x
|
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
91-1653725
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
8950 Cypress Waters Blvd, Coppell, TX
|
|
75019
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
Common Stock, $0.01 par value per share
|
COOP
|
The Nasdaq Stock Market
|
Large Accelerated Filer o
|
|
Accelerated Filer x
|
Non-Accelerated Filer o
|
|
Smaller reporting company o Emerging growth company o
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Page
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
|
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Item 3.
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Item 4.
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||
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Item 5.
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Item 6.
|
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Item 7.
|
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Item 7A.
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Item 8.
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||
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||
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||
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||
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||
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||
|
||
Item 9.
|
||
Item 9A.
|
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Item 9B.
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Item 10.
|
||
Item 11.
|
||
Item 12.
|
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Item 13.
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Item 14.
|
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Item 15.
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Item 16.
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||
|
•
|
our ability to maintain or grow the size of our servicing portfolio;
|
•
|
our ability to maintain or grow our originations volume and profitability;
|
•
|
our ability to recapture voluntary prepayments related to our existing servicing portfolio;
|
•
|
our shift in the mix of our servicing portfolio to subservicing, which is highly concentrated;
|
•
|
delays in our ability to collect or be reimbursed for servicing advances;
|
•
|
our ability to obtain sufficient liquidity and capital to operate our business;
|
•
|
changes in prevailing interest rates;
|
•
|
our ability to finance and recover costs of our reverse servicing operations;
|
•
|
our ability to successfully implement our strategic initiatives;
|
•
|
our ability to realize anticipated benefits of our previous acquisitions;
|
•
|
our ability to use net operating loss carryforwards and other tax attributes;
|
•
|
changes in our business relationships or changes in servicing guidelines with Fannie Mae, Freddie Mac and Ginnie Mae;
|
•
|
Xome’s ability to compete in highly competitive markets;
|
•
|
our ability to pay down debt;
|
•
|
our ability to manage legal and regulatory examinations and enforcement investigations and proceedings, compliance requirements and related costs;
|
•
|
our ability to prevent cyber intrusions and mitigate cyber risks; and
|
•
|
our ability to maintain our licenses and other regulatory approvals.
|
•
|
the available liquidity in the credit markets;
|
•
|
prevailing interest rates;
|
•
|
an event of default, a negative ratings action by a rating agency and limitations imposed on us under the indentures governing our current debt that contain restrictive covenants and borrowing conditions that may limit our ability to raise additional debt;
|
•
|
the strength of the lenders from which we borrow; and
|
•
|
limitations on borrowings on advance facilities imposed by the amount of eligible collateral pledged, which may be less than the borrowing capacity of the advance facility.
|
•
|
require us to dedicate a substantial portion of cash flow from operations to the payment of principal and interest on our current indebtedness and any indebtedness we may incur in the future, thereby reducing the funds available for other purposes;
|
•
|
make it more difficult for us to satisfy and comply with our obligations with respect to the unsecured senior notes;
|
•
|
subject us to increased sensitivity to increases in prevailing interest rates;
|
•
|
place us at a competitive disadvantage to competitors with relatively less debt in economic downturns, adverse industry conditions or catastrophic external events; or
|
•
|
reduce our flexibility in planning for or responding to changing business, industry and economic conditions.
|
•
|
a decrease in interest rates may increase prepayment speeds which may lead to (i) increased amortization expense; (ii) decrease in servicing fees; and (iii) decrease in the value of our MSRs;
|
•
|
an increase in interest rates, together with an increase in monthly payments when an adjustable mortgage loan’s interest rate adjusts upward from an initial fixed rate or a low introductory rate, may cause increased delinquency, default and foreclosure. Increased mortgage defaults and foreclosures may adversely affect our business as they increase our expenses and reduce the number of mortgages we service;
|
•
|
an increase in interest rates could adversely affect our loan originations volume because refinancing an existing loan would be less attractive for homeowners and qualifying for a purchase money loan may be more difficult for consumers;
|
•
|
an increase in interest rates could also adversely affect our production margins due to increased competition among originators;
|
•
|
a substantial and sustained increase in prevailing interest rates could adversely affect the loan origination volumes of Xome’s clients since refinancing and purchase loans would be less attractive to borrowers, which would in turn adversely impact Xome Services’ valuation and title order volume;
|
•
|
an increase in interest rates could adversely affect Xome Exchange’s property sales, particularly non-distressed sales, as financing may become less attractive to borrowers;
|
•
|
an increase in interest rates would increase the cost of servicing our outstanding debt, including our ability to finance servicing advances and loan originations and for borrowing for acquisitions; and
|
•
|
a decrease in interest rates could reduce our earnings from our custodial deposit accounts.
|
•
|
the rates of prepayment and repayment within the underlying pools of mortgage loans;
|
•
|
projected rates of delinquencies, defaults and liquidations;
|
•
|
future interest rates;
|
•
|
cost to service the loans;
|
•
|
ancillary revenues; and
|
•
|
amounts of future servicing advances.
|
•
|
unknown or contingent liabilities;
|
•
|
unanticipated issues in integrating information, management style, controls and procedures, servicing practices, communications and other systems including information technology systems;
|
•
|
unanticipated incompatibility of purchasing, logistics, marketing and administration methods;
|
•
|
not retaining key employees or clients; and
|
•
|
inaccuracy of valuation and/or operating assumptions supporting our purchase price.
|
•
|
difficulty in finding buyers or alternative exit strategies on acceptable terms in a timely manner;
|
•
|
destabilization of the applicable operations;
|
•
|
loss of key personnel;
|
•
|
ability to obtain necessary governmental or regulatory approvals;
|
•
|
post-disposal disputes and indemnification obligations;
|
•
|
access by purchasers to certain of our systems and tools during transition periods;
|
•
|
the migration of data and separation of systems; and
|
•
|
data privacy matters.
|
•
|
Revenue. An increase in delinquencies will result in lower revenue for loans we service for GSEs and Ginnie Mae because we only collect servicing fees from GSEs and Ginnie Mae for performing loans. Additionally, while increased delinquencies generate higher ancillary revenues, including late fees, these fees do not offset the higher cost to service a delinquent loan and are not likely to be recoverable in the event that the loan is liquidated. In addition, an increase in delinquencies reduces cash held in collections and other accounts and lowers the interest income we receive.
|
•
|
Expenses. An increase in delinquencies will result in a higher cost to service due to the increased time and effort required to collect payments from delinquent borrowers and an increase in interest expense as a result of an increase in our advancing obligations.
|
•
|
Liquidity. An increase in delinquencies could also negatively impact our liquidity because of an increase in servicing advances resulting in an increase in borrowings under advance facilities and/or insufficient financing capacity to fund increases in advances.
|
•
|
Valuation of MSRs. We base the price we pay for MSRs on, among other things, our projections of the cash flows from the related pool of mortgage loans. Our expectation of delinquencies is a significant assumption underlying those cash flow projections. If delinquencies were significantly greater than expected, the estimated fair value of our MSRs could be diminished. If the estimated fair value of MSRs is reduced, we would record a loss which would adversely impact our ability to satisfy minimum net worth covenants and borrowing conditions in our debt agreements which could have a negative impact on our financial results.
|
•
|
adversely affect our ability to finance servicing advances and maintain our status as an approved servicer by Fannie Mae, Freddie Mac, Ginnie Mae, and other investors;
|
•
|
lead to the early termination of existing advance facilities and affect the terms and availability of advance facilities that we may seek in the future;
|
•
|
cause our termination as servicer in our servicing agreements that require that we maintain specified servicer ratings; and
|
•
|
further impair our ability to consummate future servicing transactions.
|
•
|
our representations and warranties concerning loan quality and loan circumstances are inaccurate, including representations concerning the licensing of a mortgage broker;
|
•
|
we fail to secure adequate mortgage insurance within a certain period after closing;
|
•
|
a mortgage insurance provider denies coverage;
|
•
|
we fail to comply, at the individual loan level or otherwise, with regulatory requirements in the current dynamic regulatory environment; or
|
•
|
the borrower fails to make certain initial loan payments due to the purchaser.
|
•
|
strengthen our balance sheet by building capital and liquidity, reducing leverage, taking advantage of market conditions to refinance existing senior notes, and implementing derivative hedging strategies;
|
•
|
drive stronger profitability through a variety of efficiency initiatives, including ongoing improvement in unit cost economics in servicing, originations, and Xome, as well as finalizing our Project Titan servicing transformation initiative and identifying and realizing other opportunities for cost savings throughout the organization;
|
•
|
improve results at Xome by winning new third-party customers and gaining wallet share with existing customers by cross-selling multiple services and by delivering strong performance and excellent customer service;
|
•
|
continue to focus on improving the customer experience in all of our segments, as well as sustaining the culture and talent of our workforce; and
|
•
|
maintain strong relationships with agencies, investors, regulators, and other constituencies and a strong reputation for compliance and customer service.
|
•
|
our operating performance and the performance of our competitors and fluctuations in our operating results;
|
•
|
macro-economic trends, including changes in interest rates and economic growth and unemployment;
|
•
|
the public’s reaction to our press releases, our other public announcements and our filings with the SEC;
|
•
|
changes in earnings estimates or recommendations by research analysts who follow us or other companies in our industry;
|
•
|
global, national or local economic, legal and regulatory factors unrelated to our performance;
|
•
|
announcements of negative news by us or our competitors, such as announcements of poorer than expected results of operations, data breaches or significant litigation;
|
•
|
actual or anticipated variations in our or our competitors’ operating results, and our or our competitors’ growth rates;
|
•
|
failure by us or our competitors to meet analysts’ projections or guidance we or our competitors may give the market;
|
•
|
changes in laws or regulations, or new interpretations or applications of laws and regulations, that are applicable to our business;
|
•
|
changes in accounting standards, policies, guidance, interpretations or principles;
|
•
|
the departure of key personnel;
|
•
|
the number of shares publicly traded;
|
•
|
the converted Series B preferred stockholders selling their shares; and
|
•
|
other developments affecting us, our industry or our competitors.
|
|
December 31,
|
||||||||||||||||||||||
|
2014
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
||||||||||||
Mr. Cooper (formerly WMIH)
|
$
|
100
|
|
|
$
|
126
|
|
|
$
|
76
|
|
|
$
|
41
|
|
|
$
|
47
|
|
|
$
|
51
|
|
S&P 500 Index
|
100
|
|
|
99
|
|
|
109
|
|
|
130
|
|
|
122
|
|
|
157
|
|
||||||
Peer Group (2014 through 2017) and S&P Small Cap 600 Financials Index (2018 through 2019)
|
100
|
|
|
85
|
|
|
108
|
|
|
133
|
|
|
127
|
|
|
153
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||||||
|
As of December 31,
|
|
|
As of December 31,
|
||||||||||||||||
|
2019(1)
|
|
2018
|
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
Consolidated Balance Sheet Data: (amounts in millions)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
329
|
|
|
$
|
242
|
|
|
|
$
|
215
|
|
|
$
|
489
|
|
|
$
|
613
|
|
Mortgage servicing rights
|
3,502
|
|
|
3,676
|
|
|
|
2,941
|
|
|
3,166
|
|
|
3,367
|
|
|||||
Advances and other receivables, net
|
988
|
|
|
1,194
|
|
|
|
1,706
|
|
|
1,749
|
|
|
2,412
|
|
|||||
Reverse mortgage interests, net
|
6,279
|
|
|
7,934
|
|
|
|
9,984
|
|
|
11,033
|
|
|
7,514
|
|
|||||
Mortgage loans held for sale
|
4,077
|
|
|
1,631
|
|
|
|
1,891
|
|
|
1,788
|
|
|
1,430
|
|
|||||
Total assets(2)
|
18,305
|
|
|
16,973
|
|
|
|
18,036
|
|
|
19,593
|
|
|
16,617
|
|
|||||
Unsecured senior notes, net
|
2,366
|
|
|
2,459
|
|
|
|
1,874
|
|
|
1,990
|
|
|
2,026
|
|
|||||
Advance facilities, net
|
422
|
|
|
595
|
|
|
|
855
|
|
|
1,096
|
|
|
1,640
|
|
|||||
Warehouse facilities, net
|
4,575
|
|
|
2,349
|
|
|
|
3,285
|
|
|
2,421
|
|
|
1,890
|
|
|||||
Other nonrecourse debt, net
|
5,286
|
|
|
6,795
|
|
|
|
8,014
|
|
|
9,631
|
|
|
6,666
|
|
|||||
Total liabilities(2)
|
16,074
|
|
|
15,028
|
|
|
|
16,314
|
|
|
17,910
|
|
|
14,850
|
|
|||||
Total stockholders’ equity(2)
|
2,231
|
|
|
1,945
|
|
|
|
1,722
|
|
|
1,683
|
|
|
1,767
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||||||||||
|
Year Ended December 31, 2019(1)
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Year Ended December 31, 2017
|
|
Year Ended December 31, 2016
|
|
Year Ended December 31, 2015
|
||||||||||||
Consolidated Statement of Operations and Comprehensive Income Data: (amounts in millions, except for earnings per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total revenues
|
$
|
2,007
|
|
|
$
|
594
|
|
|
|
$
|
1,196
|
|
|
$
|
1,650
|
|
|
$
|
1,915
|
|
|
$
|
1,989
|
|
Total expenses
|
1,851
|
|
|
707
|
|
|
|
945
|
|
|
1,475
|
|
|
1,644
|
|
|
1,688
|
|
||||||
Total other income (expenses), net
|
(159
|
)
|
|
(24
|
)
|
|
|
(49
|
)
|
|
(131
|
)
|
|
(242
|
)
|
|
(247
|
)
|
||||||
(Loss) income before income tax (benefit) expense
|
(3
|
)
|
|
(137
|
)
|
|
|
202
|
|
|
44
|
|
|
29
|
|
|
54
|
|
||||||
Less: Income tax (benefit) expense
|
(273
|
)
|
|
(1,021
|
)
|
|
|
48
|
|
|
13
|
|
|
13
|
|
|
11
|
|
||||||
Net income
|
270
|
|
|
884
|
|
|
|
154
|
|
|
31
|
|
|
16
|
|
|
43
|
|
||||||
Less: Net (loss) income attributable to non-controlling interests
|
(4
|
)
|
|
—
|
|
|
|
—
|
|
|
1
|
|
|
(3
|
)
|
|
4
|
|
||||||
Net income attributable to Successor/Predecessor
|
274
|
|
|
884
|
|
|
|
154
|
|
|
30
|
|
|
19
|
|
|
39
|
|
||||||
Less: Undistributed earnings attributable to participating stockholders
|
2
|
|
|
8
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net income attributable to common stockholders
|
272
|
|
|
876
|
|
|
|
154
|
|
|
30
|
|
|
19
|
|
|
39
|
|
||||||
Earnings per share data:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Basic
|
$
|
2.99
|
|
|
$
|
9.65
|
|
|
|
$
|
1.57
|
|
|
$
|
0.31
|
|
|
$
|
0.19
|
|
|
$
|
0.38
|
|
Diluted
|
$
|
2.95
|
|
|
$
|
9.54
|
|
|
|
$
|
1.55
|
|
|
$
|
0.30
|
|
|
$
|
0.19
|
|
|
$
|
0.37
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other Financial Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net cash provided by / (used in):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operating activities
|
$
|
702
|
|
|
$
|
1,251
|
|
|
|
$
|
2,294
|
|
|
$
|
1,359
|
|
|
$
|
972
|
|
|
$
|
398
|
|
Investing activities
|
(338
|
)
|
|
(250
|
)
|
|
|
(162
|
)
|
|
(6
|
)
|
|
(3,738
|
)
|
|
(5,567
|
)
|
||||||
Financing activities
|
(313
|
)
|
|
(2,063
|
)
|
|
|
(2,111
|
)
|
|
(1,655
|
)
|
|
2,698
|
|
|
5,483
|
|
(1)
|
Includes the impact of the acquisition of Pacific Union Financial, LLC. See Note 3, Acquisitions, in the notes to consolidated financial statements for further details.
|
(2)
|
Includes impact of the adoption of Accounting Standards Update No. 2016-02, Leases (Topic 842) on January 1, 2019. See Note 1, Nature of Business and Basis of Presentation, and Note 9, Leases, in the notes to consolidated financial statements for further details.
|
Overview
|
•
|
Strengthen our balance sheet by building capital and liquidity, reducing leverage, taking advantage of market conditions to refinance existing senior notes, and implementing derivative hedging strategies;
|
•
|
Drive stronger profitability through a variety of efficiency initiatives, including ongoing improvement in unit cost economics in Servicing, Originations, and Xome, as well as finalizing our Project Titan servicing transformation initiative and identifying and realizing other opportunities for cost savings throughout the organization;
|
•
|
Improve results at Xome by winning new third-party customers and gaining wallet share with existing customers by cross-selling multiple services and by delivering strong performance and excellent customer service;
|
•
|
Continue to focus on improving the customer experience in all of our segments, as well as sustaining the culture and talent of our workforce; and
|
•
|
Maintain strong relationships with agencies, investors, regulators, and other constituencies and a strong reputation for compliance and customer service.
|
Table 1. Consolidated Operations
|
|
Successor
|
|
|
Predecessor
|
|
|
|
|
|
|
|||||||||||||
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Combined(1)
|
|
$ Change
|
|
% Change
|
||||||||||||
Revenues - operational
|
$
|
2,512
|
|
|
$
|
758
|
|
|
|
$
|
1,000
|
|
|
$
|
1,758
|
|
|
$
|
754
|
|
|
43
|
%
|
Revenues - Mark-to-market
|
(505
|
)
|
|
(164
|
)
|
|
|
196
|
|
|
32
|
|
|
(537
|
)
|
|
(1,678
|
)%
|
|||||
Total revenues
|
2,007
|
|
|
594
|
|
|
|
1,196
|
|
|
1,790
|
|
|
217
|
|
|
12
|
%
|
|||||
Total expenses
|
1,851
|
|
|
707
|
|
|
|
945
|
|
|
1,652
|
|
|
199
|
|
|
12
|
%
|
|||||
Total other income (expenses), net
|
(159
|
)
|
|
(24
|
)
|
|
|
(49
|
)
|
|
(73
|
)
|
|
(86
|
)
|
|
118
|
%
|
|||||
(Loss) income before income tax (benefit) expense
|
(3
|
)
|
|
(137
|
)
|
|
|
202
|
|
|
65
|
|
|
(68
|
)
|
|
(105
|
)%
|
|||||
Less: Income tax (benefit) expense
|
(273
|
)
|
|
(1,021
|
)
|
|
|
48
|
|
|
(973
|
)
|
|
700
|
|
|
(72
|
)%
|
|||||
Net income
|
270
|
|
|
884
|
|
|
|
154
|
|
|
1,038
|
|
|
(768
|
)
|
|
(74
|
)%
|
|||||
Less: Net loss attributable to non-controlling interests
|
(4
|
)
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
(100
|
)%
|
|||||
Net income attributable to Successor/Predecessor
|
$
|
274
|
|
|
$
|
884
|
|
|
|
$
|
154
|
|
|
$
|
1,038
|
|
|
$
|
(764
|
)
|
|
(74
|
)%
|
(1)
|
Refer to Basis of Presentation section for discussion on presentation of combined results.
|
Table 2. Provision for Income Taxes
|
|
Successor
|
|
|
Predecessor
|
|
|
|
|
|
|
|||||||||||||
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Combined(1)
|
|
$ Change
|
|
% Change
|
|||||||||||
Income tax (benefit) expense
|
$
|
(273
|
)
|
|
$
|
(1,021
|
)
|
|
|
$
|
48
|
|
|
$
|
(973
|
)
|
|
$
|
700
|
|
|
(72
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Effective tax rate(2)
|
7718.8
|
%
|
|
742.4
|
%
|
|
|
23.8
|
%
|
|
|
|
|
|
|
(1)
|
Refer to Basis of Presentation section for discussion on presentation of combined results.
|
(2)
|
Effective tax rate is calculated using whole numbers.
|
Segment Results
|
•
|
The Servicing segment performs operational activities on behalf of investors or owners of the underlying mortgages, including collecting and disbursing borrower payments, investor reporting, customer service, modifying loans where appropriate to help borrowers stay current, and, when necessary, performing collections, foreclosures, and the sale of REO.
|
•
|
The Originations segment originates residential mortgage loans through our direct-to-consumer channel, which provides refinance options for our existing customers, and through our correspondent and wholesale channels, which purchase or originate loans from mortgage bankers and brokers.
|
•
|
The Xome segment provides a variety of real estate services to mortgage originators, mortgage and real estate investors, and mortgage servicers, including valuation, title, and field services, and operates an exchange which facilitates the sale of foreclosed properties.
|
•
|
The Corporate/Other segment represents unallocated overhead expenses, including the costs of executive management and other corporate functions that are not directly attributable to our operating segments, our senior unsecured notes, and the results of a legacy mortgage investment portfolio, which consists of non-prime and non-conforming residential mortgage loans that were transferred to a securitization trust (“Trust 2009-A”) in 2009. We collapsed Trust 2009-A and executed the sale of the loans held in the trust in September 2019.
|
Table 3. Segment Results
|
|
Successor
|
||||||||||||||||||||||||||
|
Year Ended December 31, 2019
|
||||||||||||||||||||||||||
|
Servicing
|
|
Originations
|
|
Xome
|
|
Elimination
|
|
Total Operating
Segments |
|
Corporate/ Other
|
|
Consolidated
|
||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Service related, net
|
$
|
408
|
|
|
$
|
80
|
|
|
$
|
422
|
|
|
$
|
(3
|
)
|
|
$
|
907
|
|
|
$
|
2
|
|
|
$
|
909
|
|
Net gain on mortgage loans held for sale
|
124
|
|
|
963
|
|
|
—
|
|
|
—
|
|
|
1,087
|
|
|
11
|
|
|
1,098
|
|
|||||||
Total revenues
|
532
|
|
|
1,043
|
|
|
422
|
|
|
(3
|
)
|
|
1,994
|
|
|
13
|
|
|
2,007
|
|
|||||||
Total expenses
|
690
|
|
|
568
|
|
|
398
|
|
|
(3
|
)
|
|
1,653
|
|
|
198
|
|
|
1,851
|
|
|||||||
Other income (expenses), net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Interest income
|
500
|
|
|
98
|
|
|
—
|
|
|
—
|
|
|
598
|
|
|
7
|
|
|
605
|
|
|||||||
Interest expense
|
(469
|
)
|
|
(98
|
)
|
|
—
|
|
|
—
|
|
|
(567
|
)
|
|
(212
|
)
|
|
(779
|
)
|
|||||||
Other income (expenses), net
|
4
|
|
|
4
|
|
|
14
|
|
|
—
|
|
|
22
|
|
|
(7
|
)
|
|
15
|
|
|||||||
Total other income (expenses), net
|
35
|
|
|
4
|
|
|
14
|
|
|
—
|
|
|
53
|
|
|
(212
|
)
|
|
(159
|
)
|
|||||||
Income (loss) before income tax expense (benefit)
|
$
|
(123
|
)
|
|
$
|
479
|
|
|
$
|
38
|
|
|
$
|
—
|
|
|
$
|
394
|
|
|
$
|
(397
|
)
|
|
$
|
(3
|
)
|
|
Successor
|
||||||||||||||||||||||||||
|
Five Months Ended December 31, 2018
|
||||||||||||||||||||||||||
|
Servicing
|
|
Originations
|
|
Xome
|
|
Elimination
|
|
Total Operating
Segments |
|
Corporate/ Other
|
|
Consolidated
|
||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Service related, net
|
$
|
217
|
|
|
$
|
24
|
|
|
$
|
177
|
|
|
$
|
—
|
|
|
$
|
418
|
|
|
$
|
—
|
|
|
$
|
418
|
|
Net gain on mortgage loans held for sale
|
19
|
|
|
157
|
|
|
—
|
|
|
—
|
|
|
176
|
|
|
—
|
|
|
176
|
|
|||||||
Total revenues
|
236
|
|
|
181
|
|
|
177
|
|
|
—
|
|
|
594
|
|
|
—
|
|
|
594
|
|
|||||||
Total expenses
|
303
|
|
|
155
|
|
|
178
|
|
|
—
|
|
|
636
|
|
|
71
|
|
|
707
|
|
|||||||
Other income (expenses), net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Interest income
|
222
|
|
|
27
|
|
|
—
|
|
|
—
|
|
|
249
|
|
|
7
|
|
|
256
|
|
|||||||
Interest expense
|
(173
|
)
|
|
(26
|
)
|
|
(1
|
)
|
|
—
|
|
|
(200
|
)
|
|
(93
|
)
|
|
(293
|
)
|
|||||||
Other income, net
|
6
|
|
|
5
|
|
|
1
|
|
|
—
|
|
|
12
|
|
|
1
|
|
|
13
|
|
|||||||
Total other income (expenses), net
|
55
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
61
|
|
|
(85
|
)
|
|
(24
|
)
|
|||||||
Income (loss) before income tax expense (benefit)
|
$
|
(12
|
)
|
|
$
|
32
|
|
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
$
|
19
|
|
|
$
|
(156
|
)
|
|
$
|
(137
|
)
|
|
Predecessor
|
||||||||||||||||||||||||||
|
Seven Months Ended July 31, 2018
|
||||||||||||||||||||||||||
|
Servicing(1)
|
|
Originations
|
|
Xome
|
|
Elimination/ Reclassification(1)
|
|
Total Operating
Segments |
|
Corporate/ Other
|
|
Consolidated
|
||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Service related, net
|
$
|
740
|
|
|
$
|
36
|
|
|
$
|
149
|
|
|
$
|
(25
|
)
|
|
$
|
900
|
|
|
$
|
1
|
|
|
$
|
901
|
|
Net gain on mortgage loans held for sale
|
—
|
|
|
270
|
|
|
—
|
|
|
25
|
|
|
295
|
|
|
—
|
|
|
295
|
|
|||||||
Total revenues
|
740
|
|
|
306
|
|
|
149
|
|
|
—
|
|
|
1,195
|
|
|
1
|
|
|
1,196
|
|
|||||||
Total expenses
|
474
|
|
|
245
|
|
|
123
|
|
|
—
|
|
|
842
|
|
|
103
|
|
|
945
|
|
|||||||
Other income (expenses), net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Interest income
|
288
|
|
|
38
|
|
|
—
|
|
|
—
|
|
|
326
|
|
|
7
|
|
|
333
|
|
|||||||
Interest expense
|
(268
|
)
|
|
(37
|
)
|
|
—
|
|
|
—
|
|
|
(305
|
)
|
|
(83
|
)
|
|
(388
|
)
|
|||||||
Other (expenses) income, net
|
(1
|
)
|
|
—
|
|
|
9
|
|
|
—
|
|
|
8
|
|
|
(2
|
)
|
|
6
|
|
|||||||
Total other income (expenses), net
|
19
|
|
|
1
|
|
|
9
|
|
|
—
|
|
|
29
|
|
|
(78
|
)
|
|
(49
|
)
|
|||||||
Income (loss) before income tax expense (benefit)
|
$
|
285
|
|
|
$
|
62
|
|
|
$
|
35
|
|
|
$
|
—
|
|
|
$
|
382
|
|
|
$
|
(180
|
)
|
|
$
|
202
|
|
(1)
|
For the Predecessor’s Servicing segment results purposes, all revenues are attributable to servicing the portfolio. Therefore, $25 of net gain on mortgage loans was moved to revenues - service related, net during the seven months ended July 31, 2018. For consolidated results purposes, these amounts were reclassed to net gain on mortgage loans held for sale.
|
Servicing Segment
|
Table 4. Servicer Ratings
|
|
Successor
|
||||
|
Fitch(1)
|
|
Moody’s(2)
|
|
S&P(3)
|
Rating date
|
January 2020
|
|
May 2019
|
|
May 2019
|
|
|
|
|
|
|
Residential
|
RPS2-
|
|
Not Rated
|
|
Above Average
|
Master Servicer
|
RMS2+
|
|
SQ2
|
|
Above Average
|
Special Servicer
|
RSS2-
|
|
Not Rated
|
|
Above Average
|
Subprime Servicer
|
RPS2-
|
|
Not Rated
|
|
Above Average
|
(1)
|
Fitch Rating Scale of 1 (Highest Performance) to 5 (Low/No Proficiency)
|
(2)
|
Moody’s Rating Scale of SQ1 (Strong Ability/Stability) to SQ5 (Weak Ability/Stability)
|
(3)
|
S&P’s Rating Scale of Strong to Weak
|
•
|
The term “forward” refers to loans we service which are not “reverse mortgage loans,” as discussed below.
|
•
|
Our subservicing portfolio consists of loans where we perform the servicing responsibilities for a contractual fee, but do not own the servicing rights and therefore do not record an MSR on balance sheet.
|
•
|
Reverse mortgage loans, most commonly HECMs, provide seniors 62 and older with a loan upon which draws can be made periodically. The draws are secured by the equity in the borrower’s home. We have acquired our reverse mortgages in prior years through several transitions and it is now in run-off mode. For a significant portion of our reverse mortgages, we record MSRs on balance sheet, similar to the accounting for forward mortgages, except in cases where the costs of servicing are expected to exceed revenues, in which case a Mortgage Servicing Liability (“MSL”) is created. Additionally, due to program requirements, we consolidate certain reverse mortgages on our balance sheet and accrue interest income and expense.
|
Table 5. Servicing Segment Results of Operations
|
|
Successor
|
|
|
Predecessor
|
|
|
|
|
|
|
|||||||||||||
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Combined(1)
|
|
$ Change
|
|
% Change
|
||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Operational
|
$
|
1,273
|
|
|
$
|
464
|
|
|
|
$
|
656
|
|
|
$
|
1,120
|
|
|
$
|
153
|
|
|
14
|
%
|
Amortization
|
(236
|
)
|
|
(64
|
)
|
|
|
(112
|
)
|
|
(176
|
)
|
|
(60
|
)
|
|
34
|
%
|
|||||
Mark-to-market
|
(505
|
)
|
|
(164
|
)
|
|
|
196
|
|
|
32
|
|
|
(537
|
)
|
|
(1,678
|
)%
|
|||||
Total revenues
|
532
|
|
|
236
|
|
|
|
740
|
|
|
976
|
|
|
(444
|
)
|
|
(45
|
)%
|
|||||
Total expenses
|
690
|
|
|
303
|
|
|
|
474
|
|
|
777
|
|
|
(87
|
)
|
|
(11
|
)%
|
|||||
Total other income (expenses), net
|
35
|
|
|
55
|
|
|
|
19
|
|
|
74
|
|
|
(39
|
)
|
|
(53
|
)%
|
|||||
(Loss) income before income tax (benefit) expense
|
$
|
(123
|
)
|
|
$
|
(12
|
)
|
|
|
$
|
285
|
|
|
$
|
273
|
|
|
$
|
(396
|
)
|
|
(145
|
)%
|
(1)
|
Refer to Basis of Presentation section for discussion on presentation of combined results.
|
Table 6. Servicing Portfolio - Unpaid Principal Balances
|
|
Successor
|
|
|
Predecessor
|
||||||||
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|||||||
Average UPB
|
|
|
|
|
|
|
||||||
Forward MSRs - fair value
|
$
|
311,601
|
|
|
$
|
282,806
|
|
|
|
$
|
279,520
|
|
Subservicing and other(1)
|
283,743
|
|
|
203,341
|
|
|
|
187,407
|
|
|||
Reverse loans - amortized cost
|
25,270
|
|
|
29,837
|
|
|
|
33,380
|
|
|||
Total average UPB
|
$
|
620,614
|
|
|
$
|
515,984
|
|
|
|
$
|
500,307
|
|
|
|
|
|
|
|
|
||||||
|
|
|
Successor
|
|||||||||
|
|
|
December 31, 2019
|
|
|
December 31, 2018
|
||||||
Ending UPB
|
|
|
|
|
|
|
||||||
Forward MSRs - fair value
|
|
|
|
|
|
|
||||||
Agency
|
|
|
$
|
240,688
|
|
|
|
$
|
229,108
|
|
||
Non-agency
|
|
|
56,094
|
|
|
|
66,373
|
|
||||
Total MSRs - fair value
|
|
|
296,782
|
|
|
|
295,481
|
|
||||
|
|
|
|
|
|
|
||||||
Subservicing and other(1)
|
|
|
|
|
|
|
||||||
Agency
|
|
|
308,532
|
|
|
|
208,607
|
|
||||
Non-agency
|
|
|
15,451
|
|
|
|
15,279
|
|
||||
Total subservicing and other
|
|
|
323,983
|
|
|
|
223,886
|
|
||||
|
|
|
|
|
|
|
||||||
Reverse loans - amortized cost
|
|
|
|
|
|
|
||||||
MSR
|
|
|
2,508
|
|
|
|
3,940
|
|
||||
MSL
|
|
|
13,994
|
|
|
|
16,538
|
|
||||
Securitized loans
|
|
|
6,223
|
|
|
|
7,937
|
|
||||
Total reverse portfolio serviced
|
|
|
22,725
|
|
|
|
28,415
|
|
||||
Total ending UPB
|
|
|
$
|
643,490
|
|
|
|
$
|
547,782
|
|
(1)
|
Subservicing and other includes (i) loans we service for others, (ii) residential mortgage loans originated but have yet to be sold, and (iii) agency REO balances for which we own the mortgage servicing rights.
|
Table 7. Forward Servicing and Subservicing Portfolio UPB Rollforward
|
|
Successor
|
|
|
Predecessor
|
||||||||
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|||||||
Balance - beginning of period
|
$
|
519,367
|
|
|
$
|
465,819
|
|
|
|
$
|
473,256
|
|
Additions:
|
|
|
|
|
|
|
||||||
Originations
|
39,355
|
|
|
8,936
|
|
|
|
12,327
|
|
|||
Acquisitions
|
210,638
|
|
|
82,559
|
|
|
|
25,987
|
|
|||
Deductions:
|
|
|
|
|
|
|
||||||
Dispositions
|
(35,004
|
)
|
|
(10,140
|
)
|
|
|
(1,877
|
)
|
|||
Principal reductions and other
|
(21,792
|
)
|
|
(7,837
|
)
|
|
|
(11,240
|
)
|
|||
Voluntary reductions(1)
|
(87,683
|
)
|
|
(18,131
|
)
|
|
|
(29,172
|
)
|
|||
Involuntary reductions(2)
|
(3,816
|
)
|
|
(1,689
|
)
|
|
|
(3,241
|
)
|
|||
Net changes in loans serviced by others
|
(300
|
)
|
|
(150
|
)
|
|
|
(221
|
)
|
|||
Balance - end of period
|
$
|
620,765
|
|
|
$
|
519,367
|
|
|
|
$
|
465,819
|
|
(1)
|
Voluntary reductions are related to loan payoffs by customers.
|
(2)
|
Involuntary reductions refer to loan chargeoffs.
|
Table 8. Key Performance Metrics - Forward Servicing and Subservicing Portfolio(1)
|
|
Successor
|
||||||
|
December 31, 2019
|
|
December 31, 2018
|
||||
Loan count
|
3,588,162
|
|
|
3,133,784
|
|
||
Average loan amount(2)
|
$
|
172,980
|
|
|
$
|
165,748
|
|
Average coupon - credit sensitive(3)
|
4.7
|
%
|
|
4.9
|
%
|
||
Average coupon - interest sensitive(3)
|
4.3
|
%
|
|
4.2
|
%
|
||
60+ delinquent (% of loans)(4)
|
2.0
|
%
|
|
2.2
|
%
|
||
90+ delinquent (% of loans)(4)
|
1.7
|
%
|
|
1.9
|
%
|
||
120+ delinquent (% of loans)(4)
|
1.5
|
%
|
|
1.7
|
%
|
||
Total prepayment speed (12-month constant prepayment rate)
|
14.7
|
%
|
|
9.1
|
%
|
(1)
|
Characteristics and key performance metrics of our servicing portfolio exclude UPB and loan counts acquired but not yet boarded and currently serviced by others.
|
(2)
|
Average loan amount is presented in whole dollar amounts.
|
(3)
|
The weighted average coupon amounts for our credit and interest sensitive pools presented in the table above are only reflective of our owned forward MSR portfolio that is reported at fair value.
|
(4)
|
Loan delinquency is based on the current contractual due date of the loan. In the case of a completed loan modification, delinquency is based on the modified due date of the loan.
|
Table 9. Forward Loan Modifications and Workout Units
|
|
Successor
|
|
|
Predecessor
|
|
|
|
|
|
|
||||||||
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Combined(1)
|
|
Amount Change
|
|
% Change
|
||||||
HAMP modifications
|
11
|
|
|
5
|
|
|
|
38
|
|
|
43
|
|
|
(32
|
)
|
|
(74
|
)%
|
Non-HAMP modifications
|
20,683
|
|
|
13,120
|
|
|
|
16,828
|
|
|
29,948
|
|
|
(9,265
|
)
|
|
(31
|
)%
|
Workouts
|
19,669
|
|
|
7,066
|
|
|
|
22,700
|
|
|
29,766
|
|
|
(10,097
|
)
|
|
(34
|
)%
|
Total modification and workout units
|
40,363
|
|
|
20,191
|
|
|
|
39,566
|
|
|
59,757
|
|
|
(19,394
|
)
|
|
(32
|
)%
|
(1)
|
Refer to Basis of Presentation section for discussion on presentation of combined results.
|
Table 10. Servicing - Revenues
|
|
Successor
|
|
|
Predecessor
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Combined(1)
|
|
$ Change
|
|
% Change
|
|||||||||||||||||||||||||||||
|
Amt
|
|
bps(2)
|
|
Amt
|
|
bps(2)
|
|
|
Amt
|
|
bps(2)
|
|
Amt
|
|
bps(2)
|
|
Amt
|
|
bps(2)
|
|
Amt
|
|
bps(2)
|
|||||||||||||||||
Forward MSR Operational Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Base servicing fees
|
$
|
999
|
|
|
16
|
|
|
$
|
367
|
|
|
17
|
|
|
|
$
|
501
|
|
|
17
|
|
|
$
|
868
|
|
|
17
|
|
|
$
|
131
|
|
|
(1
|
)
|
|
15
|
%
|
|
(6
|
)%
|
Modification fees(3)
|
17
|
|
|
—
|
|
|
8
|
|
|
—
|
|
|
|
21
|
|
|
1
|
|
|
29
|
|
|
1
|
|
|
(12
|
)
|
|
(1
|
)
|
|
(41
|
)%
|
|
(100
|
)%
|
|||||
Incentive fees(3)
|
15
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
|
13
|
|
|
—
|
|
|
18
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(17
|
)%
|
|
—
|
%
|
|||||
Late payment fees(3)
|
84
|
|
|
2
|
|
|
29
|
|
|
2
|
|
|
|
45
|
|
|
2
|
|
|
74
|
|
|
2
|
|
|
10
|
|
|
—
|
|
|
14
|
%
|
|
—
|
%
|
|||||
Other ancillary revenues(3)
|
172
|
|
|
3
|
|
|
40
|
|
|
2
|
|
|
|
63
|
|
|
2
|
|
|
103
|
|
|
2
|
|
|
69
|
|
|
1
|
|
|
67
|
%
|
|
50
|
%
|
|||||
Total forward MSR operational revenue
|
1,287
|
|
|
21
|
|
|
449
|
|
|
21
|
|
|
|
643
|
|
|
22
|
|
|
1,092
|
|
|
22
|
|
|
195
|
|
|
(1
|
)
|
|
18
|
%
|
|
(5
|
)%
|
|||||
Base subservicing fees and other subservicing revenue(3)
|
239
|
|
|
4
|
|
|
67
|
|
|
3
|
|
|
|
87
|
|
|
2
|
|
|
154
|
|
|
3
|
|
|
85
|
|
|
1
|
|
|
55
|
%
|
|
33
|
%
|
|||||
Reverse servicing fees
|
31
|
|
|
—
|
|
|
16
|
|
|
1
|
|
|
|
37
|
|
|
1
|
|
|
53
|
|
|
1
|
|
|
(22
|
)
|
|
(1
|
)
|
|
(42
|
)%
|
|
(100
|
)%
|
|||||
Total servicing fee revenue
|
1,557
|
|
|
25
|
|
|
532
|
|
|
25
|
|
|
|
767
|
|
|
25
|
|
|
1,299
|
|
|
26
|
|
|
258
|
|
|
(1
|
)
|
|
20
|
%
|
|
(4
|
)%
|
|||||
MSR financing liability costs
|
(41
|
)
|
|
—
|
|
|
(20
|
)
|
|
(1
|
)
|
|
|
(33
|
)
|
|
(1
|
)
|
|
(53
|
)
|
|
(1
|
)
|
|
12
|
|
|
1
|
|
|
(23
|
)%
|
|
100
|
%
|
|||||
Excess spread costs - principal
|
(243
|
)
|
|
(4
|
)
|
|
(48
|
)
|
|
(2
|
)
|
|
|
(78
|
)
|
|
(3
|
)
|
|
(126
|
)
|
|
(2
|
)
|
|
(117
|
)
|
|
(2
|
)
|
|
93
|
%
|
|
100
|
%
|
|||||
Total operational revenue
|
1,273
|
|
|
21
|
|
|
464
|
|
|
22
|
|
|
|
656
|
|
|
21
|
|
|
1,120
|
|
|
23
|
|
|
153
|
|
|
(2
|
)
|
|
14
|
%
|
|
(9
|
)%
|
|||||
Amortization, net of accretion
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Forward MSR amortization
|
(527
|
)
|
|
(9
|
)
|
|
(128
|
)
|
|
(6
|
)
|
|
|
(190
|
)
|
|
(7
|
)
|
|
(318
|
)
|
|
(6
|
)
|
|
(209
|
)
|
|
(3
|
)
|
|
66
|
%
|
|
50
|
%
|
|||||
Excess spread accretion
|
243
|
|
|
4
|
|
|
53
|
|
|
2
|
|
|
|
78
|
|
|
3
|
|
|
131
|
|
|
3
|
|
|
112
|
|
|
1
|
|
|
85
|
%
|
|
33
|
%
|
|||||
Reverse MSL accretion(4)
|
47
|
|
|
1
|
|
|
15
|
|
|
1
|
|
|
|
—
|
|
|
—
|
|
|
15
|
|
|
—
|
|
|
32
|
|
|
1
|
|
|
213
|
%
|
|
100
|
%
|
|||||
Reverse MSR amortization
|
1
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
5
|
|
|
—
|
|
|
(125
|
)%
|
|
—
|
%
|
|||||
Total amortization, net of accretion
|
(236
|
)
|
|
(4
|
)
|
|
(64
|
)
|
|
(3
|
)
|
|
|
(112
|
)
|
|
(4
|
)
|
|
(176
|
)
|
|
(3
|
)
|
|
(60
|
)
|
|
(1
|
)
|
|
34
|
%
|
|
33
|
%
|
|||||
Mark-to-Market Adjustments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
MSR MTM(5)
|
(669
|
)
|
|
(11
|
)
|
|
(153
|
)
|
|
(7
|
)
|
|
|
295
|
|
|
10
|
|
|
142
|
|
|
3
|
|
|
(811
|
)
|
|
(14
|
)
|
|
(571
|
)%
|
|
(467
|
)%
|
|||||
Excess spread / financing MTM
|
164
|
|
|
3
|
|
|
(11
|
)
|
|
(1
|
)
|
|
|
(99
|
)
|
|
(3
|
)
|
|
(110
|
)
|
|
(2
|
)
|
|
274
|
|
|
5
|
|
|
(249
|
)%
|
|
(250
|
)%
|
|||||
Total MTM adjustments
|
(505
|
)
|
|
(8
|
)
|
|
(164
|
)
|
|
(8
|
)
|
|
|
196
|
|
|
7
|
|
|
32
|
|
|
1
|
|
|
(537
|
)
|
|
(9
|
)
|
|
(1,678
|
)%
|
|
(900
|
)%
|
|||||
Total revenues - Servicing
|
$
|
532
|
|
|
9
|
|
|
$
|
236
|
|
|
11
|
|
|
|
$
|
740
|
|
|
24
|
|
|
$
|
976
|
|
|
21
|
|
|
$
|
(444
|
)
|
|
(12
|
)
|
|
(45
|
)%
|
|
(57
|
)%
|
(1)
|
Refer to Basis of Presentation section for discussion on presentation of combined results.
|
(2)
|
Calculated basis points (“bps”) are as follows: Annual $ amount/Total Average UPB X 10000.
|
(3)
|
Certain ancillary and other non-base fees related to subservicing operations are separately presented as other subservicing revenues.
|
(4)
|
The Predecessor recorded MSL accretion within reverse servicing fees, whereas the Successor has elected to record MSL accretion within Amortization, net of accretion.
|
(5)
|
The amount of MSR MTM includes the impact of negative modeled cash flows which have been transferred to reserves on advances and other receivables. The negative modeled cash flows relate to advances and other receivables associated with inactive and liquidated loans that are no longer part of the MSR portfolio. The impact of negative modeled cash flows was $62 and $25 for the year ended December 31, 2019 and five months ended December 31, 2018, respectively. The impact of negative modeled cash flows for the Predecessor was $38 for the seven months ended July 31, 2018.
|
Table 11. Servicing - Expenses
|
|
Successor
|
|
|
Predecessor
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Combined(1)
|
|
Change
|
|
% Change
|
||||||||||||||||||||||||
Amt
|
|
bps(2)
|
|
Amt
|
|
bps(2)
|
|
|
Amt
|
|
bps(2)
|
|
Amt
|
|
bps(2)
|
|
Amt
|
|
bps(2)
|
|
Amt
|
|
bps(2)
|
|||||||||||||
Salaries, wages and benefits
|
$
|
346
|
|
|
5
|
|
$
|
131
|
|
|
6
|
|
|
$
|
175
|
|
|
6
|
|
$
|
306
|
|
|
6
|
|
$
|
40
|
|
|
(1)
|
|
13
|
%
|
|
(17
|
)%
|
General and administrative
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Servicing support fees
|
121
|
|
|
2
|
|
59
|
|
|
3
|
|
|
71
|
|
|
2
|
|
130
|
|
|
3
|
|
(9
|
)
|
|
(1)
|
|
(7
|
)%
|
|
(33
|
)%
|
|||||
Corporate and other general and administrative expenses
|
162
|
|
|
3
|
|
66
|
|
|
3
|
|
|
80
|
|
|
3
|
|
146
|
|
|
3
|
|
16
|
|
|
—
|
|
11
|
%
|
|
—
|
%
|
|||||
Foreclosure and other liquidation related expenses
|
42
|
|
|
1
|
|
38
|
|
|
2
|
|
|
133
|
|
|
4
|
|
171
|
|
|
3
|
|
(129
|
)
|
|
(2)
|
|
(75
|
)%
|
|
(67
|
)%
|
|||||
Depreciation and amortization
|
19
|
|
|
—
|
|
9
|
|
|
—
|
|
|
15
|
|
|
—
|
|
24
|
|
|
—
|
|
(5
|
)
|
|
—
|
|
(21
|
)%
|
|
—
|
%
|
|||||
Total general and administrative expenses
|
344
|
|
|
6
|
|
172
|
|
|
8
|
|
|
299
|
|
|
9
|
|
471
|
|
|
9
|
|
(127
|
)
|
|
(3)
|
|
(27
|
)%
|
|
(33
|
)%
|
|||||
Total expenses - Servicing
|
$
|
690
|
|
|
11
|
|
$
|
303
|
|
|
14
|
|
|
$
|
474
|
|
|
15
|
|
$
|
777
|
|
|
15
|
|
$
|
(87
|
)
|
|
(4)
|
|
(11
|
)%
|
|
(27
|
)%
|
(1)
|
Refer to Basis of Presentation section for discussion on presentation of combined results.
|
(2)
|
Calculated basis points (“bps”) are as follows: Annual $ amount/Total Average UPB X 10000.
|
Table 12. Servicing - Other Income (Expenses), Net
|
|
Successor
|
|
|
Predecessor
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Combined(1)
|
|
Change
|
|
% Change
|
|||||||||||||||||||||||||||||
Amt
|
|
bps(2)
|
|
Amt
|
|
bps(2)
|
|
|
Amt
|
|
bps(2)
|
|
Amt
|
|
bps(2)
|
|
Amt
|
|
bps(2)
|
|
Amt
|
|
bps(2)
|
||||||||||||||||||
Income earned on reverse mortgage interest
|
$
|
313
|
|
|
5
|
|
|
$
|
206
|
|
|
10
|
|
|
|
$
|
274
|
|
|
9
|
|
|
$
|
480
|
|
|
9
|
|
|
$
|
(167
|
)
|
|
(4
|
)
|
|
(35
|
)%
|
|
(44
|
)%
|
Other interest income
|
187
|
|
|
3
|
|
|
16
|
|
|
1
|
|
|
|
14
|
|
|
1
|
|
|
30
|
|
|
1
|
|
|
157
|
|
|
2
|
|
|
523
|
%
|
|
200
|
%
|
|||||
Interest income
|
500
|
|
|
8
|
|
|
222
|
|
|
11
|
|
|
|
288
|
|
|
10
|
|
|
510
|
|
|
10
|
|
|
(10
|
)
|
|
(2
|
)
|
|
(2
|
)%
|
|
(20
|
)%
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Reverse mortgage interest expense
|
(236
|
)
|
|
(4
|
)
|
|
(147
|
)
|
|
(6
|
)
|
|
|
(221
|
)
|
|
(7
|
)
|
|
(368
|
)
|
|
(7
|
)
|
|
132
|
|
|
3
|
|
|
(36
|
)%
|
|
(43
|
)%
|
|||||
Advance interest expense
|
(29
|
)
|
|
—
|
|
|
(13
|
)
|
|
(1
|
)
|
|
|
(19
|
)
|
|
(1
|
)
|
|
(32
|
)
|
|
(1
|
)
|
|
3
|
|
|
1
|
|
|
(9
|
)%
|
|
(100
|
)%
|
|||||
Other interest expense
|
(204
|
)
|
|
(3
|
)
|
|
(13
|
)
|
|
(1
|
)
|
|
|
(28
|
)
|
|
(1
|
)
|
|
(41
|
)
|
|
(1
|
)
|
|
(163
|
)
|
|
(2
|
)
|
|
398
|
%
|
|
200
|
%
|
|||||
Interest expense
|
(469
|
)
|
|
(7
|
)
|
|
(173
|
)
|
|
(8
|
)
|
|
|
(268
|
)
|
|
(9
|
)
|
|
(441
|
)
|
|
(9
|
)
|
|
(28
|
)
|
|
2
|
|
|
(6
|
)%
|
|
(22
|
)%
|
|||||
Other income (expenses), net
|
4
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
|
(1
|
)
|
|
—
|
|
|
5
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(20
|
)%
|
|
—
|
%
|
|||||
Total other income (expenses), net - Servicing
|
$
|
35
|
|
|
1
|
|
|
$
|
55
|
|
|
3
|
|
|
|
$
|
19
|
|
|
1
|
|
|
$
|
74
|
|
|
1
|
|
|
$
|
(39
|
)
|
|
—
|
|
|
(53
|
)%
|
|
—
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Weighted average cost - advance facilities
|
3.9
|
%
|
|
|
|
4.1
|
%
|
|
|
|
|
3.9
|
%
|
|
|
|
4.0
|
%
|
|
|
|
(0.1
|
)%
|
|
|
|
(3
|
)%
|
|
|
|||||||||||
Weighted average cost - excess spread financing
|
8.9
|
%
|
|
|
|
8.8
|
%
|
|
|
|
|
8.8
|
%
|
|
|
|
8.8
|
%
|
|
|
|
0.1
|
%
|
|
|
|
1
|
%
|
|
|
(1)
|
Refer to Basis of Presentation section for discussion on presentation of combined results.
|
(2)
|
Calculated basis points (“bps”) are as follows: Annual $ amount/Total Average UPB X 10000.
|
Table 13. Servicing Portfolios and Related Liabilities
|
|
Successor
|
||||||||||||||||||||
December 31, 2019
|
|
December 31, 2018
|
|||||||||||||||||||
UPB
|
|
Carrying Amount
|
|
Weighted Avg. Coupon
|
|
UPB
|
|
Carrying Amount
|
|
Weighted Avg. Coupon
|
|||||||||||
Forward MSRs - fair value
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Agency
|
$
|
240,688
|
|
|
$
|
2,944
|
|
|
4.5
|
%
|
|
$
|
229,108
|
|
|
$
|
3,027
|
|
|
4.5
|
%
|
Non-agency
|
56,094
|
|
|
552
|
|
|
4.7
|
%
|
|
66,373
|
|
|
638
|
|
|
4.8
|
%
|
||||
Total forward MSRs - fair value
|
296,782
|
|
|
3,496
|
|
|
4.5
|
%
|
|
295,481
|
|
|
3,665
|
|
|
4.5
|
%
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Subservicing and other(1)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Agency
|
308,532
|
|
|
N/A
|
|
|
N/A
|
|
|
208,607
|
|
|
N/A
|
|
|
N/A
|
|
||||
Non-agency
|
15,451
|
|
|
N/A
|
|
|
N/A
|
|
|
15,279
|
|
|
N/A
|
|
|
N/A
|
|
||||
Total subservicing and other
|
323,983
|
|
|
N/A
|
|
|
N/A
|
|
|
223,886
|
|
|
N/A
|
|
|
N/A
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Reverse portfolio - amortized cost
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
MSR
|
2,508
|
|
|
6
|
|
|
N/A
|
|
|
3,940
|
|
|
11
|
|
|
N/A
|
|
||||
MSL
|
13,994
|
|
|
(61
|
)
|
|
N/A
|
|
|
16,538
|
|
|
(71
|
)
|
|
N/A
|
|
||||
Securitized loans
|
6,223
|
|
|
6,279
|
|
|
N/A
|
|
|
7,937
|
|
|
7,934
|
|
|
N/A
|
|
||||
Total reverse portfolio serviced
|
22,725
|
|
|
6,224
|
|
|
N/A
|
|
|
28,415
|
|
|
7,874
|
|
|
N/A
|
|
||||
Total servicing portfolio unpaid principal balance
|
$
|
643,490
|
|
|
$
|
9,720
|
|
|
N/A
|
|
|
$
|
547,782
|
|
|
$
|
11,539
|
|
|
N/A
|
|
(1)
|
Subservicing and other amounts include loans we service for others, residential mortgage loans originated but have yet to be sold, and agency REO balances for which we own the mortgage servicing rights.
|
Table 14. Fair Value MSR Valuation
|
|
Successor
|
||||||||||||||||||
December 31, 2019
|
|
December 31, 2018
|
|||||||||||||||||
UPB
|
|
Carrying Amount
|
|
bps
|
|
UPB
|
|
Carrying Amount
|
|
bps
|
|||||||||
Forward MSRs - fair value
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Credit sensitive
|
$
|
147,895
|
|
|
$
|
1,613
|
|
|
109
|
|
$
|
135,752
|
|
|
$
|
1,495
|
|
|
110
|
Interest sensitive
|
148,887
|
|
|
1,883
|
|
|
126
|
|
159,729
|
|
|
2,170
|
|
|
136
|
||||
Total forward MSRs - fair value
|
$
|
296,782
|
|
|
$
|
3,496
|
|
|
118
|
|
$
|
295,481
|
|
|
$
|
3,665
|
|
|
124
|
Table 15. MSRs - Fair Value, Rollforward
|
|
Successor
|
|
|
Predecessor
|
||||||||
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|||||||
Fair value - beginning of period
|
$
|
3,665
|
|
|
$
|
3,413
|
|
|
|
$
|
2,937
|
|
Additions:
|
|
|
|
|
|
|
||||||
Servicing resulting from mortgage loans sold
|
434
|
|
|
120
|
|
|
|
162
|
|
|||
Purchases of servicing rights
|
858
|
|
|
479
|
|
|
|
144
|
|
|||
Dispositions:
|
|
|
|
|
|
|
||||||
Sales and cancellation of servicing assets(1)
|
(408
|
)
|
|
(111
|
)
|
|
|
4
|
|
|||
Changes in fair value:
|
|
|
|
|
|
|
||||||
Due to changes in valuation inputs or assumptions used in the valuation model:
|
|
|
|
|
|
|
||||||
Credit sensitive
|
(205
|
)
|
|
(78
|
)
|
|
|
203
|
|
|||
Interest sensitive
|
(384
|
)
|
|
(45
|
)
|
|
|
127
|
|
|||
Other changes in fair value:
|
|
|
|
|
|
|
||||||
Scheduled principal payments
|
(94
|
)
|
|
(39
|
)
|
|
|
(45
|
)
|
|||
Disposition of negative MSRs and other(2)
|
64
|
|
|
14
|
|
|
|
27
|
|
|||
Prepayments
|
|
|
|
|
|
|
||||||
Voluntary prepayments
|
|
|
|
|
|
|
||||||
Credit sensitive
|
(99
|
)
|
|
(36
|
)
|
|
|
(71
|
)
|
|||
Interest sensitive
|
(309
|
)
|
|
(37
|
)
|
|
|
(54
|
)
|
|||
Involuntary prepayments
|
|
|
|
|
|
|
||||||
Credit sensitive
|
(7
|
)
|
|
(7
|
)
|
|
|
(12
|
)
|
|||
Interest sensitive
|
(19
|
)
|
|
(8
|
)
|
|
|
(9
|
)
|
|||
Fair value - end of period
|
$
|
3,496
|
|
|
$
|
3,665
|
|
|
|
$
|
3,413
|
|
(1)
|
Amount for the seven months ended July 31, 2018 was related to the sale of nonperforming loans, which had a negative MSR value.
|
(2)
|
Amounts primarily represent negative fair values reclassified from the MSR asset to reserves as underlying loans are removed from the MSR and other reclassification adjustments.
|
Table 16. MSRs - Fair Value
|
|
Successor
|
||||
December 31, 2019
|
|
December 31, 2018
|
|||
Total MSRs Portfolio
|
|
|
|
||
Discount rate
|
9.7
|
%
|
|
10.2
|
%
|
Prepayment speeds
|
13.1
|
%
|
|
10.8
|
%
|
Average life
|
5.8 years
|
|
|
6.7 years
|
|
|
|
|
|
||
Credit Sensitive
|
|
|
|
||
Discount rate
|
10.4
|
%
|
|
11.3
|
%
|
Prepayment speeds
|
12.7
|
%
|
|
11.8
|
%
|
Average life
|
6.0 years
|
|
|
6.4 years
|
|
|
|
|
|
||
Interest Sensitive
|
|
|
|
||
Discount rate
|
9.1
|
%
|
|
9.3
|
%
|
Prepayment speeds
|
13.5
|
%
|
|
10.0
|
%
|
Average life
|
5.7 years
|
|
|
7.0 years
|
|
Table 17. Excess Spread Financing
|
|
Successor
|
|
|
Predecessor
|
||||||||
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|||||||
Fair value - beginning of period
|
$
|
1,184
|
|
|
$
|
1,039
|
|
|
|
$
|
996
|
|
Additions:
|
|
|
|
|
|
|
||||||
New financings
|
542
|
|
|
255
|
|
|
|
70
|
|
|||
Deductions:
|
|
|
|
|
|
|
||||||
Repayments of debt
|
(27
|
)
|
|
(38
|
)
|
|
|
(3
|
)
|
|||
Settlements of principal balances
|
(219
|
)
|
|
(77
|
)
|
|
|
(105
|
)
|
|||
Changes in fair value:
|
|
|
|
|
|
|
||||||
Credit sensitive
|
(61
|
)
|
|
23
|
|
|
|
73
|
|
|||
Interest sensitive
|
(108
|
)
|
|
(18
|
)
|
|
|
8
|
|
|||
Fair value - end of period
|
$
|
1,311
|
|
|
$
|
1,184
|
|
|
|
$
|
1,039
|
|
|
|
|
|
|
|
|
||||||
|
|
|
Successor
|
|||||||||
Key Weighted-Average Assumptions:
|
|
|
December 31, 2019
|
|
|
December 31, 2018
|
||||||
Total Excess Spread Portfolio
|
|
|
|
|
|
|
||||||
Discount rate
|
|
|
11.6
|
%
|
|
|
10.4
|
%
|
||||
Prepayment speeds
|
|
|
12.6
|
%
|
|
|
11.0
|
%
|
||||
Recapture rate
|
|
|
20.1
|
%
|
|
|
18.6
|
%
|
||||
Average life
|
|
|
5.8 years
|
|
|
|
6.5 years
|
|
||||
|
|
|
|
|
|
|
||||||
Credit Sensitive
|
|
|
|
|
|
|
||||||
Discount rate
|
|
|
12.3
|
%
|
|
|
11.1
|
%
|
||||
Prepayment speeds
|
|
|
12.5
|
%
|
|
|
11.6
|
%
|
||||
Recapture rate
|
|
|
21.6
|
%
|
|
|
18.0
|
%
|
||||
Average life
|
|
|
5.9 years
|
|
|
|
6.3 years
|
|
||||
|
|
|
|
|
|
|
||||||
Interest Sensitive
|
|
|
|
|
|
|
||||||
Discount rate
|
|
|
10.5
|
%
|
|
|
9.0
|
%
|
||||
Prepayment speed
|
|
|
12.8
|
%
|
|
|
9.9
|
%
|
||||
Recapture rate
|
|
|
17.6
|
%
|
|
|
16.0
|
%
|
||||
Average life
|
|
|
5.8 years
|
|
|
|
7.0 years
|
|
Table 18. MSRs Financing Liability - Rollforward
|
|
Successor
|
|
|
Predecessor
|
||||||||
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|||||||
Fair value - beginning of period
|
$
|
32
|
|
|
$
|
26
|
|
|
|
$
|
10
|
|
Changes in fair value:
|
|
|
|
|
|
|
||||||
Changes in valuation inputs or assumptions used in the valuation model
|
23
|
|
|
11
|
|
|
|
22
|
|
|||
Other changes in fair value
|
(18
|
)
|
|
(5
|
)
|
|
|
(6
|
)
|
|||
Fair value - end of period
|
$
|
37
|
|
|
$
|
32
|
|
|
|
$
|
26
|
|
|
|
|
|
|
|
|
||||||
|
|
|
Successor
|
|||||||||
Weighted-Average Assumptions
|
|
|
December 31, 2019
|
|
|
December 31, 2018
|
||||||
Advance financing rates
|
|
|
3.5
|
%
|
|
|
4.2
|
%
|
||||
Annual advance recovery rates
|
|
|
18.8
|
%
|
|
|
19.0
|
%
|
Table 19. Leveraged Portfolio Characteristics
|
|
Successor
|
||||||
December 31, 2019
|
|
December 31, 2018
|
|||||
Owned forward servicing portfolio - unencumbered
|
$
|
83,557
|
|
|
$
|
103,644
|
|
Owned forward servicing portfolio - encumbered
|
213,225
|
|
|
191,837
|
|
||
Subserviced forward servicing portfolio and other
|
323,983
|
|
|
223,886
|
|
||
Total unpaid principal balance
|
$
|
620,765
|
|
|
$
|
519,367
|
|
Table 20. Reverse - Mortgage Portfolio Characteristics
|
|
Successor
|
||||||
December 31, 2019
|
|
December 31, 2018
|
|||||
Loan count
|
165,364
|
|
|
192,810
|
|
||
Ending unpaid principal balance
|
$
|
22,725
|
|
|
$
|
28,415
|
|
Average loan amount(1)
|
$
|
137,426
|
|
|
$
|
147,374
|
|
Average coupon
|
3.6
|
%
|
|
4.5
|
%
|
||
Average borrower age
|
80
|
|
|
79
|
|
(1)
|
Average loan amount is presented in whole dollar amounts.
|
Originations Segment
|
•
|
Our direct-to-consumer lending channel relies on our call centers, website and mobile apps to interact with customers. Our primary focus is to assist our customers with a refinance or home purchase by providing them with a needs-based approach to understanding their current mortgage options.
|
•
|
Our correspondent lending channel acquires newly originated residential mortgage loans that have been underwritten to investor guidelines. This includes both conventional and government-insured loans that qualify for inclusion in securitizations that are guaranteed by the GSEs. Our correspondent lending channel enables us to replenish servicing portfolio run-off typically at better rate of return than traditional bulk or flow acquisitions.
|
•
|
Our wholesale lending channel works with mortgage brokers to source loans which are underwritten and funded by us in our name. Counterparty risk is mitigated through quality and compliance monitoring and all brokers are subject to our eligibility requirements coupled with an annual recertification process.
|
Table 21. Originations Segment Results of Operations
|
|
Successor
|
|
|
Predecessor
|
|
|
|
|
|
|
|||||||||||||
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Combined(1)
|
|
$ Change
|
|
% Change
|
|||||||||||
Total revenues
|
$
|
1,043
|
|
|
$
|
181
|
|
|
|
$
|
306
|
|
|
$
|
487
|
|
|
$
|
556
|
|
|
114
|
%
|
Total expenses
|
568
|
|
|
155
|
|
|
|
245
|
|
|
400
|
|
|
168
|
|
|
42
|
%
|
|||||
Total other income (expenses), net
|
4
|
|
|
6
|
|
|
|
1
|
|
|
7
|
|
|
(3
|
)
|
|
(43
|
)%
|
|||||
Income before income tax expense
|
$
|
479
|
|
|
$
|
32
|
|
|
|
$
|
62
|
|
|
$
|
94
|
|
|
$
|
385
|
|
|
410
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Originations Margin
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Revenue
|
$
|
1,043
|
|
|
$
|
181
|
|
|
|
$
|
306
|
|
|
$
|
487
|
|
|
$
|
556
|
|
|
114
|
%
|
Pull through adjusted lock volume
|
$
|
42,393
|
|
|
$
|
8,295
|
|
|
|
$
|
11,907
|
|
|
$
|
20,202
|
|
|
$
|
22,191
|
|
|
110
|
%
|
Revenue as a percentage of pull through adjusted lock volume(2)
|
2.46
|
%
|
|
2.18
|
%
|
|
|
2.57
|
%
|
|
2.41
|
%
|
|
0.05
|
%
|
|
2
|
%
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Expenses
|
$
|
568
|
|
|
$
|
155
|
|
|
|
$
|
245
|
|
|
$
|
400
|
|
|
$
|
168
|
|
|
42
|
%
|
Funded volume
|
$
|
40,182
|
|
|
$
|
8,884
|
|
|
|
$
|
12,317
|
|
|
$
|
21,201
|
|
|
$
|
18,981
|
|
|
90
|
%
|
Expenses as a percentage of funded volume(3)
|
1.41
|
%
|
|
1.74
|
%
|
|
|
1.99
|
%
|
|
1.89
|
%
|
|
(0.48
|
)%
|
|
(25
|
)%
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Originations Margin
|
1.05
|
%
|
|
0.44
|
%
|
|
|
0.58
|
%
|
|
0.52
|
%
|
|
0.53
|
%
|
|
102
|
%
|
(1)
|
Refer to Basis of Presentation section for discussion on presentation of combined results.
|
(2)
|
Calculated on pull-through adjusted lock volume as revenue is recognized at the time of loan lock.
|
(3)
|
Calculated on funded volume as expenses are incurred based on closing of the loan.
|
Table 22. Originations - Revenues
|
|
Successor
|
|
|
Predecessor
|
|
|
|
|
|
|
|||||||||||||
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Combined(1)
|
|
$ Change
|
|
% Change
|
|||||||||||
Service related, net - Originations
|
$
|
80
|
|
|
$
|
24
|
|
|
|
$
|
36
|
|
|
$
|
60
|
|
|
$
|
20
|
|
|
33
|
%
|
Net gain on mortgage loans held for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net gain on loans originated and sold
|
562
|
|
|
46
|
|
|
|
115
|
|
|
161
|
|
|
401
|
|
|
249
|
%
|
|||||
Capitalized servicing rights
|
420
|
|
|
114
|
|
|
|
156
|
|
|
270
|
|
|
150
|
|
|
56
|
%
|
|||||
Provision for repurchase reserves, net of release
|
(19
|
)
|
|
(3
|
)
|
|
|
(1
|
)
|
|
(4
|
)
|
|
(15
|
)
|
|
375
|
%
|
|||||
Total net gain on mortgage loans held for sale
|
963
|
|
|
157
|
|
|
|
270
|
|
|
427
|
|
|
536
|
|
|
126
|
%
|
|||||
Total revenues - Originations
|
$
|
1,043
|
|
|
$
|
181
|
|
|
|
$
|
306
|
|
|
$
|
487
|
|
|
$
|
556
|
|
|
114
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Key Metrics
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Consumer direct lock pull through adjusted volume(2)
|
$
|
18,151
|
|
|
$
|
3,588
|
|
|
|
$
|
6,100
|
|
|
$
|
9,688
|
|
|
$
|
8,463
|
|
|
87
|
%
|
Other locked pull through adjusted volume(2)
|
24,242
|
|
|
4,707
|
|
|
|
5,807
|
|
|
10,514
|
|
|
13,728
|
|
|
131
|
%
|
|||||
Total pull through adjusted lock volume
|
$
|
42,393
|
|
|
$
|
8,295
|
|
|
|
$
|
11,907
|
|
|
$
|
20,202
|
|
|
$
|
22,191
|
|
|
110
|
%
|
Funded volume
|
$
|
40,182
|
|
|
$
|
8,884
|
|
|
|
$
|
12,317
|
|
|
$
|
21,201
|
|
|
$
|
18,981
|
|
|
90
|
%
|
Volume of loans sold
|
$
|
40,092
|
|
|
$
|
9,183
|
|
|
|
$
|
12,915
|
|
|
$
|
22,098
|
|
|
$
|
17,994
|
|
|
81
|
%
|
Recapture percentage
|
26.2
|
%
|
|
24.8
|
%
|
|
|
23.8
|
%
|
|
24.6
|
%
|
|
1.6
|
%
|
|
7
|
%
|
|||||
Purchase as a percentage of funded volume
|
41.5
|
%
|
|
55.8
|
%
|
|
|
46.7
|
%
|
|
64.7
|
%
|
|
(23.2
|
)%
|
|
(36
|
)%
|
|||||
Value of capitalized servicing on retained settlements
|
147 bps
|
|
|
144 bps
|
|
|
|
141 bps
|
|
|
142 bps
|
|
|
5 bps
|
|
|
4
|
%
|
(1)
|
Refer to Basis of Presentation section for discussion on presentation of combined results.
|
(2)
|
Pull through adjusted volume represents the expected funding from locks taken during the period.
|
Table 23. Originations - Expenses
|
|
Successor
|
|
|
Predecessor
|
|
|
|
|
|
|
|||||||||||||
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Combined(1)
|
|
$ Change
|
|
% Change
|
|||||||||||
Salaries, wages and benefits
|
$
|
375
|
|
|
$
|
95
|
|
|
|
$
|
148
|
|
|
$
|
243
|
|
|
$
|
132
|
|
|
54
|
%
|
General and administrative
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Loan origination expenses
|
58
|
|
|
19
|
|
|
|
32
|
|
|
51
|
|
|
7
|
|
|
14
|
%
|
|||||
Corporate and other general and administrative expenses
|
61
|
|
|
18
|
|
|
|
26
|
|
|
44
|
|
|
17
|
|
|
39
|
%
|
|||||
Marketing and professional service fees
|
53
|
|
|
18
|
|
|
|
32
|
|
|
50
|
|
|
3
|
|
|
6
|
%
|
|||||
Depreciation and amortization
|
18
|
|
|
5
|
|
|
|
7
|
|
|
12
|
|
|
6
|
|
|
50
|
%
|
|||||
Loss on impairment of assets
|
3
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
100
|
%
|
|||||
Total general and administrative
|
193
|
|
|
60
|
|
|
|
97
|
|
|
157
|
|
|
36
|
|
|
23
|
%
|
|||||
Total expenses - Originations
|
$
|
568
|
|
|
$
|
155
|
|
|
|
$
|
245
|
|
|
$
|
400
|
|
|
$
|
168
|
|
|
42
|
%
|
(1)
|
Refer to Basis of Presentation section for discussion on presentation of combined results.
|
Table 24. Originations - Other Income (Expenses), Net
|
|
Successor
|
|
|
Predecessor
|
|
|
|
|
|
|
|||||||||||||
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Combined(1)
|
|
$ Change
|
|
% Change
|
|||||||||||
Interest income
|
$
|
98
|
|
|
$
|
27
|
|
|
|
$
|
38
|
|
|
$
|
65
|
|
|
$
|
33
|
|
|
51
|
%
|
Interest expense
|
(98
|
)
|
|
(26
|
)
|
|
|
(37
|
)
|
|
(63
|
)
|
|
(35
|
)
|
|
56
|
%
|
|||||
Other income, net
|
4
|
|
|
5
|
|
|
|
—
|
|
|
5
|
|
|
(1
|
)
|
|
(20
|
)%
|
|||||
Total other income (expenses), net - Originations
|
$
|
4
|
|
|
$
|
6
|
|
|
|
$
|
1
|
|
|
$
|
7
|
|
|
$
|
(3
|
)
|
|
(43
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Weighted average note rate - mortgage loans held for sale
|
4.3
|
%
|
|
4.9
|
%
|
|
|
4.5
|
%
|
|
4.7
|
%
|
|
(0.4
|
)%
|
|
(9
|
)%
|
|||||
Weighted average cost of funds (excluding facility fees)
|
4.1
|
%
|
|
4.5
|
%
|
|
|
4.2
|
%
|
|
4.4
|
%
|
|
(0.3
|
)%
|
|
(7
|
)%
|
(1)
|
Refer to Basis of Presentation section for discussion on presentation of combined results.
|
Xome Segment
|
•
|
The Exchange division consists of the Xome.com auction platform which utilizes proprietary technology designed to provide efficient execution for sales of foreclosed properties.
|
•
|
The Services division includes title, escrow, collateral valuation and field services related to real estate investments or transactions including purchases, sales, refinances and defaults. Services includes the business of AMS, which we acquired in August 2018.
|
•
|
The Data/Technology division contains a diversified set of businesses that provide technology solutions to real estate service providers, aggregators and a variety of investors. This includes providing aggregation, standardization and licensing for one of the nation’s largest set of MLS, public records and neighborhood demographic data.
|
Table 25. Xome Segment Results of Operations
|
|
Successor
|
|
|
Predecessor
|
|
|
|
|
|
|
|||||||||||||
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Combined(1)
|
|
$ Change
|
|
% Change
|
|||||||||||
Xome - Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total revenues
|
$
|
422
|
|
|
$
|
177
|
|
|
|
$
|
149
|
|
|
$
|
326
|
|
|
$
|
96
|
|
|
29
|
%
|
Total expenses
|
398
|
|
|
178
|
|
|
|
123
|
|
|
301
|
|
|
97
|
|
|
32
|
%
|
|||||
Total other income (expenses), net
|
14
|
|
|
—
|
|
|
|
9
|
|
|
9
|
|
|
5
|
|
|
56
|
%
|
|||||
Income (loss) before income tax expense (benefit)
|
$
|
38
|
|
|
$
|
(1
|
)
|
|
|
$
|
35
|
|
|
$
|
34
|
|
|
$
|
4
|
|
|
12
|
%
|
Income (loss) before taxes margin - Xome
|
9.0
|
%
|
|
(0.6
|
)%
|
|
|
23.5
|
%
|
|
10.4
|
%
|
|
(1.4
|
)%
|
|
(13
|
)%
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Xome - Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Exchange
|
$
|
79
|
|
|
$
|
34
|
|
|
|
$
|
62
|
|
|
$
|
96
|
|
|
$
|
(17
|
)
|
|
(18
|
)%
|
Services
|
323
|
|
|
135
|
|
|
|
74
|
|
|
209
|
|
|
114
|
|
|
55
|
%
|
|||||
Data/Technology
|
20
|
|
|
8
|
|
|
|
13
|
|
|
21
|
|
|
(1
|
)
|
|
(5
|
)%
|
|||||
Total revenues - Xome
|
$
|
422
|
|
|
$
|
177
|
|
|
|
$
|
149
|
|
|
$
|
326
|
|
|
$
|
96
|
|
|
29
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Key Metrics
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Exchange properties sold
|
9,851
|
|
|
3,952
|
|
|
|
6,920
|
|
|
10,872
|
|
|
(1,021
|
)
|
|
(9
|
)%
|
|||||
Average Exchange properties under management
|
7,893
|
|
|
5,660
|
|
|
|
6,567
|
|
|
6,189
|
|
|
1,704
|
|
|
28
|
%
|
|||||
Services completed orders
|
1,630,002
|
|
|
808,503
|
|
|
|
264,031
|
|
|
1,072,534
|
|
|
557,468
|
|
|
52
|
%
|
|||||
Percentage of revenue earned from third-party customers
|
52.5
|
%
|
|
56.2
|
%
|
|
|
28.0
|
%
|
|
43.3
|
%
|
|
9.2
|
%
|
|
21
|
%
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Xome - Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Salaries, wages and benefits
|
$
|
148
|
|
|
$
|
73
|
|
|
|
$
|
58
|
|
|
$
|
131
|
|
|
$
|
17
|
|
|
13
|
%
|
General and administrative
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Operational expenses
|
236
|
|
|
100
|
|
|
|
58
|
|
|
158
|
|
|
78
|
|
|
49
|
%
|
|||||
Depreciation and amortization
|
14
|
|
|
5
|
|
|
|
7
|
|
|
12
|
|
|
2
|
|
|
17
|
%
|
|||||
Total general and administrative
|
250
|
|
|
105
|
|
|
|
65
|
|
|
170
|
|
|
80
|
|
|
47
|
%
|
|||||
Total expenses - Xome
|
$
|
398
|
|
|
$
|
178
|
|
|
|
$
|
123
|
|
|
$
|
301
|
|
|
$
|
97
|
|
|
32
|
%
|
(1)
|
Refer to Basis of Presentation section for discussion on presentation of combined results.
|
Corporate/Other Segment
|
Table 26. Corporate/Other Segment Results of Operations
|
|
Successor
|
|
|
Predecessor
|
|
|
|
|
|
|
|||||||||||||
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Combined(1)
|
|
$ Change
|
|
% Change
|
||||||||||||
Corporate/Other - Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total revenues
|
$
|
13
|
|
|
$
|
—
|
|
|
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
12
|
|
|
1,200
|
%
|
Total expenses
|
198
|
|
|
71
|
|
|
|
103
|
|
|
174
|
|
|
24
|
|
|
14
|
%
|
|||||
Total other income (expenses), net
|
(212
|
)
|
|
(85
|
)
|
|
|
(78
|
)
|
|
(163
|
)
|
|
(49
|
)
|
|
30
|
%
|
|||||
Loss before income tax benefit - Corporate/Other
|
$
|
(397
|
)
|
|
$
|
(156
|
)
|
|
|
$
|
(180
|
)
|
|
$
|
(336
|
)
|
|
$
|
(61
|
)
|
|
18
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Corporate/Other - Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Salaries, wages and benefits
|
$
|
88
|
|
|
$
|
38
|
|
|
|
$
|
45
|
|
|
$
|
83
|
|
|
$
|
5
|
|
|
6
|
%
|
General and administrative
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Operational expenses
|
62
|
|
|
13
|
|
|
|
54
|
|
|
67
|
|
|
(5
|
)
|
|
(7
|
)%
|
|||||
Depreciation and amortization
|
40
|
|
|
20
|
|
|
|
4
|
|
|
24
|
|
|
16
|
|
|
67
|
%
|
|||||
Loss on impairment of assets
|
8
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
8
|
|
|
100
|
%
|
|||||
Total general and administrative
|
110
|
|
|
33
|
|
|
|
58
|
|
|
91
|
|
|
19
|
|
|
21
|
%
|
|||||
Total expenses - Corporate/Other
|
$
|
198
|
|
|
$
|
71
|
|
|
|
$
|
103
|
|
|
$
|
174
|
|
|
$
|
24
|
|
|
14
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Corporate/Other - Other Income (Expenses), Net
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Interest income, legacy portfolio
|
$
|
6
|
|
|
$
|
5
|
|
|
|
$
|
7
|
|
|
$
|
12
|
|
|
$
|
(6
|
)
|
|
(50
|
)%
|
Other interest income
|
1
|
|
|
2
|
|
|
|
—
|
|
|
2
|
|
|
(1
|
)
|
|
(50
|
)%
|
|||||
Total interest income
|
7
|
|
|
7
|
|
|
|
7
|
|
|
14
|
|
|
(7
|
)
|
|
(50
|
)%
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Interest expense, legacy portfolio
|
(1
|
)
|
|
(1
|
)
|
|
|
(3
|
)
|
|
(4
|
)
|
|
3
|
|
|
(75
|
)%
|
|||||
Interest expense on unsecured senior notes
|
(203
|
)
|
|
(90
|
)
|
|
|
(77
|
)
|
|
(167
|
)
|
|
(36
|
)
|
|
22
|
%
|
|||||
Other interest expense
|
(8
|
)
|
|
(2
|
)
|
|
|
(3
|
)
|
|
(5
|
)
|
|
(3
|
)
|
|
60
|
%
|
|||||
Total interest expense
|
(212
|
)
|
|
(93
|
)
|
|
|
(83
|
)
|
|
(176
|
)
|
|
(36
|
)
|
|
20
|
%
|
|||||
Other (expense) income, net
|
(7
|
)
|
|
1
|
|
|
|
(2
|
)
|
|
(1
|
)
|
|
(6
|
)
|
|
600
|
%
|
|||||
Total other income (expenses), net - Corporate/Other
|
$
|
(212
|
)
|
|
$
|
(85
|
)
|
|
|
$
|
(78
|
)
|
|
$
|
(163
|
)
|
|
$
|
(49
|
)
|
|
30
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Weighted average cost - unsecured senior notes
|
7.9
|
%
|
|
7.1
|
%
|
|
|
7.4
|
%
|
|
7.2
|
%
|
|
0.7
|
%
|
|
10
|
%
|
(1)
|
Refer to Basis of Presentation section for discussion on presentation of combined results.
|
Table 27. Legacy Portfolio Composition
|
|
Successor
|
||
December 31, 2018
|
|||
Performing - UPB
|
$
|
145
|
|
Nonperforming (90+ delinquency) - UPB
|
27
|
|
|
REO - estimated fair value
|
4
|
|
|
Total legacy portfolio
|
$
|
176
|
|
Changes in Financial Position
|
Table 28. Changes in Assets
|
|
Successor
|
|
|
|
|
|||||||||
December 31, 2019
|
|
December 31, 2018
|
|
$ Change
|
|
% Change
|
||||||||
Cash and cash equivalents
|
$
|
329
|
|
|
$
|
242
|
|
|
$
|
87
|
|
|
36.0
|
%
|
Mortgage servicing rights
|
3,502
|
|
|
3,676
|
|
|
(174
|
)
|
|
(4.7
|
)%
|
|||
Advances and other receivables, net
|
988
|
|
|
1,194
|
|
|
(206
|
)
|
|
(17.3
|
)%
|
|||
Reverse mortgage interests, net
|
6,279
|
|
|
7,934
|
|
|
(1,655
|
)
|
|
(20.9
|
)%
|
|||
Mortgage loans held for sale at fair value
|
4,077
|
|
|
1,631
|
|
|
2,446
|
|
|
150.0
|
%
|
|||
Deferred tax asset, net
|
1,345
|
|
|
967
|
|
|
378
|
|
|
39.1
|
%
|
|||
Other
|
1,785
|
|
|
1,329
|
|
|
456
|
|
|
34.3
|
%
|
|||
Total assets
|
$
|
18,305
|
|
|
$
|
16,973
|
|
|
$
|
1,332
|
|
|
7.8
|
%
|
Table 29. Changes in Liabilities and Stockholder’s Equity
|
|
Successor
|
|
|
|
|
|||||||||
December 31, 2019
|
|
December 31, 2018
|
|
$ Change
|
|
% Change
|
||||||||
Unsecured senior notes, net
|
$
|
2,366
|
|
|
$
|
2,459
|
|
|
$
|
(93
|
)
|
|
(3.8
|
)%
|
Advance facilities, net
|
422
|
|
|
595
|
|
|
(173
|
)
|
|
(29.1
|
)%
|
|||
Warehouse facilities, net
|
4,575
|
|
|
2,349
|
|
|
2,226
|
|
|
94.8
|
%
|
|||
MSR related liabilities - nonrecourse at fair value
|
1,348
|
|
|
1,216
|
|
|
132
|
|
|
10.9
|
%
|
|||
Other nonrecourse debt, net
|
5,286
|
|
|
6,795
|
|
|
(1,509
|
)
|
|
(22.2
|
)%
|
|||
Other liabilities
|
2,077
|
|
|
1,614
|
|
|
463
|
|
|
28.7
|
%
|
|||
Total liabilities
|
16,074
|
|
|
15,028
|
|
|
1,046
|
|
|
7.0
|
%
|
|||
Total stockholders’ equity
|
2,231
|
|
|
1,945
|
|
|
286
|
|
|
14.7
|
%
|
|||
Total liabilities and stockholders’ equity
|
$
|
18,305
|
|
|
$
|
16,973
|
|
|
$
|
1,332
|
|
|
7.8
|
%
|
Liquidity and Capital Resources
|
Table 30. Operating Cash Flow
|
|
Successor
|
|
|
Predecessor
|
|
|
|
|
|
|
|||||||||||||
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Combined(1)
|
|
$ Change
|
|
% Change
|
||||||||||||
Net income
|
$
|
270
|
|
|
$
|
884
|
|
|
|
$
|
154
|
|
|
$
|
1,038
|
|
|
$
|
(768
|
)
|
|
(74
|
)%
|
Fair value changes in MSRs, MSR related liabilities and mortgage loans held for investment
|
838
|
|
|
234
|
|
|
|
(80
|
)
|
|
154
|
|
|
684
|
|
|
444
|
%
|
|||||
Deferred tax (benefit) expense
|
(366
|
)
|
|
(1,021
|
)
|
|
|
63
|
|
|
(958
|
)
|
|
592
|
|
|
(62
|
)%
|
|||||
Other non-cash adjustments to net income
|
(1,249
|
)
|
|
(294
|
)
|
|
|
(388
|
)
|
|
(682
|
)
|
|
(567
|
)
|
|
83
|
%
|
|||||
Originations net sales activities
|
(1,204
|
)
|
|
(10
|
)
|
|
|
520
|
|
|
510
|
|
|
(1,714
|
)
|
|
(336
|
)%
|
|||||
Changes in working capital
|
2,413
|
|
|
1,458
|
|
|
|
2,025
|
|
|
3,483
|
|
|
(1,070
|
)
|
|
(31
|
)%
|
|||||
Net cash attributable to operating activities
|
$
|
702
|
|
|
$
|
1,251
|
|
|
|
$
|
2,294
|
|
|
$
|
3,545
|
|
|
$
|
(2,843
|
)
|
|
(80
|
)%
|
(1)
|
Refer to Basis of Presentation section for discussion on presentation of combined results.
|
Table 31. Investing Cash Flows
|
|
Successor
|
|
|
Predecessor
|
|
|
|
|
|
|
|||||||||||||
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Combined(1)
|
|
$ Change
|
|
% Change
|
||||||||||||
Acquisitions, net
|
$
|
(85
|
)
|
|
$
|
(33
|
)
|
|
|
$
|
—
|
|
|
$
|
(33
|
)
|
|
$
|
(52
|
)
|
|
158
|
%
|
Purchase of forward mortgage servicing rights, net of liabilities incurred
|
(547
|
)
|
|
(307
|
)
|
|
|
(134
|
)
|
|
(441
|
)
|
|
(106
|
)
|
|
24
|
%
|
|||||
Proceeds on sale of assets
|
—
|
|
|
—
|
|
|
|
13
|
|
|
13
|
|
|
(13
|
)
|
|
(100
|
)%
|
|||||
Proceeds on sale of forward and reverse mortgage servicing rights
|
343
|
|
|
105
|
|
|
|
—
|
|
|
105
|
|
|
238
|
|
|
227
|
%
|
|||||
Other
|
(49
|
)
|
|
(15
|
)
|
|
|
(41
|
)
|
|
(56
|
)
|
|
7
|
|
|
(13
|
)%
|
|||||
Net cash attributable to investing activities
|
$
|
(338
|
)
|
|
$
|
(250
|
)
|
|
|
$
|
(162
|
)
|
|
$
|
(412
|
)
|
|
$
|
74
|
|
|
(18
|
)%
|
(1)
|
Refer to Basis of Presentation section for discussion on presentation of combined results.
|
Table 32. Financing Cash Flow
|
|
Successor
|
|
|
Predecessor
|
|
|
|
|
|
|
|||||||||||||
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Combined(1)
|
|
$ Change
|
|
% Change
|
||||||||||||
Increase (decrease) in warehouse facilities
|
$
|
1,704
|
|
|
$
|
(351
|
)
|
|
|
$
|
(585
|
)
|
|
$
|
(936
|
)
|
|
$
|
2,640
|
|
|
(282
|
)%
|
(Decrease) increase in advance facilities
|
(186
|
)
|
|
45
|
|
|
|
(305
|
)
|
|
(260
|
)
|
|
74
|
|
|
(28
|
)%
|
|||||
Repayment of notes payable
|
(294
|
)
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
(294
|
)
|
|
(100
|
)%
|
|||||
Payment of unsecured senior notes and nonrecourse debt
|
(129
|
)
|
|
(1,036
|
)
|
|
|
(69
|
)
|
|
(1,105
|
)
|
|
976
|
|
|
(88
|
)%
|
|||||
Issuance of excess spread financing
|
542
|
|
|
255
|
|
|
|
70
|
|
|
325
|
|
|
217
|
|
|
67
|
%
|
|||||
Repayment of excess spread financing
|
(27
|
)
|
|
(38
|
)
|
|
|
(3
|
)
|
|
(41
|
)
|
|
14
|
|
|
(34
|
)%
|
|||||
Settlement of excess spread financing
|
(219
|
)
|
|
(77
|
)
|
|
|
(105
|
)
|
|
(182
|
)
|
|
(37
|
)
|
|
20
|
%
|
|||||
Decrease of participating interest financing
|
(1,591
|
)
|
|
(831
|
)
|
|
|
(1,391
|
)
|
|
(2,222
|
)
|
|
631
|
|
|
(28
|
)%
|
|||||
Changes in HECM securitizations
|
(99
|
)
|
|
(31
|
)
|
|
|
311
|
|
|
280
|
|
|
(379
|
)
|
|
(135
|
)%
|
|||||
Other
|
(14
|
)
|
|
1
|
|
|
|
(34
|
)
|
|
(33
|
)
|
|
19
|
|
|
(58
|
)%
|
|||||
Net cash attributable to financing activities
|
$
|
(313
|
)
|
|
$
|
(2,063
|
)
|
|
|
$
|
(2,111
|
)
|
|
$
|
(4,174
|
)
|
|
$
|
3,861
|
|
|
(93
|
)%
|
(1)
|
Refer to Basis of Presentation section for discussion on presentation of combined results.
|
▪
|
Base of $2.5 plus 25 basis points of outstanding UPB for total loans serviced.
|
▪
|
Tangible Net Worth comprises of total equity less goodwill, intangible assets, affiliate receivables and certain pledged assets.
|
▪
|
The sum of (i) base of $2.5 plus 35 basis points of the issuer’s total single-family effective outstanding obligations, and (ii) base of $5 plus 1% of the total effective HMBS outstanding obligations.
|
▪
|
Tangible Net Worth is defined as total equity less goodwill, intangible assets, affiliate receivables and certain pledged assets. Effective for fiscal year 2020, under the Ginnie Mae MBS Guide, the issuers will no longer be permitted to include deferred tax assets when computing the minimum net worth requirement.
|
▪
|
In addition to the minimum net worth requirement, we are also required to hold a ratio of Tangible Net Worth to Total Assets (excluding HMBS securitizations) greater than 6%.
|
▪
|
3.5 basis points of total Agency servicing.
|
▪
|
Incremental 200 basis points of total nonperforming Agency, measured as 90+ delinquencies, servicing in excess of 6% of the total Agency servicing UPB.
|
▪
|
Allowable assets for liquidity may include: cash and cash equivalents (unrestricted), available for sale or held for trading investment grade securities (e.g., Agency MBS, Obligations of GSEs, US Treasury Obligations); and unused/available portion of committed servicing advance lines.
|
▪
|
Maintain liquid assets equal to the greater of $1 or 10 basis points of our outstanding single-family MBS.
|
▪
|
Maintain liquid assets equal to at least 20% of our net worth requirement for HECM MBS.
|
Table 33. Debt
|
|
Successor
|
||||||
|
December 31, 2019
|
|
December 31, 2018
|
||||
Advance facilities, net
|
$
|
422
|
|
|
$
|
595
|
|
Warehouse facilities, net
|
4,575
|
|
|
2,349
|
|
||
Unsecured senior notes, net
|
2,366
|
|
|
2,459
|
|
Table 34. Contractual Maturities - Unsecured Senior Notes
|
Year Ending December 31,
|
|
Amount
|
||
2020
|
|
$
|
—
|
|
2021(1)
|
|
492
|
|
|
2022(1)
|
|
206
|
|
|
2023
|
|
950
|
|
|
2024
|
|
—
|
|
|
Thereafter
|
|
750
|
|
|
Unsecured senior notes principal amount
|
|
2,398
|
|
|
Unamortized debt issuance costs, premium and discount
|
|
(32
|
)
|
|
Unsecured senior notes, net
|
|
$
|
2,366
|
|
(1)
|
This note was subsequently redeemed in full in February 2020. See Note 26, Subsequent Events, in the notes to consolidated financial statements for further information.
|
Table 35. Contractual Obligations
|
|
Less than 1 Year
|
|
1 - 3 Years
|
|
3-5 Years
|
|
More than 5 Years
|
|
Total
|
||||||||||
Unsecured senior notes(1)
|
$
|
—
|
|
|
$
|
698
|
|
|
$
|
950
|
|
|
$
|
750
|
|
|
$
|
2,398
|
|
Interest payment from unsecured senior notes(2)
|
191
|
|
|
343
|
|
|
214
|
|
|
137
|
|
|
885
|
|
|||||
Advance facilities
|
135
|
|
|
287
|
|
|
—
|
|
|
—
|
|
|
422
|
|
|||||
Warehouse facilities
|
4,263
|
|
|
313
|
|
|
—
|
|
|
—
|
|
|
4,576
|
|
|||||
Finance lease obligations
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
Operating lease obligations
|
40
|
|
|
55
|
|
|
29
|
|
|
32
|
|
|
156
|
|
|||||
Total
|
$
|
4,631
|
|
|
$
|
1,696
|
|
|
$
|
1,193
|
|
|
$
|
919
|
|
|
$
|
8,439
|
|
(1)
|
On January 16, 2020, we completed an offering of $600 aggregate principal amount of 6.000% Senior Notes due 2027. In February 2020, the net proceeds of the offering, together with cash on hand, were used to redeem in full the outstanding 6.500% Senior Notes due 2021 and 6.500% Senior notes due 2022. See Note 26, Subsequent Events, in the notes to consolidated financial statements for additional information.
|
(2)
|
Interest expense on advance and warehouse facilities is not presented in this table due to the short-term nature of these facilities.
|
Critical Accounting Policies
|
Other Matters
|
•
|
a decrease in interest rates may increase prepayment speeds which may lead to (i) increased amortization expense; (ii) decrease in servicing fees; and (iii) decrease in the value of our MSRs;
|
•
|
a decrease in interest rates could reduce our earnings from our custodial deposit accounts;
|
•
|
an increase in interest rates would increase the cost of servicing our outstanding debt, including our ability to finance servicing advances and for borrowing for acquisitions;
|
•
|
an increase in interest rates, together with an increase in monthly payments when an adjustable mortgage loan’s interest rate adjusts upward from an initial fixed rate or a low introductory rate, may cause increased delinquency, default and foreclosure. Increased mortgage defaults and foreclosures may adversely affect our business as they increase our expenses and reduce the number of mortgages we service;
|
•
|
an increase in interest rates could adversely affect our loan originations volume because refinancing an existing loan would be less attractive for homeowners and qualifying for a purchase money loan may be more difficult for consumers;
|
•
|
an increase in interest rates could also adversely affect our production margins due to increased competition among originators;
|
•
|
an increase in interest rates could adversely affect Xome Exchange’s property sales, particularly non-distressed sales, as financing may become less attractive to borrowers; and
|
•
|
a substantial and sustained increase in prevailing interest rates could adversely affect the loan origination volumes of Xome’s clients since refinancing and purchase loans would be less attractive to borrowers, which would in turn adversely impact Xome Services’ valuation and title order volume.
|
Table 36. Change in Fair Value
|
|
December 31, 2019
|
||||||
Down 25 bps
|
|
Up 25 bps
|
|||||
Increase (decrease) in assets
|
|
|
|
||||
Mortgage servicing rights at fair value
|
$
|
(248
|
)
|
|
$
|
244
|
|
Mortgage loans held for sale at fair value
|
20
|
|
|
(24
|
)
|
||
Derivative financial instruments:
|
|
|
|
||||
Interest rate lock commitments
|
25
|
|
|
(32
|
)
|
||
Forward MBS trades
|
(11
|
)
|
|
13
|
|
||
Total change in assets
|
(214
|
)
|
|
201
|
|
||
|
|
|
|
||||
Increase (decrease) in liabilities
|
|
|
|
||||
Mortgage servicing rights liabilities at fair value
|
(4
|
)
|
|
4
|
|
||
Excess spread financing at fair value
|
(50
|
)
|
|
52
|
|
||
Derivative financial instruments:
|
|
|
|
||||
Interest rate lock commitments
|
(4
|
)
|
|
5
|
|
||
Forward MBS trades
|
33
|
|
|
(41
|
)
|
||
Total change in liabilities
|
(25
|
)
|
|
20
|
|
||
Total, net change
|
$
|
(189
|
)
|
|
$
|
181
|
|
Consolidated Balance Sheets as of December 31, 2019 and 2018
|
|
Consolidated Statements of Operations for the Year Ended December 31, 2019 and the Five Months Ended December 31, 2018 (Successor) and for the Seven Months Ended July 31, 2018 and the Year Ended December 31, 2017 (Predecessor)
|
|
Consolidated Statements of Stockholders’ Equity for the Year Ended December 31, 2019 and the Five Months Ended December 31, 2018 (Successor) and for the Seven Months Ended July 31, 2018 and the Year Ended December 31, 2017 (Predecessor)
|
|
Consolidated Statements of Cash Flows for the Year Ended December 31, 2019 and the Five Months Ended December 31, 2018 (Successor) and for the Seven Months Ended July 31, 2018 and the Year Ended December 31, 2017 (Predecessor)
|
|
|
Successor
|
||||||
|
December 31, 2019
|
|
December 31, 2018
|
||||
Assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
329
|
|
|
$
|
242
|
|
Restricted cash
|
283
|
|
|
319
|
|
||
Mortgage servicing rights, $3,496 and $3,665 at fair value, respectively
|
3,502
|
|
|
3,676
|
|
||
Advances and other receivables, net of reserves of $175 and $47, respectively
|
988
|
|
|
1,194
|
|
||
Reverse mortgage interests, net of reserves of $3 and $13, respectively
|
6,279
|
|
|
7,934
|
|
||
Mortgage loans held for sale at fair value
|
4,077
|
|
|
1,631
|
|
||
Mortgage loans held for investment at fair value
|
—
|
|
|
119
|
|
||
Property and equipment, net of accumulated depreciation of $55 and $16, respectively
|
112
|
|
|
96
|
|
||
Deferred tax assets, net
|
1,345
|
|
|
967
|
|
||
Other assets
|
1,390
|
|
|
795
|
|
||
Total assets
|
$
|
18,305
|
|
|
$
|
16,973
|
|
|
|
|
|
||||
Liabilities and Stockholders’ Equity
|
|
|
|
||||
Unsecured senior notes, net
|
$
|
2,366
|
|
|
$
|
2,459
|
|
Advance facilities, net
|
422
|
|
|
595
|
|
||
Warehouse facilities, net
|
4,575
|
|
|
2,349
|
|
||
Payables and other liabilities
|
2,016
|
|
|
1,543
|
|
||
MSR related liabilities - nonrecourse at fair value
|
1,348
|
|
|
1,216
|
|
||
Mortgage servicing liabilities
|
61
|
|
|
71
|
|
||
Other nonrecourse debt, net
|
5,286
|
|
|
6,795
|
|
||
Total liabilities
|
16,074
|
|
|
15,028
|
|
||
Commitments and contingencies (Note 21)
|
|
|
|
||||
Preferred stock at $0.00001 - 10 million shares authorized, 1 million shares issued and outstanding, respectively; aggregate liquidation preference of ten dollars, respectively
|
—
|
|
|
—
|
|
||
Common stock at $0.01 par value - 300 million authorized, 91.1 million and 90.8 million shares issued, respectively
|
1
|
|
|
1
|
|
||
Additional paid-in-capital
|
1,109
|
|
|
1,093
|
|
||
Retained earnings
|
1,122
|
|
|
848
|
|
||
Total Mr. Cooper stockholders’ equity
|
2,232
|
|
|
1,942
|
|
||
Non-controlling interests
|
(1
|
)
|
|
3
|
|
||
Total stockholders’ equity
|
2,231
|
|
|
1,945
|
|
||
Total liabilities and stockholders’ equity
|
$
|
18,305
|
|
|
$
|
16,973
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Year Ended December 31, 2017
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
||||||||
Service related, net
|
$
|
909
|
|
|
$
|
418
|
|
|
|
$
|
901
|
|
|
$
|
1,043
|
|
Net gain on mortgage loans held for sale
|
1,098
|
|
|
176
|
|
|
|
295
|
|
|
607
|
|
||||
Total revenues
|
2,007
|
|
|
594
|
|
|
|
1,196
|
|
|
1,650
|
|
||||
Expenses:
|
|
|
|
|
|
|
|
|
||||||||
Salaries, wages and benefits
|
957
|
|
|
337
|
|
|
|
426
|
|
|
742
|
|
||||
General and administrative
|
894
|
|
|
370
|
|
|
|
519
|
|
|
733
|
|
||||
Total expenses
|
1,851
|
|
|
707
|
|
|
|
945
|
|
|
1,475
|
|
||||
Other income (expenses), net:
|
|
|
|
|
|
|
|
|
||||||||
Interest income
|
605
|
|
|
256
|
|
|
|
333
|
|
|
597
|
|
||||
Interest expense
|
(779
|
)
|
|
(293
|
)
|
|
|
(388
|
)
|
|
(731
|
)
|
||||
Other income, net
|
15
|
|
|
13
|
|
|
|
6
|
|
|
3
|
|
||||
Total other income (expenses), net
|
(159
|
)
|
|
(24
|
)
|
|
|
(49
|
)
|
|
(131
|
)
|
||||
(Loss) income before income tax (benefit) expense
|
(3
|
)
|
|
(137
|
)
|
|
|
202
|
|
|
44
|
|
||||
Less: Income tax (benefit) expense
|
(273
|
)
|
|
(1,021
|
)
|
|
|
48
|
|
|
13
|
|
||||
Net income
|
270
|
|
|
884
|
|
|
|
154
|
|
|
31
|
|
||||
Less: Net (loss) income attributable to non-controlling interests
|
(4
|
)
|
|
—
|
|
|
|
—
|
|
|
1
|
|
||||
Net income attributable to Successor/Predecessor
|
274
|
|
|
884
|
|
|
|
154
|
|
|
30
|
|
||||
Less: Undistributed earnings attributable to participating stockholders
|
2
|
|
|
8
|
|
|
|
—
|
|
|
—
|
|
||||
Net income attributable to common stockholders
|
$
|
272
|
|
|
$
|
876
|
|
|
|
$
|
154
|
|
|
$
|
30
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net income per common share attributable to Successor/Predecessor common stockholders:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
2.99
|
|
|
$
|
9.65
|
|
|
|
$
|
1.57
|
|
|
$
|
0.31
|
|
Diluted
|
$
|
2.95
|
|
|
$
|
9.54
|
|
|
|
$
|
1.55
|
|
|
$
|
0.30
|
|
|
Preferred Stock
|
|
Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
|
Shares (in thousands)
|
|
Amount
|
|
Shares (in thousands)
|
|
Amount
|
|
Additional Paid-in Capital
|
|
Retained Earnings
|
|
Treasury Shares Amount
|
|
Total Nationstar Stockholders’
Equity and Mr. Cooper Stockholders’ Equity, respectively
|
|
Non-controlling Interests
|
|
Total Equity
|
||||||||||||||||||
Predecessor
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Balance at January 1, 2017
|
—
|
|
|
$
|
—
|
|
|
97,497
|
|
|
$
|
1
|
|
|
$
|
1,122
|
|
|
$
|
701
|
|
|
$
|
(147
|
)
|
|
$
|
1,677
|
|
|
$
|
6
|
|
|
$
|
1,683
|
|
Shares issued / (surrendered) under incentive compensation plan
|
—
|
|
|
—
|
|
|
231
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(1
|
)
|
|
(4
|
)
|
|
—
|
|
|
(4
|
)
|
||||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|
17
|
|
||||||||
Dividends to non-controlling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
(5
|
)
|
||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
30
|
|
|
—
|
|
|
30
|
|
|
1
|
|
|
31
|
|
||||||||
Balance at December 31, 2017
|
—
|
|
|
—
|
|
|
97,728
|
|
|
1
|
|
|
1,131
|
|
|
731
|
|
|
(148
|
)
|
|
1,715
|
|
|
7
|
|
|
1,722
|
|
||||||||
Shares issued / (surrendered) under incentive compensation plan
|
—
|
|
|
—
|
|
|
450
|
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
(3
|
)
|
|
(9
|
)
|
|
—
|
|
|
(9
|
)
|
||||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|
17
|
|
||||||||
Dividends to non-controlling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
(6
|
)
|
|
(1
|
)
|
||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
154
|
|
|
—
|
|
|
154
|
|
|
—
|
|
|
154
|
|
||||||||
Balance at July 31, 2018
|
—
|
|
|
$
|
—
|
|
|
98,178
|
|
|
$
|
1
|
|
|
$
|
1,147
|
|
|
$
|
885
|
|
|
$
|
(151
|
)
|
|
$
|
1,882
|
|
|
$
|
1
|
|
|
$
|
1,883
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Successor
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Balance at August 1, 2018
|
1,000
|
|
|
$
|
—
|
|
|
90,806
|
|
|
$
|
1
|
|
|
$
|
1,091
|
|
|
$
|
(36
|
)
|
|
$
|
—
|
|
|
$
|
1,056
|
|
|
$
|
—
|
|
|
$
|
1,056
|
|
Non-controlling interests acquired
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
3
|
|
||||||||
Shares issued under incentive compensation plan
|
—
|
|
|
—
|
|
|
15
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
884
|
|
|
—
|
|
|
884
|
|
|
—
|
|
|
884
|
|
||||||||
Balance at December 31, 2018
|
1,000
|
|
|
—
|
|
|
90,821
|
|
|
1
|
|
|
1,093
|
|
|
848
|
|
|
—
|
|
|
1,942
|
|
|
3
|
|
|
1,945
|
|
||||||||
Shares issued / (surrendered) under incentive compensation plan
|
—
|
|
|
—
|
|
|
297
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
||||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|
—
|
|
|
18
|
|
||||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
274
|
|
|
—
|
|
|
274
|
|
|
(4
|
)
|
|
270
|
|
||||||||
Balance at December 31, 2019
|
1,000
|
|
|
$
|
—
|
|
|
91,118
|
|
|
$
|
1
|
|
|
$
|
1,109
|
|
|
$
|
1,122
|
|
|
$
|
—
|
|
|
$
|
2,232
|
|
|
$
|
(1
|
)
|
|
$
|
2,231
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Year Ended December 31, 2017
|
||||||||
Operating Activities
|
|
|
|
|
|
|
|
|
||||||||
Net income
|
$
|
270
|
|
|
$
|
884
|
|
|
|
$
|
154
|
|
|
$
|
31
|
|
Adjustments to reconcile net income to net cash attributable to operating activities:
|
|
|
|
|
|
|
|
|
||||||||
Deferred tax (benefit) expense
|
(366
|
)
|
|
(1,021
|
)
|
|
|
63
|
|
|
(46
|
)
|
||||
Net gain on mortgage loans held for sale
|
(1,098
|
)
|
|
(176
|
)
|
|
|
(295
|
)
|
|
(607
|
)
|
||||
Interest income on reverse mortgage loans
|
(307
|
)
|
|
(206
|
)
|
|
|
(274
|
)
|
|
(490
|
)
|
||||
Loss (gain) on sale of assets
|
2
|
|
|
—
|
|
|
|
(9
|
)
|
|
(8
|
)
|
||||
MSL related increased obligation
|
—
|
|
|
—
|
|
|
|
59
|
|
|
—
|
|
||||
Provision for servicing reserves
|
66
|
|
|
38
|
|
|
|
70
|
|
|
148
|
|
||||
Fair value changes and amortization/accretion of mortgage servicing rights/liabilities
|
1,005
|
|
|
225
|
|
|
|
(177
|
)
|
|
430
|
|
||||
Fair value changes in excess spread financing
|
(169
|
)
|
|
5
|
|
|
|
81
|
|
|
12
|
|
||||
Fair value changes in mortgage servicing rights financing liability
|
5
|
|
|
6
|
|
|
|
16
|
|
|
(17
|
)
|
||||
Fair value changes in mortgage loans held for investment
|
(3
|
)
|
|
(2
|
)
|
|
|
—
|
|
|
—
|
|
||||
Amortization of premiums, net of discount accretion
|
(32
|
)
|
|
9
|
|
|
|
8
|
|
|
82
|
|
||||
Depreciation and amortization for property and equipment and intangible assets
|
91
|
|
|
39
|
|
|
|
33
|
|
|
59
|
|
||||
Share-based compensation
|
18
|
|
|
2
|
|
|
|
17
|
|
|
17
|
|
||||
Other loss
|
11
|
|
|
—
|
|
|
|
3
|
|
|
6
|
|
||||
Repurchases of forward loan assets out of Ginnie Mae securitizations
|
(2,895
|
)
|
|
(527
|
)
|
|
|
(544
|
)
|
|
(1,249
|
)
|
||||
Mortgage loans originated and purchased for sale, net of fees
|
(40,257
|
)
|
|
(8,888
|
)
|
|
|
(12,328
|
)
|
|
(19,159
|
)
|
||||
Sales proceeds and loan payment proceeds for mortgage loans held for sale and held for investment
|
41,948
|
|
|
9,405
|
|
|
|
13,392
|
|
|
20,776
|
|
||||
Changes in assets and liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Advances and other receivables
|
228
|
|
|
43
|
|
|
|
377
|
|
|
(30
|
)
|
||||
Reverse mortgage interests
|
2,192
|
|
|
1,544
|
|
|
|
1,601
|
|
|
1,672
|
|
||||
Other assets
|
78
|
|
|
(61
|
)
|
|
|
(41
|
)
|
|
(75
|
)
|
||||
Payables and other liabilities
|
(85
|
)
|
|
(68
|
)
|
|
|
88
|
|
|
(193
|
)
|
||||
Net cash attributable to operating activities
|
702
|
|
|
1,251
|
|
|
|
2,294
|
|
|
1,359
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Investing Activities
|
|
|
|
|
|
|
|
|
||||||||
Acquisitions, net of cash acquired
|
(85
|
)
|
|
(33
|
)
|
|
|
—
|
|
|
—
|
|
||||
Property and equipment additions, net of disposals
|
(49
|
)
|
|
(15
|
)
|
|
|
(40
|
)
|
|
(42
|
)
|
||||
Purchase of forward mortgage servicing rights, net of liabilities incurred
|
(547
|
)
|
|
(307
|
)
|
|
|
(134
|
)
|
|
(63
|
)
|
||||
Net payment related to acquisition of HECM related receivables
|
—
|
|
|
—
|
|
|
|
(1
|
)
|
|
—
|
|
||||
Net proceeds from acquisition of reverse mortgage servicing portfolio and HECM-related receivables
|
—
|
|
|
—
|
|
|
|
—
|
|
|
16
|
|
||||
Proceeds on sale of forward and reverse mortgage servicing rights
|
343
|
|
|
105
|
|
|
|
—
|
|
|
71
|
|
||||
Proceeds on sale of assets
|
—
|
|
|
—
|
|
|
|
13
|
|
|
16
|
|
||||
Purchase of cost-method investments
|
—
|
|
|
—
|
|
|
|
—
|
|
|
(4
|
)
|
||||
Net cash attributable to investing activities
|
(338
|
)
|
|
(250
|
)
|
|
|
(162
|
)
|
|
(6
|
)
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Year Ended December 31, 2017
|
||||||||
Financing Activities
|
|
|
|
|
|
|
|
|
||||||||
Increase (decrease) in warehouse facilities
|
1,704
|
|
|
(351
|
)
|
|
|
(585
|
)
|
|
863
|
|
||||
(Decrease) increase in advance facilities
|
(186
|
)
|
|
45
|
|
|
|
(305
|
)
|
|
(241
|
)
|
||||
Repayment of notes payable
|
(294
|
)
|
|
—
|
|
|
|
—
|
|
|
—
|
|
||||
Proceeds from issuance of HECM securitizations
|
751
|
|
|
343
|
|
|
|
759
|
|
|
707
|
|
||||
Proceeds from sale of HECM securitizations
|
20
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
||||
Repayment of HECM securitizations
|
(870
|
)
|
|
(374
|
)
|
|
|
(448
|
)
|
|
(572
|
)
|
||||
Proceeds from issuance of participating interest financing
|
277
|
|
|
112
|
|
|
|
208
|
|
|
575
|
|
||||
Repayment of participating interest financing
|
(1,868
|
)
|
|
(943
|
)
|
|
|
(1,599
|
)
|
|
(2,597
|
)
|
||||
Proceeds from issuance of excess spread financing
|
542
|
|
|
255
|
|
|
|
70
|
|
|
—
|
|
||||
Repayment of excess spread financing
|
(27
|
)
|
|
(38
|
)
|
|
|
(3
|
)
|
|
(23
|
)
|
||||
Settlement of excess spread financing
|
(219
|
)
|
|
(77
|
)
|
|
|
(105
|
)
|
|
(207
|
)
|
||||
Repayment of nonrecourse debt - legacy assets
|
(29
|
)
|
|
(6
|
)
|
|
|
(7
|
)
|
|
(15
|
)
|
||||
Redemption and repayment of unsecured senior notes
|
(100
|
)
|
|
(1,030
|
)
|
|
|
(62
|
)
|
|
(123
|
)
|
||||
Repayment of finance lease liability
|
(4
|
)
|
|
—
|
|
|
|
—
|
|
|
—
|
|
||||
Proceeds from non-controlling interests
|
—
|
|
|
3
|
|
|
|
—
|
|
|
—
|
|
||||
Surrender of shares relating to stock vesting
|
(2
|
)
|
|
—
|
|
|
|
(9
|
)
|
|
(4
|
)
|
||||
Debt financing costs
|
(8
|
)
|
|
(2
|
)
|
|
|
(24
|
)
|
|
(13
|
)
|
||||
Dividends to non-controlling interests
|
—
|
|
|
—
|
|
|
|
(1
|
)
|
|
(5
|
)
|
||||
Net cash attributable to financing activities
|
(313
|
)
|
|
(2,063
|
)
|
|
|
(2,111
|
)
|
|
(1,655
|
)
|
||||
Net increase (decrease) in cash and cash equivalents
|
51
|
|
|
(1,062
|
)
|
|
|
21
|
|
|
(302
|
)
|
||||
Cash and cash equivalents - beginning of period
|
561
|
|
|
1,623
|
|
|
|
575
|
|
|
877
|
|
||||
Cash and cash equivalents - end of period(1)
|
$
|
612
|
|
|
$
|
561
|
|
|
|
$
|
596
|
|
|
$
|
575
|
|
|
|
|
|
|
|
|
|
|
||||||||
Supplemental Disclosures of Cash Activities
|
|
|
|
|
|
|
|
|
||||||||
Cash paid for interest expense
|
$
|
174
|
|
|
$
|
283
|
|
|
|
$
|
417
|
|
|
$
|
765
|
|
Net cash paid (refunded) for income taxes
|
$
|
42
|
|
|
$
|
(37
|
)
|
|
|
$
|
36
|
|
|
$
|
102
|
|
|
|
|
|
|
|
|
|
|
||||||||
Supplemental Disclosures of Non-cash Investing Activities
|
|
|
|
|
|
|
|
|
||||||||
Forward mortgage servicing rights sales price holdback
|
$
|
49
|
|
|
$
|
—
|
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Purchase of forward mortgage servicing rights
|
$
|
28
|
|
|
$
|
—
|
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(1)
|
The following table provides a reconciliation of cash, cash equivalents and restricted cash to amount reported within the consolidated balance sheets.
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
December 31,
2019 |
|
December 31,
2018 |
|
|
July 31,
2018 |
|
December 31,
2017 |
||||||||
Cash and cash equivalents
|
$
|
329
|
|
|
$
|
242
|
|
|
|
$
|
166
|
|
|
$
|
215
|
|
Restricted cash
|
283
|
|
|
319
|
|
|
|
430
|
|
|
360
|
|
||||
Total cash, cash equivalents and restricted cash
|
$
|
612
|
|
|
$
|
561
|
|
|
|
$
|
596
|
|
|
$
|
575
|
|
•
|
Revenues from Forward Servicing Activities - Service related revenues primarily include contractually specified servicing fees, late charges, prepayment penalties and other ancillary revenues. The servicing fees are based on a contractual percentage of the outstanding principal balance and recognized as revenue as earned, which is generally upon collection of the payments from the borrower. Corresponding loan servicing costs are charged to expense as incurred. The Company recognizes ancillary revenues and earnings on float as they are earned, which is generally upon collection of the payments from the borrower.
|
•
|
Revenues from Reverse Mortgage Servicing and Reverse Mortgage Interests - The Company performs servicing of reverse mortgage loans, similar to its forward servicing business, and receives servicing fees from investors, which are recorded in revenues - service related, net in the consolidated statements of operations. For reverse mortgage interests, where the Company records entire participating interest in HECM loans, the Company accrues interest in accordance with FHA guidelines and records interest income on the consolidated statements of operations.
|
•
|
Revenues from Origination and other loan fees - Loan origination and other loan fees generally represent flat, per-loan fee amounts and are recognized as revenue, net of loan origination costs, at the time the loans are funded.
|
•
|
Net gain on mortgage loans held for sale - Net gain on loans held for sale includes the realized and unrealized gains and losses on sales of mortgage loans, as well as the changes in fair value of all loan-related derivatives, including interest rate lock commitments.
|
•
|
Exchange is a national technology-enabled platform that manages and sells residential properties through its Xome.com platform. Revenue-generating activities include commission and buyer’s premium of winning bids on auctioned real estate owned (“REO”) and short sale properties. Revenue is recognized when the performance obligation is completed, which is at the closing of real estate transactions and there is transfer of ownership to the buyer.
|
•
|
Services connects the major touch points of the real estate transactions process by providing title, escrow, collateral valuation and field services for purchase, refinance and default transactions. Major revenue-generating activities include title and escrow services and valuation services. Revenue is recognized when the performance obligation is completed, which is when services are rendered to customers.
|
•
|
Data/Technology includes the Company’s software as a service platform which provides integrated technology, media and data solutions to mortgage servicers, originators and multiple listing service (“MLS”) organizations and associations. Revenue-generating activities include software and platform system access and use, system implementation, software maintenance and support, data services and any additional customized enhancement. Revenue is recognized when the performance obligation is completed, which is generally recognized on a straight-line basis over the contractual terms. Additionally, any additional fees owed due to usage metrics in excess of the monthly minimum will be recognized each month under the usage-based royalties guidance of ASC 606.
|
Final Estimated Fair Value of Net Assets Acquired:
|
|
||
Cash and cash equivalents
|
$
|
37
|
|
Restricted cash
|
2
|
|
|
Mortgage servicing rights
|
271
|
|
|
Advances and other receivables
|
84
|
|
|
Mortgage loans held for sale
|
536
|
|
|
Mortgage loans held for investment
|
1
|
|
|
Property and equipment
|
8
|
|
|
Other assets
|
483
|
|
|
Fair value of assets acquired
|
1,422
|
|
|
Notes payable(1)
|
294
|
|
|
Advance facilities
|
13
|
|
|
Warehouse facilities
|
393
|
|
|
Payables and other liabilities
|
530
|
|
|
Other nonrecourse debt
|
129
|
|
|
Fair value of liabilities assumed
|
1,359
|
|
|
Total fair value of net tangible assets acquired
|
63
|
|
|
Intangible assets:
|
|
||
Customer relationships(2)
|
13
|
|
|
Goodwill
|
40
|
|
|
Final purchase price
|
$
|
116
|
|
(1)
|
Notes payable was subsequently paid off in February 2019 after the consummation of the acquisition.
|
(2)
|
The estimated fair values for customer relationships were measured using the excess earnings method and were determined to have a remaining useful life of 10 years.
|
|
Year Ended December 31, 2019
|
||
|
(unaudited)
|
||
Pro forma total revenues
|
$
|
2,026
|
|
|
|
||
Pro forma net income
|
$
|
273
|
|
Final Estimated Fair Value of Net Assets Acquired
|
|
||
Cash and cash equivalents
|
$
|
166
|
|
Restricted cash
|
430
|
|
|
Mortgage servicing rights
|
3,422
|
|
|
Advances and other receivables
|
1,262
|
|
|
Reverse mortgage interests
|
9,189
|
|
|
Mortgage loans held for sale
|
1,514
|
|
|
Mortgage loans held for investment
|
125
|
|
|
Property and equipment
|
96
|
|
|
Other assets
|
610
|
|
|
Fair value of assets acquired
|
16,814
|
|
|
Unsecured senior notes
|
1,830
|
|
|
Advance facilities
|
551
|
|
|
Warehouse facilities
|
2,701
|
|
|
Payables and accrued liabilities
|
1,352
|
|
|
MSR related liabilities—nonrecourse
|
1,065
|
|
|
Mortgage servicing liabilities
|
123
|
|
|
Other nonrecourse debt
|
7,583
|
|
|
Fair value of liabilities assumed
|
15,205
|
|
|
Total fair value of net tangible assets acquired
|
1,609
|
|
|
Intangible assets(1)
|
103
|
|
|
Goodwill
|
65
|
|
|
Purchase price
|
$
|
1,777
|
|
(1)
|
The following intangible assets were acquired in the Nationstar acquisition:
|
|
Useful Life (Years)
|
|
Fair Value
|
||
Customer relationships (i)
|
6
|
|
$
|
61
|
|
Tradename (ii)
|
5
|
|
8
|
|
|
Technology (ii)
|
3-5
|
|
11
|
|
|
Internally developed software(iii)
|
2
|
|
23
|
|
|
Total
|
|
|
$
|
103
|
|
(i)
|
The estimated fair values for customer relationships were measured using the excess earnings method.
|
(ii)
|
The estimated fair values for tradename and technology were measured using the relief-from-royalty method. This method assumes the tradename and technology have value to the extent the owner is relieved of the obligation to pay royalties for the benefits received from these assets.
|
(iii)
|
The estimated fair values for internally developed software were measured using the replacement cost method.
|
|
Year Ended December 31, 2018
|
||
|
(unaudited)
|
||
Pro forma total revenues
|
$
|
1,790
|
|
|
|
||
Pro forma net income
|
$
|
16
|
|
|
Successor
|
||||||
MSRs and Related Liabilities
|
December 31, 2019
|
|
December 31, 2018
|
||||
Forward MSRs - fair value
|
$
|
3,496
|
|
|
$
|
3,665
|
|
Reverse MSRs - amortized cost
|
6
|
|
|
11
|
|
||
Mortgage servicing rights
|
$
|
3,502
|
|
|
$
|
3,676
|
|
|
|
|
|
||||
Mortgage servicing liabilities - amortized cost
|
$
|
61
|
|
|
$
|
71
|
|
|
|
|
|
||||
Excess spread financing - fair value
|
$
|
1,311
|
|
|
$
|
1,184
|
|
Mortgage servicing rights financing - fair value
|
37
|
|
|
32
|
|
||
MSR related liabilities - nonrecourse at fair value
|
$
|
1,348
|
|
|
$
|
1,216
|
|
|
Successor
|
|
|
Predecessor
|
||||||||
Forward MSRs - Fair Value
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
||||||
Fair value - beginning of period
|
$
|
3,665
|
|
|
$
|
3,413
|
|
|
|
$
|
2,937
|
|
Additions:
|
|
|
|
|
|
|
||||||
Servicing retained from mortgage loans sold
|
434
|
|
|
120
|
|
|
|
162
|
|
|||
Purchases of servicing rights(1)
|
858
|
|
|
479
|
|
|
|
144
|
|
|||
Dispositions:
|
|
|
|
|
|
|
||||||
Sales of servicing assets(2)
|
(408
|
)
|
|
(111
|
)
|
|
|
4
|
|
|||
Changes in fair value:
|
|
|
|
|
|
|
||||||
Changes in valuation inputs or assumptions used in the valuation model
|
(589
|
)
|
|
(123
|
)
|
|
|
330
|
|
|||
Other changes in fair value
|
(464
|
)
|
|
(113
|
)
|
|
|
(164
|
)
|
|||
Fair value - end of period
|
$
|
3,496
|
|
|
$
|
3,665
|
|
|
|
$
|
3,413
|
|
(1)
|
Purchases of servicing rights during the year ended December 31, 2019 include $271 of mortgage servicing rights that were acquired from Pacific Union. See Note 3, Acquisitions, for further discussion. In addition, on January 3, 2019, the Company entered into a subservicing contract for $24 billion unpaid principal balance in mortgages. The related servicing rights were subsequently purchased on May 1, 2019, resulting in additional $253 servicing rights during the second quarter of 2019.
|
(2)
|
Amount for the seven months ended July 31, 2018 is related to the sale of MSRs collateralized by nonperforming loans, which have a negative MSR value.
|
|
Successor
|
||||||||||||||
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||
Forward MSRs - Sensitivity Pools
|
UPB
|
|
Fair Value
|
|
UPB
|
|
Fair Value
|
||||||||
Credit sensitive
|
$
|
147,895
|
|
|
$
|
1,613
|
|
|
$
|
135,752
|
|
|
$
|
1,495
|
|
Interest sensitive
|
148,887
|
|
|
1,883
|
|
|
159,729
|
|
|
2,170
|
|
||||
Total
|
$
|
296,782
|
|
|
$
|
3,496
|
|
|
$
|
295,481
|
|
|
$
|
3,665
|
|
|
Successor
|
||||
|
December 31, 2019
|
|
December 31, 2018
|
||
Total MSR Portfolio
|
|
|
|
||
Discount rate
|
9.7
|
%
|
|
10.2
|
%
|
Prepayment speeds
|
13.1
|
%
|
|
10.8
|
%
|
Average life
|
5.8 years
|
|
|
6.7 years
|
|
|
|
|
|
||
Credit Sensitive
|
|
|
|
||
Discount rate
|
10.4
|
%
|
|
11.3
|
%
|
Prepayment speeds
|
12.7
|
%
|
|
11.8
|
%
|
Average life
|
6.0 years
|
|
|
6.4 years
|
|
|
|
|
|
||
Interest Sensitive
|
|
|
|
||
Discount rate
|
9.1
|
%
|
|
9.3
|
%
|
Prepayment speeds
|
13.5
|
%
|
|
10.0
|
%
|
Average life
|
5.7 years
|
|
|
7.0 years
|
|
|
Successor
|
||||||||||||||
|
Discount Rate
|
|
Total Prepayment Speeds
|
||||||||||||
Forward MSRs - Hypothetical Sensitivities
|
100 bps
Adverse
Change
|
|
200 bps
Adverse
Change
|
|
10%
Adverse
Change
|
|
20%
Adverse
Change
|
||||||||
December 31, 2019
|
|
|
|
|
|
|
|
||||||||
Mortgage servicing rights
|
$
|
(127
|
)
|
|
$
|
(245
|
)
|
|
$
|
(165
|
)
|
|
$
|
(317
|
)
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2018
|
|
|
|
|
|
|
|
||||||||
Mortgage servicing rights
|
$
|
(137
|
)
|
|
$
|
(265
|
)
|
|
$
|
(129
|
)
|
|
$
|
(250
|
)
|
|
Successor
|
||||
Excess Spread Financing Assumptions
|
December 31, 2019
|
|
December 31, 2018
|
||
Discount rate
|
11.6
|
%
|
|
10.4
|
%
|
Prepayment speeds
|
12.6
|
%
|
|
11.0
|
%
|
Recapture rate
|
20.1
|
%
|
|
18.6
|
%
|
Average life
|
5.8 years
|
|
|
6.5 years
|
|
|
Successor
|
||||||||||||||
|
Discount Rate
|
|
Prepayment Speeds
|
||||||||||||
Excess Spread Financing - Hypothetical Sensitivities
|
100 bps
Adverse
Change
|
|
200 bps
Adverse
Change
|
|
10%
Adverse
Change
|
|
20%
Adverse
Change
|
||||||||
December 31, 2019
|
|
|
|
|
|
|
|
||||||||
Excess spread financing
|
$
|
46
|
|
|
$
|
95
|
|
|
$
|
46
|
|
|
$
|
96
|
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2018
|
|
|
|
|
|
|
|
||||||||
Excess spread financing
|
$
|
47
|
|
|
$
|
99
|
|
|
$
|
38
|
|
|
$
|
81
|
|
|
Successor
|
||||
Mortgage Servicing Rights Financing Assumptions
|
December 31, 2019
|
|
December 31, 2018
|
||
Advance financing rates
|
3.5
|
%
|
|
4.2
|
%
|
Annual advance recovery rates
|
18.8
|
%
|
|
19.0
|
%
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
Total Revenues - Servicing
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Year Ended December 31, 2017
|
||||||||
Contractually specified servicing fees(1)
|
$
|
1,194
|
|
|
$
|
421
|
|
|
|
$
|
574
|
|
|
$
|
1,003
|
|
Other service-related income(1)(2)
|
182
|
|
|
44
|
|
|
|
66
|
|
|
168
|
|
||||
Incentive and modification income(1)
|
40
|
|
|
17
|
|
|
|
37
|
|
|
80
|
|
||||
Late fees(1)
|
110
|
|
|
34
|
|
|
|
53
|
|
|
89
|
|
||||
Reverse servicing fees
|
31
|
|
|
16
|
|
|
|
37
|
|
|
58
|
|
||||
Mark-to-market adjustments(3)
|
(505
|
)
|
|
(164
|
)
|
|
|
196
|
|
|
(160
|
)
|
||||
Counterparty revenue share(4)
|
(284
|
)
|
|
(68
|
)
|
|
|
(111
|
)
|
|
(230
|
)
|
||||
Amortization, net of accretion(5)
|
(236
|
)
|
|
(64
|
)
|
|
|
(112
|
)
|
|
(242
|
)
|
||||
Total revenues - Servicing
|
$
|
532
|
|
|
$
|
236
|
|
|
|
$
|
740
|
|
|
$
|
766
|
|
(1)
|
Amounts include subservicing related revenues.
|
(2)
|
Amount for the year ended December 31, 2019 includes a gain of $21 from the execution of a clean-up call option on a reverse mortgage loan trust, as the Company was master servicer and holder of clean-up call rights.
|
(3)
|
Mark-to-market (“MTM”) adjustments include fair value adjustments on MSR, excess spread financing and MSR financing liabilities. The amount of MSR MTM includes the impact of negative modeled cash flows which have been transferred to reserves on advances and other receivables. The negative modeled cash flows relate to advances and other receivables associated with inactive and liquidated loans that are no longer part of the MSR portfolio. The impact of negative modeled cash flows was $62 and $25 for the year ended December 31, 2019 and five months ended December 31, 2018, respectively. The impact of negative modeled cash flows for the Predecessor was $38 for the seven months ended July 31, 2018 and $72 for the year ended December 31, 2017, respectively.
|
(4)
|
Counterparty revenue share represents the excess servicing fee that the Company pays to the counterparties under the excess spread financing arrangements and the payments made associated with MSR financing arrangements.
|
(5)
|
Amortization for the Company is net of excess spread accretion of $243 and $53 and MSL accretion of $47 and $15 for the year ended December 31, 2019 and the five months ended December 31, 2018, respectively. Amortization for the Predecessor is net of excess spread accretion of $78 for the seven months ended July 31, 2018 and $161 for the year ended December 31, 2017, respectively. The Predecessor recorded MSL accretion within reverse servicing fees, whereas the Successor has elected to record MSL accretion within Amortization, net of accretion.
|
|
Successor
|
||||||
|
December 31, 2019
|
|
December 31, 2018
|
||||
Servicing advances, net of $131 and $205 discount, respectively
|
$
|
970
|
|
|
$
|
1,000
|
|
Receivables from agencies, investors and prior servicers, net of $21 and $48 discount, respectively
|
193
|
|
|
241
|
|
||
Reserves
|
(175
|
)
|
|
(47
|
)
|
||
Total advances and other receivables, net
|
$
|
988
|
|
|
$
|
1,194
|
|
|
Successor
|
|
|
Predecessor
|
||||||||
Reserves for Advances and Other Receivables
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
||||||
Balance - beginning of period
|
$
|
47
|
|
|
$
|
—
|
|
|
|
$
|
284
|
|
Provision and other additions(1)
|
160
|
|
|
47
|
|
|
|
69
|
|
|||
Write-offs
|
(32
|
)
|
|
—
|
|
|
|
(56
|
)
|
|||
Balance - end of period
|
$
|
175
|
|
|
$
|
47
|
|
|
|
$
|
297
|
|
(1)
|
The Company recorded a provision of $62 and $25, and the Predecessor recorded a provision of $38 through the MTM adjustments in revenues - service related, net in the consolidated statements of operations for the year ended December 31, 2019, five months ended December 31, 2018 and seven months ended July 31, 2018, respectively, for inactive and liquidated loans that are no longer part of the MSR portfolio. Other additions represent reclassifications of required reserves provisioned within other balance sheet accounts as associated serviced loans become inactive or liquidate.
|
|
Successor
|
||||||||||||||
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
||||||||||||
Purchase Discounts
|
Servicing Advances
|
|
Receivables from Agencies, Investors and Prior Servicers
|
|
Servicing Advances
|
|
Receivables from Agencies, Investors and Prior Servicers
|
||||||||
Balance - beginning of period
|
$
|
205
|
|
|
$
|
48
|
|
|
$
|
246
|
|
|
$
|
56
|
|
Addition from acquisition
|
19
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Utilization of purchase discounts
|
(93
|
)
|
|
(27
|
)
|
|
(41
|
)
|
|
(8
|
)
|
||||
Balance - end of period
|
$
|
131
|
|
|
$
|
21
|
|
|
$
|
205
|
|
|
$
|
48
|
|
|
Successor
|
||||||
|
December 31, 2019
|
|
December 31, 2018
|
||||
Participating interests in HECM mortgage-backed securities, including $10 and $58 purchase premium, respectively
|
$
|
4,292
|
|
|
$
|
5,664
|
|
Other interests securitized, net of $56 and $100 purchase discount, respectively
|
938
|
|
|
1,064
|
|
||
Unsecuritized interests, net of $68 and $122 purchase discount, respectively
|
1,052
|
|
|
1,219
|
|
||
Reserves
|
(3
|
)
|
|
(13
|
)
|
||
Total reverse mortgage interests, net
|
$
|
6,279
|
|
|
$
|
7,934
|
|
|
Successor
|
||||||
|
December 31, 2019
|
|
December 31, 2018
|
||||
Repurchased HECM loans (exceed 98% MCA)
|
$
|
789
|
|
|
$
|
949
|
|
HECM related receivables(1)
|
250
|
|
|
300
|
|
||
Funded borrower draws not yet securitized
|
67
|
|
|
76
|
|
||
REO-related receivables
|
14
|
|
|
16
|
|
||
Purchase discount
|
(68
|
)
|
|
(122
|
)
|
||
Total unsecuritized interests
|
$
|
1,052
|
|
|
$
|
1,219
|
|
(1)
|
HECM related receivables consist primarily of receivables from FNMA for corporate advances and service fees and claims receivables from the U.S. Department of Housing and Urban Development on reverse mortgage interests.
|
|
Successor
|
|
|
Predecessor
|
||||||||
Reserves for reverse mortgage interests
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
||||||
Balance - beginning of period
|
$
|
13
|
|
|
$
|
—
|
|
|
|
$
|
115
|
|
Provisions (release), net
|
(3
|
)
|
|
13
|
|
|
|
32
|
|
|||
Write-offs
|
(7
|
)
|
|
—
|
|
|
|
(18
|
)
|
|||
Balance - end of period
|
$
|
3
|
|
|
$
|
13
|
|
|
|
$
|
129
|
|
|
Successor
|
||||||||||
|
Year Ended December 31, 2019
|
||||||||||
Purchase premiums and discounts for reverse mortgage interests
|
Net Premium for Participating Interests in HMBS(1)
|
|
Net Discount for Other Interest Securitized(1)
|
|
Net Discount for Unsecuritized Interests(1)
|
||||||
Balance - beginning of period
|
$
|
58
|
|
|
$
|
(100
|
)
|
|
$
|
(122
|
)
|
Adjustments(2)
|
(16
|
)
|
|
(2
|
)
|
|
(6
|
)
|
|||
Utilization of purchase discounts(3)
|
—
|
|
|
33
|
|
|
63
|
|
|||
(Amortization)/Accretion
|
(49
|
)
|
|
23
|
|
|
4
|
|
|||
Transfers(4)
|
17
|
|
|
(10
|
)
|
|
(7
|
)
|
|||
Balance - end of period
|
$
|
10
|
|
|
$
|
(56
|
)
|
|
$
|
(68
|
)
|
|
Successor
|
||||||||||
|
Five Months Ended December 31, 2018
|
||||||||||
Purchase premiums and discounts for reverse mortgage interests
|
Net Premium for Participating Interests in HMBS(1)
|
|
Net Discount for Other Interest Securitized(1)
|
|
Net Discount for Unsecuritized Interests(1)
|
||||||
Balance - beginning of period
|
$
|
58
|
|
|
$
|
(117
|
)
|
|
$
|
(173
|
)
|
Utilization of purchase discounts(3)
|
—
|
|
|
—
|
|
|
43
|
|
|||
Accretion/(Amortization)
|
—
|
|
|
17
|
|
|
8
|
|
|||
Balance - end of period
|
$
|
58
|
|
|
$
|
(100
|
)
|
|
$
|
(122
|
)
|
(1)
|
Net position as certain items are in a premium/(discount) position, based on the characteristics of underlying tranches of loans.
|
(2)
|
Adjustments to premium/(discount) due to revised cost to service assumption utilized in the valuation of reverse mortgage assets and liabilities acquired from the Merger. See Note 3, Acquisitions, for additional information.
|
(3)
|
Utilization of purchase discounts to mitigate loss on liquidated loans, for which the remaining receivable was written-off.
|
(4)
|
Transfer of premium/(discount) based on the transfer of associated loans between categories consistent with the underlying loan characteristics.
|
|
Predecessor
|
||
Purchase discounts for reverse mortgage interests
|
Seven Months Ended July 31, 2018
|
||
Balance - beginning of period
|
$
|
(89
|
)
|
Additions
|
(7
|
)
|
|
Accretion
|
14
|
|
|
Balance - end of period
|
$
|
(82
|
)
|
|
Successor
|
||||||
|
December 31, 2019
|
|
December 31, 2018
|
||||
Mortgage loans held for sale - UPB
|
$
|
3,949
|
|
|
$
|
1,568
|
|
Mark-to-market adjustment(1)
|
128
|
|
|
63
|
|
||
Total mortgage loans held for sale
|
$
|
4,077
|
|
|
$
|
1,631
|
|
(1)
|
The mark-to-market adjustment is recorded in net gain on mortgage loans held for sale in the consolidated statements of operations.
|
(1)
|
Non-accrual includes $25 and $40 of UPB related to Ginnie Mae repurchased loans as of December 31, 2019 and 2018, respectively.
|
|
Successor
|
|
|
Predecessor
|
||||||||
Mortgage loans held for sale
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
||||||
Balance - beginning of period
|
$
|
1,631
|
|
|
$
|
1,514
|
|
|
|
$
|
1,891
|
|
Loans sold
|
(41,289
|
)
|
|
(9,304
|
)
|
|
|
(13,255
|
)
|
|||
Mortgage loans originated and purchased, net of fees(1)
|
40,772
|
|
|
8,890
|
|
|
|
12,319
|
|
|||
Repurchase of loans out of Ginnie Mae securitizations
|
2,895
|
|
|
527
|
|
|
|
544
|
|
|||
Net transfers of mortgage loans held for sale to/from REO in other assets and transfer from mortgage loans held for investment(2)(3)
|
34
|
|
|
5
|
|
|
|
14
|
|
|||
Changes in fair value
|
29
|
|
|
6
|
|
|
|
(1
|
)
|
|||
Other purchase-related activities(4)
|
21
|
|
|
(2
|
)
|
|
|
9
|
|
|||
Transfer of mortgage loans held for sale to advances and other receivables, net related to claims(5)
|
(16
|
)
|
|
(5
|
)
|
|
|
(7
|
)
|
|||
Balance - end of period
|
$
|
4,077
|
|
|
$
|
1,631
|
|
|
|
$
|
1,514
|
|
(1)
|
Mortgage loans originated and purchased during the year ended December 31, 2019 includes $536 of loans held for sale that were acquired from Pacific Union. See Note 3, Acquisitions for further discussion.
|
(2)
|
Net amounts are comprised of REO in the sales process which are transferred to other assets and certain government insured mortgage REO which are transferred from other assets upon completion of the sale so that the claims process can begin.
|
(3)
|
Amount for the year ended December 31, 2019 includes $12 transfer from mortgage loans held for investment upon collapse of Trust 2009-A, the Company’s legacy portfolio, and sale of the loans held in the trust. See mortgage loans held for investment discussed in section below for additional information.
|
(4)
|
Amounts are comprised primarily of non-Ginnie Mae loan purchases and buyouts.
|
(5)
|
Amounts are comprised of claims made on certain government insured mortgage loans upon completion of the REO sale.
|
|
Successor
|
||||||
Mortgage loans held for investment at fair value
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
||||
Balance - beginning of period
|
$
|
119
|
|
|
$
|
125
|
|
Sale of mortgage loans
|
(94
|
)
|
|
—
|
|
||
Transfers to mortgage loans held for sale
|
(12
|
)
|
|
—
|
|
||
Payments received from borrowers
|
(11
|
)
|
|
(5
|
)
|
||
Transfers to real estate owned
|
(5
|
)
|
|
—
|
|
||
Changes in fair value
|
3
|
|
|
2
|
|
||
Charge-offs
|
—
|
|
|
(3
|
)
|
||
Balance - end of period
|
$
|
—
|
|
|
$
|
119
|
|
|
|
Successor
|
||
|
|
December 31, 2018
|
||
Mortgage loans held for investment – UPB
|
|
$
|
156
|
|
Fair value adjustments
|
|
(37
|
)
|
|
Total mortgage loans held for investment at fair value
|
|
$
|
119
|
|
|
Successor
|
||||||
|
December 31, 2018
|
||||||
Mortgage loans held for investment - UPB
|
UPB
|
|
Fair Value
|
||||
Non-accrual
|
$
|
27
|
|
|
$
|
13
|
|
|
Successor
|
|
|
||||||
|
December 31, 2019
|
|
December 31, 2018
|
|
Estimated Useful Life
|
||||
Furniture, fixtures, and equipment
|
$
|
50
|
|
|
$
|
32
|
|
|
3 - 5 years
|
Capitalized software costs
|
54
|
|
|
24
|
|
|
3 - 5 years
|
||
Software in development and other
|
31
|
|
|
24
|
|
|
|
||
Leasehold improvements
|
24
|
|
|
22
|
|
|
3 - 5 years
|
||
Long-term finance leases - computer equipment
|
8
|
|
|
10
|
|
|
5 years
|
||
Property and equipment
|
167
|
|
|
112
|
|
|
|
||
Less: Accumulated depreciation
|
(55
|
)
|
|
(16
|
)
|
|
|
||
Total property and equipment, net
|
$
|
112
|
|
|
$
|
96
|
|
|
|
|
Successor
|
||
|
Year Ended December 31, 2019
|
||
Operating lease cost
|
$
|
40
|
|
Short-term lease cost
|
1
|
|
|
Sublease income
|
(3
|
)
|
|
Net lease cost
|
$
|
38
|
|
|
Successor
|
||
|
Year Ended December 31, 2019
|
||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
||
Operating cash flows from operating leases
|
$
|
30
|
|
Leased assets obtained in exchange for new operating lease liabilities
|
$
|
154
|
|
Weighted average remaining lease term - operating leases, in years
|
5.5
|
|
|
Weighted average discount rate - operating leases
|
5.0
|
%
|
Year Ending December 31,
|
|
Operating Leases
|
||
2020
|
|
$
|
40
|
|
2021
|
|
32
|
|
|
2022
|
|
23
|
|
|
2023
|
|
17
|
|
|
2024
|
|
12
|
|
|
2025 and thereafter
|
|
32
|
|
|
Total future minimum lease payments
|
|
156
|
|
|
Less: imputed interest
|
|
21
|
|
|
Total operating lease liabilities
|
|
$
|
135
|
|
|
Successor
|
||||||
|
December 31, 2019
|
|
December 31, 2018
|
||||
Loans subject to repurchase right from Ginnie Mae
|
$
|
560
|
|
|
$
|
266
|
|
Derivative financial instruments
|
153
|
|
|
49
|
|
||
Trade receivables and accrued revenues
|
126
|
|
|
145
|
|
||
Right-of-use assets
|
121
|
|
|
—
|
|
||
Goodwill
|
120
|
|
|
23
|
|
||
Intangible assets
|
74
|
|
|
117
|
|
||
Other
|
236
|
|
|
195
|
|
||
Total other assets
|
$
|
1,390
|
|
|
$
|
795
|
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
||||||
Balance - beginning of period
|
$
|
23
|
|
|
$
|
10
|
|
|
|
$
|
72
|
|
Addition from acquisitions(1)
|
42
|
|
|
13
|
|
|
|
—
|
|
|||
Measurement period adjustment related to Merger(2)
|
55
|
|
|
—
|
|
|
|
—
|
|
|||
Balance - end of period
|
$
|
120
|
|
|
$
|
23
|
|
|
|
$
|
72
|
|
(1)
|
As discussed in Note 3, Acquisitions, the Company recorded goodwill of $40 in connection with the acquisition of Pacific Union. In addition, on February 28, 2019, the Company completed the acquisition of the Seterus mortgage servicing platform and assumed certain assets related thereto from IBM (“Seterus acquisition”). In connection with the Seterus acquisition, the Company recorded $2 in goodwill.
|
(2)
|
The Company recorded a total measurement period adjustment of $55 to goodwill in 2019 related to the acquisition of Nationstar. See further discussion in Note 3, Acquisitions.
|
|
Successor
|
||||||||||||
|
December 31, 2019
|
||||||||||||
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
|
Weighted Average Remaining Life in Years
|
||||||
Customer relationships
|
$
|
90
|
|
|
$
|
(45
|
)
|
|
$
|
45
|
|
|
5.9
|
Technology
|
46
|
|
|
(23
|
)
|
|
23
|
|
|
2.9
|
|||
Trade name
|
8
|
|
|
(2
|
)
|
|
6
|
|
|
3.6
|
|||
Other
|
1
|
|
|
(1
|
)
|
|
—
|
|
|
2.8
|
|||
Total intangible assets
|
$
|
145
|
|
|
$
|
(71
|
)
|
|
$
|
74
|
|
|
4.7
|
|
Successor
|
||||||||||||
|
December 31, 2018
|
||||||||||||
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
|
Weighted Average Remaining Life in Years
|
||||||
Customer relationships
|
$
|
77
|
|
|
$
|
(14
|
)
|
|
$
|
63
|
|
|
5.6
|
Technology
|
52
|
|
|
(8
|
)
|
|
44
|
|
|
3.6
|
|||
Trade name
|
8
|
|
|
(1
|
)
|
|
7
|
|
|
4.6
|
|||
Other(1)
|
3
|
|
|
—
|
|
|
3
|
|
|
4.8
|
|||
Total intangible assets
|
$
|
140
|
|
|
$
|
(23
|
)
|
|
$
|
117
|
|
|
4.7
|
(1)
|
Accumulated amortization amount is less than $1 for the specified dates.
|
Year Ending December 31,
|
|
Amount
|
||
2020
|
|
$
|
32
|
|
2021
|
|
17
|
|
|
2022
|
|
13
|
|
|
2023
|
|
8
|
|
|
2024
|
|
1
|
|
|
Thereafter
|
|
3
|
|
|
Total future amortization expense
|
|
$
|
74
|
|
|
|
|
Successor
|
||||||||||
|
|
|
December 31, 2019
|
|
Year Ended December 31, 2019
|
||||||||
|
Expiration
Dates
|
|
Outstanding
Notional
|
|
Fair
Value
|
|
Recorded Gains/(Losses)
|
||||||
Assets
|
|
|
|
|
|
|
|
||||||
Mortgage loans held for sale
|
|
|
|
|
|
|
|
||||||
Loan sale commitments
|
2020
|
|
$
|
1,202
|
|
|
$
|
32.3
|
|
|
$
|
6.5
|
|
Derivative financial instruments
|
|
|
|
|
|
|
|
||||||
IRLCs
|
2020
|
|
4,838
|
|
|
134.7
|
|
|
75.0
|
|
|||
LPCs
|
2020
|
|
1,094
|
|
|
12.2
|
|
|
10.5
|
|
|||
Forward sales of MBS
|
2020
|
|
3,120
|
|
|
6.5
|
|
|
4.6
|
|
|||
Eurodollar futures(1)
|
2020-2021
|
|
6
|
|
|
—
|
|
|
—
|
|
|||
Total derivative financial instruments - assets
|
|
|
$
|
9,058
|
|
|
$
|
153.4
|
|
|
$
|
90.1
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||
Derivative financial instruments
|
|
|
|
|
|
|
|
||||||
IRLCs(1)
|
2020
|
|
$
|
12
|
|
|
$
|
—
|
|
|
$
|
—
|
|
LPCs
|
2020
|
|
540
|
|
|
2.6
|
|
|
2.1
|
|
|||
Forward sales of MBS
|
2020
|
|
6,036
|
|
|
12.3
|
|
|
(11.6
|
)
|
|||
Eurodollar futures(1)
|
2020-2021
|
|
7
|
|
|
—
|
|
|
—
|
|
|||
Total derivative financial instruments - liabilities
|
|
|
$
|
6,595
|
|
|
$
|
14.9
|
|
|
$
|
(9.5
|
)
|
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
|
|
December 31, 2018
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
||||||||||
|
Expiration
Dates
|
|
Outstanding
Notional
|
|
Fair
Value
|
|
Recorded
Gains/(Losses)
|
|
|
Recorded Gains/(Losses)
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
||||||||
Mortgage loans held for sale
|
|
|
|
|
|
|
|
|
|
|
||||||||
Loan sale commitments
|
2019
|
|
$
|
319
|
|
|
$
|
13.5
|
|
|
$
|
2.8
|
|
|
|
$
|
10.5
|
|
Derivative financial instruments
|
|
|
|
|
|
|
|
|
|
|
||||||||
IRLCs
|
2019
|
|
1,301
|
|
|
47.6
|
|
|
(12.1
|
)
|
|
|
0.4
|
|
||||
LPCs
|
2019
|
|
215
|
|
|
1.7
|
|
|
0.4
|
|
|
|
0.3
|
|
||||
Forward sales of MBS
|
2019
|
|
485
|
|
|
0.1
|
|
|
(3.1
|
)
|
|
|
0.9
|
|
||||
Treasury futures(1)
|
2018
|
|
—
|
|
|
—
|
|
|
(0.1
|
)
|
|
|
(1.8
|
)
|
||||
Eurodollar futures(1)
|
2019-2021
|
|
19
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
||||
Total derivative financial instruments - assets
|
|
|
$
|
2,020
|
|
|
$
|
49.4
|
|
|
$
|
(14.9
|
)
|
|
|
$
|
(0.2
|
)
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
||||||||
Derivative financial instruments
|
|
|
|
|
|
|
|
|
|
|
||||||||
IRLCs(1)
|
2019
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
$
|
—
|
|
LPCs
|
2019
|
|
90
|
|
|
0.4
|
|
|
(0.2
|
)
|
|
|
0.1
|
|
||||
Forward sales of MBS
|
2019
|
|
2,639
|
|
|
19.3
|
|
|
17.4
|
|
|
|
(1.0
|
)
|
||||
Treasury futures(1)
|
2018
|
|
—
|
|
|
—
|
|
|
(0.1
|
)
|
|
|
(1.3
|
)
|
||||
Eurodollar futures(1)
|
2019-2021
|
|
6
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
||||
Total derivative financial instruments - liabilities
|
|
|
$
|
2,735
|
|
|
$
|
19.7
|
|
|
$
|
17.1
|
|
|
|
$
|
(2.2
|
)
|
(1)
|
Fair values or recorded gains/(losses) of derivative instruments are less than $0.1 for the specified dates.
|
|
|
|
|
|
|
|
|
|
|
Successor
|
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||||
Advance Facilities
|
|
Interest Rate
|
|
Maturity Date
|
|
Collateral
|
|
Capacity Amount
|
|
Outstanding
|
|
Collateral Pledged
|
|
Outstanding
|
|
Collateral pledged
|
||||||||||
$325 advance facility
|
|
LIBOR+1.5% to 6.5%
|
|
August 2021
|
|
Servicing advance receivables
|
|
$
|
325
|
|
|
$
|
224
|
|
|
$
|
285
|
|
|
$
|
209
|
|
|
$
|
284
|
|
$250 advance facility
|
|
LIBOR+1.5% to 2.6%
|
|
December 2020
|
|
Servicing advance receivables
|
|
250
|
|
|
98
|
|
|
167
|
|
|
218
|
|
|
255
|
|
|||||
$200 advance facility
|
|
LIBOR+2.5%
|
|
January 2021
|
|
Servicing advance receivables
|
|
200
|
|
|
63
|
|
|
125
|
|
|
90
|
|
|
149
|
|
|||||
$125 advance facility
|
|
CP +1.5% to 7.4%
|
|
July 2020
|
|
Servicing advance receivables
|
|
125
|
|
|
37
|
|
|
88
|
|
|
78
|
|
|
89
|
|
|||||
Advance facilities principal amount
|
|
|
|
|
|
422
|
|
|
$
|
665
|
|
|
595
|
|
|
$
|
777
|
|
||||||||
Unamortized debt issuance costs
|
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
||||||||||||
Advance facilities, net
|
|
|
|
$
|
422
|
|
|
|
|
$
|
595
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Successor
|
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||||
Warehouse Facilities
|
|
Interest Rate
|
|
Maturity Date
|
|
Collateral
|
|
Capacity Amount
|
|
Outstanding
|
|
Collateral Pledged
|
|
Outstanding
|
|
Collateral pledged
|
||||||||||
$1,500 warehouse facility
|
|
LIBOR+1.0%
|
|
June 2020
|
|
Mortgage loans or MBS
|
|
$
|
1,500
|
|
|
$
|
759
|
|
|
$
|
733
|
|
|
$
|
—
|
|
|
$
|
—
|
|
$1,200 warehouse facility
|
|
LIBOR+1.5% to 3.0%
|
|
November 2020
|
|
Mortgage loans or MBS
|
|
1,200
|
|
|
683
|
|
|
724
|
|
|
560
|
|
|
622
|
|
|||||
$1,000 warehouse facility
|
|
LIBOR+1.4% to 2.3%
|
|
September 2020
|
|
Mortgage loans or MBS
|
|
1,000
|
|
|
762
|
|
|
783
|
|
|
137
|
|
|
140
|
|
|||||
$800 warehouse facility(1)
|
|
LIBOR+1.5% to 2.9%
|
|
April 2020
|
|
Mortgage loans or MBS
|
|
800
|
|
|
589
|
|
|
656
|
|
|
464
|
|
|
514
|
|
|||||
$750 warehouse facility
|
|
LIBOR+1.4% to 2.8%
|
|
September 2020
|
|
Mortgage loans or MBS
|
|
750
|
|
|
411
|
|
|
425
|
|
|
119
|
|
|
122
|
|
|||||
$700 warehouse facility
|
|
LIBOR+1.3% to 2.2%
|
|
November 2020
|
|
Mortgage loans or MBS
|
|
700
|
|
|
469
|
|
|
488
|
|
|
220
|
|
|
248
|
|
|||||
$600 warehouse facility
|
|
LIBOR+2.3%
|
|
February 2021
|
|
Mortgage loans or MBS
|
|
600
|
|
|
174
|
|
|
202
|
|
|
151
|
|
|
168
|
|
|||||
$500 warehouse facility
|
|
LIBOR+1.5% to 3.0%
|
|
April 2020
|
|
Mortgage loans or MBS
|
|
500
|
|
|
336
|
|
|
349
|
|
|
187
|
|
|
200
|
|
|||||
$500 warehouse facility(2)
|
|
LIBOR+2.0% to 2.3%
|
|
September 2020
|
|
Mortgage loans or MBS
|
|
500
|
|
|
—
|
|
|
—
|
|
|
290
|
|
|
299
|
|
|||||
$200 warehouse facility
|
|
LIBOR+1.4%
|
|
January 2021
|
|
Mortgage loans or MBS
|
|
200
|
|
|
136
|
|
|
136
|
|
|
—
|
|
|
—
|
|
|||||
$200 warehouse facility
|
|
LIBOR+1.2%
|
|
April 2021
|
|
Mortgage loans or MBS
|
|
200
|
|
|
27
|
|
|
27
|
|
|
18
|
|
|
19
|
|
|||||
$200 warehouse facility
|
|
LIBOR+2.0%
|
|
May 2020
|
|
Mortgage loans or MBS
|
|
200
|
|
|
54
|
|
|
78
|
|
|
103
|
|
|
132
|
|
|||||
$200 warehouse facility
|
|
LIBOR+1.3%
|
|
October 2020
|
|
Mortgage loans or MBS
|
|
200
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
$50 warehouse facility
|
|
LIBOR+2.0% to 6.0%
|
|
April 2020
|
|
Mortgage loans or MBS
|
|
50
|
|
|
11
|
|
|
15
|
|
|
—
|
|
|
—
|
|
|||||
$40 warehouse facility
|
|
LIBOR+3.3%
|
|
September 2020
|
|
Mortgage loans or MBS
|
|
40
|
|
|
5
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|||||
$40 warehouse facility(2)
|
|
LIBOR+3.0%
|
|
November 2019
|
|
Mortgage loans or MBS
|
|
40
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
2
|
|
|||||
Warehouse facilities principal amount
|
|
4,416
|
|
|
4,622
|
|
|
2,250
|
|
|
2,466
|
|
||||||||||||||
MSR Facilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
$400 warehouse facility
|
|
LIBOR+3.5% to 6.1%
|
|
June 2021
|
|
Mortgage loans or MBS
|
|
400
|
|
|
150
|
|
|
945
|
|
|
100
|
|
|
928
|
|
|||||
$400 warehouse facility
|
|
LIBOR+2.3%
|
|
December 2020
|
|
Mortgage loans or MBS
|
|
400
|
|
|
—
|
|
|
200
|
|
|
—
|
|
|
226
|
|
|||||
$150 warehouse facility(1)
|
|
LIBOR+2.8%
|
|
April 2020
|
|
Mortgage loans or MBS
|
|
150
|
|
|
—
|
|
|
130
|
|
|
—
|
|
|
430
|
|
|||||
$50 warehouse facility
|
|
LIBOR+4.5%
|
|
August 2020
|
|
Mortgage loans or MBS
|
|
50
|
|
|
10
|
|
|
84
|
|
|
—
|
|
|
102
|
|
|||||
MSR facilities principal amount
|
|
160
|
|
|
1,359
|
|
|
100
|
|
|
1,686
|
|
||||||||||||||
Warehouse and MSR facilities principal amount
|
|
|
|
|
|
4,576
|
|
|
$
|
5,981
|
|
|
2,350
|
|
|
$
|
4,152
|
|
||||||||
Unamortized debt issuance costs
|
|
|
|
|
|
(1
|
)
|
|
|
|
(1
|
)
|
|
|
||||||||||||
Warehouse facilities, net
|
|
|
|
$
|
4,575
|
|
|
|
|
$
|
2,349
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Pledged Collateral:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Mortgage loans held for sale and mortgage loans held for investment
|
|
|
|
|
|
|
|
$
|
3,826
|
|
|
$
|
3,931
|
|
|
$
|
1,528
|
|
|
$
|
1,628
|
|
||||
Reverse mortgage interests
|
|
|
|
|
|
|
|
590
|
|
|
691
|
|
|
722
|
|
|
838
|
|
||||||||
MSR
|
|
|
|
|
|
|
|
160
|
|
|
1,359
|
|
|
100
|
|
|
1,686
|
|
(1)
|
Total capacity amount for this facility is $800 of which $150 is a sublimit for MSR financing.
|
(2)
|
This facility was terminated during 2019.
|
|
Successor
|
||||||
|
December 31, 2019
|
|
December 31, 2018
|
||||
$950 face value, 8.125% interest rate payable semi-annually, due July 2023
|
$
|
950
|
|
|
$
|
950
|
|
$750 face value, 9.125% interest rate payable semi-annually, due July 2026
|
750
|
|
|
750
|
|
||
$600 face value, 6.500% interest rate payable semi-annually, due July 2021(1)
|
492
|
|
|
592
|
|
||
$300 face value, 6.500% interest rate payable semi-annually, due June 2022(1)
|
206
|
|
|
206
|
|
||
Unsecured senior notes principal amount
|
2,398
|
|
|
2,498
|
|
||
Unamortized debt issuance costs, premium and discount
|
(32
|
)
|
|
(39
|
)
|
||
Unsecured senior notes, net
|
$
|
2,366
|
|
|
$
|
2,459
|
|
(1)
|
This note was subsequently redeemed in full in February 2020. See Note 26, Subsequent Events, for further information.
|
Year Ending December 31,
|
|
Amount
|
||
2020
|
|
$
|
—
|
|
2021(1)
|
|
492
|
|
|
2022(1)
|
|
206
|
|
|
2023
|
|
950
|
|
|
2024
|
|
—
|
|
|
Thereafter
|
|
750
|
|
|
Total unsecured senior notes principal amount
|
|
$
|
2,398
|
|
(1)
|
This note was subsequently redeemed in full in February 2020. See Note 26, Subsequent Events, for further information.
|
|
|
|
|
|
|
|
|
|
|
Successor
|
||||||||
|
|
|
|
|
|
|
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||
|
|
Issue Date
|
|
Maturity Date
|
|
Class of Note
|
|
Collateral Amount
|
|
Outstanding
|
|
Outstanding
|
||||||
Participating interest financing(1)
|
|
—
|
|
—
|
|
—
|
|
$
|
—
|
|
|
$
|
4,284
|
|
|
$
|
5,607
|
|
Securitization of nonperforming HECM loans
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Trust 2019-2
|
|
November 2019
|
|
November 2029
|
|
A, M1, M2, M3, M4, M5
|
|
337
|
|
|
333
|
|
|
—
|
|
|||
Trust 2019-1
|
|
June 2019
|
|
June 2029
|
|
A, M1, M2, M3, M4, M5
|
|
315
|
|
|
302
|
|
|
—
|
|
|||
Trust 2018-3
|
|
November 2018
|
|
November 2028
|
|
A, M1, M2, M3, M4, M5
|
|
226
|
|
|
209
|
|
|
326
|
|
|||
Trust 2018-2
|
|
August 2018
|
|
August 2028
|
|
A, M1, M2, M3, M4, M5
|
|
168
|
|
|
148
|
|
|
250
|
|
|||
Trust 2018-1(2)
|
|
March 2018
|
|
March 2028
|
|
A, M1, M2, M3, M4, M5
|
|
—
|
|
|
—
|
|
|
284
|
|
|||
Trust 2017-2(2)
|
|
September 2017
|
|
September 2027
|
|
A, M1, M2
|
|
—
|
|
|
—
|
|
|
231
|
|
|||
Nonrecourse Debt - Legacy(3)
|
|
November 2009
|
|
October 2039
|
|
A
|
|
—
|
|
|
—
|
|
|
29
|
|
|||
Other nonrecourse debt principal amount
|
|
|
|
|
|
|
|
|
|
5,276
|
|
|
6,727
|
|
||||
Unamortized debt issuance costs, premium and discount
|
|
|
|
|
|
|
|
|
|
10
|
|
|
68
|
|
||||
Other nonrecourse debt, net
|
|
|
|
|
|
|
|
|
|
$
|
5,286
|
|
|
$
|
6,795
|
|
(1)
|
Amounts represent the Company’s participating interest in GNMA HMBS securitized portfolios.
|
(2)
|
As discussed in Note 6, Reverse Mortgage Interests, Net, Trust 2017-2 and Trust 2018-1 were collapsed and the related debt extinguished during the year ended December 31, 2019.
|
(3)
|
As discussed in Note 7, Mortgage Loans Held for Sale and Investment, Trust 2009-A, the Company’s legacy portfolio, was collapsed and the related debt was extinguished in September 2019.
|
|
Successor
|
||||||
|
December 31, 2019
|
|
December 31, 2018
|
||||
Loans subject to repurchase from Ginnie Mae
|
$
|
560
|
|
|
$
|
266
|
|
Payables to servicing and subservicing investors
|
423
|
|
|
494
|
|
||
Payable to GSEs and securitized trusts
|
182
|
|
|
105
|
|
||
Operating lease liability
|
135
|
|
|
—
|
|
||
MSR purchases payable including advances
|
20
|
|
|
182
|
|
||
Other liabilities
|
696
|
|
|
496
|
|
||
Total payables and other liabilities
|
$
|
2,016
|
|
|
$
|
1,543
|
|
|
Successor
|
|
|
Predecessor
|
||||||||
Repurchase Reserves
|
For the year ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
||||||
Balance - beginning of period
|
$
|
8
|
|
|
$
|
9
|
|
|
|
$
|
9
|
|
Provisions(1)
|
25
|
|
|
3
|
|
|
|
3
|
|
|||
Releases
|
(8
|
)
|
|
(4
|
)
|
|
|
(3
|
)
|
|||
Balance - end of period
|
$
|
25
|
|
|
$
|
8
|
|
|
|
$
|
9
|
|
(1)
|
Provision for the year ended December 31, 2019 is primarily due to repurchase reserve liabilities assumed in connection with the acquisition of Pacific Union. See Note 3, Acquisitions, for additional information.
|
|
Successor
|
||||||||||||||
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||
|
Transfers
Accounted for as Secured Borrowings |
|
Reverse Secured Borrowings
|
|
Transfers
Accounted for as Secured Borrowings |
|
Reverse Secured Borrowings
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Restricted cash
|
$
|
66
|
|
|
$
|
42
|
|
|
$
|
70
|
|
|
$
|
63
|
|
Reverse mortgage interests, net(1)
|
—
|
|
|
5,230
|
|
|
—
|
|
|
6,728
|
|
||||
Advances and other receivables, net
|
540
|
|
|
—
|
|
|
628
|
|
|
—
|
|
||||
Mortgage loans held for investment, net(2)
|
—
|
|
|
—
|
|
|
118
|
|
|
—
|
|
||||
Other assets
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total assets
|
$
|
606
|
|
|
$
|
5,272
|
|
|
$
|
816
|
|
|
$
|
6,791
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities
|
|
|
|
|
|
|
|
||||||||
Advance facilities(3)
|
$
|
359
|
|
|
$
|
—
|
|
|
$
|
505
|
|
|
$
|
—
|
|
Payables and other liabilities
|
1
|
|
|
1
|
|
|
1
|
|
|
1
|
|
||||
Participating interest financing
|
—
|
|
|
4,284
|
|
|
—
|
|
|
5,607
|
|
||||
HECM Securitizations (HMBS)
|
|
|
|
|
|
|
|
||||||||
Trust 2019-2
|
—
|
|
|
333
|
|
|
—
|
|
|
—
|
|
||||
Trust 2019-1
|
—
|
|
|
302
|
|
|
—
|
|
|
—
|
|
||||
Trust 2018-3
|
—
|
|
|
209
|
|
|
—
|
|
|
326
|
|
||||
Trust 2018-2
|
—
|
|
|
148
|
|
|
—
|
|
|
250
|
|
||||
Trust 2018-1
|
—
|
|
|
—
|
|
|
—
|
|
|
284
|
|
||||
Trust 2017-2
|
—
|
|
|
—
|
|
|
—
|
|
|
231
|
|
||||
Nonrecourse debt–legacy assets(2)
|
—
|
|
|
—
|
|
|
29
|
|
|
—
|
|
||||
Total liabilities
|
$
|
360
|
|
|
$
|
5,277
|
|
|
$
|
535
|
|
|
$
|
6,699
|
|
(1)
|
Amounts include net purchase discount of $46 and $42 as of December 31, 2019 and December 31, 2018, respectively.
|
(2)
|
Trust 2009-A was collapsed in September 2019. Refer to Mortgage Loans Held for Investment in Note 7, Mortgage Loans Held for Sale and Investment, for additional information.
|
(3)
|
Advance facilities include the Nationstar agency advance financing facility and notes payable recorded by the Nationstar Mortgage Advance Receivable Trust, and the Nationstar Agency Advance Receivables Trust. Refer to Notes Payable in Note 12, Indebtedness, for additional information.
|
|
Successor
|
||||||
|
December 31, 2019
|
|
December 31, 2018
|
||||
Total collateral balances - UPB
|
$
|
1,503
|
|
|
$
|
1,873
|
|
Total certificate balances
|
$
|
1,512
|
|
|
$
|
1,817
|
|
|
Successor
|
||||||
Principal Amount of Loans 60 Days or More Past Due
|
December 31, 2019
|
|
December 31, 2018
|
||||
Unconsolidated securitization trusts
|
$
|
193
|
|
|
$
|
285
|
|
|
Successor
|
|||||
|
Shares (or Units)
(in thousands)
|
|
Weighted-Average Grant Date Fair Value, per Share (or Unit)
|
|||
Equity awards outstanding as of December 31, 2018
|
3,473
|
|
|
$
|
15.53
|
|
Granted
|
2,525
|
|
|
12.44
|
|
|
Vested
|
(436
|
)
|
|
16.73
|
|
|
Forfeited
|
(327
|
)
|
|
14.61
|
|
|
Equity awards outstanding as of December 31, 2019
|
5,235
|
|
|
14.00
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Year Ended December 31, 2017
|
||||||||
Net income attributable to Successor/Predecessor
|
$
|
274
|
|
|
$
|
884
|
|
|
|
$
|
154
|
|
|
$
|
30
|
|
Less: Undistributed earnings attributable to participating stockholders
|
2
|
|
|
8
|
|
|
|
—
|
|
|
—
|
|
||||
Net income attributable to common stockholders
|
$
|
272
|
|
|
$
|
876
|
|
|
|
$
|
154
|
|
|
$
|
30
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net income per common share attributable to Successor/Predecessor common stockholders:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
2.99
|
|
|
$
|
9.65
|
|
|
|
$
|
1.57
|
|
|
$
|
0.31
|
|
Diluted
|
$
|
2.95
|
|
|
$
|
9.54
|
|
|
|
$
|
1.55
|
|
|
$
|
0.30
|
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares of common stock outstanding (in thousands):
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
91,035
|
|
|
90,813
|
|
|
|
98,046
|
|
|
97,696
|
|
||||
Dilutive effect of stock awards
|
270
|
|
|
178
|
|
|
|
1,091
|
|
|
1,107
|
|
||||
Dilutive effect of participating securities
|
839
|
|
|
839
|
|
|
|
—
|
|
|
—
|
|
||||
Diluted
|
92,144
|
|
|
91,830
|
|
|
|
99,137
|
|
|
98,803
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Year Ended December 31, 2017
|
|||||||||
Current Income Taxes
|
|
|
|
|
|
|
|
|
||||||||
Federal
|
$
|
19
|
|
|
$
|
—
|
|
|
|
$
|
(14
|
)
|
|
$
|
52
|
|
State
|
74
|
|
|
—
|
|
|
|
(1
|
)
|
|
7
|
|
||||
Total current income taxes
|
93
|
|
|
—
|
|
|
|
(15
|
)
|
|
59
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Deferred Income Taxes
|
|
|
|
|
|
|
|
|
||||||||
Federal
|
(298
|
)
|
|
(1,015
|
)
|
|
|
54
|
|
|
(43
|
)
|
||||
State
|
(68
|
)
|
|
(6
|
)
|
|
|
9
|
|
|
(3
|
)
|
||||
Total deferred income taxes
|
(366
|
)
|
|
(1,021
|
)
|
|
|
63
|
|
|
(46
|
)
|
||||
Total provision for income taxes
|
$
|
(273
|
)
|
|
$
|
(1,021
|
)
|
|
|
$
|
48
|
|
|
$
|
13
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||||||||||||||
|
Year Ended December 31, 2019
|
|
Five Months Ended December 31, 2018
|
|
|
Seven Months Ended July 31, 2018
|
|
Year Ended December 31, 2017
|
||||||||||||||||||||
Tax (Benefit) Expense at Federal Statutory Rate
|
$
|
(1
|
)
|
|
21.0
|
%
|
|
$
|
(29
|
)
|
|
21.0
|
%
|
|
|
$
|
42
|
|
|
21.0
|
%
|
|
$
|
15
|
|
|
35.0
|
%
|
Effect of:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
State taxes, net of federal benefit
|
5
|
|
|
(141.2
|
)%
|
|
(6
|
)
|
|
4.2
|
%
|
|
|
8
|
|
|
3.8
|
%
|
|
1
|
|
|
1.9
|
%
|
||||
Non-controlling interests
|
1
|
|
|
(21.1
|
)%
|
|
—
|
|
|
—
|
%
|
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
(0.3
|
)%
|
||||
Change in valuation allowance
|
(285
|
)
|
|
8066.4
|
%
|
|
(990
|
)
|
|
720.0
|
%
|
|
|
—
|
|
|
—
|
%
|
|
(1
|
)
|
|
(1.2
|
)%
|
||||
Deferred adjustments
|
2
|
|
|
(64.1
|
)%
|
|
3
|
|
|
(1.8
|
)%
|
|
|
(1
|
)
|
|
(0.5
|
)%
|
|
—
|
|
|
—
|
%
|
||||
Nondeductible items
|
4
|
|
|
(136.5
|
)%
|
|
1
|
|
|
(1.0
|
)%
|
|
|
7
|
|
|
3.3
|
%
|
|
1
|
|
|
3.2
|
%
|
||||
Federal tax reform impact
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
|
—
|
|
|
—
|
%
|
|
(5
|
)
|
|
(12.6
|
)%
|
||||
Current payable adjustments
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
|
(1
|
)
|
|
(0.5
|
)%
|
|
—
|
|
|
—
|
%
|
||||
Adjustments related to uncertain tax positions
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
|
—
|
|
|
—
|
%
|
|
1
|
|
|
2.4
|
%
|
||||
Other, net
|
1
|
|
|
(5.7
|
)%
|
|
—
|
|
|
—
|
%
|
|
|
(7
|
)
|
|
(3.3
|
)%
|
|
1
|
|
|
0.5
|
%
|
||||
Total income tax (benefit) expense
|
$
|
(273
|
)
|
|
7718.8
|
%
|
|
$
|
(1,021
|
)
|
|
742.4
|
%
|
|
|
$
|
48
|
|
|
23.8
|
%
|
|
$
|
13
|
|
|
28.9
|
%
|
1.
|
Taxable income in prior carryback year(s) if carryback is permitted under the tax law;
|
2.
|
Future reversals of existing taxable temporary differences;
|
3.
|
Tax-planning strategies; and
|
4.
|
Future taxable income exclusive of reversing temporary differences and carryforwards.
|
1.
|
Internal forecasts of future pre-tax income exclusive of reversing temporary differences and carryforwards;
|
2.
|
The nature and timing of future reversals of existing deferred tax assets;
|
3.
|
Future originating temporary and permanent differences; and
|
4.
|
NOL carryforward expiration dates.
|
|
Successor
|
||||||
|
December 31, 2019
|
|
December 31, 2018
|
||||
Deferred Tax Assets
|
|
|
|
||||
Effect of:
|
|
|
|
||||
Loss carryforwards (federal, state & capital)
|
$
|
998
|
|
|
$
|
1,334
|
|
Goodwill and intangible assets
|
364
|
|
|
4
|
|
||
Loss reserves
|
108
|
|
|
69
|
|
||
Reverse mortgage interests
|
44
|
|
|
70
|
|
||
Lease liability
|
32
|
|
|
1
|
|
||
Accruals
|
16
|
|
|
14
|
|
||
Restricted share-based compensation
|
3
|
|
|
1
|
|
||
Partnership interests
|
1
|
|
|
7
|
|
||
Excess interest expense
|
—
|
|
|
10
|
|
||
Other, net
|
12
|
|
|
5
|
|
||
Total deferred tax assets
|
1,578
|
|
|
1,515
|
|
||
|
|
|
|
||||
Deferred Tax Liabilities
|
|
|
|
||||
MSR amortization and mark-to-market, net
|
(181
|
)
|
|
(243
|
)
|
||
Right-of-use assets
|
(29
|
)
|
|
—
|
|
||
Depreciation and amortization, net
|
(12
|
)
|
|
(12
|
)
|
||
Prepaid assets
|
(2
|
)
|
|
(1
|
)
|
||
Total deferred tax liabilities
|
(224
|
)
|
|
(256
|
)
|
||
Valuation allowance
|
(9
|
)
|
|
(295
|
)
|
||
Net deferred tax assets
|
$
|
1,345
|
|
|
$
|
964
|
|
|
Predecessor
|
||||||
Unrecognized Tax Benefits
|
Seven Months Ended July 31, 2018
|
|
Year Ended December 31, 2017
|
||||
Balance - beginning of period
|
$
|
17
|
|
|
$
|
—
|
|
Increases in tax positions of current year
|
—
|
|
|
1
|
|
||
(Decreases)/Increases in tax positions of prior years
|
(17
|
)
|
|
20
|
|
||
Settlements
|
—
|
|
|
(4
|
)
|
||
Balance - end of period
|
$
|
—
|
|
|
$
|
17
|
|
|
Successor
|
||||||||||||||
|
December 31, 2019
|
||||||||||||||
|
Total Fair Value
|
|
Recurring Fair Value Measurements
|
||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Mortgage loans held for sale
|
$
|
4,077.0
|
|
|
$
|
—
|
|
|
$
|
4,077.0
|
|
|
$
|
—
|
|
Mortgage loans held for investment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Forward mortgage servicing rights
|
3,496.4
|
|
|
—
|
|
|
—
|
|
|
3,496.4
|
|
||||
Derivative financial instruments:
|
|
|
|
|
|
|
|
||||||||
IRLCs
|
134.7
|
|
|
—
|
|
|
134.7
|
|
|
—
|
|
||||
Forward MBS trades
|
6.5
|
|
|
—
|
|
|
6.5
|
|
|
—
|
|
||||
LPCs
|
12.2
|
|
|
—
|
|
|
12.2
|
|
|
—
|
|
||||
Eurodollar futures(1)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total assets
|
$
|
7,726.8
|
|
|
$
|
—
|
|
|
$
|
4,230.4
|
|
|
$
|
3,496.4
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Derivative financial instruments:
|
|
|
|
|
|
|
|
||||||||
IRLCs(1)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Forward MBS trades
|
12.3
|
|
|
—
|
|
|
12.3
|
|
|
—
|
|
||||
LPCs
|
2.6
|
|
|
—
|
|
|
2.6
|
|
|
—
|
|
||||
Eurodollar futures(1)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Mortgage servicing rights financing
|
37.4
|
|
|
—
|
|
|
—
|
|
|
37.4
|
|
||||
Excess spread financing
|
1,310.8
|
|
|
—
|
|
|
—
|
|
|
1,310.8
|
|
||||
Total liabilities
|
$
|
1,363.1
|
|
|
$
|
—
|
|
|
$
|
14.9
|
|
|
$
|
1,348.2
|
|
(1)
|
Fair values of the underlying assets and liabilities are less than $0.1 for the specified dates.
|
|
Successor
|
||||||||||||||
|
December 31, 2018
|
||||||||||||||
|
Total Fair Value
|
|
Recurring Fair Value Measurements
|
||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Mortgage loans held for sale
|
$
|
1,630.8
|
|
|
$
|
—
|
|
|
$
|
1,630.8
|
|
|
$
|
—
|
|
Mortgage loans held for investment
|
119.1
|
|
|
—
|
|
|
—
|
|
|
119.1
|
|
||||
Forward mortgage servicing rights
|
3,665.4
|
|
|
—
|
|
|
—
|
|
|
3,665.4
|
|
||||
Derivative financial instruments:
|
|
|
|
|
|
|
|
||||||||
IRLCs
|
47.6
|
|
|
—
|
|
|
47.6
|
|
|
—
|
|
||||
Forward MBS trades
|
0.1
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
||||
LPCs
|
1.7
|
|
|
—
|
|
|
1.7
|
|
|
—
|
|
||||
Eurodollar futures(1)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total assets
|
$
|
5,464.7
|
|
|
$
|
—
|
|
|
$
|
1,680.2
|
|
|
$
|
3,784.5
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Derivative financial instruments:
|
|
|
|
|
|
|
|
||||||||
Forward MBS trades
|
$
|
19.3
|
|
|
$
|
—
|
|
|
$
|
19.3
|
|
|
$
|
—
|
|
LPCs
|
0.4
|
|
|
—
|
|
|
0.4
|
|
|
—
|
|
||||
Eurodollar futures(1)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Mortgage servicing rights financing
|
31.7
|
|
|
—
|
|
|
—
|
|
|
31.7
|
|
||||
Excess spread financing
|
1,184.4
|
|
|
—
|
|
|
—
|
|
|
1,184.4
|
|
||||
Total liabilities
|
$
|
1,235.8
|
|
|
$
|
—
|
|
|
$
|
19.7
|
|
|
$
|
1,216.1
|
|
(1)
|
Fair values of the underlying assets and liabilities are less than $0.1 for the specified dates.
|
|
Successor
|
||||||||||||||
|
Assets
|
|
Liabilities
|
||||||||||||
Year Ended December 31, 2019
|
Mortgage servicing rights
|
|
Mortgage loans held for investment
|
|
Excess spread
financing
|
|
Mortgage servicing rights financing
|
||||||||
Balance - beginning of period
|
$
|
3,665
|
|
|
$
|
119
|
|
|
$
|
1,184
|
|
|
$
|
32
|
|
Total gains or losses included in earnings
|
(1,053
|
)
|
|
3
|
|
|
(169
|
)
|
|
5
|
|
||||
Payments received from borrowers
|
—
|
|
|
(11
|
)
|
|
—
|
|
|
—
|
|
||||
Purchases, issuances, sales, repayments and settlements
|
|
|
|
|
|
|
|
||||||||
Purchases
|
858
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Issuances
|
434
|
|
|
—
|
|
|
542
|
|
|
—
|
|
||||
Sales
|
(408
|
)
|
|
(94
|
)
|
|
—
|
|
|
—
|
|
||||
Repayments
|
—
|
|
|
—
|
|
|
(27
|
)
|
|
—
|
|
||||
Settlements
|
—
|
|
|
—
|
|
|
(219
|
)
|
|
—
|
|
||||
Transfers to mortgage loans held for sale
|
—
|
|
|
(12
|
)
|
|
—
|
|
|
—
|
|
||||
Transfers to real estate owned
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
—
|
|
||||
Balance - end of period
|
$
|
3,496
|
|
|
$
|
—
|
|
|
$
|
1,311
|
|
|
$
|
37
|
|
|
Successor
|
||||||||||||||
|
Assets
|
|
Liabilities
|
||||||||||||
Five Months Ended December 31, 2018
|
Mortgage servicing rights
|
|
Mortgage loans held for investment
|
|
Excess spread financing
|
|
Mortgage servicing rights financing
|
||||||||
Balance - beginning of period
|
$
|
3,413
|
|
|
$
|
125
|
|
|
$
|
1,039
|
|
|
$
|
26
|
|
Total gains or losses included in earnings
|
(236
|
)
|
|
(1
|
)
|
|
5
|
|
|
6
|
|
||||
Payments received from borrowers
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
—
|
|
||||
Purchases, issuances, sales, repayments and settlements
|
|
|
|
|
|
|
|
||||||||
Purchases
|
479
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Issuances
|
120
|
|
|
—
|
|
|
255
|
|
|
—
|
|
||||
Sales
|
(111
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Repayments
|
—
|
|
|
—
|
|
|
(38
|
)
|
|
—
|
|
||||
Settlements
|
—
|
|
|
—
|
|
|
(77
|
)
|
|
—
|
|
||||
Balance - end of period
|
$
|
3,665
|
|
|
$
|
119
|
|
|
$
|
1,184
|
|
|
$
|
32
|
|
|
Predecessor
|
||||||||||
|
Assets
|
|
Liabilities
|
||||||||
Seven Months Ended July 31, 2018
|
Mortgage servicing rights
|
|
Excess spread
financing
|
|
Mortgage servicing rights financing
|
||||||
Balance - beginning of period
|
$
|
2,937
|
|
|
$
|
996
|
|
|
$
|
10
|
|
Total gains or losses included in earnings
|
166
|
|
|
81
|
|
|
16
|
|
|||
Purchases, issuances, sales, repayments and settlements
|
|
|
|
|
|
||||||
Purchases
|
144
|
|
|
—
|
|
|
—
|
|
|||
Issuances
|
162
|
|
|
70
|
|
|
—
|
|
|||
Sales
|
4
|
|
|
—
|
|
|
—
|
|
|||
Repayments
|
—
|
|
|
(3
|
)
|
|
—
|
|
|||
Settlements
|
—
|
|
|
(105
|
)
|
|
—
|
|
|||
Balance - end of period
|
$
|
3,413
|
|
|
$
|
1,039
|
|
|
$
|
26
|
|
|
Successor
|
||||||||||||||
|
December 31, 2019
|
||||||||||||||
|
Carrying
Amount
|
|
Fair Value
|
||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||
Financial assets
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
$
|
329
|
|
|
$
|
329
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Restricted cash
|
283
|
|
|
283
|
|
|
—
|
|
|
—
|
|
||||
Advances and other receivables, net
|
988
|
|
|
—
|
|
|
—
|
|
|
988
|
|
||||
Reverse mortgage interests, net
|
6,279
|
|
|
—
|
|
|
—
|
|
|
6,318
|
|
||||
Mortgage loans held for sale
|
4,077
|
|
|
—
|
|
|
4,077
|
|
|
—
|
|
||||
Mortgage loans held for investment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Derivative financial instruments
|
153
|
|
|
—
|
|
|
153
|
|
|
—
|
|
||||
Financial liabilities
|
|
|
|
|
|
|
|
||||||||
Unsecured senior notes(1)
|
2,366
|
|
|
2,505
|
|
|
—
|
|
|
—
|
|
||||
Advance facilities
|
422
|
|
|
—
|
|
|
422
|
|
|
—
|
|
||||
Warehouse facilities(1)
|
4,575
|
|
|
—
|
|
|
4,575
|
|
|
—
|
|
||||
Mortgage servicing rights financing liability
|
37
|
|
|
—
|
|
|
—
|
|
|
37
|
|
||||
Excess spread financing
|
1,311
|
|
|
—
|
|
|
—
|
|
|
1,311
|
|
||||
Derivative financial instruments
|
15
|
|
|
—
|
|
|
15
|
|
|
—
|
|
||||
Participating interest financing(1)
|
4,299
|
|
|
—
|
|
|
—
|
|
|
4,299
|
|
||||
HECM Securitization (HMBS)(1)
|
|
|
|
|
|
|
|
||||||||
Trust 2019-2
|
331
|
|
|
—
|
|
|
—
|
|
|
331
|
|
||||
Trust 2019-1
|
300
|
|
|
—
|
|
|
—
|
|
|
300
|
|
||||
Trust 2018-3
|
208
|
|
|
—
|
|
|
—
|
|
|
208
|
|
||||
Trust 2018-2
|
148
|
|
|
—
|
|
|
—
|
|
|
148
|
|
(1)
|
The amounts are presented net of unamortized debt issuance costs, premium and discount.
|
|
Successor
|
||||||||||||||
|
December 31, 2018
|
||||||||||||||
|
Carrying
Amount
|
|
Fair Value
|
||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||
Financial assets
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
$
|
242
|
|
|
$
|
242
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Restricted cash
|
319
|
|
|
319
|
|
|
—
|
|
|
—
|
|
||||
Advances and other receivables, net
|
1,194
|
|
|
—
|
|
|
—
|
|
|
1,194
|
|
||||
Reverse mortgage interests, net
|
7,934
|
|
|
—
|
|
|
—
|
|
|
7,942
|
|
||||
Mortgage loans held for sale
|
1,631
|
|
|
—
|
|
|
1,631
|
|
|
—
|
|
||||
Mortgage loans held for investment
|
119
|
|
|
—
|
|
|
—
|
|
|
119
|
|
||||
Derivative financial instruments
|
49
|
|
|
—
|
|
|
49
|
|
|
—
|
|
||||
Financial liabilities
|
|
|
|
|
|
|
|
||||||||
Unsecured senior notes(1)
|
2,459
|
|
|
2,451
|
|
|
—
|
|
|
—
|
|
||||
Advance facilities(1)
|
595
|
|
|
—
|
|
|
595
|
|
|
—
|
|
||||
Warehouse facilities(1)
|
2,349
|
|
|
—
|
|
|
2,349
|
|
|
—
|
|
||||
Mortgage servicing rights financing liability
|
32
|
|
|
—
|
|
|
—
|
|
|
32
|
|
||||
Excess spread financing
|
1,184
|
|
|
—
|
|
|
—
|
|
|
1,184
|
|
||||
Derivative financial instruments
|
20
|
|
|
—
|
|
|
20
|
|
|
—
|
|
||||
Participating interest financing(1)
|
5,675
|
|
|
—
|
|
|
—
|
|
|
5,672
|
|
||||
HECM Securitization (HMBS)(1)
|
|
|
|
|
|
|
|
||||||||
Trust 2018-3
|
326
|
|
|
—
|
|
|
—
|
|
|
326
|
|
||||
Trust 2018-2
|
250
|
|
|
—
|
|
|
—
|
|
|
249
|
|
||||
Trust 2018-1
|
284
|
|
|
—
|
|
|
—
|
|
|
284
|
|
||||
Trust 2017-2
|
231
|
|
|
—
|
|
|
—
|
|
|
230
|
|
||||
Nonrecourse debt - legacy assets
|
29
|
|
|
—
|
|
|
—
|
|
|
28
|
|
(1)
|
The amounts are presented net of unamortized debt issuance costs, premium and discount.
|
|
Successor
|
||||||||||||||||||||||||||
|
Year Ended December 31, 2019
|
||||||||||||||||||||||||||
|
Servicing
|
|
Originations
|
|
Xome
|
|
Elimination
|
|
Total Operating
Segments |
|
Corporate/ Other
|
|
Consolidated
|
||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Service related, net
|
$
|
408
|
|
|
$
|
80
|
|
|
$
|
422
|
|
|
$
|
(3
|
)
|
|
$
|
907
|
|
|
$
|
2
|
|
|
$
|
909
|
|
Net gain on mortgage loans held for sale
|
124
|
|
|
963
|
|
|
—
|
|
|
—
|
|
|
1,087
|
|
|
11
|
|
|
1,098
|
|
|||||||
Total revenues
|
532
|
|
|
1,043
|
|
|
422
|
|
|
(3
|
)
|
|
1,994
|
|
|
13
|
|
|
2,007
|
|
|||||||
Total expenses
|
690
|
|
|
568
|
|
|
398
|
|
|
(3
|
)
|
|
1,653
|
|
|
198
|
|
|
1,851
|
|
|||||||
Other income (expenses), net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Interest income
|
500
|
|
|
98
|
|
|
—
|
|
|
—
|
|
|
598
|
|
|
7
|
|
|
605
|
|
|||||||
Interest expense
|
(469
|
)
|
|
(98
|
)
|
|
—
|
|
|
—
|
|
|
(567
|
)
|
|
(212
|
)
|
|
(779
|
)
|
|||||||
Other income (expenses), net
|
4
|
|
|
4
|
|
|
14
|
|
|
—
|
|
|
22
|
|
|
(7
|
)
|
|
15
|
|
|||||||
Total other income (expenses), net
|
35
|
|
|
4
|
|
|
14
|
|
|
—
|
|
|
53
|
|
|
(212
|
)
|
|
(159
|
)
|
|||||||
(Loss) income before income tax (benefit) expense
|
$
|
(123
|
)
|
|
$
|
479
|
|
|
$
|
38
|
|
|
$
|
—
|
|
|
$
|
394
|
|
|
$
|
(397
|
)
|
|
$
|
(3
|
)
|
Depreciation and amortization for property and equipment and intangible assets
|
$
|
19
|
|
|
$
|
18
|
|
|
$
|
14
|
|
|
$
|
—
|
|
|
$
|
51
|
|
|
$
|
40
|
|
|
$
|
91
|
|
Total assets
|
$
|
11,044
|
|
|
$
|
9,257
|
|
|
$
|
526
|
|
|
$
|
(4,826
|
)
|
|
$
|
16,001
|
|
|
$
|
2,304
|
|
|
$
|
18,305
|
|
|
Successor
|
||||||||||||||||||||||||||
|
Five Months Ended December 31, 2018
|
||||||||||||||||||||||||||
|
Servicing
|
|
Originations
|
|
Xome
|
|
Elimination
|
|
Total Operating
Segments |
|
Corporate/ Other
|
|
Consolidated
|
||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Service related, net
|
$
|
217
|
|
|
$
|
24
|
|
|
$
|
177
|
|
|
$
|
—
|
|
|
$
|
418
|
|
|
$
|
—
|
|
|
$
|
418
|
|
Net gain on mortgage loans held for sale
|
19
|
|
|
157
|
|
|
—
|
|
|
—
|
|
|
176
|
|
|
—
|
|
|
176
|
|
|||||||
Total revenues
|
236
|
|
|
181
|
|
|
177
|
|
|
—
|
|
|
594
|
|
|
—
|
|
|
594
|
|
|||||||
Total expenses
|
303
|
|
|
155
|
|
|
178
|
|
|
—
|
|
|
636
|
|
|
71
|
|
|
707
|
|
|||||||
Other income (expenses), net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Interest income
|
222
|
|
|
27
|
|
|
—
|
|
|
—
|
|
|
249
|
|
|
7
|
|
|
256
|
|
|||||||
Interest expense
|
(173
|
)
|
|
(26
|
)
|
|
(1
|
)
|
|
—
|
|
|
(200
|
)
|
|
(93
|
)
|
|
(293
|
)
|
|||||||
Other income, net
|
6
|
|
|
5
|
|
|
1
|
|
|
—
|
|
|
12
|
|
|
1
|
|
|
13
|
|
|||||||
Total other income (expenses), net
|
55
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
61
|
|
|
(85
|
)
|
|
(24
|
)
|
|||||||
(Loss) income before income tax (benefit) expense
|
$
|
(12
|
)
|
|
$
|
32
|
|
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
$
|
19
|
|
|
$
|
(156
|
)
|
|
$
|
(137
|
)
|
Depreciation and amortization for property and equipment and intangible assets
|
$
|
9
|
|
|
$
|
5
|
|
|
$
|
5
|
|
|
$
|
—
|
|
|
$
|
19
|
|
|
$
|
20
|
|
|
$
|
39
|
|
Total assets
|
$
|
13,485
|
|
|
$
|
4,866
|
|
|
$
|
493
|
|
|
$
|
(3,772
|
)
|
|
$
|
15,072
|
|
|
$
|
1,901
|
|
|
$
|
16,973
|
|
|
Predecessor
|
||||||||||||||||||||||||||
|
Seven Months Ended July 31, 2018
|
||||||||||||||||||||||||||
|
Servicing
|
|
Originations
|
|
Xome
|
|
Elimination/ Reclassification(1)
|
|
Total Operating
Segments |
|
Corporate/ Other
|
|
Consolidated
|
||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Service related, net
|
$
|
740
|
|
|
$
|
36
|
|
|
$
|
149
|
|
|
$
|
(25
|
)
|
|
$
|
900
|
|
|
$
|
1
|
|
|
$
|
901
|
|
Net gain on mortgage loans held for sale
|
—
|
|
|
270
|
|
|
—
|
|
|
25
|
|
|
295
|
|
|
—
|
|
|
295
|
|
|||||||
Total revenues
|
740
|
|
|
306
|
|
|
149
|
|
|
—
|
|
|
1,195
|
|
|
1
|
|
|
1,196
|
|
|||||||
Total expenses
|
474
|
|
|
245
|
|
|
123
|
|
|
—
|
|
|
842
|
|
|
103
|
|
|
945
|
|
|||||||
Other income (expenses), net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Interest income
|
288
|
|
|
38
|
|
|
—
|
|
|
—
|
|
|
326
|
|
|
7
|
|
|
333
|
|
|||||||
Interest expense
|
(268
|
)
|
|
(37
|
)
|
|
—
|
|
|
—
|
|
|
(305
|
)
|
|
(83
|
)
|
|
(388
|
)
|
|||||||
Other (expenses) income, net
|
(1
|
)
|
|
—
|
|
|
9
|
|
|
—
|
|
|
8
|
|
|
(2
|
)
|
|
6
|
|
|||||||
Total other income (expenses), net
|
19
|
|
|
1
|
|
|
9
|
|
|
—
|
|
|
29
|
|
|
(78
|
)
|
|
(49
|
)
|
|||||||
Income (loss) before income tax expense (benefit)
|
$
|
285
|
|
|
$
|
62
|
|
|
$
|
35
|
|
|
$
|
—
|
|
|
$
|
382
|
|
|
$
|
(180
|
)
|
|
$
|
202
|
|
Depreciation and amortization for property and equipment and intangible assets
|
$
|
15
|
|
|
$
|
7
|
|
|
$
|
7
|
|
|
$
|
—
|
|
|
$
|
29
|
|
|
$
|
4
|
|
|
$
|
33
|
|
Total assets
|
$
|
14,578
|
|
|
$
|
4,701
|
|
|
$
|
425
|
|
|
$
|
(3,591
|
)
|
|
$
|
16,113
|
|
|
$
|
913
|
|
|
$
|
17,026
|
|
|
Predecessor
|
||||||||||||||||||||||||||
|
Year Ended December 31, 2017
|
||||||||||||||||||||||||||
|
Servicing(1)
|
|
Originations
|
|
Xome
|
|
Elimination/ Reclassification(1)
|
|
Total Operating
Segments |
|
Corporate/ Other
|
|
Consolidated
|
||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Service related, net
|
$
|
766
|
|
|
$
|
63
|
|
|
$
|
291
|
|
|
$
|
(79
|
)
|
|
$
|
1,041
|
|
|
$
|
2
|
|
|
$
|
1,043
|
|
Net gain on mortgage loans held for sale
|
—
|
|
|
528
|
|
|
—
|
|
|
79
|
|
|
607
|
|
|
—
|
|
|
607
|
|
|||||||
Total revenues
|
766
|
|
|
591
|
|
|
291
|
|
|
—
|
|
|
1,648
|
|
|
2
|
|
|
1,650
|
|
|||||||
Total expenses
|
691
|
|
|
439
|
|
|
247
|
|
|
—
|
|
|
1,377
|
|
|
98
|
|
|
1,475
|
|
|||||||
Other income (expenses), net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Interest income
|
527
|
|
|
55
|
|
|
—
|
|
|
—
|
|
|
582
|
|
|
15
|
|
|
597
|
|
|||||||
Interest expense
|
(523
|
)
|
|
(54
|
)
|
|
—
|
|
|
—
|
|
|
(577
|
)
|
|
(154
|
)
|
|
(731
|
)
|
|||||||
Other (expenses) income, net
|
(3
|
)
|
|
—
|
|
|
9
|
|
|
—
|
|
|
6
|
|
|
(3
|
)
|
|
3
|
|
|||||||
Total other income (expenses), net
|
1
|
|
|
1
|
|
|
9
|
|
|
—
|
|
|
11
|
|
|
(142
|
)
|
|
(131
|
)
|
|||||||
Income (loss) before income tax expense (benefit)
|
$
|
76
|
|
|
$
|
153
|
|
|
$
|
53
|
|
|
$
|
—
|
|
|
$
|
282
|
|
|
$
|
(238
|
)
|
|
$
|
44
|
|
Depreciation and amortization for property and equipment and intangible assets
|
$
|
23
|
|
|
$
|
10
|
|
|
$
|
14
|
|
|
$
|
—
|
|
|
$
|
47
|
|
|
$
|
12
|
|
|
$
|
59
|
|
Total assets
|
$
|
15,006
|
|
|
$
|
4,935
|
|
|
$
|
393
|
|
|
$
|
(3,117
|
)
|
|
$
|
17,217
|
|
|
$
|
819
|
|
|
$
|
18,036
|
|
(1)
|
For the Predecessor’s Servicing segment results purposes, all revenue is attributable to servicing the portfolio. Therefore, $25 and $79 of net gain on mortgage loans was moved to revenues - service related, net during the seven months ended July 31, 2018 and the year ended December 31, 2017, respectively. For consolidated results purposes, these amounts were reclassed to net gain on mortgage loans held for sale.
|
(1)
|
Nationstar Capital Corporation has no assets, operations or liabilities other than being a co-obligor of the unsecured senior notes.
|
(2)
|
This note was subsequently redeemed in full in February 2020. See Note 26, Subsequent Events, for further information.
|
MR. COOPER GROUP INC.
CONSOLIDATING BALANCE SHEET
DECEMBER 31, 2019
|
|||||||||||||||||||||||
|
Successor
|
||||||||||||||||||||||
|
Mr. Cooper
|
|
Issuer(1)
|
|
Guarantor (Subsidiaries of Issuer)
|
|
Non-Guarantor
(Subsidiaries of Issuer) |
|
Eliminations
|
|
Consolidated
|
||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
287
|
|
|
$
|
1
|
|
|
$
|
41
|
|
|
$
|
—
|
|
|
$
|
329
|
|
Restricted cash
|
—
|
|
|
175
|
|
|
—
|
|
|
108
|
|
|
—
|
|
|
283
|
|
||||||
Mortgage servicing rights
|
—
|
|
|
3,478
|
|
|
—
|
|
|
24
|
|
|
—
|
|
|
3,502
|
|
||||||
Advances and other receivables, net
|
—
|
|
|
988
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
988
|
|
||||||
Reverse mortgage interests, net
|
—
|
|
|
5,312
|
|
|
—
|
|
|
967
|
|
|
—
|
|
|
6,279
|
|
||||||
Mortgage loans held for sale at fair value
|
—
|
|
|
4,077
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,077
|
|
||||||
Property and equipment, net
|
—
|
|
|
92
|
|
|
—
|
|
|
20
|
|
|
—
|
|
|
112
|
|
||||||
Deferred tax assets, net
|
1,273
|
|
|
70
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
1,345
|
|
||||||
Other assets
|
—
|
|
|
1,279
|
|
|
215
|
|
|
751
|
|
|
(855
|
)
|
|
1,390
|
|
||||||
Investment in subsidiaries
|
2,828
|
|
|
698
|
|
|
—
|
|
|
—
|
|
|
(3,526
|
)
|
|
—
|
|
||||||
Total assets
|
$
|
4,101
|
|
|
$
|
16,456
|
|
|
$
|
216
|
|
|
$
|
1,913
|
|
|
$
|
(4,381
|
)
|
|
$
|
18,305
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Liabilities and Stockholders’ Equity
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Unsecured senior notes, net
|
$
|
1,667
|
|
|
$
|
699
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,366
|
|
Advance facilities, net
|
—
|
|
|
63
|
|
|
—
|
|
|
359
|
|
|
—
|
|
|
422
|
|
||||||
Warehouse facilities, net
|
—
|
|
|
4,575
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,575
|
|
||||||
Payables and other liabilities
|
63
|
|
|
1,882
|
|
|
1
|
|
|
70
|
|
|
—
|
|
|
2,016
|
|
||||||
MSR related liabilities - nonrecourse at fair value
|
—
|
|
|
1,334
|
|
|
—
|
|
|
14
|
|
|
—
|
|
|
1,348
|
|
||||||
Mortgage servicing liabilities
|
—
|
|
|
61
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
61
|
|
||||||
Other nonrecourse debt, net
|
—
|
|
|
4,299
|
|
|
—
|
|
|
987
|
|
|
—
|
|
|
5,286
|
|
||||||
Payables to affiliates
|
140
|
|
|
715
|
|
|
—
|
|
|
—
|
|
|
(855
|
)
|
|
—
|
|
||||||
Total liabilities
|
1,870
|
|
|
13,628
|
|
|
1
|
|
|
1,430
|
|
|
(855
|
)
|
|
16,074
|
|
||||||
Total stockholders’ equity
|
2,231
|
|
|
2,828
|
|
|
215
|
|
|
483
|
|
|
(3,526
|
)
|
|
2,231
|
|
||||||
Total liabilities and stockholders’ equity
|
$
|
4,101
|
|
|
$
|
16,456
|
|
|
$
|
216
|
|
|
$
|
1,913
|
|
|
$
|
(4,381
|
)
|
|
$
|
18,305
|
|
(1)
|
Issuer balances exclude the balances of its guarantor and non-guarantor subsidiaries, as previously described.
|
MR. COOPER GROUP INC.
CONSOLIDATING STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 2019
|
|||||||||||||||||||||||
|
Successor
|
||||||||||||||||||||||
|
Mr. Cooper
|
|
Issuer(1)
|
|
Guarantor
(Subsidiaries of Issuer) |
|
Non-Guarantor
(Subsidiaries of Issuer) |
|
Eliminations
|
|
Consolidated
|
||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Service related, net
|
$
|
—
|
|
|
$
|
451
|
|
|
$
|
22
|
|
|
$
|
436
|
|
|
$
|
—
|
|
|
$
|
909
|
|
Net gain on mortgage loans held for sale
|
—
|
|
|
1,087
|
|
|
—
|
|
|
11
|
|
|
—
|
|
|
1,098
|
|
||||||
Total revenues
|
—
|
|
|
1,538
|
|
|
22
|
|
|
447
|
|
|
—
|
|
|
2,007
|
|
||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Salaries, wages benefits
|
—
|
|
|
794
|
|
|
5
|
|
|
158
|
|
|
—
|
|
|
957
|
|
||||||
General and administrative
|
—
|
|
|
651
|
|
|
2
|
|
|
241
|
|
|
—
|
|
|
894
|
|
||||||
Total expenses
|
—
|
|
|
1,445
|
|
|
7
|
|
|
399
|
|
|
—
|
|
|
1,851
|
|
||||||
Other income (expenses), net:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest income
|
—
|
|
|
525
|
|
|
—
|
|
|
80
|
|
|
—
|
|
|
605
|
|
||||||
Interest expense
|
(153
|
)
|
|
(566
|
)
|
|
—
|
|
|
(60
|
)
|
|
—
|
|
|
(779
|
)
|
||||||
Other income (expenses), net
|
—
|
|
|
1
|
|
|
(15
|
)
|
|
29
|
|
|
—
|
|
|
15
|
|
||||||
Gain (loss) from subsidiaries
|
142
|
|
|
98
|
|
|
—
|
|
|
—
|
|
|
(240
|
)
|
|
—
|
|
||||||
Total other income (expenses), net
|
(11
|
)
|
|
58
|
|
|
(15
|
)
|
|
49
|
|
|
(240
|
)
|
|
(159
|
)
|
||||||
(Loss) income before income tax expense
|
(11
|
)
|
|
151
|
|
|
—
|
|
|
97
|
|
|
(240
|
)
|
|
(3
|
)
|
||||||
Less: Income tax (benefit) expense
|
(285
|
)
|
|
13
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(273
|
)
|
||||||
Net income (loss)
|
274
|
|
|
138
|
|
|
—
|
|
|
98
|
|
|
(240
|
)
|
|
270
|
|
||||||
Less: Net loss attributable to non-controlling interests
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
||||||
Net income (loss) attributable to Mr. Cooper
|
$
|
274
|
|
|
$
|
142
|
|
|
$
|
—
|
|
|
$
|
98
|
|
|
$
|
(240
|
)
|
|
$
|
274
|
|
(1)
|
Issuer activities exclude the activities of its guarantor and non-guarantor subsidiaries, as previously described.
|
MR. COOPER GROUP INC.
CONSOLIDATING STATEMENT OF CASH FLOWS
YEAR ENDED DECEMBER 31, 2019
|
|||||||||||||||||||||||
|
Successor
|
||||||||||||||||||||||
|
Mr. Cooper
|
|
Issuer(1)
|
|
Guarantor
(Subsidiaries of Issuer) |
|
Non-Guarantor
(Subsidiaries of Issuer) |
|
Eliminations
|
|
Consolidated
|
||||||||||||
Operating Activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income (loss)
|
$
|
274
|
|
|
$
|
138
|
|
|
$
|
—
|
|
|
$
|
98
|
|
|
$
|
(240
|
)
|
|
$
|
270
|
|
Adjustment to reconcile net income (loss) to net cash attributable to operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Deferred tax benefit
|
(286
|
)
|
|
(77
|
)
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(366
|
)
|
||||||
(Gain) loss from subsidiaries
|
(142
|
)
|
|
(98
|
)
|
|
—
|
|
|
—
|
|
|
240
|
|
|
—
|
|
||||||
Net gain on mortgage loans held for sale
|
—
|
|
|
(1,087
|
)
|
|
—
|
|
|
(11
|
)
|
|
—
|
|
|
(1,098
|
)
|
||||||
Interest income on reverse mortgage loans
|
—
|
|
|
(264
|
)
|
|
—
|
|
|
(43
|
)
|
|
—
|
|
|
(307
|
)
|
||||||
Loss on sale of assets
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
||||||
Provision for servicing reserves
|
—
|
|
|
66
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
66
|
|
||||||
Fair value changes and amortization/accretion of mortgage servicing rights/liabilities
|
—
|
|
|
997
|
|
|
—
|
|
|
8
|
|
|
—
|
|
|
1,005
|
|
||||||
Fair value changes in excess spread financing
|
—
|
|
|
(164
|
)
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
(169
|
)
|
||||||
Fair value changes in mortgage servicing rights financing liability
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
||||||
Fair value changes in mortgage loans held for investment
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
||||||
Amortization of premiums, net of discount accretion
|
7
|
|
|
(18
|
)
|
|
—
|
|
|
(21
|
)
|
|
—
|
|
|
(32
|
)
|
||||||
Depreciation and amortization for property and equipment and intangible assets
|
—
|
|
|
75
|
|
|
—
|
|
|
16
|
|
|
—
|
|
|
91
|
|
||||||
Share-based compensation
|
—
|
|
|
16
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
18
|
|
||||||
Other loss
|
—
|
|
|
3
|
|
|
—
|
|
|
8
|
|
|
—
|
|
|
11
|
|
||||||
Repurchases of forward loans assets out of Ginnie Mae securitizations
|
—
|
|
|
(2,895
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,895
|
)
|
||||||
Mortgage loans originated and purchased for sale, net of fees
|
—
|
|
|
(40,269
|
)
|
|
—
|
|
|
12
|
|
|
—
|
|
|
(40,257
|
)
|
||||||
Sales proceeds and loan payment proceeds for mortgage loans held for sale and held for investment
|
—
|
|
|
41,809
|
|
|
—
|
|
|
139
|
|
|
—
|
|
|
41,948
|
|
||||||
Changes in assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Advances and other receivables
|
—
|
|
|
228
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
228
|
|
||||||
Reverse mortgage interests
|
—
|
|
|
2,035
|
|
|
—
|
|
|
157
|
|
|
—
|
|
|
2,192
|
|
||||||
Other assets
|
147
|
|
|
11
|
|
|
—
|
|
|
(80
|
)
|
|
—
|
|
|
78
|
|
||||||
Payables and other liabilities
|
—
|
|
|
(70
|
)
|
|
—
|
|
|
(15
|
)
|
|
—
|
|
|
(85
|
)
|
||||||
Net cash attributable to operating activities
|
—
|
|
|
443
|
|
|
—
|
|
|
259
|
|
|
—
|
|
|
702
|
|
(1)
|
Issuer activities exclude the activities of its guarantor and non-guarantor subsidiaries, as previously described.
|
(1)
|
Issuer activities exclude the activities of its guarantor and non-guarantor subsidiaries, as previously described.
|
MR. COOPER GROUP INC.
CONSOLIDATING BALANCE SHEET
DECEMBER 31, 2018
|
|||||||||||||||||||||||
|
Successor
|
||||||||||||||||||||||
|
Mr. Cooper
|
|
Issuer(1)
|
|
Guarantor
(Subsidiaries of Issuer) |
|
Non-Guarantor
(Subsidiaries of Issuer) |
|
Eliminations
|
|
Consolidated
|
||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
193
|
|
|
$
|
1
|
|
|
$
|
48
|
|
|
$
|
—
|
|
|
$
|
242
|
|
Restricted cash
|
—
|
|
|
186
|
|
|
—
|
|
|
133
|
|
|
—
|
|
|
319
|
|
||||||
Mortgage servicing rights
|
—
|
|
|
3,644
|
|
|
—
|
|
|
32
|
|
|
—
|
|
|
3,676
|
|
||||||
Advances and other receivables, net
|
—
|
|
|
1,194
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,194
|
|
||||||
Reverse mortgage interests, net
|
—
|
|
|
6,770
|
|
|
—
|
|
|
1,164
|
|
|
—
|
|
|
7,934
|
|
||||||
Mortgage loans held for sale at fair value
|
—
|
|
|
1,631
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,631
|
|
||||||
Mortgage loans held for investment, net
|
—
|
|
|
1
|
|
|
—
|
|
|
118
|
|
|
—
|
|
|
119
|
|
||||||
Property and equipment, net
|
—
|
|
|
84
|
|
|
—
|
|
|
12
|
|
|
—
|
|
|
96
|
|
||||||
Deferred tax assets, net
|
973
|
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
967
|
|
||||||
Other assets
|
—
|
|
|
660
|
|
|
202
|
|
|
621
|
|
|
(688
|
)
|
|
795
|
|
||||||
Investment in subsidiaries
|
2,820
|
|
|
601
|
|
|
—
|
|
|
—
|
|
|
(3,421
|
)
|
|
—
|
|
||||||
Total assets
|
$
|
3,793
|
|
|
$
|
14,964
|
|
|
$
|
203
|
|
|
$
|
2,122
|
|
|
$
|
(4,109
|
)
|
|
$
|
16,973
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Liabilities and Stockholders’ Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Unsecured senior notes, net
|
$
|
1,660
|
|
|
$
|
799
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,459
|
|
Advance facilities, net
|
—
|
|
|
90
|
|
|
—
|
|
|
505
|
|
|
—
|
|
|
595
|
|
||||||
Warehouse facilities, net
|
—
|
|
|
2,349
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,349
|
|
||||||
Payables and other liabilities
|
49
|
|
|
1,413
|
|
|
1
|
|
|
80
|
|
|
—
|
|
|
1,543
|
|
||||||
MSR related liabilities - nonrecourse at fair value
|
—
|
|
|
1,197
|
|
|
—
|
|
|
19
|
|
|
—
|
|
|
1,216
|
|
||||||
Mortgage servicing liabilities
|
—
|
|
|
71
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
71
|
|
||||||
Other nonrecourse debt, net
|
—
|
|
|
5,676
|
|
|
—
|
|
|
1,119
|
|
|
—
|
|
|
6,795
|
|
||||||
Payables to affiliates
|
139
|
|
|
549
|
|
|
—
|
|
|
—
|
|
|
(688
|
)
|
|
—
|
|
||||||
Total liabilities
|
1,848
|
|
|
12,144
|
|
|
1
|
|
|
1,723
|
|
|
(688
|
)
|
|
15,028
|
|
||||||
Total stockholders’ equity
|
1,945
|
|
|
2,820
|
|
|
202
|
|
|
399
|
|
|
(3,421
|
)
|
|
1,945
|
|
||||||
Total liabilities and stockholders’ equity
|
$
|
3,793
|
|
|
$
|
14,964
|
|
|
$
|
203
|
|
|
$
|
2,122
|
|
|
$
|
(4,109
|
)
|
|
$
|
16,973
|
|
(1)
|
Issuer balances exclude the balances of its guarantor and non-guarantor subsidiaries, as previously described.
|
MR. COOPER GROUP INC.
CONSOLIDATING STATEMENT OF OPERATIONS
FIVE MONTHS ENDED DECEMBER 31, 2018
|
|||||||||||||||||||||||
|
Successor
|
||||||||||||||||||||||
|
Mr. Cooper
|
|
Issuer(1)
|
|
Guarantor
(Subsidiaries of Issuer) |
|
Non-Guarantor
(Subsidiaries of Issuer) |
|
Eliminations
|
|
Consolidated
|
||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Service related, net
|
$
|
—
|
|
|
$
|
233
|
|
|
$
|
9
|
|
|
$
|
176
|
|
|
$
|
—
|
|
|
$
|
418
|
|
Net gain on mortgage loans held for sale
|
—
|
|
|
175
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
176
|
|
||||||
Total revenues
|
—
|
|
|
408
|
|
|
9
|
|
|
177
|
|
|
—
|
|
|
594
|
|
||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Salaries, wages and benefits
|
1
|
|
|
258
|
|
|
2
|
|
|
76
|
|
|
—
|
|
|
337
|
|
||||||
General and administrative
|
—
|
|
|
262
|
|
|
1
|
|
|
107
|
|
|
—
|
|
|
370
|
|
||||||
Total expenses
|
1
|
|
|
520
|
|
|
3
|
|
|
183
|
|
|
—
|
|
|
707
|
|
||||||
Other income (expenses), net:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest income
|
—
|
|
|
237
|
|
|
—
|
|
|
19
|
|
|
—
|
|
|
256
|
|
||||||
Interest expense
|
(64
|
)
|
|
(211
|
)
|
|
—
|
|
|
(18
|
)
|
|
—
|
|
|
(293
|
)
|
||||||
Other income, net
|
1
|
|
|
11
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
13
|
|
||||||
(Loss) gain from subsidiaries
|
(44
|
)
|
|
2
|
|
|
—
|
|
|
—
|
|
|
42
|
|
|
—
|
|
||||||
Total other income (expenses), net
|
(107
|
)
|
|
39
|
|
|
—
|
|
|
2
|
|
|
42
|
|
|
(24
|
)
|
||||||
(Loss) income before income tax benefit
|
(108
|
)
|
|
(73
|
)
|
|
6
|
|
|
(4
|
)
|
|
42
|
|
|
(137
|
)
|
||||||
Less: Income tax benefit
|
(992
|
)
|
|
(29
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,021
|
)
|
||||||
Net income (loss)
|
884
|
|
|
(44
|
)
|
|
6
|
|
|
(4
|
)
|
|
42
|
|
|
884
|
|
||||||
Less: Net loss attributable to non-controlling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net income (loss) attributable to Mr. Cooper
|
$
|
884
|
|
|
$
|
(44
|
)
|
|
$
|
6
|
|
|
$
|
(4
|
)
|
|
$
|
42
|
|
|
$
|
884
|
|
(1)
|
Issuer activities exclude the activities of its guarantor and non-guarantor subsidiaries, as previously described.
|
MR. COOPER GROUP INC.
CONSOLIDATING STATEMENT OF OPERATIONS
SEVEN MONTHS ENDED JULY 31, 2018
|
|||||||||||||||||||||||
|
Predecessor
|
||||||||||||||||||||||
|
Nationstar
|
|
Issuer(1)
|
|
Guarantor
(Subsidiaries of Issuer) |
|
Non-Guarantor
(Subsidiaries of Issuer) |
|
Eliminations
|
|
Consolidated
|
||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Service related, net
|
$
|
—
|
|
|
$
|
732
|
|
|
$
|
16
|
|
|
$
|
153
|
|
|
$
|
—
|
|
|
$
|
901
|
|
Net gain on mortgage loans held for sale
|
—
|
|
|
295
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
295
|
|
||||||
Total revenues
|
—
|
|
|
1,027
|
|
|
16
|
|
|
153
|
|
|
—
|
|
|
1,196
|
|
||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Salaries, wages benefits
|
—
|
|
|
359
|
|
|
3
|
|
|
64
|
|
|
—
|
|
|
426
|
|
||||||
General and administrative
|
27
|
|
|
427
|
|
|
1
|
|
|
64
|
|
|
—
|
|
|
519
|
|
||||||
Total expenses
|
27
|
|
|
786
|
|
|
4
|
|
|
128
|
|
|
—
|
|
|
945
|
|
||||||
Other income (expenses), net:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest income
|
—
|
|
|
299
|
|
|
—
|
|
|
34
|
|
|
—
|
|
|
333
|
|
||||||
Interest expense
|
—
|
|
|
(364
|
)
|
|
—
|
|
|
(24
|
)
|
|
—
|
|
|
(388
|
)
|
||||||
Other (expenses) income, net
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
9
|
|
|
—
|
|
|
6
|
|
||||||
Gain (loss) from subsidiaries
|
181
|
|
|
56
|
|
|
—
|
|
|
—
|
|
|
(237
|
)
|
|
—
|
|
||||||
Total other income (expenses), net
|
181
|
|
|
(12
|
)
|
|
—
|
|
|
19
|
|
|
(237
|
)
|
|
(49
|
)
|
||||||
Income (loss) before income tax expense
|
154
|
|
|
229
|
|
|
12
|
|
|
44
|
|
|
(237
|
)
|
|
202
|
|
||||||
Less: Income tax expense
|
—
|
|
|
48
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
48
|
|
||||||
Net income (loss)
|
154
|
|
|
181
|
|
|
12
|
|
|
44
|
|
|
(237
|
)
|
|
154
|
|
||||||
Less: Net income attributable to non-controlling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net income (loss) attributable to Nationstar
|
$
|
154
|
|
|
$
|
181
|
|
|
$
|
12
|
|
|
$
|
44
|
|
|
$
|
(237
|
)
|
|
$
|
154
|
|
(1)
|
Issuer activities exclude the activities of its guarantor and non-guarantor subsidiaries, as previously described.
|
MR. COOPER GROUP INC.
CONSOLIDATING STATEMENT OF CASH FLOWS
FIVE MONTHS ENDED DECEMBER 31, 2018
|
|||||||||||||||||||||||
|
Successor
|
||||||||||||||||||||||
|
Mr. Cooper
|
|
Issuer(1)
|
|
Guarantor
(Subsidiaries of Issuer) |
|
Non-Guarantor
(Subsidiaries of Issuer) |
|
Eliminations
|
|
Consolidated
|
||||||||||||
Operating Activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income (loss)
|
$
|
884
|
|
|
$
|
(44
|
)
|
|
$
|
6
|
|
|
$
|
(4
|
)
|
|
$
|
42
|
|
|
$
|
884
|
|
Adjustments to reconcile net income (loss) to net cash attributable to operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Deferred tax benefit
|
(971
|
)
|
|
(49
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1,021
|
)
|
||||||
Loss (gain) from subsidiaries
|
44
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
(42
|
)
|
|
—
|
|
||||||
Net gain on mortgage loans held for sale
|
—
|
|
|
(175
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(176
|
)
|
||||||
Interest income on reverse mortgage loans
|
—
|
|
|
(206
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(206
|
)
|
||||||
Provision for servicing reserves
|
—
|
|
|
38
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
38
|
|
||||||
Fair value changes and amortization/accretion of mortgage servicing rights/liabilities
|
—
|
|
|
225
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
225
|
|
||||||
Fair value changes in excess spread financing
|
—
|
|
|
6
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
5
|
|
||||||
Fair value changes in mortgage servicing rights financing liability
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
||||||
Fair value changes in mortgage loans held for investment
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
||||||
Amortization of premiums, net of discount accretion
|
3
|
|
|
7
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
9
|
|
||||||
Depreciation and amortization for property and equipment and intangible assets
|
—
|
|
|
33
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
39
|
|
||||||
Share-based compensation
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
2
|
|
||||||
Other loss (gain)
|
—
|
|
|
1
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
||||||
Repurchases of forward loans assets out of Ginnie Mae securitizations
|
—
|
|
|
(527
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(527
|
)
|
||||||
Mortgage loans originated and purchased for sale, net of fees
|
—
|
|
|
(8,888
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,888
|
)
|
||||||
Sales proceeds and loan payment proceeds for mortgage loans held for sale and held for investment
|
—
|
|
|
9,389
|
|
|
—
|
|
|
16
|
|
|
—
|
|
|
9,405
|
|
||||||
Changes in assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Advances and other receivables
|
—
|
|
|
43
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
43
|
|
||||||
Reverse mortgage interests
|
—
|
|
|
1,569
|
|
|
—
|
|
|
(25
|
)
|
|
—
|
|
|
1,544
|
|
||||||
Other assets
|
1
|
|
|
(18
|
)
|
|
(6
|
)
|
|
(38
|
)
|
|
—
|
|
|
(61
|
)
|
||||||
Payables and other liabilities
|
28
|
|
|
(130
|
)
|
|
—
|
|
|
34
|
|
|
—
|
|
|
(68
|
)
|
||||||
Net cash attributable to operating activities
|
(11
|
)
|
|
1,279
|
|
|
—
|
|
|
(17
|
)
|
|
—
|
|
|
1,251
|
|
(1)
|
Issuer activities exclude the activities of its guarantor and non-guarantor subsidiaries, as previously described.
|
MR. COOPER GROUP INC.
CONSOLIDATING STATEMENT OF CASH FLOWS
FIVE MONTHS ENDED DECEMBER 31, 2018
(Continued)
|
|||||||||||||||||||||||
|
Successor
|
||||||||||||||||||||||
|
Mr. Cooper
|
|
Issuer(1)
|
|
Guarantor
(Subsidiaries of Issuer) |
|
Non-Guarantor
(Subsidiaries of Issuer) |
|
Eliminations
|
|
Consolidated
|
||||||||||||
Investing Activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Acquisition, net of cash acquired
|
—
|
|
|
—
|
|
|
—
|
|
|
(33
|
)
|
|
—
|
|
|
(33
|
)
|
||||||
Property and equipment additions, net of disposals
|
—
|
|
|
(18
|
)
|
|
—
|
|
|
3
|
|
|
—
|
|
|
(15
|
)
|
||||||
Purchase of forward mortgage servicing rights, net of liabilities incurred
|
—
|
|
|
(313
|
)
|
|
—
|
|
|
6
|
|
|
—
|
|
|
(307
|
)
|
||||||
Proceeds on sale of forward and reverse mortgage servicing rights
|
—
|
|
|
105
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
105
|
|
||||||
Net cash attributable to investing activities
|
—
|
|
|
(226
|
)
|
|
—
|
|
|
(24
|
)
|
|
—
|
|
|
(250
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Financing Activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Decrease in warehouse facilities
|
—
|
|
|
(351
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(351
|
)
|
||||||
Increase in advance facilities
|
—
|
|
|
40
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
45
|
|
||||||
Proceeds from issuance of HECM securitizations
|
—
|
|
|
—
|
|
|
—
|
|
|
343
|
|
|
—
|
|
|
343
|
|
||||||
Repayment of HECM securitizations
|
—
|
|
|
—
|
|
|
—
|
|
|
(374
|
)
|
|
—
|
|
|
(374
|
)
|
||||||
Proceeds from issuance of participating interest financing
|
—
|
|
|
112
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
112
|
|
||||||
Repayment of participating interest financing
|
—
|
|
|
(943
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(943
|
)
|
||||||
Proceeds from issuance of excess spread financing
|
—
|
|
|
255
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
255
|
|
||||||
Repayment of excess spread financing
|
—
|
|
|
(38
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(38
|
)
|
||||||
Settlement of excess spread financing
|
—
|
|
|
(77
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(77
|
)
|
||||||
Repayment of nonrecourse debt - legacy assets
|
—
|
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
(6
|
)
|
||||||
Redemption and repayment of unsecured senior notes
|
—
|
|
|
(1,030
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,030
|
)
|
||||||
Proceeds from non-controlling interests
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
||||||
Debt financing costs
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
1
|
|
|
—
|
|
|
(2
|
)
|
||||||
Net cash attributable to financing activities
|
—
|
|
|
(2,032
|
)
|
|
—
|
|
|
(31
|
)
|
|
—
|
|
|
(2,063
|
)
|
||||||
Net decrease in cash and cash equivalents
|
(11
|
)
|
|
(979
|
)
|
|
—
|
|
|
(72
|
)
|
|
—
|
|
|
(1,062
|
)
|
||||||
Cash and cash equivalents - beginning of period
|
11
|
|
|
1,358
|
|
|
1
|
|
|
253
|
|
|
—
|
|
|
1,623
|
|
||||||
Cash and cash equivalents - end of period
|
$
|
—
|
|
|
$
|
379
|
|
|
$
|
1
|
|
|
$
|
181
|
|
|
$
|
—
|
|
|
$
|
561
|
|
(1)
|
Issuer activities exclude the activities of its guarantor and non-guarantor subsidiaries, as previously described.
|
MR. COOPER GROUP INC.
CONSOLIDATING STATEMENT OF CASH FLOWS
SEVEN MONTHS ENDED JULY 31, 2018
|
|||||||||||||||||||||||
|
Predecessor
|
||||||||||||||||||||||
|
Nationstar
|
|
Issuer(1)
|
|
Guarantor
(Subsidiaries of Issuer) |
|
Non-Guarantor
(Subsidiaries of Issuer) |
|
Eliminations
|
|
Consolidated
|
||||||||||||
Operating Activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income (loss)
|
$
|
154
|
|
|
$
|
181
|
|
|
$
|
12
|
|
|
$
|
44
|
|
|
$
|
(237
|
)
|
|
$
|
154
|
|
Adjustment to reconcile net income (loss) to net cash attributable to operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Deferred tax expense
|
—
|
|
|
63
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
63
|
|
||||||
(Gain) loss from subsidiaries
|
(181
|
)
|
|
(56
|
)
|
|
—
|
|
|
—
|
|
|
237
|
|
|
—
|
|
||||||
Net gain on mortgage loans held for sale
|
—
|
|
|
(295
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(295
|
)
|
||||||
Interest income on reverse mortgage loans
|
—
|
|
|
(274
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(274
|
)
|
||||||
Gain on sale of assets
|
—
|
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
|
—
|
|
|
(9
|
)
|
||||||
MSL related increased obligation
|
—
|
|
|
59
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
59
|
|
||||||
Provision for servicing reserves
|
—
|
|
|
70
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
70
|
|
||||||
Fair value changes and amortization/accretion of mortgage servicing rights/liabilities
|
—
|
|
|
(178
|
)
|
|
—
|
|
|
1
|
|
|
—
|
|
|
(177
|
)
|
||||||
Fair value changes in excess spread financing
|
—
|
|
|
81
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
81
|
|
||||||
Fair value changes in mortgage servicing rights financing liability
|
—
|
|
|
16
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16
|
|
||||||
Amortization of premiums, net of discount accretion
|
—
|
|
|
11
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
8
|
|
||||||
Depreciation and amortization for property and equipment and intangible assets
|
—
|
|
|
26
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
33
|
|
||||||
Share-based compensation
|
—
|
|
|
16
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
17
|
|
||||||
Other loss
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
||||||
Repurchases of forward loans assets out of Ginnie Mae securitizations
|
—
|
|
|
(544
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(544
|
)
|
||||||
Mortgage loans originated and purchased for sale, net of fees
|
—
|
|
|
(12,328
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(12,328
|
)
|
||||||
Sales proceeds and loan payment proceeds for mortgage loans held for sale and held for investment
|
—
|
|
|
13,381
|
|
|
—
|
|
|
11
|
|
|
—
|
|
|
13,392
|
|
||||||
Changes in assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Advances and other receivables
|
—
|
|
|
377
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
377
|
|
||||||
Reverse mortgage interests
|
—
|
|
|
1,866
|
|
|
—
|
|
|
(265
|
)
|
|
—
|
|
|
1,601
|
|
||||||
Other assets
|
9
|
|
|
(294
|
)
|
|
(12
|
)
|
|
256
|
|
|
—
|
|
|
(41
|
)
|
||||||
Payables and other liabilities
|
27
|
|
|
65
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
88
|
|
||||||
Net cash attributable to operating activities
|
9
|
|
|
2,246
|
|
|
—
|
|
|
39
|
|
|
—
|
|
|
2,294
|
|
(1)
|
Issuer activities exclude the activities of its guarantor and non-guarantor subsidiaries, as previously described.
|
MR COOPER GROUP INC.
CONSOLIDATING STATEMENT OF CASH FLOWS
SEVEN MONTHS ENDED JULY 31, 2018
(Continued)
|
|||||||||||||||||||||||
|
Predecessor
|
||||||||||||||||||||||
|
Nationstar
|
|
Issuer(1)
|
|
Guarantor
(Subsidiaries of Issuer) |
|
Non-Guarantor
(Subsidiaries of Issuer) |
|
Eliminations
|
|
Consolidated
|
||||||||||||
Investing Activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Property and equipment additions, net of disposals
|
—
|
|
|
(35
|
)
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
(40
|
)
|
||||||
Purchase of forward mortgage servicing rights, net of liabilities incurred
|
—
|
|
|
(127
|
)
|
|
—
|
|
|
(7
|
)
|
|
—
|
|
|
(134
|
)
|
||||||
Net payment related to acquisition of HECM related receivables
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
||||||
Proceeds on sale of assets
|
—
|
|
|
—
|
|
|
—
|
|
|
13
|
|
|
—
|
|
|
13
|
|
||||||
Net cash attributable to investing activities
|
—
|
|
|
(163
|
)
|
|
—
|
|
|
1
|
|
|
—
|
|
|
(162
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Financing Activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Decrease in warehouse facilities
|
—
|
|
|
(585
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(585
|
)
|
||||||
Decrease in advance facilities
|
—
|
|
|
(55
|
)
|
|
—
|
|
|
(250
|
)
|
|
—
|
|
|
(305
|
)
|
||||||
Proceeds from issuance of HECM securitizations
|
—
|
|
|
—
|
|
|
—
|
|
|
759
|
|
|
—
|
|
|
759
|
|
||||||
Repayment of HECM securitizations
|
—
|
|
|
—
|
|
|
—
|
|
|
(448
|
)
|
|
—
|
|
|
(448
|
)
|
||||||
Proceeds from issuance of participating interest financing in reverse mortgage interests
|
—
|
|
|
208
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
208
|
|
||||||
Repayment of participating interest financing in reverse mortgage interests
|
—
|
|
|
(1,599
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,599
|
)
|
||||||
Proceeds from issuance of excess spread financing
|
—
|
|
|
70
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
70
|
|
||||||
Repayment of excess spread financing
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
||||||
Settlement of excess spread financing
|
—
|
|
|
(105
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(105
|
)
|
||||||
Repayment of nonrecourse debt - legacy assets
|
—
|
|
|
—
|
|
|
—
|
|
|
(7
|
)
|
|
—
|
|
|
(7
|
)
|
||||||
Repurchase of unsecured senior notes
|
—
|
|
|
(62
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(62
|
)
|
||||||
Repurchase of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Surrender of shares relating to stock vesting
|
(9
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
||||||
Debt financing costs
|
—
|
|
|
(24
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(24
|
)
|
||||||
Dividends to non-controlling interests
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
||||||
Net cash attributable to financing activities
|
(9
|
)
|
|
(2,156
|
)
|
|
—
|
|
|
54
|
|
|
—
|
|
|
(2,111
|
)
|
||||||
Net (decrease) increase in cash and cash equivalents
|
—
|
|
|
(73
|
)
|
|
—
|
|
|
94
|
|
|
—
|
|
|
21
|
|
||||||
Cash and cash equivalents - beginning of period
|
—
|
|
|
423
|
|
|
1
|
|
|
151
|
|
|
—
|
|
|
575
|
|
||||||
Cash and cash equivalents - end of period
|
$
|
—
|
|
|
$
|
350
|
|
|
$
|
1
|
|
|
$
|
245
|
|
|
$
|
—
|
|
|
$
|
596
|
|
(1)
|
Issuer activities exclude the activities of its guarantor and non-guarantor subsidiaries, as previously described.
|
MR. COOPER GROUP INC.
CONSOLIDATING STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 2017
|
|||||||||||||||||||||||
|
Predecessor
|
||||||||||||||||||||||
|
Nationstar
|
|
Issuer(1)
|
|
Guarantor
(Subsidiaries of Issuer) |
|
Non-Guarantor (Subsidiaries of Issuer)
|
|
Eliminations
|
|
Consolidated
|
||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Service related, net
|
$
|
—
|
|
|
$
|
717
|
|
|
$
|
28
|
|
|
$
|
298
|
|
|
$
|
—
|
|
|
$
|
1,043
|
|
Net gain on mortgage loans held for sale
|
—
|
|
|
606
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
607
|
|
||||||
Total revenues
|
—
|
|
|
1,323
|
|
|
28
|
|
|
299
|
|
|
—
|
|
|
1,650
|
|
||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Salaries wages and benefits
|
—
|
|
|
605
|
|
|
5
|
|
|
132
|
|
|
—
|
|
|
742
|
|
||||||
General and administrative
|
—
|
|
|
590
|
|
|
11
|
|
|
132
|
|
|
—
|
|
|
733
|
|
||||||
Total expenses
|
—
|
|
|
1,195
|
|
|
16
|
|
|
264
|
|
|
—
|
|
|
1,475
|
|
||||||
Other income (expenses), net:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest income
|
—
|
|
|
544
|
|
|
—
|
|
|
53
|
|
|
—
|
|
|
597
|
|
||||||
Interest expense
|
—
|
|
|
(675
|
)
|
|
—
|
|
|
(56
|
)
|
|
—
|
|
|
(731
|
)
|
||||||
Other (expenses) income, net
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
9
|
|
|
—
|
|
|
3
|
|
||||||
Gain (loss) from subsidiaries
|
30
|
|
|
53
|
|
|
—
|
|
|
—
|
|
|
(83
|
)
|
|
—
|
|
||||||
Total other income (expenses), net
|
30
|
|
|
(84
|
)
|
|
—
|
|
|
6
|
|
|
(83
|
)
|
|
(131
|
)
|
||||||
Income (loss) before income tax expense
|
30
|
|
|
44
|
|
|
12
|
|
|
41
|
|
|
(83
|
)
|
|
44
|
|
||||||
Less: Income tax expense
|
—
|
|
|
13
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13
|
|
||||||
Net income (loss)
|
30
|
|
|
31
|
|
|
12
|
|
|
41
|
|
|
(83
|
)
|
|
31
|
|
||||||
Less: Net income attributable to non-controlling interests
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||||
Net income (loss) attributable to Nationstar
|
$
|
30
|
|
|
$
|
30
|
|
|
$
|
12
|
|
|
$
|
41
|
|
|
$
|
(83
|
)
|
|
$
|
30
|
|
(1)
|
Issuer activities exclude the activities of its guarantor and non-guarantor subsidiaries, as previously described.
|
MR. COOPER GROUP INC.
CONSOLIDATING STATEMENT OF CASH FLOWS
YEAR ENDED DECEMBER 31, 2017
|
|||||||||||||||||||||||
|
Predecessor
|
||||||||||||||||||||||
|
Nationstar
|
|
Issuer(1)
|
|
Guarantor
(Subsidiaries of Issuer) |
|
Non-
Guarantor (Subsidiaries of Issuer) |
|
Eliminations
|
|
Consolidated
|
||||||||||||
Operating Activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income (loss)
|
$
|
30
|
|
|
$
|
31
|
|
|
$
|
12
|
|
|
$
|
41
|
|
|
$
|
(83
|
)
|
|
$
|
31
|
|
Adjustments to reconcile net income (loss) to net cash attributable to operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Deferred tax benefit
|
—
|
|
|
(46
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(46
|
)
|
||||||
(Gain) loss from subsidiaries
|
(30
|
)
|
|
(53
|
)
|
|
—
|
|
|
—
|
|
|
83
|
|
|
—
|
|
||||||
Net gain on mortgage loans held for sale
|
—
|
|
|
(606
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(607
|
)
|
||||||
Interest income on reverse mortgage loans
|
—
|
|
|
(490
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(490
|
)
|
||||||
Loss (gain) on sale of assets
|
—
|
|
|
1
|
|
|
—
|
|
|
(9
|
)
|
|
—
|
|
|
(8
|
)
|
||||||
Provision for servicing reserves
|
—
|
|
|
148
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
148
|
|
||||||
Fair value changes and amortization/accretion of mortgage servicing rights/liabilities
|
—
|
|
|
430
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
430
|
|
||||||
Fair value changes in excess spread financing
|
—
|
|
|
15
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
12
|
|
||||||
Fair value changes in mortgage servicing rights financing liability
|
—
|
|
|
(17
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17
|
)
|
||||||
Amortization of premiums, net of discount accretion
|
—
|
|
|
73
|
|
|
—
|
|
|
9
|
|
|
—
|
|
|
82
|
|
||||||
Depreciation and amortization for property and equipment and intangible assets
|
—
|
|
|
45
|
|
|
—
|
|
|
14
|
|
|
—
|
|
|
59
|
|
||||||
Share-based compensation
|
—
|
|
|
12
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
17
|
|
||||||
Other loss
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
||||||
Repurchases of forward loans assets out of Ginnie Mae securitizations
|
—
|
|
|
(1,249
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,249
|
)
|
||||||
Mortgage loans originated and purchased for sale, net of fees
|
—
|
|
|
(19,159
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(19,159
|
)
|
||||||
Sales proceeds and loan payment proceeds for mortgage loans held for sale and held for investment
|
—
|
|
|
20,760
|
|
|
—
|
|
|
16
|
|
|
—
|
|
|
20,776
|
|
||||||
Changes in assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Advances and other receivables
|
—
|
|
|
(30
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(30
|
)
|
||||||
Reverse mortgage interests
|
—
|
|
|
1,829
|
|
|
—
|
|
|
(157
|
)
|
|
—
|
|
|
1,672
|
|
||||||
Other assets
|
4
|
|
|
(103
|
)
|
|
(12
|
)
|
|
36
|
|
|
—
|
|
|
(75
|
)
|
||||||
Payables and other liabilities
|
—
|
|
|
(180
|
)
|
|
(1
|
)
|
|
(12
|
)
|
|
—
|
|
|
(193
|
)
|
||||||
Net cash attributable to operating activities
|
4
|
|
|
1,417
|
|
|
(1
|
)
|
|
(61
|
)
|
|
—
|
|
|
1,359
|
|
(1)
|
Issuer activities exclude the activities of its guarantor and non-guarantor subsidiaries, as previously described.
|
(1)
|
Issuer activities exclude the activities of its guarantor and non-guarantor subsidiaries, as previously described.
|
|
Successor
|
||||||||||||||
|
Year Ended December 31, 2019
|
||||||||||||||
|
First Quarter
|
|
Second Quarter
|
|
Third Quarter
|
|
Fourth Quarter
|
||||||||
Service related revenue, net
|
$
|
84
|
|
|
$
|
137
|
|
|
$
|
258
|
|
|
$
|
430
|
|
Net gain on mortgage loans held for sale
|
166
|
|
|
262
|
|
|
360
|
|
|
310
|
|
||||
Total revenues
|
250
|
|
|
399
|
|
|
618
|
|
|
740
|
|
||||
Total expenses
|
443
|
|
|
492
|
|
|
478
|
|
|
438
|
|
||||
Total other income (expenses), net
|
(40
|
)
|
|
(24
|
)
|
|
(33
|
)
|
|
(62
|
)
|
||||
(Loss) income before income tax (benefit) expense
|
(233
|
)
|
|
(117
|
)
|
|
107
|
|
|
240
|
|
||||
Less: Income tax (benefit) expense
|
(47
|
)
|
|
(29
|
)
|
|
24
|
|
|
(221
|
)
|
||||
Net (loss) income
|
(186
|
)
|
|
(88
|
)
|
|
83
|
|
|
461
|
|
||||
Less: Net loss attributable to non-controlling interests
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|
(2
|
)
|
||||
Net (loss) income attributable to Mr. Cooper
|
$
|
(186
|
)
|
|
$
|
(87
|
)
|
|
$
|
84
|
|
|
$
|
463
|
|
Less: Undistributed earnings attributable to participating stockholders(1)
|
—
|
|
|
—
|
|
|
1
|
|
|
4
|
|
||||
Net (loss) income attributable to common stockholders
|
$
|
(186
|
)
|
|
$
|
(87
|
)
|
|
$
|
83
|
|
|
$
|
459
|
|
|
|
|
|
|
|
|
|
||||||||
Net (loss) income per common share attributable to Mr. Cooper common stockholders:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(2.05
|
)
|
|
$
|
(0.96
|
)
|
|
$
|
0.91
|
|
|
$
|
5.03
|
|
Diluted
|
$
|
(2.05
|
)
|
|
$
|
(0.96
|
)
|
|
$
|
0.90
|
|
|
$
|
4.95
|
|
|
Predecessor
|
|
|
Successor
|
||||||||||||||||
|
Quarter Ended March 31, 2018
|
|
Quarter Ended June 30, 2018
|
|
One Month Ended July 31, 2018
|
|
|
Two Months Ended September 30, 2018
|
|
Quarter Ended December 31, 2018
|
||||||||||
Service related revenue, net
|
$
|
464
|
|
|
$
|
317
|
|
|
$
|
120
|
|
|
|
$
|
259
|
|
|
$
|
159
|
|
Net gain on mortgage loans held for sale
|
124
|
|
|
127
|
|
|
44
|
|
|
|
83
|
|
|
93
|
|
|||||
Total revenues
|
588
|
|
|
444
|
|
|
164
|
|
|
|
342
|
|
|
252
|
|
|||||
Total expenses
|
364
|
|
|
339
|
|
|
242
|
|
|
|
275
|
|
|
432
|
|
|||||
Total other income (expenses), net
|
(18
|
)
|
|
(26
|
)
|
|
(5
|
)
|
|
|
(26
|
)
|
|
2
|
|
|||||
Income (loss) before income tax expense (benefit)
|
206
|
|
|
79
|
|
|
(83
|
)
|
|
|
41
|
|
|
(178
|
)
|
|||||
Less: Income tax expense (benefit)
|
46
|
|
|
21
|
|
|
(19
|
)
|
|
|
(979
|
)
|
|
(42
|
)
|
|||||
Net income (loss)
|
160
|
|
|
58
|
|
|
(64
|
)
|
|
|
1,020
|
|
|
(136
|
)
|
|||||
Less: Net income attributable to non-controlling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|||||
Net income (loss) attributable to Predecessor/Successor
|
160
|
|
|
58
|
|
|
(64
|
)
|
|
|
1,020
|
|
|
(136
|
)
|
|||||
Less: Undistributed earnings attributable to participating stockholders(1)
|
—
|
|
|
—
|
|
|
—
|
|
|
|
9
|
|
|
—
|
|
|||||
Net income (loss) attributable to common stockholders
|
$
|
160
|
|
|
$
|
58
|
|
|
$
|
(64
|
)
|
|
|
$
|
1,011
|
|
|
$
|
(136
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss) per common share attributable to Predecessor/Successor common stockholders:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
$
|
1.63
|
|
|
$
|
0.59
|
|
|
$
|
(0.65
|
)
|
|
|
$
|
11.13
|
|
|
$
|
(1.50
|
)
|
Diluted
|
$
|
1.61
|
|
|
$
|
0.59
|
|
|
$
|
(0.65
|
)
|
|
|
$
|
10.99
|
|
|
$
|
(1.50
|
)
|
(1)
|
Undistributed earnings allocated to participating securities and earnings per share are computed independently for each period. Accordingly, the sum of each quarterly amount may not agree to the year-to-date total.
|
1.
|
Financial Statements:
|
2.
|
Financial Statement Schedules:
|
3.
|
Exhibits:
|
|
|
Incorporated by Reference
|
Filed or Furnished Herewith
|
|||
Exhibit Number
|
Description
|
Form
|
File No.
|
Exhibit
|
Filing Date
|
|
|
|
|
|
|
|
|
2.1+
|
8-K
|
001-14667
|
2.1
|
02/14/2018
|
|
|
|
|
|
|
|
|
|
3.1
|
8-K
|
001-14667
|
3.1
|
10/10/2018
|
|
|
|
|
|
|
|
|
|
3.2
|
10-Q
|
001-14667
|
3.2
|
11/09/2018
|
|
|
|
|
|
|
|
|
|
4.1
|
10-Q
|
001-14667
|
4.1
|
11/01/2019
|
|
|
|
|
|
|
|
|
|
4.2
|
8-K
|
001-14667
|
4.6
|
01/31/2014
|
|
|
|
|
|
|
|
|
|
4.3
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
4.4
|
8-K
|
001-4667
|
4.2
|
01/31/2014
|
|
|
|
|
|
|
|
|
|
4.5
|
8-K
|
001-35449
|
4.1
|
02/07/2013
|
|
|
|
|
|
|
|
|
|
4.6
|
8-K
|
001-35449
|
4.2
|
03/26/2013
|
|
|
|
|
|
|
|
|
|
4.7
|
8-K
|
001-35449
|
4.1
|
06/22/2018
|
|
|
|
|
|
|
|
|
|
4.8
|
8-K
|
001-1667
|
4.1
|
08/01/2018
|
|
|
|
|
|
|
|
|
|
4.9
|
8-K
|
001-35449
|
4.1
|
05/31/2013
|
|
|
|
|
|
|
|
|
|
4.10
|
8-K
|
00135449
|
4.2
|
06/22/2018
|
|
|
|
|
|
|
|
|
|
|
|
Incorporated by Reference
|
Filed or Furnished Herewith
|
|||
Exhibit Number
|
Description
|
Form
|
File No.
|
Exhibit
|
Filing Date
|
|
|
|
|
|
|
|
|
4.11
|
8-K
|
001-14667
|
4.2
|
08/01/2018
|
|
|
|
|
|
|
|
|
|
4.12
|
8-K
|
001-14667
|
4.1
|
07/13/2018
|
|
|
|
|
|
|
|
|
|
4.13
|
8-K
|
001-14667
|
4.3
|
08/01/2018
|
|
|
|
|
|
|
|
|
|
4.14
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
4.15
|
8-K
|
001-35449
|
10.1
|
02/06/2013
|
|
|
|
|
|
|
|
|
|
4.16
|
10-Q
|
001-35449
|
4.4
|
05/09/2014
|
|
|
|
|
|
|
|
|
|
4.17
|
10-Q
|
001-35449
|
4.1
|
08/03/2015
|
|
|
|
|
|
|
|
|
|
4.18
|
10-Q
|
001-35449
|
4.2
|
08/03/2015
|
|
|
|
|
|
|
|
|
|
|
|
Incorporated by Reference
|
Filed or Furnished Herewith
|
|||
Exhibit Number
|
Description
|
Form
|
File No.
|
Exhibit
|
Filing Date
|
|
|
|
|
|
|
|
|
4.19
|
10-K
|
001-35449
|
4.17
|
03/01/2016
|
|
|
|
|
|
|
|
|
|
10.1
|
8-K
|
001-35449
|
10.5
|
02/06/2013
|
|
|
|
|
|
|
|
|
|
10.2
|
8-K
|
001-35449
|
10.6
|
02/06/2013
|
|
|
|
|
|
|
|
|
|
10.3
|
10-K
|
001-35449
|
10.18
|
03/15/2013
|
|
|
|
|
|
|
|
|
|
10.4
|
10-K
|
001-35449
|
10.19
|
03/15/2013
|
|
|
|
|
|
|
|
|
|
10.5
|
10-K
|
001-35449
|
10.20
|
03/15/2013
|
|
|
|
|
|
|
|
|
|
10.6
|
10-K
|
001-35449
|
10.21
|
03/15/2013
|
|
|
|
|
|
|
|
|
|
10.7
|
10-Q
|
001-35449
|
10.11
|
11/14/2013
|
|
|
|
|
|
|
|
|
|
10.8
|
10-Q
|
001-35449
|
10.12
|
11/14/2013
|
|
|
|
|
|
|
|
|
|
10.9
|
10-Q
|
001-35449
|
10.13
|
11/14/2013
|
|
|
|
|
|
|
|
|
|
|
|
Incorporated by Reference
|
Filed or Furnished Herewith
|
|||
Exhibit Number
|
Description
|
Form
|
File No.
|
Exhibit
|
Filing Date
|
|
|
|
|
|
|
|
|
10.10
|
10-Q
|
001-35449
|
10.3
|
11/07/2014
|
|
|
|
|
|
|
|
|
|
10.11
|
10-Q
|
001-35449
|
10.4
|
11/07/2014
|
|
|
|
|
|
|
|
|
|
10.12
|
10-K
|
001-35449
|
10.28
|
03/01/2016
|
|
|
|
|
|
|
|
|
|
10.13
|
10-K
|
001-35449
|
10.17
|
03/09/2017
|
|
|
|
|
|
|
|
|
|
10.14
|
10-K
|
001-35449
|
10.18
|
03/09/2017
|
|
|
|
|
|
|
|
|
|
10.15
|
10-K
|
001-35449
|
10.18
|
03/02/2018
|
|
|
|
|
|
|
|
|
|
10.16
|
10-Q
|
001-35449
|
10.1
|
05/10/2018
|
|
|
|
|
|
|
|
|
|
10.17
|
10-K
|
001-14667
|
10.17
|
03/11/2019
|
|
|
|
|
|
|
|
|
|
10.18
|
10-K
|
001-14667
|
10.18
|
03/11/2019
|
|
|
|
|
|
|
|
|
|
10.19
|
10-Q
|
001-14667
|
10.1
|
05/08/2019
|
|
|
|
|
|
|
|
|
|
|
|
Incorporated by Reference
|
Filed or Furnished Herewith
|
|||
Exhibit Number
|
Description
|
Form
|
File No.
|
Exhibit
|
Filing Date
|
|
|
|
|
|
|
|
|
10.20
|
10-Q
|
001-14667
|
10.2
|
05/08/2019
|
|
|
|
|
|
|
|
|
|
10.21
|
10-Q
|
001-14667
|
10.1
|
08/02/2019
|
|
|
|
|
|
|
|
|
|
10.22
|
10-Q
|
001-35449
|
10.1
|
05/05/2016
|
|
|
|
|
|
|
|
|
|
10.23
|
10-Q
|
001-35449
|
10.2
|
08/09/2016
|
|
|
|
|
|
|
|
|
|
10.24
|
10-K
|
001-35449
|
10.21
|
03/09/2017
|
|
|
|
|
|
|
|
|
|
10.25
|
10-K
|
001-35449
|
10.22
|
03/09/2017
|
|
|
|
|
|
|
|
|
|
10.26
|
10-K
|
001-35449
|
10.23
|
03/02/2018
|
|
|
|
|
|
|
|
|
|
10.27
|
10-Q
|
001-35449
|
10.2
|
05/10/2018
|
|
|
|
|
|
|
|
|
|
|
|
Incorporated by Reference
|
Filed or Furnished Herewith
|
|||
Exhibit Number
|
Description
|
Form
|
File No.
|
Exhibit
|
Filing Date
|
|
|
|
|
|
|
|
|
10.28
|
10-Q
|
001-35449
|
10.1
|
08/03/2018
|
|
|
|
|
|
|
|
|
|
10.29
|
10-K
|
001-14667
|
10.26
|
03/11/2019
|
|
|
|
|
|
|
|
|
|
10.30
|
10-K
|
001-14667
|
10.27
|
03/11/2019
|
|
|
|
|
|
|
|
|
|
10.31
|
10-Q
|
001-14667
|
10.3
|
05/08/2019
|
|
|
|
|
|
|
|
|
|
10.32
|
10-Q
|
001-14667
|
10.4
|
05/08/2019
|
|
|
|
|
|
|
|
|
|
10.33
|
10-Q
|
001-14667
|
10.2
|
08/02/2019
|
|
|
|
|
|
|
|
|
|
10.34
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
10.35**
|
10-K
|
001-35449
|
10.45
|
03/01/2016
|
|
|
|
|
|
|
|
|
|
10.36**
|
10-K
|
001-35449
|
10.46
|
03/01/2016
|
|
|
|
|
|
|
|
|
|
10.37**
|
8-K
|
001-14667
|
10.1
|
12/12/2018
|
|
|
|
|
|
|
|
|
|
10.38**
|
10-K
|
001-14667
|
10.17
|
03/15/2013
|
|
|
|
|
|
|
|
|
|
10.39**
|
8-K
|
001-14667
|
99.1
|
02/03/2014
|
|
|
|
|
|
|
|
|
|
|
|
Incorporated by Reference
|
Filed or Furnished Herewith
|
|||
Exhibit Number
|
Description
|
Form
|
File No.
|
Exhibit
|
Filing Date
|
|
|
|
|
|
|
|
|
10.40**
|
10-K
|
001-14667
|
10.15
|
02/27/2015
|
|
|
|
|
|
|
|
|
|
10.41**
|
10-K
|
001-14667
|
10.33
|
03/02/2018
|
|
|
|
|
|
|
|
|
|
10.42**
|
8-K
|
001-35449
|
10.1
|
05/12/2016
|
|
|
|
|
|
|
|
|
|
10.43**
|
8-K
|
001-14667
|
10.2
|
08/01/2018
|
|
|
|
|
|
|
|
|
|
10.44**
|
10-K
|
001-35449
|
10.54
|
03/01/2016
|
|
|
|
|
|
|
|
|
|
10.45**
|
10-Q
|
001-35449
|
10.5
|
05/07/2015
|
|
|
|
|
|
|
|
|
|
10.46**
|
S-8
|
333-231552
|
99.1
|
05/16/2019
|
|
|
|
|
|
|
|
|
|
10.47**
|
8-K
|
001-14667
|
10.2
|
05/17/2019
|
|
|
|
|
|
|
|
|
|
10.48**
|
8-K
|
001-14667
|
10.3
|
05/17/2019
|
|
|
|
|
|
|
|
|
|
10.49**
|
8-K
|
001-35449
|
10.1
|
04/02/2015
|
|
|
|
|
|
|
|
|
|
10.50**
|
8-K
|
001-14667
|
10.1
|
05/13/2015
|
|
|
|
|
|
|
|
|
|
21.1
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
23.1
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
31.1
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
31.2
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
32.1
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
32.2
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
|
|
Incorporated by Reference
|
Filed or Furnished Herewith
|
|||
Exhibit Number
|
Description
|
Form
|
File No.
|
Exhibit
|
Filing Date
|
|
|
|
|
|
|
|
|
101.INS
|
XBRL Instance Document
|
|
|
|
|
X
|
|
|
|
|
|
|
|
101.SCH
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
|
X
|
|
|
|
|
|
|
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
|
X
|
|
|
|
|
|
|
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
|
X
|
|
|
|
|
|
|
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
|
X
|
|
|
|
|
|
|
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
|
X
|
|
|
/s/ Jay Bray
|
February 28, 2020
|
Jay Bray, President, Chief Executive Officer and Director (Principal Executive Officer)
|
|
|
|
/s/ Christopher G. Marshall
|
February 28, 2020
|
Christopher G. Marshall, Vice Chairman and Chief Financial Officer (Principal Financial and Accounting Officer)
|
|
|
|
/s/ Elizabeth Burr
|
February 28, 2020
|
Elizabeth Burr, Director
|
|
|
|
/s/ Robert H. Gidel
|
February 28, 2020
|
Robert H. Gidel, Director
|
|
|
|
/s/ Roy A. Guthrie
|
February 28, 2020
|
Roy A. Guthrie, Director
|
|
|
|
/s/ Christopher J. Harrington
|
February 28, 2020
|
Christopher J. Harrington, Director
|
|
|
|
/s/ Michael D. Malone
|
February 28, 2020
|
Michael D. Malone, Director
|
|
|
|
/s/ Tagar C. Olson
|
February 28, 2020
|
Tagar C. Olson, Director
|
|
|
|
/s/ Steven D. Scheiwe
|
February 28, 2020
|
Steven D. Scheiwe, Director
|
|
|
|
Rules of Construction 1
|
Definitions 2
|
Compliance Certificates and Opinions 55
|
Form of Documents Delivered to Trustee 55
|
Acts of Holders 56
|
Notices, Etc., to Trustee, Issuer, any Guarantor and Agent 56
|
Notice to Holders; Waiver 57
|
Effect of Headings and Table of Contents 58
|
Successors and Assigns 58
|
Severability Clause 58
|
Benefits of Indenture 58
|
Governing Law; Submission to Jurisdiction 58
|
Legal Holidays 58
|
No Personal Liability of Directors, Managers, Officers, Employees and Stockholders 59
|
[Reserved] 59
|
Counterparts 59
|
USA PATRIOT Act 59
|
Waiver of Jury Trial 59
|
Force Majeure 59
|
FATCA 59
|
Form and Dating 60
|
Execution, Authentication, Delivery and Dating 60
|
Title and Terms 61
|
Note Registrar, Transfer Agent and Paying Agent 62
|
Denominations 63
|
Temporary Notes 63
|
SECTION 3.05.
|
Registration of Transfer and Exchange 63
|
Mutilated, Destroyed, Lost and Stolen Notes 64
|
Payment of Interest; Interest Rights Preserved 64
|
Persons Deemed Owners 66
|
Cancellation 66
|
SECTION 3.10.
|
Computation of Interest 66
|
Transfer and Exchange 66
|
CUSIP, ISIN and Common Code Numbers 66
|
Issuance of Additional Notes 67
|
Satisfaction and Discharge of Indenture 67
|
Application of Trust Money 68
|
Events of Default 69
|
Acceleration of Maturity: Rescission and Annulment 70
|
Collection of Indebtedness and Suits for Enforcement by Trustee 72
|
Trustee May File Proofs of Claim 72
|
Trustee May Enforce Claims Without Possession of Notes 73
|
Application of Money Collected 73
|
Limitation on Suits 73
|
Right of Holders to Bring Suit for Payment 74
|
Restoration of Rights and Remedies 74
|
Rights and Remedies Cumulative 74
|
Delay or Omission Not Waiver 74
|
Control by Holders 75
|
Waiver of Past Defaults 75
|
Waiver of Stay or Extension Laws 75
|
Undertaking for Costs 75
|
Duties of the Trustee 76
|
SECTION 6.02.
|
Notice of Defaults 77
|
Certain Rights of Trustee 77
|
Trustee Not Responsible for Recitals or Issuance of Notes 79
|
May Hold Notes 79
|
Money Held in Trust 79
|
Compensation and Reimbursement 79
|
Corporate Trustee Required; Eligibility 80
|
Resignation and Removal; Appointment of Successor 80
|
Acceptance of Appointment by Successor 81
|
Merger, Conversion, Consolidation or Succession to Business 81
|
Appointment of Authenticating Agent 82
|
Issuer to Furnish Trustee Names and Addresses 83
|
Reports by Trustee 83
|
Issuer May Consolidate, Etc., Only on Certain Terms 84
|
Guarantors May Consolidate, Etc., Only on Certain Terms 85
|
Successor Substituted 86
|
Division 86
|
Amendments or Supplements Without Consent of Holders 86
|
Amendments, Supplements or Waivers with Consent of Holders 87
|
Execution of Amendments, Supplements or Waivers 89
|
Effect of Amendments, Supplements or Waivers 89
|
[Reserved] 89
|
Reference in Notes to Supplemental Indentures 89
|
SECTION 9.07.
|
Notice of Supplemental Indentures 89
|
Payment of Principal, Premium, if any, and Interest 89
|
Maintenance of Office or Agency 90
|
Money for Notes Payments to Be Held in Trust 90
|
Organizational Existence 91
|
Payment of Taxes and Other Claims 91
|
[Reserved] 91
|
[Reserved] 91
|
SECTION 10.08.
|
Statement by Officer as to Default 91
|
Reports and Other Information 92
|
Limitation on Restricted Payments 94
|
Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock 104
|
Limitation on Liens 111
|
Limitation on Transactions with Affiliates 112
|
Limitation on Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries 115
|
Limitation on Guarantees of Indebtedness by Restricted Subsidiaries 117
|
Change of Control 118
|
Asset Sales 120
|
SECTION 10.18.
|
Suspension of Covenants 124
|
Right of Redemption 125
|
[Reserved.] 126
|
Applicability of Article 126
|
Election to Redeem; Notice to Trustee 126
|
Selection by Trustee of Notes to Be Redeemed 126
|
Notice of Redemption 127
|
Deposit of Redemption Price 128
|
Notes Payable on Redemption Date 128
|
Notes Redeemed in Part 129
|
Mandatory Redemption; Open Market Purchases 129
|
Tender Offer Optional Redemption 129
|
Guarantees 129
|
Severability 131
|
Restricted Subsidiaries 131
|
Limitation of Guarantors’ Liability 131
|
Contribution 131
|
Subrogation 131
|
Reinstatement 132
|
Release of a Guarantor 132
|
Benefits Acknowledged 132
|
Effectiveness of Guarantees 132
|
Issuer’s Option to Effect Legal Defeasance or Covenant Defeasance 133
|
Legal Defeasance and Discharge 133
|
Covenant Defeasance 133
|
Conditions to Legal Defeasance or Covenant Defeasance 134
|
Deposited Money and Government Securities To Be Held in Trust Other
|
Reinstatement 135
|
Date:
|
By:
|
|
as Authenticating Agent
|
|
|
|
|
Year
|
Percentage
|
|
2023
|
103.000
|
%
|
2024
|
101.500
|
%
|
2025 and thereafter
|
100.000
|
%
|
By:
|
/s Patrick Giordano
Name: Patrick Giordano Title: Vice President |
Term
|
Defined in Section:
|
“Agent Members”
|
2.1(b)
|
“Global Notes”
|
2.1(a)
|
“Permanent Regulation S Global Note”
|
2.1(a)
|
“Regulation S”
|
2.1(a)
|
“Regulation S Global Note”
|
2.1(a)
|
“Rule 144A”
|
2.1(a)
|
“Rule 144A Global Note”
|
2.1(a)
|
“Temporary Regulation S Global Note”
|
2.1(a)
|
By:
|
Name: Title: |
By:
|
Authorized Signatory |
Year
|
Percentage
|
2023
|
103.000%
|
2024
|
101.500%
|
2025 and thereafter
|
100.000%
|
(1)
|
pursuant to an effective registration statement under the Securities Act; or
|
(2)
|
inside the United States to a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act) that purchases for its own account or for the account of a qualified institutional buyer to whom notice is given that such transfer is being made in reliance on Rule 144A, in each case pursuant to and in compliance with Rule 144A under the Securities Act; or
|
(3)
|
outside the United States in an offshore transaction within the meaning of Regulation S under the Securities Act in compliance with Rule 904 under the Securities Act.
|
Dated:
|
|
|
Notice: To be executed by
an executive officer |
Date of Exchange
|
Amount of decrease in Principal amount of this Global Note
|
Amount of increase in Principal amount of this Global Note
|
Principal amount of this Global Note following such decrease or increase
|
Signature of authorized signatory of Trustee or Notes Custodian
|
Date:
|
______________ Your Signature:
(Sign exactly as your name appears on the other side of this Note) |
Name
|
Title:
|
Signature
|
__________________
|
__________________
|
__________________
|
__________________
|
__________________
|
__________________
|
__________________
|
__________________
|
__________________
|
By: /s/ Anthony Beshara
|
Name: Anthony Beshara Title: Director |
By: /s/ Pedro Alvarez
|
Name: Pedro Alvarez Title: SVP, Treasury |
(1)
|
Registration Statement (Form S-8 No. 333-231552) pertaining to the 2019 Omnibus Incentive Plan of Mr. Cooper Group Inc.,
|
(2)
|
Registration Statement (Form S-8 No. 333-226468) pertaining to the Second Amended and Restated 2012 Incentive Compensation Plan of Nationstar Mortgage Holdings Inc., and
|
(3)
|
Registration Statement (Form S-3 No. 333-205426) of Mr. Cooper Group Inc.
|
1.
|
I have reviewed this Annual Report on Form 10-K for the year ended December 31, 2019 of Mr. Cooper Group Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a - 15(e) and 15d - 15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a - 15(f) and 15(d) - 15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
|
|
Date:
|
February 28, 2020
|
|
|
|
/s/ Jay Bray
|
|
|
|
|
Jay Bray
|
|
|
|
|
Chief Executive Officer
|
1.
|
I have reviewed this Annual Report on Form 10-K for the year ended December 31, 2019 of Mr. Cooper Group Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a - 15(e) and 15d - 15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a - 15(f) and 15d - 15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
|
|
Date:
|
February 28, 2020
|
|
|
|
/s/ Christopher G. Marshall
|
|
|
|
|
Christopher G. Marshall
|
|
|
|
|
Vice Chairman & Chief Financial Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
Date:
|
February 28, 2020
|
|
|
/s/ Jay Bray
|
||
|
Jay Bray
|
||
|
Chief Executive Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
Date:
|
February 28, 2020
|
|
/s/ Christopher G. Marshall
|
|
|
Christopher G. Marshall
|
|
|
Vice Chairman & Chief Financial Officer
|