business, reputation, financial condition, liquidity and results of operations. State Licensing, State Attorneys General and Other Matters Our licensed entities are required to renew their licenses, typically on an annual basis, and to do so they must satisfy the license renewal requirements of each jurisdiction, which generally include financial requirements such as providing audited financial statements or satisfying minimum net worth requirements and non-financial requirements such as satisfactorily completing examinations as to the licensee’s compliance with applicable laws and regulations. Failure to satisfy any of the requirements to which our licensed entities are subject could result in a variety of regulatory actions ranging from a fine, a directive requiring a certain step to be taken, entry into a consent order, a suspension or ultimately a revocation of a license, any of which could have a material adverse impact on our results of operations and financial condition. In addition, we receive information requests and other inquiries, both formal and informal in nature, from our state financial regulators as part of their general regulatory oversight of our servicing and lending businesses. We also regularly engage with state attorneys general and the CFPB and, on occasion, we engage with other federal agencies, including the Department of Justice and various inspectors general on various matters, including responding to information requests and other inquiries. Many of our regulatory engagements arise from a complaint that the entity is investigating, although some are formal investigations or proceedings. The GSEs (and their conservator, FHFA), HUD, FHA, VA, Ginnie Mae, the United States Treasury Department, and others also subject us to periodic reviews and audits. We have in the past resolved, and may in the future resolve, matters via consent orders, payments of monetary amounts and other agreements in order to settle issues identified in connection with examinations or other oversight activities, and such resolutions could have material and adverse effects on our business, reputation, operations, results of operations and financial condition. In April 2017 and shortly thereafter, mortgage and banking regulatory agencies from 29 states and the District of Columbia took administrative actions against OLS and certain other Ocwen companies that alleged deficiencies in our compliance with laws and regulations relating to our servicing and lending activities. An additional state regulator brought legal action together with that state’s attorney general, as described below. These administrative actions were applicable to OLS, but additional Ocwen entities were named in some actions, including Ocwen Financial Corporation, OMS, Homeward, Liberty, OFSPL and Ocwen Business Solutions, Inc. (OBS). We have now resolved all of the state regulatory matters arising in April 2017. In resolving these matters, we entered into agreements containing restrictions and commitments with respect to the operation of our business and our regulatory compliance activities, including restrictions and conditions relating to acquisitions of MSRs, a transition to an alternate loan servicing system from the REALServicing system, engagement of third-party auditors, escrow and data testing, error remediation, and financial condition reporting. We also provided certain borrower financial remediation and made payments to state regulators. We have taken substantial steps toward fulfilling our commitments under these agreements, including completing the transfer of loans to Black Knight MSP, completing pre-transfer and post-transfer data integrity audits, developing and implementing enhancements to our consumer complaint process, completing a third-party escrow review and ongoing reporting and information sharing. We continue to be subject to obligations under these agreements, including completing the final phase of a data integrity audit under our agreement with the State of Massachusetts, which is currently underway. We have also incurred, and will continue to incur, costs to comply with the terms of the settlements we have entered into, including the costs of conducting an escrow review, Maryland organizational assessments and Massachusetts data integrity audits, and costs relating to the transition to Black Knight MSP. With respect to the escrow review, the third-party auditor has issued its final report and we have completed all related remediation measures. It is possible that legal or other actions could be taken against us with respect to the identified escrow errors, which could result in additional costs or other adverse impacts. If we fail to comply with the terms of our settlements, additional legal or other actions could be taken against us. Such actions could have a materially adverse impact on our business, reputation, financial condition, liquidity and results of operations. Certain of the state regulators’ cease and desist orders referenced a confidential supervisory memorandum of understanding (MOU) that we entered into with the Multistate Mortgage Committee (MMC) and six states relating to a servicing examination from 2013 to 2015. Among other things, the MOU prohibited us from repurchasing stock during the development of a going forward plan and, thereafter, except as permitted by the plan. We submitted a plan in 2016 that contained no stock repurchase restrictions and, therefore, we do not believe we are currently restricted from repurchasing stock. We requested confirmation from the signatories of the MOU that they agree with this interpretation, and received affirmative responses from the MMC and five states, and a response declining to take a legal position from the remaining state. On occasion, we engage with agencies of the federal government on various matters. For example, Ocwen was named as a defendant in a HUD administrative complaint filed by a non-profit organization alleging discrimination in the manner in which Ocwen maintains REO properties in minority communities. In February 2018, this matter was administratively closed, and similar claims were filed in federal court. We believe these claims are without merit and intend to vigorously defend ourselves. In 2017, Ocwen received a subpoena from the Office of the Special Inspector General for the Troubled Asset Relief Program requesting documents and information related to Ocwen’s participation in the Treasury Department’s Making Home Affordable Program. Ocwen has also received subpoenas that appear to relate to federal government agency initiatives relating to our industry generally, since we understand other lenders and servicers have received similar subpoenas. These include subpoenas in 2016 and 2017 from the Office of Inspector General of HUD requesting documentation related to HECM loans and lender-placed insurance arrangements with a mortgage insurer and a 2019 subpoena from the VA Office of the Inspector General requesting documentation related to the origination and underwriting of loans guaranteed by the Veterans Benefits Administration. In each instance, we have provided documents and information in response to these subpoenas. Loan Put-Back and Related Contingencies We have exposure to representation, warranty and indemnification obligations relating to our Originations business, including lending, sales and securitization activities, and relating to our servicing practices. At September 30, 2021 and September 30, 2020, we had outstanding representation and warranty repurchase demands of $59.6 million UPB (301 loans) and $45.2 million UPB (263 loans), respectively. We review each demand and monitor through resolution, primarily through rescission, loan repurchase or make-whole payment. The following table presents the changes in our liability for representation and warranty obligations and similar indemnification obligations: Nine Months Ended September 30, 2021 2020 Beginning balance (1) $ 40,374 $ 50,838 Provision (reversal) for representation and warranty obligations 1,483 (1,141) New production liability 3,227 1,361 Charge-offs and other (2) (2,530) (8,130) Ending balance (1) $ 42,554 $ 42,928 (1) The liability for representation and warranty obligations and compensatory fees for foreclosures is reported in Other liabilities (a component of Liability for indemnification obligations) on our unaudited consolidated balance sheets. (2) Includes principal and interest losses realized in connection with repurchased loans, make-whole, indemnification and fee payments and settlements net of recoveries, if any. We believe that it is reasonably possible that losses beyond amounts currently recorded for potential representation and warranty obligations and other claims described above could occur, and such losses could have an adverse impact on our results of operations, financial condition or cash flows. However, based on currently available information, we are unable to estimate a range of reasonably possible losses above amounts that have been recorded at September 30, 2021 . Other Ocwen, on its own behalf and on behalf of various mortgage loan investors, is engaged in a variety of activities to seek payments from mortgage insurers for unpaid claims, including claims where the mortgage insurers paid less than the full claim amount. Ocwen believes that many of the actions by mortgage insurers were in violation of the applicable insurance policies and insurance law. In some cases, Ocwen has entered into tolling agreements, initiated arbitration or litigation, engaged in settlement discussi |
Subsequent Events
Subsequent Events | 3 Months Ended |
Sep. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 23 – Subsequent Events On October 1, 2021, PMC completed the transaction entered into on June 17, 2021 with Reverse Mortgage Solutions, Inc. (RMS) and its parent, Mortgage Assets Management, LLC (MAM), a subsidiary of investment funds managed by Waterfall Asset Management, LLC, to acquire certain assets of RMS related to reverse mortgage subservicing, including subservicing contracts and related foreclosed properties. The aggregate purchase price at closing was approximately $12.4 million, subject to certain holdbacks and adjustments. In addition, PMC has extended employment offers to approximately 350 former RMS employees. Concurrent with the closing of the transaction, PMC became the subservicer under a five-year subservicing agreement for reverse mortgages owned by RMS and MAM. As a result, PMC became the subservicer for approximately |
Organization and Basis of Pre_2
Organization and Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in conformity with the instructions of the Securities and Exchange Commission (SEC) to Form 10-Q and SEC Regulation S-X, Article 10, Rule 10-01 for interim financial statements. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America (GAAP) for complete financial statements. In our opinion, the accompanying unaudited consolidated financial statements contain all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation. The results of operations and other data for the three and nine months ended September 30, 2021 are not necessarily indicative of the results that may be expected for any other interim period or for the year ending December 31, 2021. The unaudited consolidated financial statements presented herein should be read in conjunction with the audited consolidated financial statements and related notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2020. |
Use of Estimates and Assumptions | Use of Estimates and Assumptions The preparation of financial statements in conformity with GAAP requires that management make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Such estimates and assumptions include, but are not limited to, those that relate to fair value measurements, income taxes and the provision for losses that may arise from contingencies including litigation proceedings. In developing estimates and assumptions, management uses all available information; however, actual results could materially differ from those estimates and assumptions. |
Recently Adopted and Issued Accounting Standards | Recently Adopted Accounting Standards Income Taxes (ASC Topic 740): Simplifying the Accounting for Income Taxes (ASU 2019-12) The FASB issued this ASU to Accounting Standards Codification (ASC) Topic 740, Income Taxes, as part of its overall simplification initiative to reduce costs and complexity of applying accounting standards while maintaining or improving the usefulness of the information provided to users of financial statements. Amendments include the removal of certain exceptions to the general principles of ASC Topic 740 in such areas as intraperiod tax allocation, year to date losses in interim periods and deferred tax liabilities related to outside basis differences. Amendments also include simplification in other areas such as interim recognition of enactment of tax laws or rate changes and accounting for a franchise tax (or similar tax) that is partially based on income. Our adoption of this standard on January 1, 2021 did not have a material impact on our consolidated financial statements. Debt—Debt with Conversion and Other Options and Derivatives and Hedging—Contracts in Entity's Own Equity—Accounting for Convertible Instruments and Contracts in an Entity's Own Equity (ASU 2020-06) The amendments in this ASU simplify the accounting for certain financial instruments with characteristics of liabilities and equity by reducing the number of accounting models for convertible debt and convertible preferred stock instruments. In addition, this ASU amended the derivative guidance for the “own stock” scope exception and certain aspects when calculating earnings per share. The amendments in this ASU affect entities that issue convertible instruments and/or contracts in an entity’s own equity. The amendments in this ASU are effective on January 1, 2022, with early adoption permitted on January 1, 2021. Our early adoption of this standard on January 1, 2021 did not have a material impact on our consolidated financial statements. Investments—Equity Securities (ASC Topic 321), Investments—Equity Method and Joint Ventures (ASC Topic 323), and Derivatives and Hedging (ASC Topic 815) (ASU 2020-01) The amendments in this ASU affect all entities that apply the guidance in ASC Topics 321, 323, and 815 and (1) elect to apply the measurement alternative or (2) enter into a forward contract or purchase an option to purchase securities that, upon settlement of the forward contract or exercise of the purchased option, would be accounted for under the equity method of accounting. The amendments clarify that forward or option contracts to purchase investments that will be accounted for using the equity method that do not meet the definition of a derivative under ASC Topic 815 are in the scope of ASC Topic 321. Therefore, when the purchase contract is considered a forward or option contract in the scope of this guidance, the investor would account for changes in the contract’s fair value prior to closing through earnings, unless the contract qualifies for the measurement alternative and it is elected. If the measurement alternative is elected, the change in the fair value of the contract would be reflected in earnings upon closing. In addition, if there are observable transactions or impairments before closing, the guidance would require remeasurement of the contract to fair value. The guidance in this ASU also specifies that when applying the measurement alternative in ASC Topic 321, observable transactions include those transactions by the investor that result in the application or discontinuation of the equity method of accounting. The amendments under this ASU are effective prospectively. Our adoption of this standard on January 1, 2021 did not have a material impact on our consolidated financial statements. Accounting Standards Issued but Not Yet Adopted Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options (a consensus of the FASB Emerging Issues Task Force) (ASU 2021-04) The amendments in this ASU provide the following guidance for a modification or an exchange of a freestanding equity-classified written call option that is not within the scope of another Topic: (1) treat a modification of the terms or conditions or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange as an exchange of the original instrument for a new instrument, (2) measure the effect of a modification or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange and (3) recognize the effect of a modification or an exchange of a freestanding equity-classified written call option to compensate for goods or services in accordance with the guidance in ASC Topic 718. In a multiple-element transaction (for example, one that includes both debt financing and equity financing), the total effect of the modification should be allocated to the respective elements in the transaction. The amendments in this ASU are effective for us on January 1, 2022. We do not anticipate that the adoption of this standard will have a material impact on our consolidated financial statements. |
Securitizations and Variable _2
Securitizations and Variable Interest Entities (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Transfers and Servicing [Abstract] | |
Schedule of Cash Flows Related to Transfers Accounted for as Sales | The following table presents a summary of cash flows received from and paid to securitization trusts related to transfers of loans accounted for as sales that were outstanding: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Proceeds received from securitizations $ 5,823,765 $ 2,364,829 $ 12,220,596 $ 4,256,082 Servicing fees collected (1) 16,440 12,561 43,968 35,204 Purchases of previously transferred assets, net of claims reimbursed (6,065) (2,061) (16,085) (6,338) $ 5,834,140 $ 2,375,329 $ 12,248,479 $ 4,284,948 |
Schedule of Assets That Relate to Continuing Involvement with Transferred Financial Assets with Servicing Rights and Maximum Exposure to Loss Including the Unpaid Principal Balance | The following table presents the carrying amounts of our assets that relate to our continuing involvement with forward loans that we have transferred with servicing rights retained as well as an estimate of our maximum exposure to loss including the UPB of the transferred loans: September 30, 2021 December 31, 2020 Carrying value of assets MSRs, at fair value $ 281,161 $ 137,029 Advances 133,994 143,361 UPB of loans transferred (1) 26,724,676 18,062,856 Maximum exposure to loss $ 27,139,831 $ 18,343,246 |
Carrying Value and Classification of Assets and Liabilities of Loans Held for Sale Financing Facility | The table below presents the carrying value and classification of the assets and liabilities of the loans held for sale financing facility: September 30, 2021 Mortgage loans (Loans held for sale, at fair value) $ 461,827 Outstanding borrowings (Mortgage loan warehouse facilities) 465,018 |
Carrying Value And Classification Of Assets And Liabilities Of Advance Financing Facilities | The table below presents the carrying value and classification of the assets and liabilities of the advance financing facilities: September 30, 2021 December 31, 2020 Match funded advances (Advances, net) $ 594,645 $ 651,576 Debt service accounts (Restricted cash) 7,241 14,195 Unamortized deferred lender fees (Other assets) 1,783 4,253 Prepaid interest (Other assets) 205 291 Advance match funded liabilities 516,572 581,288 |
Carrying Value And Classification Of Assets And Liabilities Of Agency MSR Financing Facility | The table below presents the carrying value and classification of the assets and liabilities of the Agency MSR financing facility: September 30, 2021 December 31, 2020 MSRs pledged (MSRs, at fair value) $ 649,202 $ 476,371 Unamortized deferred lender fees (Other assets) 2,290 1,183 Debt service account (Restricted cash) 104 211 Outstanding borrowings (MSR financing facilities, net) 349,298 210,755 |
Carrying Value And Classification Of Assets And Liabilities Of PLS Notes Facility | The table below presents the carrying value and classification of the assets and liabilities of the PLS Notes facility: September 30, 2021 December 31, 2020 MSRs pledged (MSRs, at fair value) $ 103,082 $ 129,204 Debt service account (Restricted cash) 2,071 2,385 Outstanding borrowings (MSR financing facilities, net) 48,243 68,313 Unamortized debt issuance costs (MSR financing facilities, net) 506 894 |
Fair Value (Tables)
Fair Value (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value Assets and Liabilities | The carrying amounts and the estimated fair values of our financial instruments and certain of our nonfinancial assets measured at fair value on a recurring or non-recurring basis or disclosed, but not measured, at fair value are as follows: September 30, 2021 December 31, 2020 Level Carrying Value Fair Value Carrying Value Fair Value Financial assets Loans held for sale Loans held for sale, at fair value (a) (e) 3, 2 $ 921,621 $ 921,621 $ 366,364 $ 366,364 Loans held for sale, at lower of cost or fair value (b) 3 12,079 12,079 21,472 21,472 Total Loans held for sale $ 933,700 $ 933,700 $ 387,836 $ 387,836 Loans held for investment Loans held for investment - Reverse mortgages (a) 3 $ 7,100,726 $ 7,100,726 $ 6,997,127 $ 6,997,127 Loans held for investment - Restricted for securitization investors (a) 3 8,004 8,004 9,770 9,770 Total loans held for investment $ 7,108,730 $ 7,108,730 $ 7,006,897 $ 7,006,897 Advances, net (c) 3 $ 739,596 $ 739,596 $ 828,239 $ 828,239 Receivables, net (c) 3 183,090 183,090 187,665 187,665 Mortgage-backed securities (a) 3 1,618 1,618 2,019 2,019 Corporate bonds (a) 2 211 211 211 211 Investment in equity method investee (c) 3 19,794 19,794 — — Financial liabilities: Advance match funded liabilities (c) 3 $ 516,572 $ 515,405 $ 581,288 $ 581,997 Financing liabilities: HMBS-related borrowings (a) 3 $ 6,782,564 $ 6,782,564 $ 6,772,711 $ 6,772,711 Other financing liabilities Financing liability -Transferred MSR liability (a) 3 702,907 702,907 566,952 566,952 Financing liability - Owed to securitization investors (a) 3 8,004 8,004 9,770 9,770 Total Other financing liabilities 710,911 710,911 576,722 576,722 Senior secured term loan (c) (d) 2 $ — $ — $ 179,776 $ 184,639 Mortgage loan warehouse facilities (c) 3 1,069,170 1,069,170 451,713 451,713 MSR financing facilities (c) (d) 3 945,744 918,217 437,672 406,860 Senior notes: Senior notes (c) (d) (f) 2 392,190 403,490 311,898 320,879 OFC Senior notes due 2027 (c) (d) (f) 3 220,468 258,805 — — Total Senior notes $ 612,658 $ 662,295 $ 311,898 $ 320,879 September 30, 2021 December 31, 2020 Level Carrying Value Fair Value Carrying Value Fair Value Derivative financial instrument assets (liabilities) Interest rate lock commitments (a) 3 $ 14,030 $ 14,030 $ 22,706 $ 22,706 Forward trades - Loans held for sale (a) 2 421 421 (50) (50) TBA / Forward mortgage-backed securities (MBS) trades (a) 1 (11,227) (11,227) (4,554) (4,554) Interest rate swap futures (a) 1 (8,236) (8,236) 504 504 TBA forward Pipeline trades (a) 1 5,262 5,262 — — Other 3 (438) (438) — — MSRs (a) 3 $ 2,176,260 $ 2,176,260 $ 1,294,817 $ 1,294,817 (a) Measured at fair value on a recurring basis. (b) Measured at fair value on a non-recurring basis. (c) Disclosed, but not measured, at fair value. (d) The carrying values are net of unamortized debt issuance costs and discount. See Note 12 – Borrowings for additional information . (e) Loans repurchased from Ginnie Mae securitizations with a fair value of $210.8 million and $51.1 million at September 30, 2021 and December 31, 2020, respectively, are classified as Level 3. The remaining balance of loans held for sale at fair value is classified as Level 2. (f) On March 4, 2021, PMC completed the issuance and sale of $400.0 million aggregate principal amount of senior secured notes. Fair value is based on valuation data obtained from a pricing service. Therefore, these notes are classified as Level 2. Additionally on March 4, 2021 and May 3, 2021, Ocwen completed the private placement of $199.5 million and $85.5 million, respectively, aggregate principal amount of senior secured second lien notes. These notes are classified as Level 3. See Note 12 – Borrowings for additional information. |
Schedule of Reconciliation of Changes in Fair Value of Level 3 Assets and Liabilities | The following tables present a reconciliation of the changes in fair value of Level 3 assets and liabilities that we measure at fair value on a recurring basis: Loans Held for Investment - Restricted for Securitization Investors Financing Liability - Owed to Securitization Investors Loans Held for Sale - Fair Value Mortgage-Backed Securities IRLCs Three months ended September 30, 2021 Beginning balance $ 8,680 $ (8,680) $ 138,842 $ 1,607 $ 17,437 Cumulative effect of fair value election — — — — Purchases, issuances, sales and settlements Purchases — — 136,996 — — Issuances — — — — 184,995 Sales — — (64,032) — — Settlements (676) 676 — — — Transfers (to) from: Loans held for sale, at fair value — — — — (182,783) Receivables, net — — (558) — — (676) 676 72,406 — 2,212 Change in fair value included in earnings — — (496) 11 (5,619) Transfers in and / or out of Level 3 — — — — — Ending balance $ 8,004 $ (8,004) $ 210,752 $ 1,618 $ 14,030 Loans Held for Investment - Restricted for Securitization Investors Financing Liability - Owed to Securitization Investors Loans Held for Sale - Fair Value Mortgage-Backed Securities IRLCs Three months ended September 30, 2020 Beginning balance $ 11,664 $ (11,664) $ 25,950 $ 1,726 $ 17,818 Purchases, issuances, sales and settlements Purchases — — 45,445 — — Issuances — — — — 87,311 Sales — — (45,723) — — Settlements (652) 652 356 — (77,785) Transfers (to) from: Receivables, net — — 157 — — (652) 652 235 — 9,526 Change in fair value included in earnings — — 224 424 (4,665) Ending balance $ 11,012 $ (11,012) $ 26,409 $ 2,150 $ 22,679 Loans Held for Investment - Restricted for Securitization Investors Financing Liability - Owed to Securitization Investors Loans Held for Sale - Fair Value Mortgage-backed Securities IRLCs Nine Months Ended September 30, 2021 Beginning balance $ 9,770 $ (9,770) $ 51,072 $ 2,019 $ 22,706 Purchases, issuances, sales and settlements Purchases — — 303,117 — — Issuances — — — — 446,751 Sales — — (135,088) — — Settlements (1,766) 1,766 — — — Transfers (to) from: Loans held for sale, at fair value — — — — (425,169) Other assets — — (377) — — Receivables, net — — (1,113) — — (1,766) 1,766 166,539 — 21,582 Change in fair value included in earnings — — (6,859) (401) (30,258) Ending balance $ 8,004 $ (8,004) $ 210,752 $ 1,618 $ 14,030 Loans Held for Investment - Restricted for Securitization Investors Financing Liability - Owed to Securitization Investors Loans Held for Sale - Fair Value Mortgage-backed Securities IRLCs Nine Months Ended September 30, 2020 Beginning balance $ 23,342 $ (22,002) $ — $ 2,075 $ — Purchases, issuances, sales and settlements Purchases — — 103,955 — — Issuances — — — — 144,931 Deconsolidation of mortgage-backed securitization trusts (10,715) 9,519 — — — Sales — — (104,273) — — Settlements (1,615) 1,615 (70) — — Transfers (to) from: Loans held for sale, at fair value — — — — (128,224) Receivables, net — — (113) — — (12,330) 11,134 (501) — 16,707 Change in fair value included in earnings — (144) 1,328 75 (4,506) Transfers in and / or out of Level 3 — — 25,582 — 10,478 Ending balance $ 11,012 $ (11,012) $ 26,409 $ 2,150 $ 22,679 |
Schedule of Significant Assumptions used in Valuation | Significant unobservable assumptions September 30, December 31, Life in years Range 1.1 to 8.0 0.9 to 8.0 Weighted average 5.6 5.9 Conditional prepayment rate, including voluntary and involuntary prepayments Range 11.0% to 35.5% 10.6% to 28.8% Weighted average 16.2 % 15.4 % Discount rate 2.5 % 1.9 % Significant unobservable assumptions September 30, 2021 December 31, 2020 Agency Non-Agency Agency Non-Agency Weighted average prepayment speed 9.0 % 12.0 % 11.8 % 11.5 % Weighted average lifetime delinquency rate 1.4 % 12.8 % 3.0 % 28.0 % Weighted average discount rate 8.6 % 11.2 % 9.2 % 11.4 % Weighted average cost to service (in dollars) $ 72 $ 209 $ 79 $ 270 Significant unobservable assumptions September 30, December 31, Life in years Range 1.1 to 8.0 0.9 to 8.0 Weighted average 5.6 5.9 Conditional prepayment rate Range 11.0% to 35.5% 10.6% to 28.8% Weighted average 16.2 % 15.4 % Discount rate 2.3 % 1.7 % Significant unobservable assumptions September 30, December 31, Weighted average prepayment speed 11.2 % 11.5 % Weighted average delinquency rate 11.2 % 29.8 % Weighted average discount rate 10.7 % 11.4 % Weighted average cost to service (in dollars) $ 199 $ 287 |
Summary of Estimated Change in the Value of MSRs Carried at Fair Value | The following table summarizes the estimated change in the value of the MSRs as of September 30, 2021 given hypothetical increases in lifetime prepayments and yield assumptions: Adverse change in fair value 10% 20% Weighted average prepayment speeds $ (65,965) $ (128,151) Weighted average discount rate (53,571) (103,573) |
Loans Held for Sale (Tables)
Loans Held for Sale (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Receivables [Abstract] | |
Schedule of Loans Held for Sale Fair Value | Loans Held for Sale - Fair Value Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Beginning balance $ 680,866 $ 253,037 $ 366,364 $ 208,752 Originations and purchases 6,366,795 2,429,977 12,987,522 4,378,999 Proceeds from sales (6,098,495) (2,317,579) (12,362,149) (4,190,355) Principal collections (22,334) (5,721) (39,037) (21,479) Transfers from (to): Loans held for investment, at fair value 1,220 781 2,898 1,900 Receivables, net (7,625) (14,723) (25,151) (62,949) REO (Other assets) (1,767) (1,713) (5,312) (2,554) Gain (loss) on sale of loans 1,793 17,509 (13,006) 45,762 Increase (decrease) in fair value of loans (5,336) 4,220 (6,025) 1,925 Other 6,504 1,178 15,517 6,965 Ending balance (1) $ 921,621 $ 366,966 $ 921,621 $ 366,966 (1) At September 30, 2021 and 2020, the balances include $(9.3) million and $(5.8) million, respectively, of fair value adjustments. |
Schedule of Loans Held for Sale at Lower Cost or Fair Value, Activity | Loans Held for Sale - Lower of Cost or Fair Value Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Beginning balance - before Valuation Allowance $ 20,278 $ 31,880 $ 27,652 $ 73,160 Proceeds from sales (2,916) 891 (9,583) (45,974) Principal collections (415) (514) (629) (1,319) Transfers from (to): Receivables, net (444) — (936) 61 Gain (loss) on sale of loans 35 (1,141) 549 474 Other 123 (1,220) (392) 3,494 Ending balance - before Valuation Allowance 16,661 29,896 16,661 29,896 Beginning balance - Valuation Allowance $ (5,124) $ (6,400) $ (6,180) $ (6,643) (Provision for) reversal of valuation allowance 602 45 1,582 (1,084) Transfer to (from) Liability for indemnification obligations (Other liabilities) (60) (42) 16 (117) Sales of loans — 166 — 1,613 Ending balance - Valuation Allowance (4,582) (6,231) (4,582) (6,231) Ending balance, net $ 12,079 $ 23,665 $ 12,079 $ 23,665 |
Schedule of Gains on Loans Held for Sale, Net | Gain on Loans Held for Sale, Net Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Gain on sales of loans, net MSRs retained on transfers of forward mortgage loans $ 66,420 $ 22,096 $ 136,482 $ 37,785 Gain (loss) on sale of forward mortgage loans (1) (2,601) 11,897 (25,440) 35,201 Gain on sale of repurchased Ginnie Mae loans 3,962 4,663 12,277 11,036 67,781 38,656 123,319 84,022 Change in fair value of IRLCs (4,135) 4,828 (9,225) 16,876 Change in fair value of loans held for sale (3,491) 3,061 (3,323) 3,367 Loss on economic hedge instruments (2) 780 179 592 (10,141) Other (1,233) (838) (3,227) (1,360) $ 59,702 $ 45,886 $ 108,136 $ 92,764 (1) Includes $22.5 million gain in the three and nine months ended September 30, 2021 related to loans purchased through the exercise of our servicer call rights with respect to certain Non-Agency trusts and sold, servicing release, in the three months ended September 30, 2021. |
Reverse Mortgages (Tables)
Reverse Mortgages (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Receivables [Abstract] | |
Schedule of Loans Held For Investment and HMBS Related Borrowings | Three Months Ended September 30, 2021 2020 Loans Held for Investment - Reverse Mortgages HMBS - Related Borrowings Loans Held for Investment - Reverse Mortgages HMBS - Related Borrowings Beginning balance $ 7,112,273 $ (6,823,911) $ 6,718,992 $ (6,477,616) Originations 494,330 — 299,628 — Securitization of HECM loans accounted for as a financing — (452,262) — (295,347) Additional proceeds from securitization of HECM loans and tails — (7,751) — (12,407) Repayments (principal payments received) (449,236) 446,277 (249,372) 247,793 Transfers to: Loans held for sale, at fair value (1,220) — (781) — Receivables, net (84) — 105 — Other assets (121) — (38) — Change in fair value included in earnings (55,216) 55,083 81,396 (68,966) Ending Balance $ 7,100,726 $ (6,782,564) $ 6,849,930 $ (6,606,543) Securitized loans (pledged to HMBS-Related Borrowings) $ 6,874,025 $ (6,782,564) $ 6,715,093 $ (6,606,543) Unsecuritized loans 226,701 134,837 — Total $ 7,100,726 $ 6,849,930 Nine Months Ended September 30, 2021 2020 Loans Held for Investment - Reverse Mortgages HMBS - Related Borrowings Loans Held for Investment - Reverse Mortgages HMBS - Related Borrowings Beginning balance $ 6,997,127 $ (6,772,711) $ 6,269,596 $ (6,063,435) Cumulative effect of fair value election (1) — — 47,038 — Originations 1,214,772 — 867,702 — Securitization of HECM loans accounted for as a financing (incl. realized fair value changes) — (1,119,742) — (885,987) Additional proceeds from securitization of HECM loans and tails — (34,918) — (28,572) Repayments (principal payments received) (1,170,245) 1,161,609 (619,486) 613,026 Transfers to: Loans held for sale, at fair value (2,898) — (1,900) — Receivables, net (169) — (181) — REO (Other assets) (316) — (403) — Change in fair value 62,455 (16,802) 287,564 (241,575) Ending Balance $ 7,100,726 $ (6,782,564) $ 6,849,930 $ (6,606,543) Securitized $ 6,874,025 $ (6,782,564) $ 6,715,093 $ (6,606,543) Unsecuritized 226,701 134,837 $ 7,100,726 $ 6,849,930 |
Schedule of Reverse Mortgage Revenue, Net | Reverse Mortgage Revenue, net Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Gain on new originations (1) $ 12,900 $ 13,545 $ 46,170 $ 33,156 Change in fair value of securitized loans held for investment and HMBS-related borrowings, net (13,033) (1,115) (517) 12,833 Change in fair value included in earnings, net (133) 12,430 45,653 45,989 Loan fees and other 5,168 2,069 10,509 5,066 $ 5,035 $ 14,499 $ 56,162 $ 51,055 |
Advances (Tables)
Advances (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Advances [Abstract] | |
Schedule of Advances Paid on Behalf of Borrowers or on Foreclosed Properties | September 30, 2021 December 31, 2020 Principal and interest $ 238,071 $ 277,132 Taxes and insurance 331,013 364,593 Foreclosures, bankruptcy, REO and other 177,189 192,787 746,273 834,512 Allowance for losses (6,677) (6,273) Advances, net $ 739,596 $ 828,239 |
Schedule of Activity in Advances | The following table summarizes the activity in net advances: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Beginning balance - before Allowance for Losses $ 768,864 $ 908,829 $ 834,512 $ 1,066,448 Acquisition of advances in connection with the purchase of MSRs — 14 4,495 14 New advances 181,567 198,549 565,284 667,577 Sales of advances (80) (150) (328) (604) Collections of advances and other (204,078) (268,560) (657,690) (894,753) Ending balance - before Allowance for Losses 746,273 838,682 746,273 838,682 Beginning balance - Allowance for Losses $ (6,891) $ (7,820) $ (6,273) $ (9,925) Provision (1,581) (2,173) (5,478) (5,944) Net charge-offs and other 1,795 3,915 5,074 9,791 Ending balance - Allowance for Losses (6,677) (6,078) (6,677) (6,078) Ending balance, net $ 739,596 $ 832,604 $ 739,596 $ 832,604 |
Mortgage Servicing (Tables)
Mortgage Servicing (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Transfers and Servicing [Abstract] | |
Schedule of Activity Related to MSRs - Fair Value Measurement Method | MSRs – At Fair Value Three Months Ended September 30, 2021 2020 Agency Non-Agency Total Agency Non-Agency Total Beginning balance $ 1,408,420 $ 664,098 $ 2,072,518 $ 305,085 $ 739,829 $ 1,044,914 Sales and other transfers — — — — (1) (1) Additions: Recognized on the sale of residential mortgage loans 66,420 — 66,420 22,096 — 22,096 Purchase of MSRs 36,153 — 36,153 32,249 — 32,249 Servicing transfers and adjustments 17 (4,723) (4,706) 16 — 16 Changes in fair value: Changes in valuation inputs or assumptions (2) 6,983 67,836 74,819 (4,731) 13,496 8,765 Realization of expected cash flows (2) (38,186) (30,758) (68,944) (15,051) (23,975) (39,026) Ending balance $ 1,479,807 $ 696,453 $ 2,176,260 $ 339,664 $ 729,349 $ 1,069,013 MSRs – At Fair Value Nine Months Ended September 30, 2021 2020 Agency Non-Agency Total Agency Non-Agency Total Beginning balance $ 578,957 $ 715,860 $ 1,294,817 $ 714,006 $ 772,389 $ 1,486,395 Sales and other transfers — — — — (108) (108) Additions: Recognized on the sale of residential mortgage loans 136,482 — 136,482 37,785 — 37,785 Purchase of MSRs 806,469 — 806,469 78,994 — 78,994 Servicing transfers and adjustments (1) 73 (6,913) (6,840) (263,830) 403 (263,427) Changes in fair value: Changes in valuation inputs or assumptions (2) 47,132 73,306 120,438 (166,546) 23,839 (142,707) Realization of expected cash flows (2) (89,306) (85,800) (175,106) (60,745) (67,174) (127,919) Ending balance $ 1,479,807 $ 696,453 $ 2,176,260 $ 339,664 $ 729,349 $ 1,069,013 (1) Servicing transfers and adjustments include a $263.7 million derecognition of MSRs effective with the February 20, 2020 notice of termination of the subservicing agreement between NRZ and PMC. See Note 8 — MSR Transfers Not Qualifying for Sale Accounting for further information. |
Schedule of Composition of Servicing UPB | September 30, 2021 June 30, 2021 December 31, 2020 September 30, 2020 Owned MSRs $ 136,316,900 $ 148,882,743 $ 90,174,495 $ 71,301,427 NRZ pledged MSRs (1) 56,141,289 59,038,668 64,061,198 66,782,351 MAV pledged MSRs (1) 13,570,892 — — — Total MSR UPB $ 206,029,081 $ 207,921,411 $ 154,235,693 $ 138,083,778 (1) MSRs subject to sale agreements with NRZ and MAV that do not meet sale accounting criteria. See Note 8 — MSR Transfers Not Qualifying for Sale Accounting. |
Schedule of Components of Servicing and Subservicing Fees | Servicing Revenue Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Loan servicing and subservicing fees Servicing $ 103,094 $ 53,410 $ 246,363 $ 161,154 Subservicing 2,867 10,324 8,971 26,143 MAV 1,575 — 1,575 — NRZ 75,034 91,015 233,135 299,089 182,570 154,749 490,044 486,386 Ancillary income Late charges 10,656 11,012 31,335 38,323 Recording fees 3,726 3,900 10,579 9,828 Loan collection fees 2,858 3,047 8,568 10,048 Boarding and deboarding fees 1,627 4,262 6,830 5,619 Custodial accounts (float earnings) 1,234 1,057 3,547 8,787 Other, net 3,914 3,695 11,859 9,454 24,015 26,973 72,720 82,059 $ 206,585 $ 181,722 $ 562,764 $ 568,445 |
MSR Transfers Not Qualifying _2
MSR Transfers Not Qualifying for Sale Accounting (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Transfers and Servicing [Abstract] | |
Schedule of Assets, Liabilities Related to MSR Transfer Agreements | The following table presents selected assets and liabilities recorded on our unaudited consolidated balance sheets in connection with the MSR transfer agreements with NRZ and MAV that do not qualify for sale accounting. Balance Sheets September 30, 2021 December 31, 2020 Transferred MSRs, at fair value NRZ $ 574,020 $ 566,952 MAV 144,893 — $ 718,913 $ 566,952 Other financing liability - Transferred MSR liability (1), at fair value NRZ $ 574,020 $ 566,952 MAV 128,887 — $ 702,907 $ 566,952 Due from NRZ (Receivables) - Subservicing fees and reimbursable expenses $ 2,892 $ 4,611 Due to NRZ (Other liabilities) - Advance collections, servicing fees and other 92,188 94,691 |
Schedule of Activity Related to Financing Liability - MSRs Pledged | The following tables present the activity of the transferred MSR liability recorded in connection with the MSR transfer agreements with NRZ and MAV that do not qualify for sale accounting. Three Months Ended September 30, 2021 September 30, 2020 Transferred MSR Liability Original Rights to MSRs Agreements - NRZ MAV Agreements Total Original Rights to MSRs Agreements - NRZ Beginning Balance $ 535,571 $ — $ 535,571 $ 582,558 Sales — 132,003 132,003 — Changes in fair value (2) 63,762 (2,433) 61,329 12,203 Runoff and settlement (21,100) (683) (21,783) (17,452) Calls (1) (4,213) — (4,213) — Ending Balance $ 574,020 $ 128,887 $ 702,907 $ 577,309 Nine Months Ended September 30, 2021 Transferred MSR Liability Original Rights to MSRs Agreements - NRZ MAV Agreements Total Beginning Balance $ 566,952 $ — $ 566,952 Sales — 132,003 132,003 Changes in fair value 73,706 (2,433) 71,273 Runoff and settlement (59,626) (683) (60,309) Calls (1) (7,012) — (7,012) Ending Balance $ 574,020 $ 128,887 $ 702,907 Nine Months Ended September 30, 2020 Transferred MSR Liability Original Rights to MSRs Agreements - NRZ 2017 Agreements and New RMSR Agreements - NRZ PMC MSR Agreements - NRZ Total Beginning Balance $ 603,046 $ 35,445 $ 312,102 $ 950,593 Sales — — (226) (226) Changes in fair value (2) 26,081 903 (40,720) (13,736) Runoff and settlement: (49,150) (35,121) (7,492) (91,763) Derecognition of Pledged MSR financing liability due to termination of PMC MSR Agreements — — (263,664) (263,664) Calls (1) (2,668) (1,227) — (3,895) Ending Balance $ 577,309 $ — $ — $ 577,309 (1) Represents the carrying value of MSRs in connection with call rights exercised by NRZ, for MSRs transferred to NRZ under the 2017 Agreements and New RMSR Agreements (each as defined below), or by Ocwen at NRZ’s direction, for MSRs underlying the Original Rights to MSRs Agreements (as defined below). Ocwen derecognizes the MSRs and the related financing liability upon collapse of the securitization. |
Schedule of Results of Operations in Connection With MSR Transfer Agreements that Do Not Qualify for Sale Accounting | The following tables present selected items in our unaudited consolidated statements of operations in connection with the MSR transfer agreements with NRZ and MAV that do not qualify for sale accounting. Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Statements of Operations Servicing fees Servicing fees collected on behalf of NRZ $ 75,034 $ 91,015 $ 233,135 $ 299,089 Servicing fees collected on behalf of MAV 1,001 — $ 1,001 — $ 76,035 $ 91,015 $ 234,136 $ 299,089 Pledged MSR liability expense NRZ (see further details below) $ 93,253 $ 57,404 $ 170,914 $ 105,684 MAV (see further details below) (2,094) — (2,094) — $ 91,160 $ 57,404 $ 168,820 $ 105,684 NRZ Pledged MSR liability expense: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Servicing fees collected on behalf of NRZ $ 75,034 $ 91,015 $ 233,135 $ 299,089 Less: Subservicing fee retained by Ocwen 21,475 25,674 67,987 80,529 Net servicing fees remitted to NRZ 53,559 65,341 165,148 218,560 Less: Reduction (increase) in financing liability Changes in fair value: Original Rights to MSRs Agreements (1) (63,762) (12,202) (73,706) (26,081) 2017 Agreements and New RMSR Agreements — — — (903) PMC MSR Agreements — — — 40,720 (63,762) (12,202) (73,706) 13,736 Runoff and settlement: Original Rights to MSRs Agreements (1) 21,100 17,451 59,627 49,150 2017 Agreements and New RMSR Agreements — — — 35,121 PMC MSR Agreements — — — 7,492 21,100 17,451 59,627 91,763 Other 2,968 2,688 8,313 7,377 Pledged MSR liability expense - NRZ $ 93,253 $ 57,404 $ 170,914 $ 105,684 (1) Effective January 1, 2021, changes in fair value due to actual vs. model variances are presented as Changes in valuation inputs or assumptions. Activity for the three and nine months ended September 30, 2020 in the table above has been recast to conform to current year disclosure, resulting in losses of $1.8 million and $7.6 million, respectively, reclassified from Runoff and settlement to Changes in fair value. MAV Pledged MSR liability expense: Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021 Servicing fees collected on behalf of MAV $ 1,001 $ 1,001 Less: Subservicing fee retained by Ocwen 178 178 Net servicing fees remitted to MAV 823 823 Less: Reduction (increase) in Transferred MSR liability Changes in fair value 2,433 2,433 Runoff and settlement 683 683 3,116 3,116 Other (199) (199) Pledged MSR liability expense - MAV $ (2,094) $ (2,094) |
Schedule of Unpaid Principal Balance of Loans Serviced on Behalf of Others | The following table presents UPB of loans serviced on behalf of NRZ and MAV for transferred MSRs that did not qualify for sale accounting together with the UPB of loans subserviced on behalf of NRZ and MAV: September 30, 2021 December 31, 2020 NRZ Agreements Ocwen servicer of record (MSR title retained by Ocwen) - Ocwen MSR (1) (2) $ 12,601,689 $ 14,114,602 NRZ servicer of record (MSR title transferred to NRZ) - Ocwen MSR (1) 43,526,008 49,866,082 Ocwen subservicer 2,251,947 3,130,704 58,379,644 67,111,388 MAV Agreements MSR transferred to MAV (1) 13,570,892 — Ocwen subservicer 7,855,112 — 21,426,004 — Total UPB $ 79,805,648 $ 67,111,388 (1) The MSR transfers did not qualify for sale accounting treatment. |
Receivables (Tables)
Receivables (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Schedule of Receivables | September 30, 2021 December 31, 2020 Servicing-related receivables: Government-insured loan claims - Forward $ 93,717 $ 103,058 Government-insured loan claims - Reverse 34,620 32,887 Due from custodial accounts 25,700 19,393 Reimbursable expenses 5,419 4,970 Subservicing fees and reimbursable expenses - Due from NRZ 2,892 4,611 Subservicing fees and reimbursable expenses - Due from MAV 1,412 — Other 2,167 1,087 165,926 166,006 Income taxes receivable 54,501 57,503 Due from MAV 1,245 — Other receivables 3,093 3,200 224,764 226,709 Allowance for losses (41,674) (39,044) $ 183,090 $ 187,665 |
Government Insured Loans Claims | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Schedule of Changes in Allowance For Losses | Allowance for Losses - Government-Insured Loan Claims Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Beginning balance $ 41,216 $ 53,310 $ 38,339 $ 56,868 Provision 2,990 5,055 10,526 12,249 Charge-offs and other, net (3,141) (17,607) (7,800) (28,359) Ending balance $ 41,065 $ 40,758 $ 41,065 $ 40,758 |
Investment in Equity Method I_2
Investment in Equity Method Investee (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investment in equity method investee | Our investment in MAV Canopy is comprised of following at September 30, 2021: Capital contribution $ 18,512 Earnings of equity method investee 1,282 Investment in equity method investee $ 19,794 |
Equity Method Investment Summarized Financial Information | The following tables present a summary of our transactions with MAV, MAV Canopy or Oaktree as related parties, as of or for the three and nine months ended September 30, 2021: Balance Sheet MSRs, at fair value (1) $ 144,893 Receivables Reimbursable expenses MSR sales price holdback - (MAV) (1) $ 1,644 Due from MAV 2,657 Transferred MSR liability, at fair value (2) $ 128,887 Other liabilities Due to MAV 226 Revenue Servicing and subservicing fees Servicing fees collected on behalf of MAV (1) $ 1,001 Subservicing fees - Subservicing agreement (MAV) 574 Ancillary fees (MAV) (1) 707 $ 2,282 MSR valuation adjustments, net (MAV) (1) $ (3,116) Other income (expense) Interest expense - OFC senior secured notes (Oaktree) $ (21,351) Pledged MSR liability expense - MAV (1) 2,094 Other income - Administrative services agreement (MAV) 140 Other UPB of MSR transferred by PMC to MAV in the three and nine months ended September 30, 2021 $ 13,683,143 Cash proceeds from transfers of MSRs by PMC to MAV in the three and nine months ended September 30, 2021 $ 130,024 UPB of loans sub-serviced - Subservicing agreement (MAV) as of September 30, 2021 MSR transferred to MAV, not qualifying for sale accounting 13,570,892 Ocwen subservicer 7,855,112 $ 21,426,004 (1) For sales of MSRs to MAV which did not qualify as a sale for accounting purposes, we continue to recognize the MSRs and related pledged MSR liability on our consolidated balance sheets, as well as the full amount of servicing revenue and changes in the fair value of the MSRs and related financing liability in our unaudited consolidated statements of operations. Changes in fair value of the Rights to MSRs are recognized in MSR valuation adjustments, net in the unaudited consolidated statements of operations. Changes in fair value of the MSR related financing liability are reported in Pledged MSR liability expense. |
Other Assets (Tables)
Other Assets (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Other Assets [Abstract] | |
Schedule of Other Assets | September 30, 2021 December 31, 2020 Contingent loan repurchase asset $ 450,385 $ 480,221 Prepaid expenses 21,398 21,176 Derivatives, at fair value 20,329 23,246 Prepaid representation, warranty and indemnification claims - Agency MSR sale 15,173 15,173 REO 8,602 7,771 Prepaid lender fees, net 8,338 9,556 Deferred tax asset, net 3,724 3,543 Mortgage backed securities, at fair value 1,618 2,019 Security deposits 1,173 2,222 Other 11,857 6,556 $ 542,597 $ 571,483 |
Borrowings (Tables)
Borrowings (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Financing Liabilities | Financing Liabilities Outstanding Balance Borrowing Type Collateral Interest Rate Maturity September 30, 2021 December 31, 2020 HMBS-related borrowings, at fair value (1) Loans held for investment 1ML + 242 bps (1) (1) $ 6,782,564 $ 6,772,711 Other financing liabilities, at fair value Original Rights to MSRs Agreements - NRZ MSRs (2) (2) 574,020 566,952 Transferred MSR liability - MAV MSRs (2) (2) 128,887 — 702,907 566,952 Financing liability - Owed to securitization investors, at fair value: Residential Asset Securitization Trust 2003-A11 (RAST 2003-A11) (3) Loans held for investment (3) Oct. 2033 8,004 9,770 Total Other financing liabilities, at fair value 710,911 576,722 $ 7,493,475 $ 7,349,433 (1) Represents amounts due to the holders of beneficial interests in Ginnie Mae guaranteed HMBS that did not qualify for sale accounting treatment of HECM loans. Under this accounting treatment, the HECM loans securitized with Ginnie Mae remain on our consolidated balance sheets and the proceeds from the sale are recognized as a financing liability, which is recorded at fair value consistent with the related HECM loans. The beneficial interests in Ginnie Mae guaranteed HMBS have no maturity dates, and the borrowings mature as the related loans are repaid. Interest rate is a weighted average based on the pass-through rate of the loans. See Note 2 – Securitizations and Variable Interest Entities. (2) Pledged MSR liabilities are recognized due to the accounting treatment of MSR sale transactions with NRZ and MAV that did not qualify as sales for accounting purposes. Under this accounting treatment, the MSRs transferred remain on the consolidated balance sheet and the proceeds from the sale are recognized as a financing liability, which is recorded at fair value consistent with the related MSRs. The financing liability has no contractual maturity or repayment schedule. See Note 8 — MSR Transfers Not Qualifying for Sale Accounting for additional information. (3) Consists of securitization debt certificates due to third parties that represent beneficial interests in trusts that we include in our unaudited consolidated financial statements. Holders of the debt issued by the consolidated securitization trust entities have recourse only to the assets of the SPE for satisfaction of the debt and have no recourse against the assets of Ocwen. Similarly, the general creditors of Ocwen have no claim on the assets of the trusts. Trust pay interest based on fixed rates ranging between 4.25% and 5.75% and a variable rate based on 1ML plus 0.45%, includes certificates that are Principal Only certificates and are not entitled to receive distributions of interest. |
Schedule of Match Funded Liabilities | Advance Match Funded Liabilities Borrowing Capacity September 30, 2021 December 31, 2020 Borrowing Type Maturity (1) Amort. Date (1) Total Available (2) Weighted Average Interest Rate (6) Balance Weighted Average Interest Rate (6) Balance Advance Receivables Backed Notes - Series 2015-VF5 (3) Jun. 2052 Jun. 2022 $ 80,000 $ 54,505 2.14 % $ 25,495 4.26 % $ 89,396 Advance Receivables Backed Notes, Series 2020-T1 (4) Aug. 2052 Aug. 2022 475,000 — 1.49 % 475,000 1.49 % 475,000 Total Ocwen Master Advance Receivables Trust (OMART) 555,000 54,505 1.52 % 500,495 1.93 % 564,396 Ocwen Freddie Advance Funding (OFAF) - Advance Receivables Backed Notes, Series 2015-VF1 (5) Aug. 2052 Aug. 2022 40,000 23,923 2.15 % 16,077 3.26 % 16,892 $ 595,000 $ 78,428 1.54 % $ 516,572 1.96 % $ 581,288 (1) The amortization date of our facilities is the date on which the revolving period ends under each advance facility note and repayment of the outstanding balance must begin if the note is not renewed or extended. The maturity date is the date on which all outstanding balances must be repaid. In all of our advance facilities, there are multiple notes outstanding. After the amortization date for each note, all collections that represent the repayment of advances pledged to the facility must be applied ratably to each outstanding amortizing note to reduce the balance and, as such, the collection of advances allocated to the amortizing note may not be used to fund new advances. (2) Borrowing capacity under the OMART and OFAF facilities is available to us provided that we have sufficient eligible collateral to pledge. At September 30, 2021, none of the available borrowing capacity of the OMART and OFAF advance financing notes could be used based on the amount of eligible collateral. (3) Interest is computed based on the lender’s cost of funds plus a margin of 200 bps. On June 30, 2021, the amortization date was extended by one year to June 30, 2022, the interest rate margin was reduced from 400 bps to 200 bps, and the borrowing capacity was voluntarily reduced to from $250.0 million to $80.0 million. (4) The weighted average rate of the notes at September 30, 2021 is 1.49%, with rates on the individual classes of notes ranging from 1.28% to 5.42%. (5) Interest was computed based on the lender’s cost of funds plus a margin of 300 bps. On June 30, 2021, the amortization date was extended to August 27, 2021. On August 26, 2021, the interest rate was reduced to the lender’s cost of funds plus a margin of 200 bps, the borrowing capacity was voluntarily reduced from $70.0 million to $40.0 million and the amortization date was extended to August 26, 2022. (6) The weighted average interest rate, excluding the effect of the amortization of prepaid lender fees, is computed using the outstanding balance of each respective note and its interest rate at the financial statement date. At September 30, 2021 and December 31, 2020, the balance of unamortized prepaid lender fees was $1.8 million and $4.3 million, respectively, and are included in Other assets in our consolidated balance sheets. |
Schedule of Mortgage Loan Warehouse, MSR Financing Facilities and SSTL | Mortgage Loan Warehouse Facilities Available Borrowing Capacity Outstanding Balance Borrowing Type Collateral Interest Rate (1) Maturity Uncommitted Committed (2) September 30, 2021 December 31, 2020 Master repurchase agreement (3) Loans held for sale (LHFS) 1ML + 220 - 375 bps June 2022 $ 115,000 $ 61,282 $ 98,718 $ 195,773 Master repurchase agreement (4) LHFS (forward and reverse) 1ML + 325 bps forward; 1ML + 350 bps reverse Nov. 2021 50,000 124,385 75,615 80,081 Master repurchase agreement (5) N/A SOFR + 190 bps; SOFR floor 25 bps N/A 50,000 — — — Participation agreement (6) LHFS (6) June 2022 203,609 — 96,391 — Master repurchase agreement (6) LHFS (6) June 2022 — 100,000 — 63,281 Master repurchase agreement (7) LHFS (7) June 2022 — 1,000 — — Mortgage warehouse agreement (8) LHFS 1ML + 350 bps; Floor 5.25% Jan. 2022 — 37,681 12,319 11,715 Mortgage warehouse agreement (9) LHFS (reverse) 1ML + 250 bps; 3.25% floor Oct. 2021 28,929 — 146,071 73,134 Mortgage warehouse agreement (10) LHFS (10) N/A 34,962 — 165,038 27,729 Master repurchase agreement (11) LHFS 1ML + 200 bps N/A — — 465,018 — Loan and security agreement (12) HECM (ABO) Prime Rate + 50 bps; Floor 450 bps Apr. 2022 — 20,000 10,000 — Master repurchase agreement (13) LHFS 1ML + 250 bps Oct. 2021 210,000 — — — Total mortgage loan warehouse facilities 2.77% (14) $ 692,500 $ 344,348 $ 1,069,170 $ 451,713 (1) 1ML was 0.08% and 0.14% at September 30, 2021 and December 31, 2020, respectively. Prime Rate was 3.25% as at September 30, 2021. (2) Of the borrowing capacity on mortgage loan warehouse facilities extended on a committed basis, $3.3 million of the available borrowing capacity could be used at September 30, 2021 based on the amount of eligible collateral that could be pledged. (3) The maximum borrowing under this agreement is $275.0 million, of which $160.0 million is available on a committed basis and the remainder is available at the discretion of the lender. On March 31, 2021, we renewed the facility and the maturity date was extended to June 30, 2022. (4) The maximum borrowing under this agreement is $250.0 million, of which $200.0 million is available on a committed basis and the remainder is available on an uncommitted basis. The agreement allows the lender to acquire a 100% beneficial interest in the underlying mortgage loans. (5) The lender provides financing for up to $50.0 million at the discretion of the lender. The agreement has no stated maturity dat e. Interest on this facility is based on the Secured Overnight Financing Rate (SOFR). (6) On June 23, 2021, the facility was renewed for one year to June 23, 2022, the uncommitted borrowing capacity under the participation agreement was increased to $150.0 million and the committed borrowing capacity under the repurchase agreement increased to $100.0 million. The interest rate on repurchase agreement was revised to the stated interest rate of the mortgage loans, less 35 bps with a floor of 3.00% for new originations and less 10 bps with a floor of 3.25% for Ginnie Mae modifications, Ginnie Mae buyouts and RMBS bond clean up loans. The interest rate on the participation agreement was revised to the stated interest rate of the mortgage loans, less 35 bps with a floor of 3.00% for new originations. The agreements allow the lender to acquire a 100% beneficial interest in the underlying mortgage loans. On July 23, 2021, we temporarily increased the borrowing capacity under the participation agreement to $300.0 million until September 15, 2021. On September 14, 2021, the temporary increase in borrowing capacity was extended to November 15, 2021. (7) On June 20, 2021, the facility was renewed for one year to June 23, 2022. (8) Under this agreement, the lender provides financing for up to $50.0 million on a committed basis. On January 15, 2021, the maturity date of this facility was extended to January 15, 2022. (9) Under this agreement, t he lender provides financing for up to $150.0 million on an uncommitted basis. On February 1, 2021, the borrowing capacity was temporarily increased from $100.0 million to $150.0 million until February 28, 2021 when it was reduced to $100.0 million. On March 30, 2021, the borrowing capacity was temporarily increased to $150.0 million effective April 1, 2021 until April 29, 2021 when the increase was made permanent. On September 27, 2021, the borrowing capacity was increased to $175.0 million until maturity. On October 14, 2021, the maturity date of the facility was extended to November 23, 2021. (10) On May 17, 2021, the total borrowing capacity of this facility, all of which is uncommitted, was increased from $100.0 million to $150.0 million through the addition of a $50.0 million participation interest. The agreement has no stated maturity date, however each transaction has a maximum duration of four years. The cost of this line is set at e ach transaction date and is based on the interest rate and type of the collateral. On September 1, 2021, the total borrowing capacity of the facility was increased to $200.0 million. (11) On March 29, 2021, we entered into a repurchase agreement which provides borrowing at our discretion up to a certain maximum amount of capacity on a rolling 30-day committed basis. This facility is structured as a gestation repurchase facility whereby dry Agency mortgage loans are transferred to a trust which trust issues a trust certificate that is pledged as the collateral for the borrowings. See Note 2 – Securitizations and Variable Interest Entities for additional information. On March 31, 2021, the trust issued the first certificate of $50.0 million which was increased to $75.0 million on May 28, 2021 and further increased to $225.0 million on July 29, 2021. The second trust certificate of $50.0 million was issued on April 12, 2021 and increased to $100.0 million on July 13, 2021. Additional trust certificates of $25.0 million and $100.0 million were issued for borrowing on June 25, 2021 and July 23, 2021, respectively, under this agreement. Each certificate is renewed monthly and we reduced the interest rate to 1ML + 200 bps during the monthly certificate renewals in July 2021. (12) On April 29, 2021, we entered into a revolving facility agreement which provides up to $30.0 million of committed borrowing capacity secured by eligible HECM loans that are active buyouts (ABO), as defined in the agreement. (13) On July 23, 2021, we entered into a repurchase agreement warehouse facility with borrowing capacity of $210.0 million. This facility expired in October 2021. (14) Weighted average interest rate at September 30, 2021, excluding the effect of the amortization of prepaid lender fees. At September 30, 2021 and December 31, 2020, unamortized prepaid lender fees were $0.9 million and $2.0 million, respectively, and are included in Other assets in our consolidated balance sheets. MSR financing facilities, net Available Borrowing Capacity Outstanding Balance Borrowing Type Collateral Interest Rate (1) Maturity Uncommitted Committed (2) September 30, 2021 December 31, 2020 Agency MSR financing facility (3) MSRs, Advances 1ML + 325 bps June 2022 $ — $ 75,702 $ 349,298 $ 210,755 Ginnie Mae MSR financing facility (4) MSRs, Advances 1ML + 450 bps; 1ML floor 0.50% Dec. 2021 6,937 — 118,063 112,022 Ocwen Excess Spread-Collateralized Notes, Series 2019-PLS1 (5) MSRs 5.07% Nov. 2024 — — 48,243 68,313 Secured Notes, Ocwen Asset Servicing Income Series, Series 2014-1 (6) MSRs (6) Feb. 2028 — — 41,362 47,476 Agency MSR financing facility - revolving loan (7) MSRs 1yr Swap + 2.50% June 2026 — 7,929 277,071 — Agency MSR financing facility - term loan (7) MSRs 1yr Swap + 2.50% June 2023 — — 112,779 — Total MSR financing facilities 3.68% (8) 6,937 83,631 946,816 438,566 Unamortized debt issuance costs - PLS Notes and Agency MSR financing - term loan (9) (1,072) (894) Total MSR financing facilities, net $ 945,744 $ 437,672 (1) 1ML was 0.08% and 0.14% at September 30, 2021 and December 31, 2020, respectively. 1-year swap rate was 0.19% and 0.19% at September 30, 2021 and December 31, 2020, respectively. (2) Of the borrowing capacity on MSR financing facilities extended on a committed basis, none of the available borrowing capacity could be used at September 30, 2021 based on the amount of eligible collateral that could be pledged. (3) PMC’s obligations under this facility are secured by a lien on the related MSRs. Ocwen guarantees the obligations of PMC under this facility. The maximum amount which we may borrow pursuant to the repurchase agreements is $425.0 million on a committed basis. We also pledged the membership interest of the depositor for our OMART advance financing facility as additional collateral to this facility. See Note 2 – Securitizations and Variable Interest Entities for additional information. We are subject to daily margining requirements under the terms of our MSR financing facilities. Declines in fair value of our MSRs due to declines in market interest rates, assumption updates or other factors require that we provide additional collateral to our lenders under these facilities. On March 31, 2021, the facility was upsized to $350.0 million, the interest rate reduced to 1ML plus 325bps, and the maturity was renewed to June 30, 2022. These changes became effective on April 15, 2021. On June 2, 2021, the facility was temporarily upsized to $425.0 million for a period of 90 calendar days ending no later than September 1, 2021. On August 26, 2021 and later on October 25, 2021, the temporary upsize was extended until November 1, 2021. (4) PMC’s obligations under this facility are secured by a lien on the related Ginnie Mae MSRs and advances. Ocwen guarantees the obligations of PMC under the facility. The borrowing capacity is $125.0 million on an uncommitted basis. See (3) above regarding daily margining requirements. On October 26, 2021, the borrowing capacity was increased to $150.0 million on an uncommitted basis. (5) PLS Issuer’s obligations under the facility are secured by a lien on the related PLS MSRs. Ocwen guarantees the obligations of PLS Issuer under the facility. The Class A PLS Notes issued pursuant to the credit agreement had an initial principal amount of $100.0 million and amortize in accordance with a pre-determined schedule subject to modification under certain events. See Note 2 – Securitizations and Variable Interest Entities for additional information. See (3) above regarding daily margining requirements. (6) OASIS noteholders are entitled to receive a monthly payment equal to the sum of: (a) 21 basis points of the UPB of the reference pool of Freddie Mac mortgages; (b) any termination payment amounts; (c) any excess refinance amounts; and (d) the note redemption amounts, each as defined in the indenture supplement for the notes. Monthly amortization of the liability is estimated using the proportion of monthly projected service fees on the underlying MSRs as a percentage of lifetime projected fees, adjusted for the term of the notes. (7) On June 28, 2021, we entered into a facility which includes a $135.0 million term loan and a $285.0 million revolving loan secured by a lien on PMC’s Agency MSRs. See (3) above regarding daily margining requirements. (8) Weighted average interest rate at September 30, 2021, excluding the effect of the amortization of debt issuance costs and prepaid lender fees. (9) At September 30, 2021, unamortized debt issuance costs included $0.5 million and $0.6 million on the PLS Notes and the Agency MSR financing facility - term loan, respectively. At September 30, 2021 and December 31, 2020, unamortized prepaid lender fees related to revolving type MSR financing facilities were $5.7 million and $3.3 million, respectively, and are included in Other assets in our consolidated balance sheets. Senior Secured Term Loan, net Outstanding Balance Borrowing Type Collateral Interest Rate Maturity September 30, 2021 December 31, 2020 SSTL (1) (1) 1-Month Euro-dollar rate + 600 bps with a Eurodollar floor of 100 bps (1) May 2022 (1) $ — $ 185,000 Unamortized debt issuance costs — (4,867) Discount — (357) $ — $ 179,776 (1) On March 4, 2021, we repaid in full the $185.0 million outstanding principal balance. The prepayment resulted in our recognition of an $8.4 million loss on debt extinguishment, including a prepayment premium of 2% of the outstanding principal balance, or $3.7 million. |
Schedule of Senior Notes | Senior Notes Interest Rate (1) Maturity Outstanding Balance September 30, 2021 December 31, 2020 PMC Senior Secured Notes 7.875% March 2026 $ 400,000 $ — OFC Senior Secured Notes 12% paid in cash or 13.25% paid-in-kind (see below) March 2027 285,000 — PHH Corporation (PHH) Senior Notes 6.375% August 2021 — 21,543 PMC Senior Secured Notes 8.375% November 2022 — 291,509 Principal balance 685,000 313,052 Discount (2) PMC Senior Secured Notes (1,844) — OFC Senior Secured Notes (3) (55,638) — (57,482) — Unamortized debt issuance costs (2) PMC Senior Secured Notes (5,966) (968) OFC Senior Secured Notes (8,894) — (14,860) (968) Fair value adjustments — (186) $ 612,658 $ 311,898 (1) Excluding the effect of the amortization of debt issuance costs and discount. (2) The discount and debt issuance costs are amortized to interest expense through the maturity of the respective notes. (3) Includes original issue discount (OID) and additional discount related to the concurrent issuance of warrants and common stock. See below for additional information. |
Schedule of Redemption Prices | On or after March 15, 2023, PMC may redeem some or all of the PMC Senior Secured Notes at its option at the following redemption prices, plus accrued and unpaid interest, if any, on the notes redeemed to, but excluding, the redemption date if redeemed during the 12-month period beginning on March 15th of the years indicated below: Redemption Year Redemption Price 2023 103.938 % 2024 101.969 2025 and thereafter 100.000 |
Other Liabilities (Tables)
Other Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Other Liabilities | September 30, 2021 December 31, 2020 Contingent loan repurchase liability $ 450,385 $ 480,221 Due to NRZ - Advance collections, servicing fees and other 92,188 94,691 Other accrued expenses 83,397 87,898 Checks held for escheat 44,780 35,654 Accrued legal fees and settlements 44,629 38,932 Liability for indemnification obligations 44,478 41,920 MSR purchase price holdback 40,976 20,923 Servicing-related obligations 32,686 35,237 Derivatives, at fair value 20,518 4,638 Lease liability 20,311 27,393 Liability for uncertain tax positions 16,119 16,188 Liability for unfunded pension obligation 12,026 12,662 Accrued interest payable 6,534 4,915 Liability for unfunded India gratuity plan 6,103 6,051 Other 17,618 16,652 $ 932,748 $ 923,975 |
Derivative Financial Instrume_2
Derivative Financial Instruments and Hedging Activities (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Activity | The table below summarizes the fair value, notional and maturity of derivative instruments. The notional amount of our contracts does not represent our exposure to credit loss. None of the derivatives were designated as a hedge for accounting purposes as of or during the nine months ended September 30, 2021 and 2020. September 30, 2021 December 31, 2020 Maturities Notional Fair value Maturities Notional Fair value Derivative Assets (Other assets) Forward sales of Reverse loans Oct. 2021 $ 85,000 $ 762 Jan. 2021 $ 30,000 $ 34 Forward loans IRLCs Not.2021 - Dec.2021 1,222,451 13,407 Apr. 2021 619,713 22,224 Reverse loans IRLCs Oct. 2021 80,486 623 Jan. 2021 11,692 482 TBA forward Pipeline trades Oct.2021 - Dec.2021 1,210,000 5,538 N/A — — Interest rate swap futures N/A — — Mar. 2021 593,500 504 Other N/A — — N/A — 2 Total $ 2,597,937 $ 20,329 $ 1,254,905 $ 23,246 Derivative Liabilities (Other liabilities) Forward sales of Reverse loans Oct. 2021 $ 55,000 $ (341) Jan. 2021 $ 20,000 $ (84) TBA forward Pipeline trades Oct.2021 - Dec.2021 245,000 (276) N/A — — TBA forward MBS trades Oct.2021 - Nov.2021 1,210,000 (11,227) Jan. 2021 400,000 (4,554) Interest rate swap futures Oct.2021 - Dec.2021 952,500 (8,236) N/A — — Other N/A — (438) N/A — — Total $ 2,462,500 $ (20,518) $ 420,000 $ (4,638) The table below summarizes the net gains and losses of our derivative instruments recognized in our consolidated statement of operations. Nine Months Ended September 30, 2021 Nine Months Ended September 30, 2020 Gain / (Loss) Gain / (Loss) Amount Financial Statement Line Amount Financial Statement Line Derivative Forward loans IRLCs $ (8,817) Gain on loans held for sale, net $ 16,860 Gain on loans held for sale, net Reverse loans IRLCs 141 Reverse mortgage revenue, net 940 Reverse mortgage revenue, net TBA forward pipeline trades 592 Gain on loans held for sale, net (Economic hedge) — Gain on loans held for sale, net (Economic hedge) Interest rate swap futures and TBA forward MBS trades — Gain on loans held for sale, net (Economic hedge) (9,564) Gain on loans held for sale, net (Economic hedge) Interest rate swap futures and TBA forward MBS trades (3,310) MSR valuation adjustments, net 39,258 MSR valuation adjustments, net Forward sales of Reverse loans 471 Reverse mortgage revenue, net (62) Reverse mortgage revenue, net Other (439) Gain on loans held for sale, net (561) Gain on loans held for sale, net Total $ (11,362) $ 46,871 |
Interest Expense (Tables)
Interest Expense (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Other Income and Expenses [Abstract] | |
Schedule of Components of Interest Expense | Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Senior notes $ 18,483 $ 6,658 $ 44,932 $ 19,977 Mortgage loan warehouse facilities 8,985 3,932 20,673 10,531 MSR financing facilities 8,623 3,919 17,950 12,655 Advance match funded liabilities 2,809 6,565 11,570 19,541 SSTL — 4,395 2,956 15,985 Other 1,723 1,346 4,510 4,868 $ 40,623 $ 26,815 $ 102,591 $ 83,557 |
Basic and Diluted Earnings (L_2
Basic and Diluted Earnings (Loss) per Share (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Reconciliation of Calculation of Basic Loss per Share to Diluted Loss per Share | Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Basic earnings (loss) per share Net income (loss) $ 21,552 $ (9,420) $ 19,773 $ (32,955) Weighted average shares of common stock 9,189,030 8,669,550 8,960,696 8,770,102 Basic earnings (loss) per share $ 2.35 $ (1.09) $ 2.21 $ (3.76) Diluted earnings (loss) per share Net income (loss) $ 21,552 $ (9,420) $ 19,773 $ (32,955) Weighted average shares of common stock 9,189,030 8,669,550 8,960,696 8,770,102 Effect of dilutive elements Common stock warrants 65,593 — 97,426 — Common stock awards 147,235 — 161,049 — Contingent issuance of common stock — — 51,580 — Dilutive weighted average shares of common stock 9,401,858 8,669,550 9,270,751 8,770,102 Diluted earnings (loss) per share $ 2.29 $ (1.09) $ 2.13 $ (3.76) Stock options and common stock awards excluded from the computation of diluted earnings (loss) per share Anti-dilutive (1) 166,153 193,144 155,213 218,020 Market-based (2) 87,509 125,395 87,509 125,395 (1) Includes stock options that are anti-dilutive because their exercise price was greater than the average market price of Ocwen’s stock, and stock awards that are anti-dilutive based on the application of the treasury stock method. (2) Shares that are issuable upon the achievement of certain market-based performance criteria related to Ocwen’s stock price. |
Business Segment Reporting (Tab
Business Segment Reporting (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information | Financial information for our segments is as follows: Three Months Ended September 30, 2021 Results of Operations Servicing Originations Corporate Items and Other Corporate Eliminations (1) Business Segments Consolidated Servicing and subservicing fees $ 205,431 $ 1,155 $ — $ — $ 206,585 Reverse mortgage revenue, net (13,032) 18,067 — — 5,035 Gain on loans held for sale, net (1) 31,555 29,604 — (1,457) 59,702 Other revenue, net 303 9,947 1,529 — 11,779 Revenue 224,257 58,773 1,529 (1,457) 283,101 MSR valuation adjustments, net (1) (10,577) 2,800 — 1,457 (6,320) Operating expenses 80,849 43,498 21,088 — 145,436 Other (expense) income: Interest income 2,416 5,348 105 — 7,869 Interest expense (28,979) (6,711) (4,933) — (40,623) Pledged MSR liability expense (91,120) — (41) — (91,160) Other 1,443 122 1,267 — 2,832 Other expense, net (116,239) (1,241) (3,602) — (121,082) Income (loss) before income taxes $ 16,592 $ 16,833 $ (23,162) $ — $ 10,263 Three Months Ended September 30, 2020 Results of Operations Servicing Originations Corporate Items and Other Corporate Eliminations (1) Business Segments Consolidated Servicing and subservicing fees $ 178,544 $ 3,178 $ — $ — $ 181,722 Reverse mortgage revenue, net (1,116) 15,615 — — 14,499 Gain on loans held for sale, net (1) 6,758 31,295 — 7,833 45,886 Other revenue, net 1,248 4,125 1,555 — 6,928 Revenue 185,434 54,213 1,555 7,833 249,035 MSR valuation adjustments, net (1) (38,351) 12,370 — (7,833) (33,814) Operating expenses 84,639 30,304 34,579 — 149,522 Other (expense) income: Interest income 1,637 1,952 212 — 3,801 Interest expense (22,179) (2,405) (2,231) — (26,815) Pledged MSR liability expense (57,434) — 30 — (57,404) Other 2,178 230 937 — 3,345 Other expense, net (75,798) (223) (1,052) — (77,073) Income (loss) before income taxes $ (13,354) $ 36,056 $ (34,076) $ — $ (11,374) Nine Months Ended September 30, 2021 Results of Operations Servicing Originations Corporate Items and Other Corporate Eliminations (1) Business Segments Consolidated Servicing and subservicing fees $ 556,927 $ 5,837 $ — $ — $ 562,764 Reverse mortgage revenue, net (511) 56,673 — — 56,162 Gain on loans held for sale, net (1) 39,206 94,470 — (25,541) 108,136 Other revenue, net 1,302 23,450 4,326 — 29,078 Revenue 596,924 180,431 4,326 (25,541) 756,140 MSR valuation adjustments, net (1) (103,215) 20,112 — 25,541 (57,562) Operating expenses 247,228 120,514 67,131 — 434,873 Other (expense) income: Interest income 4,905 10,776 312 — 15,993 Interest expense (72,598) (14,963) (15,030) — (102,591) Loss on extinguishment of debt — — (15,458) — (15,458) Pledged MSR liability expense (168,847) — 27 — (168,820) Other 4,787 4 2,045 — 6,836 Other expense, net (231,753) (4,183) (28,104) — (264,040) Income (loss) before income taxes $ 14,728 $ 75,846 $ (90,909) $ — $ (335) Nine Months Ended September 30, 2020 Results of Operations Servicing Originations Corporate Items and Other Corporate Eliminations (1) Business Segments Consolidated Servicing and subservicing fees $ 565,201 $ 3,186 $ 58 $ — $ 568,445 Reverse mortgage revenue, net 12,837 38,218 — — 51,055 Gain on loans held for sale, net (1) 10,768 74,163 — 7,833 92,764 Other revenue, net 3,223 9,234 5,180 — 17,637 Revenue 592,029 124,801 5,238 7,833 729,901 MSR valuation adjustments, net (1) (249,873) 26,338 — (7,833) (231,368) Operating expenses 255,534 78,330 97,681 — 431,545 Other (expense) income: Interest income 6,321 4,733 1,708 — 12,762 Interest expense (69,755) (6,591) (7,211) — (83,557) Pledged MSR liability expense (105,771) — 87 — (105,684) Other 8,300 198 (3,882) — 4,616 Other expense, net (160,905) (1,660) (9,298) — (171,863) Income (loss) before income taxes $ (74,283) $ 71,149 $ (101,741) $ — $ (104,875) (1) Corporate Eliminations for the three and nine months ended September 30, 2021 includes an inter-segment derivatives elimination of $1.5 million and $25.5 million, respectively, with a corresponding offset in MSR valuation adjustments, net; and $7.8 million for the three and nine months ended September 30, 2020. Total Assets Servicing Originations Corporate Items and Other Business Segments Consolidated September 30, 2021 $ 10,790,503 $ 865,011 $ 384,724 $ 12,040,238 December 31, 2020 $ 9,847,603 $ 379,233 $ 424,291 $ 10,651,127 September 30, 2020 $ 9,516,514 $ 437,304 $ 470,033 $ 10,423,851 Depreciation and Amortization Expense Servicing Originations Corporate Items and Other Business Segments Consolidated Three months ended September 30, 2021 Depreciation expense $ 137 $ 77 $ 2,247 $ 2,461 Amortization of debt issuance costs and discount 129 — 2,076 2,205 Three months ended September 30, 2020 Depreciation expense $ 219 $ 31 $ 4,055 $ 4,305 Amortization of debt issuance costs and discount 115 — 1,039 1,154 Nine Months Ended September 30, 2021 Depreciation expense $ 514 $ 125 $ 6,888 $ 7,527 Amortization of debt issuance costs and discount 388 — 5,050 5,438 Nine months ended September 30, 2020 Depreciation expense $ 652 $ 102 $ 14,644 $ 15,398 Amortization of debt issuance costs and discount 343 — 4,992 5,335 |
Commitments (Tables)
Commitments (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Other Commitments [Abstract] | |
Schedule of Activity Related to HMBS Repurchases | Activity with regard to HMBS repurchases, primarily MCA repurchases, are as follows: Nine Months Ended September 30, 2021 Active Inactive Total Number Amount Number Amount Number Amount Beginning balance 141 $ 29,852 317 $ 56,449 458 $ 86,301 Additions 217 57,684 203 41,956 420 99,640 Recoveries, net (1) (221) (50,748) (130) (18,244) (351) (68,992) Transfers (18) (6,261) 18 6,261 — — Changes in value — 9 — (2,494) — (2,485) Ending balance 119 $ 30,536 408 $ 83,928 527 $ 114,464 (1) Includes amounts received upon assignment of loan to HUD, loan payoff, REO liquidation and claim proceeds less any amounts charged off as unrecoverable. |
Contingencies (Tables)
Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Loss Contingency [Abstract] | |
Schedule of Indemnification Obligations | The following table presents the changes in our liability for representation and warranty obligations and similar indemnification obligations: Nine Months Ended September 30, 2021 2020 Beginning balance (1) $ 40,374 $ 50,838 Provision (reversal) for representation and warranty obligations 1,483 (1,141) New production liability 3,227 1,361 Charge-offs and other (2) (2,530) (8,130) Ending balance (1) $ 42,554 $ 42,928 (1) The liability for representation and warranty obligations and compensatory fees for foreclosures is reported in Other liabilities (a component of Liability for indemnification obligations) on our unaudited consolidated balance sheets. (2) Includes principal and interest losses realized in connection with repurchased loans, make-whole, indemnification and fee payments and settlements net of recoveries, if any. |
Organization and Basis of Pre_3
Organization and Basis of Presentation - Narrative (Details) | Aug. 13, 2020 | Sep. 30, 2021Employee | May 03, 2021 |
Description of Business and Basis of Presentation [Line Items] | |||
Ownership percentage | 15.00% | 4.90% | |
Total number of employees | 5,200 | ||
Reverse stock split ratio | 0.07 | ||
MAV Canopy HoldCo I, LLC | |||
Description of Business and Basis of Presentation [Line Items] | |||
Ownership percentage | 15.00% | ||
INDIA | |||
Description of Business and Basis of Presentation [Line Items] | |||
Total number of employees | 3,200 | ||
PHILIPPINES | |||
Description of Business and Basis of Presentation [Line Items] | |||
Total number of employees | 400 | ||
Minimum | |||
Description of Business and Basis of Presentation [Line Items] | |||
Percentage of foreign based employees engaged in supporting loan servicing operations | 67.00% |
Securitizations and Variable _3
Securitizations and Variable Interest Entities - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | |||||
Average period to securitization | 30 days | ||||
MSRs retained | $ 66,420 | $ 22,096 | $ 136,482 | $ 37,785 | |
Percentage of loan transferred through securitization 60 days or more past due | 4.30% | 6.80% | |||
Ginnie Mae Loans | |||||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | |||||
Percentage of loan transferred through securitization 60 days or more past due | 13.10% | 17.10% |
Securitizations and Variable _4
Securitizations and Variable Interest Entities - Schedule of Cash Flows Related to Transfers Accounted for as Sales (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Transfers and Servicing [Abstract] | ||||
Proceeds received from securitizations | $ 5,823,765 | $ 2,364,829 | $ 12,220,596 | $ 4,256,082 |
Servicing fees collected | 16,440 | 12,561 | 43,968 | 35,204 |
Purchases of previously transferred assets, net of claims reimbursed | (6,065) | (2,061) | (16,085) | (6,338) |
Cash flows between transferor and transferee proceeds and payment related to transfers accounted for sales | $ 5,834,140 | $ 2,375,329 | $ 12,248,479 | $ 4,284,948 |
Securitizations and Variable _5
Securitizations and Variable Interest Entities - Schedule of Assets That Relate to Continuing Involvement with Transferred Financial Assets with Servicing Rights and Maximum Exposure to Loss Including the Unpaid Principal Balance (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||
UPB of loans transferred | $ 26,724,676 | $ 18,062,856 |
Maximum exposure to loss | 27,139,831 | 18,343,246 |
GinnieMae | ||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||
UPB of loans transferred | 5,300,000 | 4,100,000 |
Mortgage Servicing Rights - Fair Value | ||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||
Carrying value of assets | 281,161 | 137,029 |
Advances and Match Funded Advances | ||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||
Carrying value of assets | $ 133,994 | $ 143,361 |
Securitizations and Variable _6
Securitizations and Variable Interest Entities - Schedule of Carrying Value of Assets and Liabilities of Loans Held for Sale Financing Facility (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2019 |
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||||||
Loans held for sale, at fair value | $ 921,621 | $ 680,866 | $ 366,364 | $ 366,966 | $ 253,037 | $ 208,752 |
Outstanding borrowings (Mortgage loan warehouse facilities) | 7,493,475 | 7,349,433 | ||||
Secured Debt | ||||||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||||||
Outstanding borrowings (Mortgage loan warehouse facilities) | 946,816 | 438,566 | ||||
Master Repurchase Agreement | Secured Debt | ||||||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||||||
Outstanding borrowings (Mortgage loan warehouse facilities) | 465,018 | 0 | ||||
Variable Interest Entity, Primary Beneficiary | ||||||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||||||
Loans held for sale, at fair value | $ 461,827 | $ 0 |
Securitizations and Variable _7
Securitizations and Variable Interest Entities - Schedule Of Carrying Value and Classification of Assets and Liabilities of Advance Financing Facilities (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 |
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | |||
Debt service accounts | $ 13,271 | $ 14,873 | |
Unamortized debt issuance costs (Other secured borrowings, net) | 8,338 | $ 9,556 | |
Advance match funded liabilities (related to VIEs) | 516,572 | 581,288 | |
Variable Interest Entity, Primary Beneficiary | Advance Match Funded Liabilities | |||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | |||
Match funded advances (Advances, net) | 594,645 | 651,576 | |
Debt service accounts | 7,241 | 14,195 | |
Unamortized debt issuance costs (Other secured borrowings, net) | 1,783 | 4,253 | |
Prepaid Interest | 205 | 291 | |
Advance match funded liabilities (related to VIEs) | $ 516,572 | $ 581,288 |
Securitizations and Variable _8
Securitizations and Variable Interest Entities - Schedule Of Carrying Value and Classification of Assets and Liabilities of Agency MSR Financing Facility (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 |
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | |||
MSRs pledged (MSRs, at fair value) | $ 2,176,260 | $ 1,294,817 | |
Unamortized debt issuance costs (Other secured borrowings, net) | 8,338 | 9,556 | |
Debt service accounts | 13,271 | $ 14,873 | |
Variable Interest Entity, Primary Beneficiary | Secured Debt | Agency Mortgage Servicing Rights Financing Facility | |||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | |||
MSRs pledged (MSRs, at fair value) | 649,202 | 476,371 | |
Unamortized debt issuance costs (Other secured borrowings, net) | 2,290 | 1,183 | |
Debt service accounts | 104 | 211 | |
Outstanding borrowings (MSR financing facilities, net) | $ 349,298 | $ 210,755 |
Securitizations and Variable _9
Securitizations and Variable Interest Entities - Carrying Value and Classification of Assets And Liabilities of PLS Notes Facility (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 |
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | |||
MSRs pledged (MSRs, at fair value) | $ 2,176,260 | $ 1,294,817 | |
Debt service accounts | 13,271 | $ 14,873 | |
Unamortized debt issuance costs (Other secured borrowings, net) | 8,338 | 9,556 | |
Secured Debt | |||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | |||
Outstanding borrowings (Other secured borrowings, net) | 945,744 | 437,672 | |
Ocwen Excess Spread-Collateralized Notes, Series 2019-PLS1 Class A | Secured Debt | |||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | |||
Outstanding borrowings (Other secured borrowings, net) | 48,243 | 68,313 | |
Variable Interest Entity, Primary Beneficiary | Ocwen Excess Spread-Collateralized Notes, Series 2019-PLS1 Class A | Secured Debt | |||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | |||
MSRs pledged (MSRs, at fair value) | 103,082 | 129,204 | |
Debt service accounts | 2,071 | 2,385 | |
Outstanding borrowings (Other secured borrowings, net) | 48,243 | 68,313 | |
Unamortized debt issuance costs (Other secured borrowings, net) | $ 506 | $ 894 |
Fair Value - Schedule of Fair V
Fair Value - Schedule of Fair Value Assets and Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2019 |
Loans held for sale | ||||||
Loans held for sale, at fair value | $ 921,621 | $ 680,866 | $ 366,364 | $ 366,966 | $ 253,037 | $ 208,752 |
Investment in equity method investee | 19,794 | 0 | ||||
Financial liabilities: | ||||||
Advance match funded liabilities | 516,572 | 581,288 | ||||
HMBS-related borrowings | 6,782,564 | 6,823,911 | 6,772,711 | 6,606,543 | 6,477,616 | 6,063,435 |
Financing liabilities: | ||||||
Other financing liabilities, at fair value | 710,911 | 576,722 | ||||
Other secured borrowings: | ||||||
Mortgage loan warehouse facilities | 1,069,170 | 451,713 | ||||
MSR financing facilities, net | 945,744 | 437,672 | ||||
Senior Notes [Abstract] | ||||||
Senior notes, net | 612,658 | 311,898 | ||||
Derivative financial instruments assets (liabilities): | ||||||
Derivative liabilities | (20,518) | (4,638) | ||||
Derivative liability, fair value | 20,518 | 4,638 | ||||
Mortgage servicing rights | ||||||
Mortgage servicing rights, at fair value | 2,176,260 | $ 2,072,518 | 1,294,817 | $ 1,069,013 | $ 1,044,914 | $ 1,486,395 |
Carrying Value | ||||||
Loans held for sale | ||||||
Total Loans held for sale | 933,700 | 387,836 | ||||
Loans held for investment | 7,108,730 | 7,006,897 | ||||
Senior Notes [Abstract] | ||||||
Senior notes, net | 612,658 | 311,898 | ||||
Fair Value | ||||||
Loans held for sale | ||||||
Total Loans held for sale | 933,700 | 387,836 | ||||
Loans held for investment | 7,108,730 | 7,006,897 | ||||
Senior Notes [Abstract] | ||||||
Senior notes, net | 662,295 | 320,879 | ||||
Level 2 | Carrying Value | ||||||
Loans held for sale | ||||||
Loans held for sale, at fair value | 921,621 | 366,364 | ||||
Corporate bonds | 211 | 211 | ||||
Other secured borrowings: | ||||||
Senior secured term loan | 0 | 179,776 | ||||
Senior Notes [Abstract] | ||||||
Senior secured notes | 392,190 | 311,898 | ||||
Level 2 | Fair Value | ||||||
Loans held for sale | ||||||
Loans held for sale, at fair value | 921,621 | 366,364 | ||||
Corporate bonds | 211 | 211 | ||||
Other secured borrowings: | ||||||
Senior secured term loan | 0 | 184,639 | ||||
Senior Notes [Abstract] | ||||||
Senior secured notes | 403,490 | 320,879 | ||||
Level 3 | Carrying Value | ||||||
Loans held for sale | ||||||
Loans held for sale, at lower of cost or fair value | 12,079 | 21,472 | ||||
Loans held for investment | 7,100,726 | 6,997,127 | ||||
Advances (including match funded) | 739,596 | 828,239 | ||||
Receivables, net | 183,090 | 187,665 | ||||
Mortgage-backed securities, at fair value | 1,618 | 2,019 | ||||
Investment in equity method investee | 0 | |||||
Financial liabilities: | ||||||
Advance match funded liabilities | 516,572 | 581,288 | ||||
HMBS-related borrowings | 6,782,564 | 6,772,711 | ||||
Other secured borrowings: | ||||||
Mortgage loan warehouse facilities | 1,069,170 | 451,713 | ||||
MSR financing facilities, net | 945,744 | 437,672 | ||||
Derivative financial instruments assets (liabilities): | ||||||
Interest rate lock commitments | 14,030 | 22,706 | ||||
Mortgage servicing rights | ||||||
Mortgage servicing rights, at fair value | 2,176,260 | 1,294,817 | ||||
Level 3 | Carrying Value | Second Lien | ||||||
Senior Notes [Abstract] | ||||||
Senior secured notes | 220,468 | 0 | ||||
Level 3 | Fair Value | ||||||
Loans held for sale | ||||||
Loans held for sale, at lower of cost or fair value | 12,079 | 21,472 | ||||
Loans held for investment | 7,100,726 | 6,997,127 | ||||
Advances (including match funded) | 739,596 | 828,239 | ||||
Receivables, net | 183,090 | 187,665 | ||||
Mortgage-backed securities, at fair value | 1,618 | 2,019 | ||||
Investment in equity method investee | 0 | |||||
Financial liabilities: | ||||||
Advance match funded liabilities | 515,405 | 581,997 | ||||
HMBS-related borrowings | 6,782,564 | 6,772,711 | ||||
Other secured borrowings: | ||||||
Mortgage loan warehouse facilities | 1,069,170 | 451,713 | ||||
MSR financing facilities, net | 918,217 | 406,860 | ||||
Derivative financial instruments assets (liabilities): | ||||||
Interest rate lock commitments | 14,030 | 22,706 | ||||
Mortgage servicing rights | ||||||
Mortgage servicing rights, at fair value | 2,176,260 | 1,294,817 | ||||
Level 3 | Fair Value | Second Lien | ||||||
Senior Notes [Abstract] | ||||||
Senior secured notes | 258,805 | 0 | ||||
Loans Held for Investment Securitization Trusts | Level 3 | Carrying Value | ||||||
Loans held for sale | ||||||
Loans held for investment | 8,004 | 9,770 | ||||
Loans Held for Investment Securitization Trusts | Level 3 | Fair Value | ||||||
Loans held for sale | ||||||
Loans held for investment | 8,004 | 9,770 | ||||
Forward LHFS Trades | Level 2 | Carrying Value | ||||||
Derivative financial instruments assets (liabilities): | ||||||
Derivative asset | 421 | |||||
Derivative liabilities | 50 | |||||
Forward LHFS Trades | Level 2 | Fair Value | ||||||
Derivative financial instruments assets (liabilities): | ||||||
Derivative asset | 421 | |||||
Derivative liabilities | 50 | |||||
TBA forward MBS trades | ||||||
Derivative financial instruments assets (liabilities): | ||||||
Derivative liability, fair value | 11,227 | 4,554 | ||||
TBA forward MBS trades | Level 1 | Carrying Value | ||||||
Derivative financial instruments assets (liabilities): | ||||||
Derivative liabilities | (11,227) | (4,554) | ||||
TBA forward MBS trades | Level 1 | Fair Value | ||||||
Derivative financial instruments assets (liabilities): | ||||||
Derivative liabilities | (11,227) | (4,554) | ||||
Interest Rate Swap | ||||||
Derivative financial instruments assets (liabilities): | ||||||
Derivative liability, fair value | 8,236 | 0 | ||||
Interest Rate Swap | Level 1 | Carrying Value | ||||||
Derivative financial instruments assets (liabilities): | ||||||
Derivative asset | 504 | |||||
Derivative liabilities | (8,236) | |||||
Interest Rate Swap | Level 1 | Fair Value | ||||||
Derivative financial instruments assets (liabilities): | ||||||
Derivative asset | 504 | |||||
Derivative liabilities | (8,236) | |||||
TBA Forward Pipelines Trades | ||||||
Derivative financial instruments assets (liabilities): | ||||||
Derivative asset | 0 | |||||
Derivative liability, fair value | 276 | |||||
TBA Forward Pipelines Trades | Level 1 | Fair Value | ||||||
Derivative financial instruments assets (liabilities): | ||||||
Derivative asset | 5,262 | |||||
Other | ||||||
Derivative financial instruments assets (liabilities): | ||||||
Derivative liability, fair value | 438 | 0 | ||||
Other | Level 3 | Carrying Value | ||||||
Derivative financial instruments assets (liabilities): | ||||||
Other | (438) | 0 | ||||
Other | Level 3 | Fair Value | ||||||
Derivative financial instruments assets (liabilities): | ||||||
Other | 0 | |||||
Financing Liability - MSRs Pledged | ||||||
Financing liabilities: | ||||||
Other financing liabilities, at fair value | 702,907 | 566,952 | ||||
Financing Liability - MSRs Pledged | Level 3 | Carrying Value | ||||||
Financing liabilities: | ||||||
Other financing liabilities, at fair value | 702,907 | 566,952 | ||||
Financing Liability - MSRs Pledged | Level 3 | Fair Value | ||||||
Financing liabilities: | ||||||
Other financing liabilities, at fair value | 702,907 | 566,952 | ||||
Financing Liability Owed to Securitization Investors | Level 3 | Carrying Value | ||||||
Financing liabilities: | ||||||
Other financing liabilities, at fair value | 8,004 | 9,770 | ||||
Financing Liability Owed to Securitization Investors | Level 3 | Fair Value | ||||||
Financing liabilities: | ||||||
Other financing liabilities, at fair value | $ 8,004 | $ 9,770 |
Fair Value - Schedule of Fair_2
Fair Value - Schedule of Fair Value Assets and Liabilities (Footnote) (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Jun. 30, 2021 | May 03, 2021 | Mar. 04, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2019 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Senior notes, net | $ 612,658 | $ 311,898 | ||||||
7.875% Senior Notes, Due 2026 | Secured Debt | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Senior notes, net | 400,000 | $ 400,000 | 0 | |||||
12% Paid in Cash or 13.25% Paid in Kind Senior Notes, Due 2027 | Secured Debt | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Senior notes, net | 285,000 | $ 85,500 | $ 199,500 | 0 | ||||
Level 3 | Loans Held for Sale - Fair Value | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Loans related to Ginnie Mae guaranteed securitizations | 210,752 | $ 138,842 | 51,072 | $ 26,409 | $ 25,950 | $ 0 | ||
Ginnie Mae Loans | Level 3 | Loans Held for Sale - Fair Value | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Loans related to Ginnie Mae guaranteed securitizations | $ 210,800 | $ 51,100 |
Fair Value - Schedule of Reconc
Fair Value - Schedule of Reconciliation of Changes in Fair Value of Level 3 Assets and Liabilities (Details) - Level 3 - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Loans Held for Inv. - Restricted for Securitization Investors | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning balance | $ 8,680 | $ 11,664 | $ 9,770 | $ 23,342 |
Purchases, issuances, sales and settlements | ||||
Deconsolidation of mortgage-backed securitization trusts | (10,715) | |||
Settlements | (676) | (652) | (1,766) | (1,615) |
Purchases, issuances, sales and settlements, total | (676) | (652) | (1,766) | (12,330) |
Total realized and unrealized gains and (losses): | ||||
Change in fair value | 0 | 0 | ||
Transfers in and / or out of Level 3 | 0 | |||
Ending balance | 8,004 | 11,012 | 8,004 | 11,012 |
Financing Liability Owed to Securitization Investors | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning balance | (8,680) | (11,664) | (9,770) | (22,002) |
Purchases, issuances, sales and settlements | ||||
Deconsolidation of mortgage-backed securitization trusts | 9,519 | |||
Settlements | 676 | 652 | 1,766 | 1,615 |
Purchases, issuances, sales and settlements, total | 676 | 652 | 1,766 | 11,134 |
Total realized and unrealized gains and (losses): | ||||
Change in fair value | 0 | (144) | ||
Transfers in and / or out of Level 3 | 0 | |||
Ending balance | (8,004) | (11,012) | (8,004) | (11,012) |
Loans Held for Sale - Fair Value | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning balance | 138,842 | 25,950 | 51,072 | 0 |
Purchases, issuances, sales and settlements | ||||
Purchases | 136,996 | 45,445 | 303,117 | 103,955 |
Issuances | 0 | |||
Sales | (64,032) | (45,723) | (135,088) | (104,273) |
Settlements | 0 | 356 | (70) | |
Loans held for sale, at fair value | 0 | |||
Other assets | (377) | |||
Receivables, net | (558) | (157) | (1,113) | (113) |
Purchases, issuances, sales and settlements, total | 72,406 | 235 | 166,539 | (501) |
Total realized and unrealized gains and (losses): | ||||
Change in fair value | (496) | 224 | (6,859) | 1,328 |
Transfers in and / or out of Level 3 | 0 | 25,582 | ||
Ending balance | 210,752 | 26,409 | 210,752 | 26,409 |
Mortgage-Backed Securities | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning balance | 1,607 | 1,726 | 2,019 | 2,075 |
Purchases, issuances, sales and settlements | ||||
Purchases, issuances, sales and settlements, total | 0 | 0 | 0 | 0 |
Total realized and unrealized gains and (losses): | ||||
Change in fair value | 11 | 424 | (401) | 75 |
Transfers in and / or out of Level 3 | 0 | |||
Ending balance | 1,618 | 2,150 | 1,618 | 2,150 |
IRLCs | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning balance | 17,437 | 17,818 | 22,706 | 0 |
Purchases, issuances, sales and settlements | ||||
Purchases | 0 | |||
Issuances | 184,995 | 87,311 | 446,751 | 144,931 |
Sales | 0 | |||
Settlements | 0 | (77,785) | 0 | |
Loans held for sale, at fair value | (182,783) | (425,169) | ||
Receivables, net | 0 | |||
Purchases, issuances, sales and settlements, total | 2,212 | 9,526 | 21,582 | 16,707 |
Total realized and unrealized gains and (losses): | ||||
Change in fair value | (5,619) | (4,665) | (30,258) | (4,506) |
Transfers in and / or out of Level 3 | 0 | 10,478 | ||
Ending balance | $ 14,030 | $ 22,679 | $ 14,030 | $ 22,679 |
Fair Value - Schedule of Signif
Fair Value - Schedule of Significant Assumptions used in Valuation (Details) | Sep. 30, 2021yearsUSD ($) | Dec. 31, 2020USD ($)years |
Loans Held for Investment Reverse Mortgages | Measurement Input, Expected Term | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 5.6 | 5.9 |
Loans Held for Investment Reverse Mortgages | Measurement Input, Prepayment Rate | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 0.162 | 0.154 |
Loans Held for Investment Reverse Mortgages | Measurement Input, Discount Rate | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 0.025 | 0.019 |
Loans Held for Investment Reverse Mortgages | Minimum | Measurement Input, Expected Term | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 1.1 | 0.9 |
Loans Held for Investment Reverse Mortgages | Minimum | Measurement Input, Prepayment Rate | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 0.110 | 0.106 |
Loans Held for Investment Reverse Mortgages | Maximum | Measurement Input, Expected Term | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 8 | 8 |
Loans Held for Investment Reverse Mortgages | Maximum | Measurement Input, Prepayment Rate | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 0.355 | 0.288 |
Fair Value Agency Mortgage Servicing Rights | Measurement Input, Prepayment Rate | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 0.090 | 0.118 |
Fair Value Agency Mortgage Servicing Rights | Measurement Input, Default Rate | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 0.014 | 0.030 |
Fair Value Agency Mortgage Servicing Rights | Measurement Input, Discount Rate | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 0.086 | 0.092 |
Fair Value Agency Mortgage Servicing Rights | Measurement Input, Weighted Average Cost to Service | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | $ | 72 | 79 |
Fair Value Non-Agency Mortgage Servicing Rights | Measurement Input, Prepayment Rate | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 0.120 | 0.115 |
Fair Value Non-Agency Mortgage Servicing Rights | Measurement Input, Default Rate | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 0.128 | 0.280 |
Fair Value Non-Agency Mortgage Servicing Rights | Measurement Input, Discount Rate | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 0.112 | 0.114 |
Fair Value Non-Agency Mortgage Servicing Rights | Measurement Input, Weighted Average Cost to Service | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | $ | 209 | 270 |
HMBS-Related Borrowings | Measurement Input, Expected Term | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 5.6 | 5.9 |
HMBS-Related Borrowings | Measurement Input, Prepayment Rate | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 0.162 | 0.154 |
HMBS-Related Borrowings | Measurement Input, Discount Rate | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 0.023 | 0.017 |
HMBS-Related Borrowings | Minimum | Measurement Input, Expected Term | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 1.1 | 0.9 |
HMBS-Related Borrowings | Minimum | Measurement Input, Prepayment Rate | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 0.110 | 0.106 |
HMBS-Related Borrowings | Maximum | Measurement Input, Expected Term | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 8 | 8 |
HMBS-Related Borrowings | Maximum | Measurement Input, Prepayment Rate | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 0.355 | 0.288 |
Mortgage Servicing Rights Pledged | Measurement Input, Prepayment Rate | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 0.112 | 0.115 |
Mortgage Servicing Rights Pledged | Measurement Input, Default Rate | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 0.112 | 0.298 |
Mortgage Servicing Rights Pledged | Measurement Input, Discount Rate | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | 0.107 | 0.114 |
Mortgage Servicing Rights Pledged | Measurement Input, Weighted Average Cost to Service | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement input | $ | 199 | 287 |
Fair Value - Schedule of Estima
Fair Value - Schedule of Estimated Change in Fair Value of MSRs (Details) $ in Thousands | Sep. 30, 2021USD ($) |
Transfers and Servicing [Abstract] | |
Weighted average prepayment speeds, 10% | $ (65,965) |
Weighted average prepayment speeds, 20% | (128,151) |
Weighted average discount rate, 10% | (53,571) |
Weighted average discount rate, 20% | $ (103,573) |
Loans Held for Sale - Schedule
Loans Held for Sale - Schedule of Loans Held for Sale Fair Value (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Movement In Loans Held For Sale At Fair Value [Roll Forward] | ||||
Beginning balance | $ 680,866 | $ 253,037 | $ 366,364 | $ 208,752 |
Originations and purchases | 6,366,795 | 2,429,977 | 12,987,522 | 4,378,999 |
Proceeds from sales | (6,098,495) | (2,317,579) | (12,362,149) | (4,190,355) |
Principal collections | (22,334) | (5,721) | (39,037) | (21,479) |
Loans held for investment, at fair value | 1,220 | 781 | 2,898 | 1,900 |
Receivables, net | (7,625) | (14,723) | (25,151) | (62,949) |
REO (Other assets) | (1,767) | (1,713) | (5,312) | (2,554) |
Gain (loss) on sale of loans | 1,793 | 17,509 | (13,006) | 45,762 |
Increase (decrease) in fair value of loans | (5,336) | 4,220 | (6,025) | 1,925 |
Other | 6,504 | 1,178 | 15,517 | 6,965 |
Ending balance | $ 921,621 | $ 366,966 | $ 921,621 | $ 366,966 |
Loans Held for Sale - Schedul_2
Loans Held for Sale - Schedule of Loans Held for Sale Fair Value (Footnote) (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Receivables [Abstract] | ||
Increase (decrease) in fair value of loans held for sale | $ (9.3) | $ (5.8) |
Loans Held for Sale - Schedul_3
Loans Held for Sale - Schedule of Loans Held for Sale at Lower Cost or Fair Value, Activity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Movement In Loans Held For Sale At Fair Value [Roll Forward] | ||||
Beginning balance - before Valuation Allowance | $ 20,278 | $ 31,880 | $ 27,652 | $ 73,160 |
Proceeds from sales | (2,916) | 891 | (9,583) | (45,974) |
Principal collections | (415) | (514) | (629) | (1,319) |
Receivables, net | (444) | 0 | (936) | 61 |
Gain (loss) on sale of loans | 35 | (1,141) | 549 | 474 |
Other | 123 | (1,220) | (392) | 3,494 |
Ending balance - before Valuation Allowance | 16,661 | 29,896 | 16,661 | 29,896 |
Ending balance, net | $ 12,079 | $ 23,665 | $ 12,079 | $ 23,665 |
Loans Held for Sale - Schedul_4
Loans Held for Sale - Schedule of Changes in Valuation Allowance (Details) - Valuation Allowance for Loans Held for Sale - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Beginning balance - Valuation Allowance | $ (5,124) | $ (6,400) | $ (6,180) | $ (6,643) |
Provision | 602 | 45 | 1,582 | (1,084) |
Transfer to (from) Liability for indemnification obligations (Other liabilities) | (60) | (42) | 16 | (117) |
Sales of loans | 0 | 166 | 0 | 1,613 |
Ending balance - Valuation Allowance | $ (4,582) | $ (6,231) | $ (4,582) | $ (6,231) |
Loans Held for Sale - Schedul_5
Loans Held for Sale - Schedule of Gains on Loans Held for Sale, Net (Details) - USD ($) $ in Thousands | Jul. 31, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
MSRs retained on transfers of forward mortgage loans | $ 66,420 | $ 22,096 | $ 136,482 | $ 37,785 | |
Gain on sales of loans, net | 67,781 | 38,656 | 123,319 | 84,022 | |
Change in fair value of IRLCs | (4,135) | 4,828 | (9,225) | 16,876 | |
Change in fair value of loans held for sale | (3,491) | 3,061 | (3,323) | 3,367 | |
Loss on economic hedge instruments | 780 | 179 | 592 | (10,141) | |
Other | (1,233) | (838) | (3,227) | (1,360) | |
Gain on loans held for sale, net | 59,702 | 45,886 | 108,136 | 92,764 | |
Intersegment Eliminations | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Gain on loans held for sale, net | (1,457) | 7,833 | (25,541) | 7,833 | |
Gains on derivatives | (1,500) | (25,500) | 7,800 | ||
Gain (loss) on Sale of Forward Mortgage Loans | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Gain on sales of loans, net | $ 22,500 | (2,601) | 11,897 | (25,440) | 35,201 |
Repurchased Ginnie Mae Loans | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Gain on sales of loans, net | $ 3,962 | $ 4,663 | $ 12,277 | $ 11,036 |
Reverse Mortgages - Schedule of
Reverse Mortgages - Schedule of Loans Held For Investment and HMBS Related Borrowings (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Receivables [Abstract] | ||||
Loans held for investment - reverse mortgages, beginning balance | $ 7,112,273 | $ 6,718,992 | $ 6,997,127 | $ 6,269,596 |
Cumulative effect of fair value election | 0 | 47,038 | ||
Originations | 494,330 | 299,628 | 1,214,772 | 867,702 |
Repayments (principal payments received) | (449,236) | (249,372) | (1,170,245) | (619,486) |
Loans held for sale, at fair value | (1,220) | (781) | (2,898) | (1,900) |
Receivables, net | (84) | 105 | (169) | (181) |
REO (Other assets) | (121) | (38) | (316) | (403) |
Change in fair value | (55,216) | 81,396 | 62,455 | 287,564 |
Securitized loans (pledged to HMBS-Related Borrowings) | 6,874,025 | 6,715,093 | 6,874,025 | 6,715,093 |
Un-securitized loans | 226,701 | 134,837 | 226,701 | 134,837 |
Loans held for investment, reverse mortgages, ending balance | 7,100,726 | 6,849,930 | 7,100,726 | 6,849,930 |
Home Equity Conversion Mortgage-Backed Securities Related Borrowings At Fair Value | (6,823,911) | (6,477,616) | (6,772,711) | (6,063,435) |
Securitization of HECM loans accounted for as a financing | (452,262) | (295,347) | (1,119,742) | (885,987) |
Additional proceeds from securitization of HECM loans and tails | (7,751) | (12,407) | (34,918) | (28,572) |
Repayments (principal payments received) | 446,277 | 247,793 | 1,161,609 | 613,026 |
Change in fair value | 55,083 | (68,966) | (16,802) | (241,575) |
Home Equity Conversion Mortgage-Backed Securities Related Borrowings At Fair Value | (6,782,564) | (6,606,543) | (6,782,564) | (6,606,543) |
Securitized loans (pledged to HMBS-Related Borrowings) | $ (6,782,564) | $ (6,606,543) | $ (6,782,564) | $ (6,606,543) |
Reverse Mortgages - Schedule _2
Reverse Mortgages - Schedule of Reverse Mortgage Revenue, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Receivables [Abstract] | ||||
Gain on new originations | $ 12,900 | $ 13,545 | $ 46,170 | $ 33,156 |
Change in fair value of securitized loans held for investment and HMBS-related borrowings, net | (13,033) | (1,115) | (517) | 12,833 |
Change in fair value included in earnings, net | (133) | 12,430 | 45,653 | 45,989 |
Loan fees and other | 5,168 | 2,069 | 10,509 | 5,066 |
Reverse mortgage revenue, net | $ 5,035 | $ 14,499 | $ 56,162 | $ 51,055 |
Advances - Schedule of Advances
Advances - Schedule of Advances Paid on Behalf of Borrowers or on Foreclosed Properties (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2019 |
Advances On Behalf of Borrowers [Line Items] | ||||||
Advances, gross | $ 746,273 | $ 834,512 | ||||
Allowance for losses | (6,677) | $ (6,891) | (6,273) | $ (6,078) | $ (7,820) | $ (9,925) |
Advances, net | 739,596 | 828,239 | ||||
Principal and Interest | ||||||
Advances On Behalf of Borrowers [Line Items] | ||||||
Advances, gross | 238,071 | 277,132 | ||||
Taxes and Insurance | ||||||
Advances On Behalf of Borrowers [Line Items] | ||||||
Advances, gross | 331,013 | 364,593 | ||||
Foreclosures, Bankruptcy, REO and Other | ||||||
Advances On Behalf of Borrowers [Line Items] | ||||||
Advances, gross | $ 177,189 | $ 192,787 |
Advances - Schedule of Activity
Advances - Schedule of Activity in Advances (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Advances [Roll Forward] | ||||
Beginning balance - before Allowance for Losses | $ 768,864 | $ 908,829 | $ 834,512 | $ 1,066,448 |
Acquisition of advances in connection with the purchase of MSRs | 0 | 14 | 4,495 | 14 |
New advances | 181,567 | 198,549 | 565,284 | 667,577 |
Sales of advances | (80) | (150) | (328) | (604) |
Collections of advances and other | (204,078) | (268,560) | (657,690) | (894,753) |
Ending balance - before Allowance for Losses | 746,273 | 838,682 | 746,273 | 838,682 |
Ending balance, net | $ 739,596 | $ 832,604 | $ 739,596 | $ 832,604 |
Advances - Schedule of Changes
Advances - Schedule of Changes in Allowance for Losses (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Financing Receivable, Allowance for Credit Loss [Line Items] | ||||
Beginning balance - Allowance for Losses | $ (6,891) | $ (7,820) | $ (6,273) | $ (9,925) |
Provision | (1,581) | (2,173) | (5,478) | (5,944) |
Net charge-offs and other | 1,795 | 3,915 | 5,074 | 9,791 |
Ending balance - Allowance for Losses | $ (6,677) | $ (6,078) | $ (6,677) | $ (6,078) |
Mortgage Servicing - Schedule o
Mortgage Servicing - Schedule of Activity Related to MSRs - Fair Value Measurement Method (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Servicing Asset at Fair Value, Amount [Roll Forward] | ||||
Beginning balance | $ 2,072,518 | $ 1,044,914 | $ 1,294,817 | $ 1,486,395 |
Sales and other transfers | 0 | (1) | 0 | (108) |
Recognized on the sale of residential mortgage loans | 66,420 | 22,096 | 136,482 | 37,785 |
Purchase of MSRs | 36,153 | 32,249 | 806,469 | 78,994 |
Servicing transfers and adjustments | (4,706) | 16 | (6,840) | (263,427) |
Changes in fair value: | ||||
Changes in valuation inputs or assumptions | 74,819 | 8,765 | 120,438 | (142,707) |
Realization of expected cash flows | (68,944) | (39,026) | (175,106) | (127,919) |
Ending balance | 2,176,260 | 1,069,013 | 2,176,260 | 1,069,013 |
Fair Value Agency Mortgage Servicing Rights | ||||
Servicing Asset at Fair Value, Amount [Roll Forward] | ||||
Beginning balance | 1,408,420 | 305,085 | 578,957 | 714,006 |
Sales and other transfers | 0 | 0 | 0 | 0 |
Recognized on the sale of residential mortgage loans | 66,420 | 22,096 | 136,482 | 37,785 |
Purchase of MSRs | 36,153 | 32,249 | 806,469 | 78,994 |
Servicing transfers and adjustments | 17 | 16 | 73 | (263,830) |
Changes in fair value: | ||||
Changes in valuation inputs or assumptions | 6,983 | (4,731) | 47,132 | (166,546) |
Realization of expected cash flows | (38,186) | (15,051) | (89,306) | (60,745) |
Ending balance | 1,479,807 | 339,664 | 1,479,807 | 339,664 |
Fair Value Non-Agency Mortgage Servicing Rights | ||||
Servicing Asset at Fair Value, Amount [Roll Forward] | ||||
Beginning balance | 664,098 | 739,829 | 715,860 | 772,389 |
Sales and other transfers | 0 | (1) | 0 | (108) |
Recognized on the sale of residential mortgage loans | 0 | 0 | 0 | 0 |
Purchase of MSRs | 0 | 0 | 0 | 0 |
Servicing transfers and adjustments | (4,723) | 0 | (6,913) | 403 |
Changes in fair value: | ||||
Changes in valuation inputs or assumptions | 67,836 | 13,496 | 73,306 | 23,839 |
Realization of expected cash flows | (30,758) | (23,975) | (85,800) | (67,174) |
Ending balance | $ 696,453 | $ 729,349 | $ 696,453 | $ 729,349 |
Mortgage Servicing - Schedule_2
Mortgage Servicing - Schedule of Activity Related to MSRs - Fair Value Measurement Method (Footnote) (Details) - USD ($) $ in Thousands | Feb. 20, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 |
Servicing Assets at Fair Value [Line Items] | |||||
Servicing transfers and adjustments | $ 4,706 | $ (16) | $ 6,840 | $ 263,427 | |
Reclassification to changes in valuation inputs or assumptions | $ 9,100 | $ 4,000 | |||
New Residential Investment Corp | |||||
Servicing Assets at Fair Value [Line Items] | |||||
Servicing transfers and adjustments | $ 263,700 |
Mortgage Servicing - Schedule_3
Mortgage Servicing - Schedule of Composition of Servicing UPB (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 |
Transfers and Servicing [Abstract] | ||||
Owned MSRs | $ 136,316,900 | $ 148,882,743 | $ 90,174,495 | $ 71,301,427 |
NRZ pledged MSRs | 56,141,289 | 59,038,668 | 64,061,198 | 66,782,351 |
MAV pledged MSRs | 13,570,892 | 0 | 0 | 0 |
Total MSR UPB | $ 206,029,081 | $ 207,921,411 | $ 154,235,693 | $ 138,083,778 |
Mortgage Servicing - Schedule_4
Mortgage Servicing - Schedule of Components of Servicing and Subservicing Fees (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Transfers and Servicing [Abstract] | ||||
Servicing | $ 103,094 | $ 53,410 | $ 246,363 | $ 161,154 |
Subservicing | 2,867 | 10,324 | 8,971 | 26,143 |
MAV | 1,575 | 0 | 1,575 | 0 |
NRZ | 75,034 | 91,015 | 233,135 | 299,089 |
Servicing and Subservicing fees, total | 182,570 | 154,749 | 490,044 | 486,386 |
Late charges | 10,656 | 11,012 | 31,335 | 38,323 |
Recording Fees | 3,726 | 3,900 | 10,579 | 9,828 |
Loan collection fees | 2,858 | 3,047 | 8,568 | 10,048 |
Boarding and deboarding fees | 1,627 | 4,262 | 6,830 | 5,619 |
Custodial accounts (float earnings) | 1,234 | 1,057 | 3,547 | 8,787 |
Other, net | 3,914 | 3,695 | 11,859 | 9,454 |
Ancillary income | 24,015 | 26,973 | 72,720 | 82,059 |
Servicing and subservicing fees | $ 206,585 | $ 181,722 | $ 562,764 | $ 568,445 |
Mortgage Servicing - Narrative
Mortgage Servicing - Narrative (Details) - USD ($) $ in Millions | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Servicing Assets at Fair Value [Line Items] | |||
UPB of MSRs sold | $ 18 | $ 55.7 | |
UPB of loans acquired | 72,200 | 9,900 | |
Float balances | 3,300 | 2,000 | $ 1,700 |
Performing GSE Loans | |||
Servicing Assets at Fair Value [Line Items] | |||
UPB of loans acquired | $ 46,800 | $ 575.3 |
MSR Transfers Not Qualifying _3
MSR Transfers Not Qualifying for Sale Accounting - Schedule of Assets, Liabilities Related to MSR Transfer Agreements (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2019 |
Servicing Liabilities at Fair Value [Line Items] | ||||||
MSRs, at fair value | $ 2,176,260 | $ 2,072,518 | $ 1,294,817 | $ 1,069,013 | $ 1,044,914 | $ 1,486,395 |
Other financing liabilities, at fair value | 710,911 | 576,722 | ||||
Due from NRZ | 2,892 | 4,611 | ||||
Due to NRZ - Advance collections and servicing fees | 92,188 | 94,691 | ||||
Transferred MSRs, at Fair Value | ||||||
Servicing Liabilities at Fair Value [Line Items] | ||||||
MSRs, at fair value | 718,913 | 566,952 | ||||
Financing Liability - MSRs Pledged | ||||||
Servicing Liabilities at Fair Value [Line Items] | ||||||
Other financing liabilities, at fair value | 702,907 | 566,952 | ||||
New Residential Investment Corp | Transferred MSRs, at Fair Value | ||||||
Servicing Liabilities at Fair Value [Line Items] | ||||||
MSRs, at fair value | 574,020 | 566,952 | ||||
New Residential Investment Corp | Original Rights to MSRs Agreements | Transferred MSRs, at Fair Value | ||||||
Servicing Liabilities at Fair Value [Line Items] | ||||||
Other financing liabilities, at fair value | 566,952 | |||||
MSR Asset Vehicle LLC | Transferred MSRs, at Fair Value | ||||||
Servicing Liabilities at Fair Value [Line Items] | ||||||
MSRs, at fair value | 144,893 | 0 | ||||
MSR Asset Vehicle LLC | Original Rights to MSRs Agreements | Transferred MSRs, at Fair Value | ||||||
Servicing Liabilities at Fair Value [Line Items] | ||||||
Other financing liabilities, at fair value | $ 128,887 | $ 0 |
MSR Transfers Not Qualifying _4
MSR Transfers Not Qualifying for Sale Accounting - Schedule of Activity Related to Financing Liability - MSRs Pledged (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Servicing Assets at Fair Value [Line Items] | ||||
Derecognition of Pledged MSR financing liability due to termination of PMC MSR Agreements | $ 0 | $ (263,344) | ||
Financing Liability - MSRs Pledged | ||||
Servicing Assets at Fair Value [Line Items] | ||||
Beginning balance, Financing Liability | $ 535,571 | 566,952 | 950,593 | |
Sales | (132,003) | (132,003) | (226) | |
Changes in fair value | 61,329 | 71,273 | (13,736) | |
Runoff and settlement | (21,783) | (60,309) | (91,763) | |
Derecognition of Pledged MSR financing liability due to termination of PMC MSR Agreements | (263,664) | |||
Calls | (4,213) | (7,012) | (3,895) | |
Ending balance, Financing Liability | 702,907 | $ 577,309 | 702,907 | 577,309 |
New Residential Investment Corp | ||||
Servicing Assets at Fair Value [Line Items] | ||||
Changes in fair value | (63,762) | (12,202) | (73,706) | 13,736 |
MSR Asset Vehicle LLC | ||||
Servicing Assets at Fair Value [Line Items] | ||||
Changes in fair value | 2,433 | 2,433 | ||
MSR Asset Vehicle LLC | Financing Liability - MSRs Pledged | ||||
Servicing Assets at Fair Value [Line Items] | ||||
Beginning balance, Financing Liability | 0 | 0 | ||
Sales | (132,003) | (132,003) | ||
Changes in fair value | (2,433) | (2,433) | ||
Runoff and settlement | (683) | (683) | ||
Calls | 0 | 0 | ||
Ending balance, Financing Liability | 128,887 | 128,887 | ||
Original Rights to MSRs Agreements | New Residential Investment Corp | ||||
Servicing Assets at Fair Value [Line Items] | ||||
Ending balance, Financing Liability | 574,020 | 574,020 | ||
Changes in fair value | (63,762) | (12,202) | (73,706) | (26,081) |
Original Rights to MSRs Agreements | New Residential Investment Corp | Financing Liability - MSRs Pledged | ||||
Servicing Assets at Fair Value [Line Items] | ||||
Beginning balance, Financing Liability | 535,571 | 582,558 | 566,952 | 603,046 |
Changes in fair value | 63,762 | 12,203 | 73,706 | 26,081 |
Runoff and settlement | (21,100) | (17,452) | (59,626) | (49,150) |
Calls | (4,213) | 0 | (7,012) | (2,668) |
Ending balance, Financing Liability | 574,020 | 577,309 | 574,020 | 577,309 |
Original Rights to MSRs Agreements | New Residential Investment Corp | Reclassification | ||||
Servicing Assets at Fair Value [Line Items] | ||||
Changes in fair value | 1,800 | 7,600 | ||
2017 Agreements and New RMSR Agreements | New Residential Investment Corp | Financing Liability - MSRs Pledged | ||||
Servicing Assets at Fair Value [Line Items] | ||||
Beginning balance, Financing Liability | 35,445 | |||
Changes in fair value | 903 | |||
Runoff and settlement | (35,121) | |||
Calls | (1,227) | |||
Ending balance, Financing Liability | 0 | 0 | ||
PMC MSR Agreements | ||||
Servicing Assets at Fair Value [Line Items] | ||||
Changes in fair value | $ 0 | 0 | $ 0 | 40,720 |
PMC MSR Agreements | New Residential Investment Corp | Financing Liability - MSRs Pledged | ||||
Servicing Assets at Fair Value [Line Items] | ||||
Beginning balance, Financing Liability | 312,102 | |||
Sales | (226) | |||
Changes in fair value | (40,720) | |||
Runoff and settlement | (7,492) | |||
Derecognition of Pledged MSR financing liability due to termination of PMC MSR Agreements | (263,664) | |||
Ending balance, Financing Liability | $ 0 | $ 0 |
MSR Transfers Not Qualifying _5
MSR Transfers Not Qualifying for Sale Accounting – Schedule of Results of Operations in Connection With MSR Transfer Agreements that Do Not Qualify for Sale Accounting (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Related Party Transaction [Line Items] | ||||
Servicing fees collected on behalf of MAV | $ 76,035 | $ 91,015 | $ 234,136 | $ 299,089 |
MSR Pledged liability expense | 91,160 | 57,404 | 168,820 | 105,684 |
PMC MSR Agreements | ||||
Related Party Transaction [Line Items] | ||||
Changes in fair value | 0 | 0 | 0 | 40,720 |
Runoff and settlement | 0 | 0 | 0 | 7,492 |
New Residential Investment Corp | ||||
Related Party Transaction [Line Items] | ||||
Servicing fees collected on behalf of MAV | 75,034 | 91,015 | 233,135 | 299,089 |
MSR Pledged liability expense | 93,253 | 57,404 | 170,914 | 105,684 |
Less: Subservicing fee retained by Ocwen | 21,475 | 25,674 | 67,987 | 80,529 |
Net servicing fees remitted | 53,559 | 65,341 | 165,148 | 218,560 |
Changes in fair value | (63,762) | (12,202) | (73,706) | 13,736 |
Runoff and settlement | 21,100 | 17,451 | 59,627 | 91,763 |
Other | 2,968 | 2,688 | 8,313 | 7,377 |
New Residential Investment Corp | Original Rights to MSRs Agreements | ||||
Related Party Transaction [Line Items] | ||||
Changes in fair value | (63,762) | (12,202) | (73,706) | (26,081) |
Runoff and settlement | 21,100 | 17,451 | 59,627 | 49,150 |
New Residential Investment Corp | 2017 Agreements and New RMSR Agreements | ||||
Related Party Transaction [Line Items] | ||||
Changes in fair value | 0 | 0 | 0 | (903) |
Runoff and settlement | 0 | 0 | 0 | 35,121 |
MSR Asset Vehicle LLC | ||||
Related Party Transaction [Line Items] | ||||
Servicing fees collected on behalf of MAV | 1,001 | 0 | 1,001 | 0 |
MSR Pledged liability expense | 2,094 | $ 0 | 2,094 | $ 0 |
Less: Subservicing fee retained by Ocwen | 178 | 178 | ||
Net servicing fees remitted | 823 | 823 | ||
Changes in fair value | 2,433 | 2,433 | ||
Runoff and settlement | 683 | 683 | ||
Less: Reduction (increase) in financing liability | 3,116 | 3,116 | ||
Other | $ (199) | $ (199) |
MSR Transfers Not Qualifying _6
MSR Transfers Not Qualifying for Sale Accounting - Schedule of Results of Operations in Connection With MSR Transfer Agreements that Do Not Qualify for Sale Accounting (Footnote) (Details) - New Residential Investment Corp - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Servicing Liabilities at Fair Value [Line Items] | ||||
Changes in fair value | $ (63,762) | $ (12,202) | $ (73,706) | $ 13,736 |
Original Rights to MSRs Agreements | ||||
Servicing Liabilities at Fair Value [Line Items] | ||||
Changes in fair value | $ (63,762) | (12,202) | $ (73,706) | (26,081) |
Original Rights to MSRs Agreements | Reclassification | ||||
Servicing Liabilities at Fair Value [Line Items] | ||||
Changes in fair value | $ 1,800 | $ 7,600 |
MSR Transfers Not Qualifying _7
MSR Transfers Not Qualifying for Sale Accounting - UPB of Loans Serviced on behalf of NRZ and MAV (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Servicing Assets at Fair Value [Line Items] | ||
UPB of rights to MSRs sold | $ 79,805,648 | $ 67,111,388 |
New Residential Investment Corp | ||
Servicing Assets at Fair Value [Line Items] | ||
UPB of rights to MSRs sold | 58,379,644 | 67,111,388 |
Outstanding servicing advances | 493,400 | |
New Residential Investment Corp | Mortgage Servicing Rights Title Retained | ||
Servicing Assets at Fair Value [Line Items] | ||
UPB of rights to MSRs sold | 12,601,689 | 14,114,602 |
New Residential Investment Corp | Mortgage Servicing Rights Title Transferred | ||
Servicing Assets at Fair Value [Line Items] | ||
UPB of rights to MSRs sold | 43,526,008 | 49,866,082 |
New Residential Investment Corp | Subservicing Assets | ||
Servicing Assets at Fair Value [Line Items] | ||
UPB of rights to MSRs sold | 2,251,947 | 3,130,704 |
MSR Asset Vehicle LLC | ||
Servicing Assets at Fair Value [Line Items] | ||
UPB of rights to MSRs sold | 21,426,004 | 0 |
Outstanding servicing advances | 4,500 | |
MSR Asset Vehicle LLC | Mortgage Servicing Rights Title Transferred | ||
Servicing Assets at Fair Value [Line Items] | ||
UPB of rights to MSRs sold | 13,570,892 | 0 |
MSR Asset Vehicle LLC | Subservicing Assets | ||
Servicing Assets at Fair Value [Line Items] | ||
UPB of rights to MSRs sold | $ 7,855,112 | $ 0 |
MSR Transfers Not Qualifying _8
MSR Transfers Not Qualifying for Sale Accounting - Narrative (Details) $ in Thousands | Oct. 01, 2020USD ($)Loan | Sep. 01, 2020USD ($)Loan | Jan. 31, 2018USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Dec. 31, 2020USD ($) | Feb. 20, 2020USD ($) |
Servicing Assets at Fair Value [Line Items] | ||||||||
Proceeds from sale of mortgage servicing rights accounted for as financing | $ 279,600 | $ 54,600 | $ 130,024 | $ 0 | ||||
UPB of rights to MSRs sold | 79,805,648 | $ 67,111,388 | ||||||
Unpaid principal balance of loans related to termination | $ 34,200,000 | |||||||
New Residential Investment Corp | ||||||||
Servicing Assets at Fair Value [Line Items] | ||||||||
UPB of rights to MSRs sold | 58,379,644 | 67,111,388 | ||||||
Unpaid principal balance of loans related to termination | $ 16,000,000 | $ 18,200,000 | ||||||
Number of loans de-boarded from servicing portfolio | Loan | 136,500 | 133,718 | ||||||
New Residential Investment Corp | Mortgage Servicing Rights Title Retained | ||||||||
Servicing Assets at Fair Value [Line Items] | ||||||||
UPB of rights to MSRs sold | 12,601,689 | $ 14,114,602 | ||||||
New RMSR Agreements | New Residential Investment Corp | ||||||||
Servicing Assets at Fair Value [Line Items] | ||||||||
UPB of rights to MSRs sold | 58,400,000 | |||||||
2017 Agreements and New RMSR Agreements | New Residential Investment Corp | Mortgage Servicing Rights Title Retained | ||||||||
Servicing Assets at Fair Value [Line Items] | ||||||||
UPB of rights to MSRs sold | $ 12,600,000 |
Receivables - Schedule of Recei
Receivables - Schedule of Receivables (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Receivables [Abstract] | ||
Government-insured loan claims - Forward | $ 93,717 | $ 103,058 |
Government-insured loan claims - Reverse | 34,620 | 32,887 |
Due from custodial accounts | 25,700 | 19,393 |
Reimbursable expenses | 5,419 | 4,970 |
Subservicing fees and reimbursable expenses - Due from NRZ | 2,892 | 4,611 |
Subservicing fees and reimbursable expenses - Due from MAV | 1,412 | 0 |
Other | 2,167 | 1,087 |
Servicing receivable, total | 165,926 | 166,006 |
Income taxes receivable | 54,501 | 57,503 |
Due from MAV | 1,245 | 0 |
Other receivables | 3,093 | 3,200 |
Other receivables, gross | 224,764 | 226,709 |
Allowance for losses | (41,674) | (39,044) |
Receivables, net | $ 183,090 | $ 187,665 |
Receivables - Narrative (Detail
Receivables - Narrative (Detail) - USD ($) $ in Millions | Sep. 30, 2021 | Dec. 31, 2020 |
Servicing | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Allowance for financing notes | $ 41.1 | $ 38.3 |
Receivables - Schedule of Chang
Receivables - Schedule of Changes in allowance of Government-Insured Loan Claims (Details) - Government Insured Loans Claims - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Beginning balance | $ 41,216 | $ 53,310 | $ 38,339 | $ 56,868 |
Provision | 2,990 | 5,055 | 10,526 | 12,249 |
Charge-offs and other, net | (3,141) | (17,607) | (7,800) | (28,359) |
Ending balance | $ 41,065 | $ 40,758 | $ 41,065 | $ 40,758 |
Investment in Equity Method I_3
Investment in Equity Method Investee (Narrative) (Details) - USD ($) | Sep. 30, 2021 | Jun. 01, 2021 | May 03, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 21, 2020 |
Schedule of Equity Method Investments [Line Items] | ||||||
Investment in equity method investee | $ 250,000,000 | |||||
Ownership percentage | 15.00% | 4.90% | 15.00% | |||
Capital contribution | $ 5,000,000 | $ 18,512,000 | ||||
UPB of loans acquired | $ 72,200,000,000 | 72,200,000,000 | $ 9,900,000,000 | |||
UPB of MSRs sold | $ 18,000,000 | $ 55,700,000 | ||||
MAV Canopy HoldCo I, LLC | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Ownership percentage | 15.00% | 15.00% | ||||
MAV Canopy HoldCo I, LLC | Oaktree | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Ownership percentage | 85.00% | 85.00% | ||||
Fannie Mae MSRs | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
UPB of MSRs sold | $ 4,100,000,000 | |||||
GSE MSR Portfolio | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
UPB of MSRs sold | $ 8,200,000,000 | |||||
Forward Bulk Servicing Rights Purchase and Sale Agreement | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
UPB of MSRs sold | $ 1,300,000,000 | |||||
Maximum | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Management fee expense | $ 500,000 |
Investment in Equity Method I_4
Investment in Equity Method Investee - Schedule of Investment (Details) - USD ($) $ in Thousands | May 03, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 |
Schedule of Equity Method Investments [Line Items] | ||||||
Capital contribution | $ 5,000 | $ 18,512 | ||||
Earnings of equity method investee | $ 932 | $ 0 | 1,282 | $ 0 | ||
Investment in equity method investee | $ 19,794 | $ 19,794 | $ 0 |
Investment in Equity Method I_5
Investment in Equity Method Investee - Schedule of Equity Method Investment Summarized Financial Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Schedule of Equity Method Investments [Line Items] | |||||
Mortgage servicing rights (MSRs), at fair value | $ 2,176,260 | $ 2,176,260 | $ 1,294,817 | ||
Other financing liabilities, at fair value | 710,911 | 710,911 | 576,722 | ||
Servicing fees collected on behalf of MAV | 76,035 | $ 91,015 | 234,136 | $ 299,089 | |
Ancillary fees (MAV) | 3,914 | 3,695 | 11,859 | 9,454 | |
Servicing and subservicing fees | 24,015 | 26,973 | 72,720 | 82,059 | |
MSR valuation adjustments, net | 6,320 | 33,814 | 57,562 | 231,368 | |
Interest expense | (40,623) | (26,815) | (102,591) | (83,557) | |
MSR Pledged liability expense | 91,160 | $ 57,404 | 168,820 | $ 105,684 | |
UPB of loans transferred | 26,724,676 | 26,724,676 | 18,062,856 | ||
UPB of rights to MSRs sold | 79,805,648 | 79,805,648 | $ 67,111,388 | ||
Oaktree | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Interest expense | (21,351) | ||||
MSR Asset Vehicle LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Mortgage servicing rights (MSRs), at fair value | 144,893 | 144,893 | |||
MSR sales price holdback - (MAV) | 1,644 | 1,644 | |||
Due from MAV | 2,657 | 2,657 | |||
Due to MAV | 226 | 226 | |||
Servicing fees collected on behalf of MAV | 1,001 | ||||
Subservicing fees - Subservicing agreement (MAV) | 574 | ||||
Ancillary fees (MAV) | 707 | ||||
Servicing and subservicing fees | 2,282 | ||||
MSR valuation adjustments, net | (3,116) | ||||
MSR Pledged liability expense | 2,094 | ||||
Other income, Administrative services agreement (MAV) | 140 | ||||
UPB of loans transferred | 13,683,143 | 13,683,143 | |||
Cash proceeds from transfers of MSRs by PMC to MAV | 130,024 | ||||
UPB of rights to MSRs sold | 21,426,004 | 21,426,004 | |||
MSR Asset Vehicle LLC | Transferred MSRs, at Fair Value | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Other financing liabilities, at fair value | 128,887 | 128,887 | |||
MSR Asset Vehicle LLC | Subservicing Assets | |||||
Schedule of Equity Method Investments [Line Items] | |||||
UPB of rights to MSRs sold | $ 7,855,112 | $ 7,855,112 |
Other Assets - Schedule of Othe
Other Assets - Schedule of Other Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Other Assets [Abstract] | ||
Contingent loan repurchase asset | $ 450,385 | $ 480,221 |
Prepaid expenses | 21,398 | 21,176 |
Derivatives, at fair value | 20,329 | 23,246 |
Prepaid representation, warranty and indemnification claims - Agency MSR sale | 15,173 | 15,173 |
REO | 8,602 | 7,771 |
Prepaid lender fees, net | 8,338 | 9,556 |
Deferred tax asset, net | 3,724 | 3,543 |
Mortgage backed securities, at fair value | 1,618 | 2,019 |
Security deposits | 1,173 | 2,222 |
Other | 11,857 | 6,556 |
Other assets | $ 542,597 | $ 571,483 |
Borrowings - Schedule of Financ
Borrowings - Schedule of Financing Liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2019 | |
Debt Instrument [Line Items] | ||||||||
HMBS-related borrowings | $ 6,782,564 | $ 6,782,564 | $ 6,823,911 | $ 6,772,711 | $ 6,606,543 | $ 6,477,616 | $ 6,063,435 | |
Other financing liabilities, at fair value | 710,911 | 710,911 | 576,722 | |||||
Total Financing liabilities | 7,493,475 | 7,493,475 | 7,349,433 | |||||
Financing Liability - MSRs Pledged | ||||||||
Debt Instrument [Line Items] | ||||||||
Other financing liabilities, at fair value | 702,907 | 702,907 | 566,952 | |||||
Residential Asset Securitization Trust | ||||||||
Debt Instrument [Line Items] | ||||||||
Other financing liabilities, at fair value | 8,004 | 8,004 | 9,770 | |||||
Original Rights to MSRs Agreements | Financing Liability - MSRs Pledged | ||||||||
Debt Instrument [Line Items] | ||||||||
Other financing liabilities, at fair value | 574,020 | 574,020 | 566,952 | |||||
MAV MSR Sale Agreements | Financing Liability - MSRs Pledged | ||||||||
Debt Instrument [Line Items] | ||||||||
Other financing liabilities, at fair value | $ 128,887 | $ 128,887 | $ 0 | |||||
Minimum | Residential Asset Securitization Trust | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, interest rate | 4.25% | 4.25% | ||||||
Maximum | Residential Asset Securitization Trust | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, interest rate | 5.75% | 5.75% | ||||||
London Interbank Offered Rate (LIBOR) | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 0.14% | 0.08% | ||||||
London Interbank Offered Rate (LIBOR) | HMBS-Related Borrowings | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 2.42% | |||||||
London Interbank Offered Rate (LIBOR) | Residential Asset Securitization Trust | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 0.45% |
Borrowings - Schedule of Match
Borrowings - Schedule of Match Funded Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Aug. 26, 2021 | Jun. 30, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||||
Advance match funded liabilities (related to VIEs) | $ 516,572 | $ 581,288 | ||
Advance Receivables Backed Notes - Series 2015-VF5 | ||||
Debt Instrument [Line Items] | ||||
Borrowing Capacity | 80,000 | $ 250,000 | ||
Advance Receivables Backed Notes, Series 2015-VF1 | ||||
Debt Instrument [Line Items] | ||||
Borrowing Capacity | $ 40,000 | $ 70,000 | ||
Advance Match Funded Liabilities | ||||
Debt Instrument [Line Items] | ||||
Borrowing Capacity | 595,000 | |||
Available borrowing capacity | $ 78,428 | |||
Weighted average interest rate | 1.54% | 1.96% | ||
Advance match funded liabilities (related to VIEs) | $ 516,572 | $ 581,288 | ||
Total Ocwen Master Advance Receivables Trust (OMART) | ||||
Debt Instrument [Line Items] | ||||
Borrowing Capacity | 555,000 | |||
Available borrowing capacity | $ 54,505 | |||
Weighted average interest rate | 1.52% | 1.93% | ||
Advance match funded liabilities (related to VIEs) | $ 500,495 | $ 564,396 | ||
Total Ocwen Master Advance Receivables Trust (OMART) | Advance Receivables Backed Notes - Series 2015-VF5 | ||||
Debt Instrument [Line Items] | ||||
Borrowing Capacity | 80,000 | |||
Available borrowing capacity | $ 54,505 | |||
Weighted average interest rate | 2.14% | 4.26% | ||
Advance match funded liabilities (related to VIEs) | $ 25,495 | $ 89,396 | ||
Total Ocwen Master Advance Receivables Trust (OMART) | Advance Receivables Backed Notes, Series 2020-T1 | ||||
Debt Instrument [Line Items] | ||||
Borrowing Capacity | 475,000 | |||
Available borrowing capacity | $ 0 | |||
Weighted average interest rate | 1.49% | 1.49% | ||
Advance match funded liabilities (related to VIEs) | $ 475,000 | $ 475,000 | ||
Total Ocwen Freddie Advance Funding Facility (OFAF) | Advance Receivables Backed Notes, Series 2015-VF1 | ||||
Debt Instrument [Line Items] | ||||
Borrowing Capacity | 40,000 | |||
Available borrowing capacity | $ 23,923 | |||
Weighted average interest rate | 2.15% | 3.26% | ||
Advance match funded liabilities (related to VIEs) | $ 16,077 | $ 16,892 |
Borrowings - Schedule of Matc_2
Borrowings - Schedule of Match Funded Liabilities (Footnote) (Details) - USD ($) | Aug. 26, 2021 | Jun. 30, 2021 | Sep. 30, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||||
Prepaid lender fees, net | $ 8,338,000 | $ 9,556,000 | ||
Advance Receivables Backed Notes - Series 2015-VF5 | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 4.00% | 2.00% | ||
Maximum borrowing capacity | $ 250,000,000 | $ 80,000,000 | ||
Advance Receivables Backed Notes, Series 2015-VF1 | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 2.00% | 3.00% | ||
Maximum borrowing capacity | $ 40,000,000 | $ 70,000,000 | ||
Advance Match Funded Liabilities | ||||
Debt Instrument [Line Items] | ||||
Available borrowing capacity based on amount of eligible collateral | $ 0 | |||
Maximum borrowing capacity | $ 595,000,000 | |||
Weighted average interest rate | 1.54% | 1.96% | ||
Prepaid lender fees, net | $ 1,800,000 | $ 4,300,000 | ||
Total Ocwen Master Advance Receivables Trust (OMART) | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | $ 555,000,000 | |||
Weighted average interest rate | 1.52% | 1.93% | ||
Total Ocwen Master Advance Receivables Trust (OMART) | Advance Receivables Backed Notes - Series 2015-VF5 | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | $ 80,000,000 | |||
Weighted average interest rate | 2.14% | 4.26% | ||
Total Ocwen Master Advance Receivables Trust (OMART) | Advance Receivables Backed Notes, Series 2020-T1 | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | $ 475,000,000 | |||
Weighted average interest rate | 1.49% | 1.49% | ||
Total Ocwen Master Advance Receivables Trust (OMART) | Advance Receivables Backed Notes, Series 2020-T1 | Minimum | ||||
Debt Instrument [Line Items] | ||||
Weighted average interest rate | 1.28% | |||
Total Ocwen Master Advance Receivables Trust (OMART) | Advance Receivables Backed Notes, Series 2020-T1 | Maximum | ||||
Debt Instrument [Line Items] | ||||
Weighted average interest rate | 5.42% |
Borrowings - Narrative (Details
Borrowings - Narrative (Details) - USD ($) $ in Thousands | May 03, 2021 | Mar. 04, 2021 | Sep. 30, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||||
Senior notes, net | $ 612,658 | $ 311,898 | ||
Interest rate (as a percent) | 3.25% | |||
Covenant compliance, consolidated tangible net worth at period end | $ 275,000 | |||
Oaktree | ||||
Debt Instrument [Line Items] | ||||
Discount | $ 10,500 | |||
6.375% Senior Notes, Due 2021 | ||||
Debt Instrument [Line Items] | ||||
Redemption price | 100.00% | |||
8.375% Senior Secured Notes Due In 2022 | ||||
Debt Instrument [Line Items] | ||||
Redemption price | 102.094% | |||
Loss on debt extinguishment | $ 7,100 | |||
7.875% Senior Notes, Due 2026 | ||||
Debt Instrument [Line Items] | ||||
Redemption price | 7.875% | |||
7.875% Senior Notes, Due 2026 | Prior to March 15, 2023 | ||||
Debt Instrument [Line Items] | ||||
Redemption price | 100.00% | |||
Percentage of premium on outstanding principal amount | 1.00% | |||
7.875% Senior Notes, Due 2026 | On or Prior to March 15, 2023 | ||||
Debt Instrument [Line Items] | ||||
Redemption price | 107.875% | |||
Redemption price, percentage of principal amount | 35.00% | |||
12% Paid in Cash or 13.25% Paid in Kind Senior Notes, Due 2027 | ||||
Debt Instrument [Line Items] | ||||
Interest rate (as a percent) | 12.00% | |||
Minimum unrestricted cash | $ 50,000 | |||
Covenant compliance, consolidated tangible net worth at period end | 275,000 | |||
Proceeds from issuance of senior secured notes | 68,000 | $ 158,500 | ||
Discount | 24,500 | |||
Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Senior notes, net | 685,000 | 313,052 | ||
Discount | 57,482 | 0 | ||
Senior Notes | 7.875% Senior Notes, Due 2026 | ||||
Debt Instrument [Line Items] | ||||
Discount | 2,100 | 1,844 | 0 | |
Senior Notes | 12% Paid in Cash or 13.25% Paid in Kind Senior Notes, Due 2027 | ||||
Debt Instrument [Line Items] | ||||
Discount | 55,638 | 0 | ||
Secured Debt | 8.375% Senior Secured Notes Due In 2022 | ||||
Debt Instrument [Line Items] | ||||
Senior notes, net | $ 0 | 291,509 | ||
Interest rate (as a percent) | 8.375% | |||
Secured Debt | 7.875% Senior Notes, Due 2026 | ||||
Debt Instrument [Line Items] | ||||
Senior notes, net | 400,000 | $ 400,000 | 0 | |
Interest rate (as a percent) | 7.875% | |||
Secured Debt | 12% Paid in Cash or 13.25% Paid in Kind Senior Notes, Due 2027 | ||||
Debt Instrument [Line Items] | ||||
Senior notes, net | $ 85,500 | 199,500 | $ 285,000 | $ 0 |
Secured Debt | 12% Paid in Cash or 13.25% Paid in Kind Senior Notes, Due 2027 | Prior to March 4, 2022 | ||||
Debt Instrument [Line Items] | ||||
Interest rate (as a percent) | 7.00% | |||
Minimum | ||||
Debt Instrument [Line Items] | ||||
Restrictive liquidity requirements | $ 125,000 | |||
Minimum | 7.875% Senior Notes, Due 2026 | On or Prior to March 15, 2023 | ||||
Debt Instrument [Line Items] | ||||
Percentage of principal amount outstanding post redemption | 65.00% | |||
Senior Secured Term Loan | ||||
Debt Instrument [Line Items] | ||||
Loss on debt extinguishment | $ 8,400 |
Borrowings - Schedule of Mortga
Borrowings - Schedule of Mortgage Loan Warehouse, MSR Financing Facilities and SSTL (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | ||
Mar. 31, 2021 | Jun. 30, 2021 | Sep. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | |
Line of Credit Facility [Line Items] | |||||
Other secured borrowings | $ 7,493,475 | $ 7,349,433 | |||
Unamortized debt issuance costs | $ (500) | ||||
Interest rate (as a percent) | 3.25% | ||||
Ocwen Excess Spread-Collateralized Notes, Series 2019-PLS1 Class A | |||||
Line of Credit Facility [Line Items] | |||||
Interest rate (as a percent) | 5.07% | ||||
Agency MSR Financing Facility Term Loan | |||||
Line of Credit Facility [Line Items] | |||||
Unamortized debt issuance costs | $ (600) | ||||
London Interbank Offered Rate (LIBOR) | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 0.14% | 0.08% | |||
London Interbank Offered Rate (LIBOR) | Agency Mortgage Servicing Rights Financing Facility | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 3.25% | ||||
Secured Debt | |||||
Line of Credit Facility [Line Items] | |||||
Uncommitted available borrowing capacity | $ 6,937 | ||||
Available borrowing capacity | 83,631 | ||||
Other secured borrowings | 946,816 | 438,566 | |||
Long-term Debt | 945,744 | 437,672 | |||
Unamortized debt issuance costs | (1,072) | (894) | |||
Discount - SSTL | 0 | (357) | |||
Secured Debt | Senior Secured Term Loan | |||||
Line of Credit Facility [Line Items] | |||||
Other secured borrowings | 0 | 185,000 | |||
Long-term Debt | 0 | 179,776 | |||
Unamortized debt issuance costs | 0 | (4,867) | |||
Secured Debt | Master Repurchase Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Uncommitted available borrowing capacity | 115,000 | ||||
Available borrowing capacity | 61,282 | ||||
Other secured borrowings | 98,718 | 195,773 | |||
Secured Debt | Master Repurchase Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Uncommitted available borrowing capacity | 50,000 | ||||
Available borrowing capacity | 124,385 | ||||
Other secured borrowings | 75,615 | 80,081 | |||
Secured Debt | Master Repurchase Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Uncommitted available borrowing capacity | 50,000 | ||||
Available borrowing capacity | 0 | ||||
Other secured borrowings | 0 | 0 | |||
Secured Debt | Participation Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Uncommitted available borrowing capacity | 203,609 | ||||
Available borrowing capacity | 0 | ||||
Other secured borrowings | 96,391 | 0 | |||
Secured Debt | Master Repurchase Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Uncommitted available borrowing capacity | 0 | ||||
Available borrowing capacity | 100,000 | ||||
Other secured borrowings | 0 | 63,281 | |||
Secured Debt | Master Repurchase Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Uncommitted available borrowing capacity | 0 | ||||
Available borrowing capacity | 1,000 | ||||
Other secured borrowings | 0 | 0 | |||
Secured Debt | Mortgage Warehouse Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Uncommitted available borrowing capacity | 0 | ||||
Available borrowing capacity | 37,681 | ||||
Other secured borrowings | 12,319 | 11,715 | |||
Secured Debt | Mortgage Warehouse Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Uncommitted available borrowing capacity | 28,929 | ||||
Available borrowing capacity | 0 | ||||
Other secured borrowings | 146,071 | 73,134 | |||
Secured Debt | Mortgage Warehouse Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Uncommitted available borrowing capacity | 34,962 | ||||
Available borrowing capacity | 0 | ||||
Other secured borrowings | 165,038 | 27,729 | |||
Secured Debt | Master Repurchase Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Uncommitted available borrowing capacity | 0 | ||||
Available borrowing capacity | 0 | ||||
Other secured borrowings | 465,018 | 0 | |||
Secured Debt | Loan and Security Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Uncommitted available borrowing capacity | 0 | ||||
Available borrowing capacity | 20,000 | ||||
Other secured borrowings | $ 10,000 | 0 | |||
Basis spread on variable rate | 0.50% | ||||
Interest rate at index floor rate | 4.50% | ||||
Secured Debt | Master Repurchase Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Uncommitted available borrowing capacity | $ 210,000 | ||||
Available borrowing capacity | 0 | ||||
Other secured borrowings | 0 | 0 | |||
Secured Debt | Agency Mortgage Servicing Rights Financing Facility | |||||
Line of Credit Facility [Line Items] | |||||
Uncommitted available borrowing capacity | 0 | ||||
Available borrowing capacity | 75,702 | ||||
Other secured borrowings | 349,298 | 210,755 | |||
Secured Debt | Ginnie Mae Mortgage Servicing Rights Financing Facility | |||||
Line of Credit Facility [Line Items] | |||||
Uncommitted available borrowing capacity | 6,937 | ||||
Available borrowing capacity | 0 | ||||
Long-term Debt | 118,063 | 112,022 | |||
Secured Debt | Ocwen Excess Spread-Collateralized Notes, Series 2019-PLS1 Class A | |||||
Line of Credit Facility [Line Items] | |||||
Uncommitted available borrowing capacity | 0 | ||||
Available borrowing capacity | 0 | ||||
Long-term Debt | 48,243 | 68,313 | |||
Secured Debt | OASIS Series 2014-1 | |||||
Line of Credit Facility [Line Items] | |||||
Uncommitted available borrowing capacity | 0 | ||||
Available borrowing capacity | 0 | ||||
Long-term Debt | 41,362 | 47,476 | |||
Secured Debt | Agency MSR Financing Facility Revolving Loan | |||||
Line of Credit Facility [Line Items] | |||||
Uncommitted available borrowing capacity | 0 | ||||
Available borrowing capacity | 7,929 | ||||
Long-term Debt | $ 277,071 | 0 | |||
Basis spread on variable rate | 2.50% | ||||
Secured Debt | Agency MSR Financing Facility Term Loan | |||||
Line of Credit Facility [Line Items] | |||||
Uncommitted available borrowing capacity | $ 0 | ||||
Available borrowing capacity | 0 | ||||
Long-term Debt | $ 112,779 | 0 | |||
Basis spread on variable rate | 2.50% | ||||
Secured Debt | London Interbank Offered Rate (LIBOR) | Mortgage Warehouse Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 3.50% | ||||
Interest rate at index floor rate | 5.25% | ||||
Secured Debt | London Interbank Offered Rate (LIBOR) | Mortgage Warehouse Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 2.50% | ||||
Interest rate at index floor rate | 3.25% | ||||
Secured Debt | London Interbank Offered Rate (LIBOR) | Master Repurchase Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 2.50% | ||||
Secured Debt | London Interbank Offered Rate (LIBOR) | Agency Mortgage Servicing Rights Financing Facility | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 3.25% | ||||
Secured Debt | Secured Overnight Financing Rate (SOFR) | Master Repurchase Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 1.90% | ||||
Interest rate at index floor rate | 0.25% | ||||
Secured Debt | Eurodollar | Senior Secured Term Loan | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 6.00% | ||||
Interest rate at index floor rate | 1.00% | ||||
Secured Debt | Minimum | London Interbank Offered Rate (LIBOR) | Master Repurchase Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 3.25% | ||||
Secured Debt | Maximum | London Interbank Offered Rate (LIBOR) | Master Repurchase Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 3.50% | ||||
Secured Debt | Maximum | London Interbank Offered Rate (LIBOR) | Master Repurchase Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 2.00% | ||||
Mortgage Loan Warehouse Facilities | |||||
Line of Credit Facility [Line Items] | |||||
Available borrowing capacity | $ 3,300 | ||||
Mortgage Loan Warehouse Facilities | Total Servicing Lines of Credit | |||||
Line of Credit Facility [Line Items] | |||||
Interest rate (as a percent) | 3.68% | ||||
Mortgage Loan Warehouse Facilities | Secured Debt | |||||
Line of Credit Facility [Line Items] | |||||
Uncommitted available borrowing capacity | $ 692,500 | ||||
Available borrowing capacity | 344,348 | ||||
Other secured borrowings | $ 1,069,170 | $ 451,713 | |||
Weighted average interest rate | 2.77% | ||||
Mortgage Loan Warehouse Facilities | Secured Debt | London Interbank Offered Rate (LIBOR) | Ginnie Mae Mortgage Servicing Rights Financing Facility | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 4.50% | ||||
Interest rate at index floor rate | 0.50% | ||||
Mortgage Loan Warehouse Facilities | Secured Debt | Minimum | London Interbank Offered Rate (LIBOR) | Master Repurchase Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 2.20% | ||||
Mortgage Loan Warehouse Facilities | Secured Debt | Maximum | London Interbank Offered Rate (LIBOR) | Master Repurchase Agreement | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 3.75% |
Borrowings - Schedule of Mort_2
Borrowings - Schedule of Mortgage Loan Warehouse, MSR Financing Facilities and SSTL (Footnote) (Details) - USD ($) | Jun. 23, 2021 | May 17, 2021 | Mar. 04, 2021 | Mar. 31, 2021 | Jun. 30, 2021 | Sep. 30, 2021 | Oct. 26, 2021 | Sep. 27, 2021 | Sep. 01, 2021 | Jul. 29, 2021 | Jul. 23, 2021 | Jul. 13, 2021 | Jun. 25, 2021 | Jun. 02, 2021 | May 28, 2021 | May 16, 2021 | May 03, 2021 | Apr. 29, 2021 | Apr. 12, 2021 | Mar. 30, 2021 | Feb. 28, 2021 | Feb. 01, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 |
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Interest rate (as a percent) | 3.25% | ||||||||||||||||||||||||
Unamortized debt issuance costs | $ 500,000 | ||||||||||||||||||||||||
Prepaid lender fees, net | 8,338,000 | $ 9,556,000 | |||||||||||||||||||||||
Oaktree | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Debt instrument, face amount | $ 85,500,000 | ||||||||||||||||||||||||
Senior Secured Term Loan | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Repayment of SSTL | $ 185,000,000 | ||||||||||||||||||||||||
Loss on debt extinguishment | $ 8,400,000 | ||||||||||||||||||||||||
Percentage of prepayment premium | 2.00% | ||||||||||||||||||||||||
Redemption premium | $ 3,700,000 | ||||||||||||||||||||||||
Master Repurchase Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Maximum borrowing capacity | 275,000,000 | ||||||||||||||||||||||||
Borrowings available on committed basis | $ 160,000,000 | ||||||||||||||||||||||||
Master Repurchase Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Maximum borrowing capacity | $ 150,000,000 | ||||||||||||||||||||||||
Borrowings available on committed basis | $ 100,000,000 | ||||||||||||||||||||||||
Master Repurchase Agreement | New Originations | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate | 0.35% | ||||||||||||||||||||||||
Interest rate at index floor rate | 3.00% | ||||||||||||||||||||||||
Master Repurchase Agreement | Ginnie Mae Modifications | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate | 0.10% | ||||||||||||||||||||||||
Interest rate at index floor rate | 3.25% | ||||||||||||||||||||||||
Participation Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Maximum borrowing capacity | $ 300,000,000 | ||||||||||||||||||||||||
Participation Agreement | New Originations | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate | 0.35% | ||||||||||||||||||||||||
Interest rate at index floor rate | 3.00% | ||||||||||||||||||||||||
Master Repurchase Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Trust certificate used to pledge as collateral for borrowings | $ 50,000,000 | $ 225,000,000 | $ 100,000,000 | $ 100,000,000 | $ 25,000,000 | $ 75,000,000 | $ 50,000,000 | ||||||||||||||||||
Ocwen Excess Spread-Collateralized Notes, Series 2019-PLS1 Class A | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Interest rate (as a percent) | 5.07% | ||||||||||||||||||||||||
Agency MSR Financing Facility Revolving Loan | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Prepaid lender fees, net | $ 5,700,000 | 3,300,000 | |||||||||||||||||||||||
Agency MSR Financing Facility Term Loan | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Unamortized debt issuance costs | $ 600,000 | ||||||||||||||||||||||||
London Interbank Offered Rate (LIBOR) | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate | 0.14% | 0.08% | |||||||||||||||||||||||
London Interbank Offered Rate (LIBOR) | Agency Mortgage Servicing Rights Financing Facility | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate | 3.25% | ||||||||||||||||||||||||
One Year Swap Rate | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate | 0.19% | 0.19% | |||||||||||||||||||||||
Secured Debt | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Available borrowing capacity | $ 83,631,000 | ||||||||||||||||||||||||
Unamortized debt issuance costs | 1,072,000 | 894,000 | |||||||||||||||||||||||
Secured Debt | Senior Secured Term Loan | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Unamortized debt issuance costs | 0 | 4,867,000 | |||||||||||||||||||||||
Secured Debt | Master Repurchase Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Available borrowing capacity | 61,282,000 | ||||||||||||||||||||||||
Secured Debt | Master Repurchase Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Available borrowing capacity | 124,385,000 | ||||||||||||||||||||||||
Secured Debt | Master Repurchase Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Available borrowing capacity | 0 | ||||||||||||||||||||||||
Secured Debt | Master Repurchase Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Available borrowing capacity | 100,000,000 | ||||||||||||||||||||||||
Secured Debt | Participation Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Available borrowing capacity | 0 | ||||||||||||||||||||||||
Secured Debt | Mortgage Warehouse Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Available borrowing capacity | 37,681,000 | ||||||||||||||||||||||||
Secured Debt | Mortgage Warehouse Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Available borrowing capacity | 0 | ||||||||||||||||||||||||
Secured Debt | Mortgage Warehouse Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Available borrowing capacity | 0 | ||||||||||||||||||||||||
Secured Debt | Master Repurchase Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Available borrowing capacity | $ 0 | ||||||||||||||||||||||||
Secured Debt | Loan and Security Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate | 0.50% | ||||||||||||||||||||||||
Available borrowing capacity | $ 20,000,000 | ||||||||||||||||||||||||
Interest rate at index floor rate | 4.50% | ||||||||||||||||||||||||
Secured Debt | Master Repurchase Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Available borrowing capacity | $ 0 | ||||||||||||||||||||||||
Secured Debt | Agency Mortgage Servicing Rights Financing Facility | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Available borrowing capacity | 75,702,000 | ||||||||||||||||||||||||
Maximum borrowing capacity | $ 350,000,000 | 425,000,000 | $ 425,000,000 | ||||||||||||||||||||||
Secured Debt | Ginnie Mae Mortgage Servicing Rights Financing Facility | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Available borrowing capacity | 0 | ||||||||||||||||||||||||
Maximum borrowing capacity | 125,000,000 | ||||||||||||||||||||||||
Secured Debt | Ocwen Excess Spread-Collateralized Notes, Series 2019-PLS1 Class A | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Available borrowing capacity | 0 | ||||||||||||||||||||||||
Debt instrument, face amount | $ 100,000,000 | ||||||||||||||||||||||||
Secured Debt | Agency MSR Financing Facility Revolving Loan | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate | 2.50% | ||||||||||||||||||||||||
Available borrowing capacity | $ 7,929,000 | ||||||||||||||||||||||||
Maximum borrowing capacity | $ 285,000,000 | ||||||||||||||||||||||||
Secured Debt | Agency MSR Financing Facility Term Loan | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate | 2.50% | ||||||||||||||||||||||||
Available borrowing capacity | $ 0 | ||||||||||||||||||||||||
Maximum borrowing capacity | $ 135,000,000 | ||||||||||||||||||||||||
Secured Debt | Eurodollar | Senior Secured Term Loan | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate | 6.00% | ||||||||||||||||||||||||
Interest rate at index floor rate | 1.00% | ||||||||||||||||||||||||
Secured Debt | London Interbank Offered Rate (LIBOR) | Master Repurchase Agreement | Maximum | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate | 3.50% | ||||||||||||||||||||||||
Secured Debt | London Interbank Offered Rate (LIBOR) | Mortgage Warehouse Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate | 3.50% | ||||||||||||||||||||||||
Interest rate at index floor rate | 5.25% | ||||||||||||||||||||||||
Secured Debt | London Interbank Offered Rate (LIBOR) | Mortgage Warehouse Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate | 2.50% | ||||||||||||||||||||||||
Interest rate at index floor rate | 3.25% | ||||||||||||||||||||||||
Secured Debt | London Interbank Offered Rate (LIBOR) | Master Repurchase Agreement | Maximum | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate | 2.00% | ||||||||||||||||||||||||
Secured Debt | London Interbank Offered Rate (LIBOR) | Master Repurchase Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate | 2.50% | ||||||||||||||||||||||||
Secured Debt | London Interbank Offered Rate (LIBOR) | Agency Mortgage Servicing Rights Financing Facility | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate | 3.25% | ||||||||||||||||||||||||
OASIS Series 2014-1 | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate | 0.21% | ||||||||||||||||||||||||
Secured Debt | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Prepaid lender fees, net | $ 900,000 | ||||||||||||||||||||||||
Secured Debt | Master Repurchase Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Maximum borrowing capacity | 250,000,000 | ||||||||||||||||||||||||
Borrowings available on committed basis | $ 200,000,000 | ||||||||||||||||||||||||
Beneficial interest | 100.00% | ||||||||||||||||||||||||
Secured Debt | Master Repurchase Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Maximum borrowing capacity | $ 50,000,000 | ||||||||||||||||||||||||
Secured Debt | Participation Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Beneficial interest | 100.00% | ||||||||||||||||||||||||
Secured Debt | Loan and Security Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Borrowings available on committed basis | $ 30,000,000 | ||||||||||||||||||||||||
Mortgage Loan Warehouse Facilities | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Available borrowing capacity | $ 3,300,000 | ||||||||||||||||||||||||
Mortgage Loan Warehouse Facilities | Secured Debt | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Available borrowing capacity | $ 344,348,000 | ||||||||||||||||||||||||
Mortgage Loan Warehouse Facilities | Secured Debt | London Interbank Offered Rate (LIBOR) | Master Repurchase Agreement | Maximum | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate | 3.75% | ||||||||||||||||||||||||
Mortgage Loan Warehouse Facilities | Secured Debt | London Interbank Offered Rate (LIBOR) | Ginnie Mae Mortgage Servicing Rights Financing Facility | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Basis spread on variable rate | 4.50% | ||||||||||||||||||||||||
Interest rate at index floor rate | 0.50% | ||||||||||||||||||||||||
Mortgage Loan Warehouse Facilities | Secured Debt | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Prepaid lender fees, net | $ 2,000,000 | ||||||||||||||||||||||||
Mortgage Loan Warehouse Facilities | Secured Debt | Mortgage Warehouse Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Borrowings available on committed basis | $ 50,000,000 | ||||||||||||||||||||||||
Mortgage Loan Warehouse Facilities | Secured Debt | Mortgage Warehouse Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Maximum borrowing capacity | 150,000,000 | $ 175,000,000 | $ 150,000,000 | $ 100,000,000 | $ 150,000,000 | $ 100,000,000 | |||||||||||||||||||
Mortgage Loan Warehouse Facilities | Secured Debt | Mortgage Warehouse Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Maximum borrowing capacity | $ 150,000,000 | $ 200,000,000 | $ 100,000,000 | ||||||||||||||||||||||
Additions of participating interest | $ 50,000,000 | ||||||||||||||||||||||||
Mortgage Loan Warehouse Facilities | Secured Debt | Master Repurchase Agreement | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Maximum borrowing capacity | $ 210,000,000 | ||||||||||||||||||||||||
Subsequent Event | Secured Debt | Ginnie Mae Mortgage Servicing Rights Financing Facility | |||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||
Maximum borrowing capacity | $ 150,000,000 |
Borrowings - Schedule of Senior
Borrowings - Schedule of Senior Notes (Details) - USD ($) $ in Thousands | 6 Months Ended | 9 Months Ended | |||
Jun. 30, 2021 | Sep. 30, 2021 | May 03, 2021 | Mar. 04, 2021 | Dec. 31, 2020 | |
Debt Instrument [Line Items] | |||||
Senior notes | $ 612,658 | $ 311,898 | |||
Unamortized debt issuance costs | $ (500) | ||||
Interest rate (as a percent) | 3.25% | ||||
Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Senior notes | $ 685,000 | 313,052 | |||
Discount | (57,482) | 0 | |||
Unamortized debt issuance costs | (14,860) | (968) | |||
Fair value adjustments | $ (186) | 0 | |||
Long-term Debt | 612,658 | 311,898 | |||
7.875% Senior Notes, Due 2026 | Secured Debt | |||||
Debt Instrument [Line Items] | |||||
Senior notes | $ 400,000 | $ 400,000 | 0 | ||
Interest rate (as a percent) | 7.875% | ||||
7.875% Senior Notes, Due 2026 | Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Discount | $ (1,844) | (2,100) | 0 | ||
Unamortized debt issuance costs | $ (5,966) | ||||
12% Paid in Cash or 13.25% Paid in Kind Senior Notes, Due 2027 | |||||
Debt Instrument [Line Items] | |||||
Discount | (24,500) | ||||
Interest rate (as a percent) | 12.00% | ||||
12% Paid in Cash or 13.25% Paid in Kind Senior Notes, Due 2027 | Secured Debt | |||||
Debt Instrument [Line Items] | |||||
Senior notes | $ 285,000 | $ 85,500 | $ 199,500 | 0 | |
12% Paid in Cash or 13.25% Paid in Kind Senior Notes, Due 2027 | Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Discount | (55,638) | 0 | |||
Unamortized debt issuance costs | $ (8,894) | 0 | |||
12% Paid in Cash or 13.25% Paid in Kind Senior Notes, Due 2027 | Payment in Kind (PIK) Note | |||||
Debt Instrument [Line Items] | |||||
Interest rate (as a percent) | 13.25% | ||||
6.375% Senior Notes, Due 2021 | Senior Unsecured Notes | |||||
Debt Instrument [Line Items] | |||||
Senior notes | $ 0 | 21,543 | |||
Interest rate (as a percent) | 6.375% | ||||
8.375% Senior Secured Notes Due In 2022 | Secured Debt | |||||
Debt Instrument [Line Items] | |||||
Senior notes | $ 0 | 291,509 | |||
Interest rate (as a percent) | 8.375% | ||||
8.375% Senior Secured Notes Due In 2022 | Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Unamortized debt issuance costs | $ (968) |
Borrowings - Schedule of Redemp
Borrowings - Schedule of Redemption Prices (Details) | 9 Months Ended |
Sep. 30, 2021 | |
2023 | |
Debt Instrument [Line Items] | |
Redemption price | 103.938% |
2024 | |
Debt Instrument [Line Items] | |
Redemption price | 101.969% |
2025 and thereafter | |
Debt Instrument [Line Items] | |
Redemption price | 100.00% |
Other Liabilities - Schedule of
Other Liabilities - Schedule of Other Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Other Liabilities Disclosure [Abstract] | ||
Contingent loan repurchase liability | $ 450,385 | $ 480,221 |
Due to NRZ - Advance collections and servicing fees | 92,188 | 94,691 |
Other accrued expenses | 83,397 | 87,898 |
Checks held for escheat | 44,780 | 35,654 |
Accrued legal fees and settlements | 44,629 | 38,932 |
Liability for indemnification obligations | 44,478 | 41,920 |
MSR purchase price holdback | 40,976 | 20,923 |
Servicing-related obligations | 32,686 | 35,237 |
Derivatives, at fair value | 20,518 | 4,638 |
Lease liability | 20,311 | 27,393 |
Liability for uncertain tax positions | 16,119 | 16,188 |
Liability for unfunded pension obligation | 12,026 | 12,662 |
Accrued interest payable | 6,534 | 4,915 |
Liability for unfunded India gratuity plan | 6,103 | 6,051 |
Other | 17,618 | 16,652 |
Other liabilities | $ 932,748 | $ 923,975 |
Equity - Narrative (Details)
Equity - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | May 03, 2021 | Mar. 04, 2021 | Mar. 31, 2021 | Jun. 30, 2020 | Sep. 30, 2021 | Dec. 31, 2020 | Aug. 13, 2020 | Aug. 12, 2020 | Feb. 03, 2020 |
Subsidiary, Sale of Stock [Line Items] | |||||||||
Share repurchase program authorized amount | $ 5,000 | ||||||||
Shares repurchased (shares) | 377,484 | ||||||||
Repurchase of common stock | $ 4,500 | ||||||||
Average price paid per share | $ 11.90 | ||||||||
Payments for commissions | $ 100 | ||||||||
Additional shares issued on reverse stock split rounding | 4,692 | ||||||||
Common stock outstanding before stock split | 130,013,696 | ||||||||
Common stock, shares, outstanding | 9,189,030 | 8,687,750 | 8,672,272 | ||||||
Common stock, shares authorized | 13,333,333 | 13,333,333 | 200,000,000 | ||||||
Common stock, par value | $ 0.01 | ||||||||
Warrants to purchase, common stock shares | 261,248 | 1,184,768 | |||||||
Percentage ownership upon exercise of warrants | 3.00% | 12.00% | |||||||
Warrants exercise price | $ 24.31 | $ 26.82 | |||||||
Fair value of warrants issued | $ 16,500 | ||||||||
Issuance of common stock, shares | 426,705 | ||||||||
Ownership percentage | 4.90% | 15.00% | |||||||
Issuance of common stock, value | $ 9,900 | $ 12,169 | |||||||
Sale of stock, price per share | $ 23.15 | ||||||||
Allocated fair value of common stock | $ 12,600 | ||||||||
Allocated fair value of warrants | 4,300 | ||||||||
12% Paid in Cash or 13.25% Paid in Kind Senior Notes, Due 2027 | |||||||||
Subsidiary, Sale of Stock [Line Items] | |||||||||
Debt issuance cost in connection with warrants | $ 500 | $ 800 |
Derivative Financial Instrume_3
Derivative Financial Instruments and Hedging Activities - Summary of Derivatives (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Derivative Notional Balance | |||
Notional balance | $ 2,597,937 | $ 1,254,905 | |
Fair value of derivative assets (liabilities) at: | |||
Derivatives, at fair value | 20,329 | 23,246 | |
Derivative liability, notional amount | 2,462,500 | 420,000 | |
Derivative liability, fair value | (20,518) | (4,638) | |
Gains (losses) on derivatives | (11,362) | $ 46,871 | |
Forward loans IRLCs | |||
Derivative Notional Balance | |||
Notional balance | 1,222,451 | 619,713 | |
Fair value of derivative assets (liabilities) at: | |||
Derivatives, at fair value | 13,407 | 22,224 | |
Gains (losses) on derivatives | (8,817) | 16,860 | |
Reverse loans IRLCs | |||
Derivative Notional Balance | |||
Notional balance | 80,486 | 11,692 | |
Fair value of derivative assets (liabilities) at: | |||
Derivatives, at fair value | 623 | 482 | |
Gains (losses) on derivatives | 141 | 940 | |
TBA Forward Pipelines Trades | |||
Derivative Notional Balance | |||
Notional balance | 1,210,000 | 0 | |
Fair value of derivative assets (liabilities) at: | |||
Derivatives, at fair value | 5,538 | 0 | |
Derivative liability, notional amount | 245,000 | 0 | |
Derivative liability, fair value | (276) | ||
Gains (losses) on derivatives | 592 | 0 | |
Interest Rate Swap | |||
Derivative Notional Balance | |||
Notional balance | 0 | 593,500 | |
Fair value of derivative assets (liabilities) at: | |||
Derivatives, at fair value | 0 | 504 | |
Derivative liability, notional amount | 952,500 | 0 | |
Derivative liability, fair value | (8,236) | 0 | |
Gains (losses) on derivatives | 0 | (9,564) | |
Interest Rate Swap Futures And TBA Forward MBS Trades | |||
Fair value of derivative assets (liabilities) at: | |||
Gains (losses) on derivatives | (3,310) | 39,258 | |
Forward Sales Of Reverse Loans | |||
Derivative Notional Balance | |||
Notional balance | 85,000 | 30,000 | |
Fair value of derivative assets (liabilities) at: | |||
Derivatives, at fair value | 762 | 34 | |
Derivative liability, notional amount | 55,000 | 20,000 | |
Derivative liability, fair value | (341) | (84) | |
Gains (losses) on derivatives | 471 | (62) | |
TBA forward MBS trades | |||
Fair value of derivative assets (liabilities) at: | |||
Derivative liability, notional amount | 1,210,000 | 400,000 | |
Derivative liability, fair value | (11,227) | (4,554) | |
Other | |||
Derivative Notional Balance | |||
Notional balance | 0 | 0 | |
Fair value of derivative assets (liabilities) at: | |||
Derivatives, at fair value | 0 | 2 | |
Derivative liability, notional amount | 0 | 0 | |
Derivative liability, fair value | (438) | $ 0 | |
Gains (losses) on derivatives | $ (439) | $ (561) |
Derivative Financial Instrume_4
Derivative Financial Instruments and Hedging Activities - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||
Foreign currency re-measurement exchange gains (losses) | $ 0.2 | $ (0.2) | $ 0.3 | $ (1.1) |
Interest Expense - Schedule of
Interest Expense - Schedule of Components of Interest Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Debt securities: | ||||
Interest expense | $ 40,623 | $ 26,815 | $ 102,591 | $ 83,557 |
Senior Notes | ||||
Debt securities: | ||||
Interest expense | 18,483 | 6,658 | 44,932 | 19,977 |
Mortgage Loan Warehouse Facilities | ||||
Debt securities: | ||||
Interest expense | 8,985 | 3,932 | 20,673 | 10,531 |
MSR Financing Facilities | ||||
Debt securities: | ||||
Interest expense | 8,623 | 3,919 | 17,950 | 12,655 |
Advance Match Funded Liabilities | ||||
Debt securities: | ||||
Interest expense | 2,809 | 6,565 | 11,570 | 19,541 |
Senior Secured Term Loan | ||||
Debt securities: | ||||
Interest expense | 0 | 4,395 | 2,956 | 15,985 |
Other | ||||
Debt securities: | ||||
Interest expense | $ 1,723 | $ 1,346 | $ 4,510 | $ 4,868 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Income Tax Contingency [Line Items] | ||||
Income tax benefit | $ 11,289 | $ 1,954 | $ 20,108 | $ 71,920 |
Income tax benefit | $ (11,300) | $ (2,000) | $ (20,100) | (71,900) |
Coronavirus Aid, Relief, And Economic Security Act (CARES Act) | ||||
Income Tax Contingency [Line Items] | ||||
Income tax benefit | 71,500 | |||
Coronavirus Aid, Relief, And Economic Security Act (CARES Act) | Domestic Tax Authority | ||||
Income Tax Contingency [Line Items] | ||||
Income tax benefit | 70,300 | |||
Coronavirus Aid, Relief, And Economic Security Act (CARES Act) | Foreign Tax Authority | ||||
Income Tax Contingency [Line Items] | ||||
Income tax benefit | $ 1,200 |
Basic and Diluted Earnings (L_3
Basic and Diluted Earnings (Loss) per Share - Schedule of Reconciliation of Calculation of Basic Earnings per Share to Diluted Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Basic earnings (loss) per share | ||||
Net income (loss) | $ 21,552 | $ (9,420) | $ 19,773 | $ (32,955) |
Weighted average shares of common stock | 9,189,030 | 8,669,550 | 8,960,696 | 8,770,102 |
Basic income (loss) per share | $ 2.35 | $ (1.09) | $ 2.21 | $ (3.76) |
Common stock awards | 147,235 | 0 | 161,049 | 0 |
Contingent issuance of common stock | 0 | 0 | 51,580 | 0 |
Dilutive weighted average shares of common stock | 9,401,858 | 8,669,550 | 9,270,751 | 8,770,102 |
Diluted income (loss) per share | $ 2.29 | $ (1.09) | $ 2.13 | $ (3.76) |
Stock options and common stock awards excluded from the computation of diluted earnings (loss) per share | ||||
Anti-dilutive Securities (in shares) | 166,153 | 193,144 | 155,213 | 218,020 |
Common stock warrants | 65,593 | 0 | 97,426 | 0 |
Market Based | ||||
Stock options and common stock awards excluded from the computation of diluted earnings (loss) per share | ||||
Anti-dilutive Securities (in shares) | 87,509 | 125,395 | 87,509 | 125,395 |
Business Segment Reporting - Na
Business Segment Reporting - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Segment Reporting Information [Line Items] | ||||
Revenues | $ 283,101,000 | $ 249,035,000 | $ 756,140,000 | $ 729,901,000 |
Income (loss) before income taxes | $ 10,263,000 | (11,374,000) | $ (335,000) | (104,875,000) |
Reverse Servicing | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | (500,000) | 12,100,000 | ||
Income (loss) before income taxes | $ (5,600,000) | $ (900,000) |
Business Segment Reporting - Sc
Business Segment Reporting - Schedule of Segment Reporting Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Results of Operations | |||||
Servicing and subservicing fees | $ 206,585 | $ 181,722 | $ 562,764 | $ 568,445 | |
Reverse mortgage revenue, net | 5,035 | 14,499 | 56,162 | 51,055 | |
Gain on loans held for sale, net | 59,702 | 45,886 | 108,136 | 92,764 | |
Other revenue, net | 11,779 | 6,928 | 29,078 | 17,637 | |
Revenues | 283,101 | 249,035 | 756,140 | 729,901 | |
MSR valuation adjustments, net | (6,320) | (33,814) | (57,562) | (231,368) | |
Operating expenses | 145,436 | 149,522 | 434,873 | 431,545 | |
Other (expense) income: | |||||
Interest income | 7,869 | 3,801 | 15,993 | 12,762 | |
Interest expense | (40,623) | (26,815) | (102,591) | (83,557) | |
Loss on extinguishment of debt | 0 | 0 | (15,458) | 0 | |
Pledged MSR liability expense | (91,160) | (57,404) | (168,820) | (105,684) | |
Other | 2,832 | 3,345 | 6,836 | 4,616 | |
Total other expense, net | (121,082) | (77,073) | (264,040) | (171,863) | |
Income (loss) before income taxes | 10,263 | (11,374) | (335) | (104,875) | |
Total Assets | |||||
Balance | 12,040,238 | 10,423,851 | 12,040,238 | 10,423,851 | $ 10,651,127 |
Operating Segments | Servicing | |||||
Results of Operations | |||||
Servicing and subservicing fees | 205,431 | 178,544 | 556,927 | 565,201 | |
Reverse mortgage revenue, net | (13,032) | (1,116) | (511) | 12,837 | |
Gain on loans held for sale, net | 31,555 | 6,758 | 39,206 | 10,768 | |
Other revenue, net | 303 | 1,248 | 1,302 | 3,223 | |
Revenues | 224,257 | 185,434 | 596,924 | 592,029 | |
MSR valuation adjustments, net | (10,577) | (38,351) | (103,215) | (249,873) | |
Operating expenses | 80,849 | 84,639 | 247,228 | 255,534 | |
Other (expense) income: | |||||
Interest income | 2,416 | 1,637 | 4,905 | 6,321 | |
Interest expense | (28,979) | (22,179) | (72,598) | (69,755) | |
Loss on extinguishment of debt | 0 | ||||
Pledged MSR liability expense | (91,120) | (57,434) | (168,847) | (105,771) | |
Other | 1,443 | 2,178 | 4,787 | 8,300 | |
Total other expense, net | (116,239) | (75,798) | (231,753) | (160,905) | |
Income (loss) before income taxes | 16,592 | (13,354) | 14,728 | (74,283) | |
Total Assets | |||||
Balance | 10,790,503 | 9,516,514 | 10,790,503 | 9,516,514 | 9,847,603 |
Operating Segments | Originations | |||||
Results of Operations | |||||
Servicing and subservicing fees | 1,155 | 3,178 | 5,837 | 3,186 | |
Reverse mortgage revenue, net | 18,067 | 15,615 | 56,673 | 38,218 | |
Gain on loans held for sale, net | 29,604 | 31,295 | 94,470 | 74,163 | |
Other revenue, net | 9,947 | 4,125 | 23,450 | 9,234 | |
Revenues | 58,773 | 54,213 | 180,431 | 124,801 | |
MSR valuation adjustments, net | 2,800 | 12,370 | 20,112 | 26,338 | |
Operating expenses | 43,498 | 30,304 | 120,514 | 78,330 | |
Other (expense) income: | |||||
Interest income | 5,348 | 1,952 | 10,776 | 4,733 | |
Interest expense | (6,711) | (2,405) | (14,963) | (6,591) | |
Loss on extinguishment of debt | 0 | ||||
Pledged MSR liability expense | 0 | 0 | 0 | 0 | |
Other | 122 | 230 | 4 | 198 | |
Total other expense, net | (1,241) | (223) | (4,183) | (1,660) | |
Income (loss) before income taxes | 16,833 | 36,056 | 75,846 | 71,149 | |
Total Assets | |||||
Balance | 865,011 | 437,304 | 865,011 | 437,304 | 379,233 |
Operating Segments | Corporate Items and Other | |||||
Results of Operations | |||||
Servicing and subservicing fees | 0 | 0 | 0 | 58 | |
Reverse mortgage revenue, net | 0 | 0 | 0 | 0 | |
Gain on loans held for sale, net | 0 | 0 | 0 | 0 | |
Other revenue, net | 1,529 | 1,555 | 4,326 | 5,180 | |
Revenues | 1,529 | 1,555 | 4,326 | 5,238 | |
MSR valuation adjustments, net | 0 | 0 | 0 | 0 | |
Operating expenses | 21,088 | 34,579 | 67,131 | 97,681 | |
Other (expense) income: | |||||
Interest income | 105 | 212 | 312 | 1,708 | |
Interest expense | (4,933) | (2,231) | (15,030) | (7,211) | |
Loss on extinguishment of debt | (15,458) | ||||
Pledged MSR liability expense | (41) | 30 | 27 | 87 | |
Other | 1,267 | 937 | 2,045 | (3,882) | |
Total other expense, net | (3,602) | (1,052) | (28,104) | (9,298) | |
Income (loss) before income taxes | (23,162) | (34,076) | (90,909) | (101,741) | |
Total Assets | |||||
Balance | 384,724 | 470,033 | 384,724 | 470,033 | $ 424,291 |
Intersegment Eliminations | |||||
Results of Operations | |||||
Servicing and subservicing fees | 0 | 0 | 0 | 0 | |
Reverse mortgage revenue, net | 0 | 0 | 0 | 0 | |
Gain on loans held for sale, net | (1,457) | 7,833 | (25,541) | 7,833 | |
Other revenue, net | 0 | 0 | 0 | 0 | |
Revenues | (1,457) | 7,833 | (25,541) | 7,833 | |
MSR valuation adjustments, net | 1,457 | 7,833 | (25,541) | 7,833 | |
Operating expenses | 0 | 0 | 0 | 0 | |
Other (expense) income: | |||||
Interest income | 0 | 0 | 0 | 0 | |
Interest expense | 0 | 0 | 0 | 0 | |
Loss on extinguishment of debt | 0 | ||||
Pledged MSR liability expense | 0 | 0 | 0 | 0 | |
Other | 0 | 0 | 0 | 0 | |
Total other expense, net | 0 | 0 | 0 | 0 | |
Income (loss) before income taxes | $ 0 | $ 0 | $ 0 | $ 0 |
Business Segment Reporting - _2
Business Segment Reporting - Schedule of Segment Reporting Information (Footnote) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | |
Intersegment Eliminations | |||
Segment Reporting Information [Line Items] | |||
Gains on derivatives | $ (1.5) | $ (25.5) | $ 7.8 |
Business Segment Reporting - _3
Business Segment Reporting - Schedule of Depreciation and Amortization by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Segment Reporting Information [Line Items] | ||||
Depreciation expense | $ 2,461 | $ 4,305 | $ 7,527 | $ 15,398 |
Amortization of debt issuance costs and discount | 2,205 | 1,154 | 5,438 | 5,335 |
Servicing | ||||
Segment Reporting Information [Line Items] | ||||
Depreciation expense | 137 | 219 | 514 | 652 |
Amortization of debt issuance costs and discount | 129 | 115 | 388 | 343 |
Originations | ||||
Segment Reporting Information [Line Items] | ||||
Depreciation expense | 77 | 31 | 125 | 102 |
Amortization of debt issuance costs and discount | 0 | 0 | 0 | 0 |
Corporate and Other | ||||
Segment Reporting Information [Line Items] | ||||
Depreciation expense | 2,247 | 4,055 | 6,888 | 14,644 |
Amortization of debt issuance costs and discount | $ 2,076 | $ 1,039 | $ 5,050 | $ 4,992 |
Regulatory Requirements - Narra
Regulatory Requirements - Narrative (Details) - USD ($) | 1 Months Ended | ||
Oct. 31, 2020 | Sep. 30, 2021 | Dec. 31, 2020 | |
Public Utilities, General Disclosures [Line Items] | |||
Net worth requirement | $ 389,200,000 | ||
Cash and cash equivalents | 236,072,000 | $ 284,802,000 | |
PHH Mortgage Corporation | |||
Public Utilities, General Disclosures [Line Items] | |||
Net worth | 557,700,000 | ||
Restrictive liquidity requirements | 48,200,000 | ||
Cash and cash equivalents | $ 216,600,000 | ||
CA DBO | |||
Public Utilities, General Disclosures [Line Items] | |||
Litigation settlement expense | $ 62,000 |
Commitments - Narrative (Detail
Commitments - Narrative (Details) $ in Millions | 9 Months Ended | ||
Sep. 30, 2021USD ($)Employee | Dec. 31, 2020USD ($) | Dec. 21, 2020USD ($) | |
Other Commitments [Line Items] | |||
Threshold of outstanding principal balance on maximum claim amount (as a percent) | 98.00% | ||
Investment in equity method investee | $ 250 | ||
Number of employees retained | Employee | 5,200 | ||
Floating Rate Reverse Mortgage Loans | |||
Other Commitments [Line Items] | |||
Additional borrowing capacity to borrowers | $ 2,100 | $ 2,000 | |
Funded amount in connection with reverse mortgage loans | 147.6 | ||
Forward Mortgage Loan Interest Rate Lock Commitments | |||
Other Commitments [Line Items] | |||
Short-term commitments to lend | 1,200 | ||
Reverse loans IRLCs | |||
Other Commitments [Line Items] | |||
Short-term commitments to lend | $ 80.5 | ||
New Residential Investment Corp | |||
Other Commitments [Line Items] | |||
Servicing agreements notice of termination | 180 days | ||
Customer Concentration Risk | Unpaid Principal Balance | New Residential Investment Corp | |||
Other Commitments [Line Items] | |||
Concentration risk (percent) | 24.00% | ||
Customer Concentration Risk | Loan Count | New Residential Investment Corp | |||
Other Commitments [Line Items] | |||
Concentration risk (percent) | 34.00% | ||
Customer Concentration Risk | Delinquent Loans | New Residential Investment Corp | |||
Other Commitments [Line Items] | |||
Concentration risk (percent) | 62.00% |
Commitments - Schedule of Activ
Commitments - Schedule of Activity Related to HMBS Repurchases (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2021USD ($)Securitiesloan | |
Long-term Purchase Commitment [Line Items] | |
Beginning balance, repurchase securities, number | Securities | 458 |
Additions, repurchase securities, number | Securities | 420 |
Recoveries, net, repurchase securities, number | Securities | (351) |
Transfers, repurchase securities, number | Securities | 0 |
Change in value, repurchase securities, number | Securities | 0 |
Ending balance, repurchase securities, number | Securities | 527 |
Beginning balance, repurchase securities, amount | $ 86,301 |
Additions, repurchase securities, amount | 99,640 |
Recoveries, repurchase securities, amount | (68,992) |
Transfers, repurchase securities, amount | 0 |
Change in value, repurchase securities, amount | (2,485) |
Ending balance, repurchase securities, amount | $ 114,464 |
Active | |
Long-term Purchase Commitment [Line Items] | |
Beginning balance, repurchase securities, number | loan | 141 |
Additions, repurchase securities, number | loan | 217 |
Recoveries, net, repurchase securities, number | loan | (221) |
Transfers, repurchase securities, number | loan | (18) |
Change in value, repurchase securities, number | loan | 0 |
Ending balance, repurchase securities, number | Securities | 119 |
Beginning balance, repurchase securities, amount | $ 29,852 |
Additions, repurchase securities, amount | 57,684 |
Recoveries, repurchase securities, amount | (50,748) |
Transfers, repurchase securities, amount | (6,261) |
Change in value, repurchase securities, amount | 9 |
Ending balance, repurchase securities, amount | $ 30,536 |
Inactive | |
Long-term Purchase Commitment [Line Items] | |
Beginning balance, repurchase securities, number | loan | 317 |
Additions, repurchase securities, number | loan | 203 |
Recoveries, net, repurchase securities, number | loan | (130) |
Transfers, repurchase securities, number | loan | 18 |
Change in value, repurchase securities, number | loan | 0 |
Ending balance, repurchase securities, number | Securities | 408 |
Beginning balance, repurchase securities, amount | $ 56,449 |
Additions, repurchase securities, amount | 41,956 |
Recoveries, repurchase securities, amount | (18,244) |
Transfers, repurchase securities, amount | 6,261 |
Change in value, repurchase securities, amount | (2,494) |
Ending balance, repurchase securities, amount | $ 83,928 |
Contingencies - Narrative (Deta
Contingencies - Narrative (Details) $ in Millions | Apr. 20, 2017States | Sep. 30, 2021USD ($)LoanStates | Sep. 30, 2020USD ($)Loan |
Loss Contingencies [Line Items] | |||
Accrued penalty | $ 44.6 | ||
Number of states charging with regulatory action | States | 29 | ||
Warranty repurchase demands unpaid principal balance | $ 59.6 | $ 45.2 | |
Warranty repurchase demands number of loans | Loan | 301 | 263 | |
PHH Corporation | |||
Loss Contingencies [Line Items] | |||
Accrued penalty | $ 2.5 | ||
Multistate Mortgage Committee | |||
Loss Contingencies [Line Items] | |||
Number of states who are part of confidential supervisory memorandum of understanding | States | 6 |
Contingencies - Schedule of Ind
Contingencies - Schedule of Indemnification Obligations (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Indemnification Obligations Liability [Roll Forward] | ||
Beginning balance | $ 40,374 | $ 50,838 |
Provision (reversal) for representation and warranty obligations | 1,483 | (1,141) |
New production liability | 3,227 | 1,361 |
Charge-offs and other | (2,530) | (8,130) |
Ending balance | $ 42,554 | $ 42,928 |
Subsequent Events - Narrative (
Subsequent Events - Narrative (Details) $ in Millions | Oct. 01, 2021USD ($)EmployeesLoan | Sep. 30, 2021USD ($)Employee | Sep. 30, 2020USD ($) |
Subsequent Event [Line Items] | |||
Total number of employees | Employee | 5,200 | ||
UPB of loans acquired | $ 72,200 | $ 9,900 | |
Subsequent Event | RMS | |||
Subsequent Event [Line Items] | |||
Aggregate purchase price | $ 12.4 | ||
Total number of employees | Employees | 350 | ||
Number of reverse mortgage loans acquired | Loan | 57,000 | ||
UPB of loans acquired | $ 14,300 |