v3.25.1
REVERSE MORTGAGE LOANS HELD FOR INVESTMENT AND HMBS-RELATED BORROWINGS
 3 Months Ended
Mar. 31, 2025
Fair Value Disclosures [Abstract]  
REVERSE MORTGAGE LOANS HELD FOR INVESTMENT AND HMBS-RELATED BORROWINGS
NOTE 7—REVERSE MORTGAGE LOANS HELD FOR INVESTMENT AND HMBS-RELATED BORROWINGS
A reconciliation of the changes in reverse mortgage loans held for investment and HMBS-related borrowings for the periods presented is below:
Three Months Ended
March 31, 2025
(in thousands)
Reverse Mortgage Loans Held for Investment
HMBS-Related Borrowings(1)
Balance — beginning of period$451,704 $(425,979)
Originations and purchases30,214 — 
Securitization of home equity conversion mortgages (“HECM”) loans and tails accounted for as a financing (including realized fair value changes)
— (37,651)
Repayments (principal payments received)(9,259)9,205 
Change in fair value recognized in earnings(2)
9,492 (6,577)
Balance — end of period$482,151 $(461,002)
March 31, 2025
Securitized loans (pledged to HMBS-related borrowings)$469,416 $(461,002)
Unsecuritized loans and tail advances12,735 — 
Total$482,151 $(461,002)
Three Months Ended
March 31, 2024
(in thousands)Reverse Mortgage Loans Held for Investment
HMBS-Related Borrowings(1)
Balance — beginning of period$315,912 $(302,183)
Originations and purchases30,543 — 
Securitization of HECM loans and tails accounted for as a financing (including realized fair value changes)
— (26,524)
Repayments (principal payments received)(9,192)9,486 
Change in fair value recognized in earnings(2)
10,813 (7,583)
Balance — end of period$348,076 $(326,804)
March 31, 2024
Securitized loans (pledged to HMBS-related borrowings)$333,518 $(326,804)
Unsecuritized loans and tail advances14,558 — 
Total$348,076 $(326,804)
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(1)HMBS-related borrowings represent the issuance of pools of HMBS, which are guaranteed by GNMA, to third-party security holders. The Company accounts for the transfers of these advances in the related HECM loans as secured borrowings, retaining the initial HECM loans in the Condensed Consolidated Balance Sheets as reverse mortgage loans held for investment and recording the pooled HMBS as HMBS-related borrowings.
(2)See further breakdown in the table below.
The following table presents gains (losses) on reverse mortgage loans held for investment and HMBS-related borrowings for the periods presented:
Three Months Ended
March 31,
(in thousands)20252024
Gain on new originations(1)
$1,807 $1,284 
Gain on tail securitizations(2)
501 322 
Net interest income24 23 
Change in fair value583 1,601 
Fair value gain recognized in earnings(3)
2,915 3,230 
Loan fees and other(4)
1,019 786 
Total
$3,934 $4,016 
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(1)Includes the changes in fair value of newly originated loans held for investment in the period from origination through securitization date.
(2)Includes the cash realized gains upon securitization of tails.
(3)See breakdown between loans held for investment and HMBS-related borrowings in the table above.
(4)Loan fees and other are included in loan origination fees and gain on sale of loans, net in the Condensed Consolidated Statements of Operations.
The following table presents the unobservable input assumptions used to determine the fair value of reverse mortgage loans held for investment and HMBS-related borrowings:
March 31,
2025		December 31,
2024
Unobservable InputRange (Weighted Average)
Life in years
0.1 - 9.2 (6.6)
0.1 - 9.2 (6.8)
Discount rate
12.0% - 12.0% (12.0%)
12.0% - 12.0% (12.0%)
Conditional prepayment rate including voluntary and involuntary prepayments
6.6% - 11.9% (7.9%)
6.5% - 10.9% (7.9%)