v3.26.1
Other Financing Lines of Credit
 3 Months Ended
Mar. 31, 2026
Debt Disclosure [Abstract]  
Other Financing Lines of Credit
8. Other Financing Lines of Credit
Other financing lines of credit consisted of the following (in thousands):
Outstanding borrowings at
Maturity DateInterest RateCollateral Pledged
Total Capacity(1)
March 31, 2026December 31, 2025
Reverse lines:
June 2026 - December 2026Secured Overnight Financing Rate (“SOFR”) + applicable marginFirst and Second Lien Mortgages$1,090,000 $415,557 $737,435 
Various(2)
Bond accrual rate/SOFR + applicable marginMortgage Related Assets390,788 372,303 335,443 
October 2027SOFR + applicable marginHECM Mortgage Servicing Rights (“MSR”)70,000 54,808 63,462 
October 2026SOFR + applicable marginUnsecuritized Tails40,000 26,100 20,269 
Total reverse lines of credit1,590,788 868,768 1,156,609 
Mortgage line:
Various(2)
Bond accrual rate + applicable marginMortgage Related Assets30,570 30,570 31,090 
Total other financing lines of credit$1,621,358 $899,338 $1,187,699 
(1)Capacity is dependent upon maintaining compliance with, or obtaining waivers of, the terms, conditions, and covenants of the respective agreements, including asset-eligibility requirements. Capacity amounts presented are as of March 31, 2026.
(2)These lines of credit are tied to the maturity date of the underlying mortgage related assets that have been pledged as collateral.
As of March 31, 2026 and December 31, 2025, the weighted average interest rate on outstanding financing lines of credit was 7.58% and 8.18%, respectively.
The Company’s financing arrangements and credit facilities contain various financial covenants, which primarily relate to required tangible net worth amounts, liquidity reserves, leverage ratios, and profitability. As of March 31, 2026, the Company was in compliance with the financial covenants.
The terms of the Company’s financing arrangements and credit facilities contain covenants, and the terms of the Company’s government sponsored entities (“GSE”)/seller servicer contracts contain requirements that may restrict FOA Equity and its subsidiaries from paying distributions to its members. These restrictions include restrictions on paying distributions whenever the payment of such distributions would cause FOA Equity or its subsidiaries to no longer be in compliance with any of its financial covenants or GSE requirements. Further, FOA Equity is generally prohibited under Delaware law from making a distribution to a member to the extent that, at the time of the distribution, after giving effect to the distribution, liabilities of FOA Equity (with certain exceptions) exceed the fair value of its assets. Subsidiaries of FOA Equity are generally subject to similar legal limitations on their ability to make distributions to FOA Equity.
The maximum allowable distributions available to the Company are based on the most restrictive financial covenant ratios and are presented in the following tables (in thousands, except for ratios):
Financial Covenants RequirementMarch 31, 2026Maximum Allowable Distribution
FAR
Adjusted tangible net worth$250,000 $562,351 $312,351 
Liquidity 41,620 71,416 29,796 
Leverage ratio
6:1
2.0:1
376,444 
FAH
Adjusted tangible net worth$200,000 $553,571 $353,571 
Liquidity40,000 74,838 34,838 
Leverage ratio
10:1
2.6:1
409,047 
Financial Covenants RequirementDecember 31, 2025Maximum Allowable Distribution
FAR
Adjusted tangible net worth$250,000 $569,044 $319,044 
Liquidity 42,412 64,688 22,276 
Leverage ratio
6:1
2.7:1
315,994 
FAH
Adjusted tangible net worth$200,000 $561,035 $361,035 
Liquidity 40,000 68,632 28,632 
Leverage ratio
10:1
3.1:1
388,240