v3.26.1
Other Financing Lines of Credit
 6 Months Ended
Jun. 30, 2026
Debt Disclosure [Abstract]  
Other Financing Lines of Credit
9. 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)
June 30, 2026December 31, 2025
Reverse lines:
August 2026 - June 2027Secured Overnight Financing Rate (“SOFR”) + applicable marginFirst and Second Lien Mortgages$1,005,000 $507,940 $737,435 
Various(2)
Bond accrual rate/SOFR + applicable marginMortgage Related Assets460,610 434,110 335,443 
October 2027SOFR + applicable marginHECM MSR70,000 46,154 63,462 
October 2026SOFR + applicable marginUnsecuritized Tails90,000 36,646 20,269 
Total reverse lines of credit1,625,610 1,024,850 1,156,609 
Mortgage line:
Various(2)
Bond accrual rate + applicable marginMortgage Related Assets29,916 29,916 31,090 
Total other financing lines of credit$1,655,526 $1,054,766 $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 June 30, 2026.
(2)These lines of credit are generally tied to the maturity date of the underlying mortgage related assets that have been pledged as collateral.
As of June 30, 2026 and December 31, 2025, the weighted average interest rate on outstanding financing lines of credit was 7.48% 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 June 30, 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 RequirementJune 30, 2026Maximum Allowable Distribution
FAR
Adjusted tangible net worth$250,000 $528,597 $278,597 
Liquidity 54,159 63,595 9,436 
Leverage ratio
6:1
2.7:1
294,006 
FAH
Adjusted tangible net worth$200,000 $532,702 $332,702 
Liquidity40,000 70,515 30,515 
Leverage ratio
10:1
3.1:1
369,750 
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