XML 29 R10.htm IDEA: XBRL DOCUMENT
v3.20.2

Advances and Other Receivables, Net | 6 Months Ended
--- | ---
Jun. 30, 2020
Receivables [Abstract] |
Advances and other receivables, net | 4. Advances and Other Receivables, Net Advances and other receivables, net, consists of the following:
Advances and Other Receivables, Net | June 30, 2020 |  | December 31, 2019
Servicing advances, net of $117 and $131 purchase discount, respectively | $ | 695 |  |  | $ | 970 |
Receivables from agencies, investors and prior servicers, net of $21 and $21 purchase discount, respectively | 189 |  |  | 193 |
Reserves | (216) |  |  | (175) |
Total advances and other receivables, net | $ | 668 |  |  | $ | 988 |
The Company, as loan servicer, is contractually responsible to advance funds on behalf of the borrower and investor primarily for loan principal and interest, property taxes and hazard insurance and foreclosure costs. Advances are primarily recovered through reimbursement from the investor, proceeds from sale of loan collateral, mortgage insurance claims or the borrower. Reserves for advances and other receivables on loans liquidated or purchased out of the MSR portfolio are established within advances and other receivables. The following table sets forth the activities of the servicing reserves for advances and other receivables:
| Three Months Ended June 30, |  |  |  |  | Six Months Ended June 30, |  |
Reserves for Advances and Other Receivables | 2020 |  |  | 2019 |  | 2020 |  | 2019
Balance - beginning of period | $ | 193 |  |  |  | $ | 71 |  |  | $ | 168 |  |  | $ | 47 |
Provision and other additions(1) | 29 |  |  |  | 37 |  |  | 59 |  |  | 67 |
Write-offs | (6) |  |  |  | (10) |  |  | (11) |  |  | (16) |
Balance - end of period | $ | 216 |  |  |  | $ | 98 |  |  | $ | 216 |  |  | $ | 98 |
(1)The Company recorded a provision of $3 and $17 through the MTM adjustments in revenues - service related, net, in the consolidated statements of operations for the three months ended June 30, 2020 and 2019, respectively, and $13 and $28 for the six months ended June 30, 2020 and 2019, respectively, for inactive and liquidated l oans 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. Purchase Discount for Advances and Other Receivables In connection with the acquisition of Pacific Union in February 2019, the Company recorded the acquired advances and other receivables at estimated fair value as of the acquisition date, which resulted in a purchase discount of $19. Refer to Note 2, Acquisitions, for discussion of the Pacific Union acquisition. In 2018, the Company recorded the acquired advances and other receivables in connection with the Merger at estimated fair value as of the acquisition date, which resulted in a purchase discount of $302. As of June 30, 2020, a total of $183 purchase discount has been utilized, with $138 purchase discount remaining. The following tables set forth the activities of the purchase discounts for advances and other receivables:
| Three Months Ended June 30, 2020 |  |  |  | Three Months Ended June 30, 2019 |  |
Purchase Discount for Advances and Other Receivables | Servicing Advances |  | Receivables from Agencies, Investors and Prior Servicers |  | Servicing Advances |  | Receivables from Agencies, Investors and Prior Servicers
Balance - beginning of period | $ | 125 |  |  | $ | 21 |  |  | $ | 169 |  |  | $ | 48 |
Utilization of purchase discounts | (8) |  |  | — |  |  | (13) |  |  | — |
Balance - end of period | $ | 117 |  |  | $ | 21 |  |  | $ | 156 |  |  | $ | 48 |
| Six Months Ended June 30, 2020 |  |  |  | Six Months Ended June 30, 2019 |  |
Purchase Discount for Advances and Other Receivables | Servicing Advances |  | Receivables from Agencies, Investors and Prior Servicers |  | Servicing Advances |  | Receivables from Agencies, Investors and Prior Servicers
Balance - beginning of period | $ | 131 |  |  | $ | 21 |  |  | $ | 205 |  |  | $ | 48 |
Addition from acquisition | — |  |  | — |  |  | 19 |  |  | — |
Utilization of purchase discounts | (14) |  |  | — |  |  | (68) |  |  | — |
Balance - end of period | $ | 117 |  |  | $ | 21 |  |  | $ | 156 |  |  | $ | 48 |
Credit Loss for Advances and Other Receivables As described in Note 1, Nature of Business and Basis of Presentation, advances and other receivables are within the scope of ASU 2016-13, and the Company modified its accounting policy regarding its assessment of reserves for credit-related losses in accordance with CECL framework. During the three and six months ended June 30, 2020, the Company increased the CECL reserve by $8 and $14, respectively. As of June 30, 2020, the total CECL reserve was $31, of which $14 and $17 was recorded in reserves and purchase discount for advances and other receivables, respectively. Based upon the Company’s application of ASU 2016-13, the Company determined that the credit-related risk associated with applicable financial instruments typically increase with the passage of time. The CECL reserve methodology considers these financial instruments collectible to a point in time o f 39 months. An y projected remaining balance at the end of the collection period is considered a loss and factors into the overall CECL loss rate required.

X
- Definition The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -SubTopic 10 -URI http://asc.fasb.org/subtopic&trid=2196772 + Details
Name: | us-gaap_LoansNotesTradeAndOtherReceivablesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_ReceivablesAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration