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VARIABLE INTEREST ENTITIES (Tables) | 3 Months Ended
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Mar. 31, 2025
Organization, Consolidation and Presentation of Financial Statements [Abstract] |
Schedule of Variable Interest Entities | The table below presents the carrying value and classification of the assets and liabilities of consolidated VIEs on the consolidated balance sheets:
|  | Advance Purchaser |  | Newrez Joint Ventures |  | Residential Mortgage Loans |  | Consumer Loan Companies |  | Asset Management and Other |  | SPAC |  | Consolidated CFEs(A) |  | Total
March 31, 2025 |  |  |  |  |  |  |  | Loan Securitizations - Residential Transition Loans |  | Loan Securitizations - Residential Mortgage Loans |  | Consolidated Funds |
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Servicer advance investments, at fair value |  | $ | 321,531 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 321,531 |
Residential mortgage loans, HFS, at fair value |  | — |  |  | — |  |  | 474,987 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 474,987 |
Consumer loans |  | — |  |  | — |  |  | — |  |  | 201,468 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 201,468 |
Assets of consolidated CFEs - investments |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 938,532 |  |  | 2,703,112 |  |  | 1,175,136 |  |  | 4,816,780 |
Cash and cash equivalents |  | 7,984 |  |  | 19,690 |  |  | — |  |  | — |  |  | 697 |  |  | 1,034 |  |  | — |  |  | — |  |  | — |  |  | 29,405 |
Restricted cash |  | 6,146 |  |  | — |  |  | 6,080 |  |  | 5,995 |  |  | 12,673 |  |  | 230,810 |  |  | 8,639 |  |  | 14,984 |  |  | 61,417 |  |  | 346,744 |
Other assets |  | 4 |  |  | 447 |  |  | — |  |  | 6,798 |  |  | 166,462 |  |  | 341 |  |  | 42,997 |  |  | — |  |  | 27,984 |  |  | 245,033 |
Total Assets |  | $ | 335,665 |  |  | $ | 20,137 |  |  | $ | 481,067 |  |  | $ | 214,261 |  |  | $ | 179,832 |  |  | $ | 232,185 |  |  | $ | 990,168 |  |  | $ | 2,718,096 |  |  | $ | 1,264,537 |  |  | $ | 6,435,948 |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Secured financing agreements |  | $ | — |  |  | $ | — |  |  | $ | 385,916 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 385,916 |
Secured notes and bonds payable |  | 246,438 |  |  | — |  |  | — |  |  | 169,035 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 415,473 |
Notes payable of consolidated CFEs |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 859,760 |  |  | 2,295,166 |  |  | 955,470 |  |  | 4,110,396 |
Accrued expenses and other liabilities |  | 1,681 |  |  | 1,903 |  |  | — |  |  | 1,302 |  |  | 2,556 |  |  | 8,234 |  |  | 1,083 |  |  | 15,317 |  |  | 103,997 |  |  | 136,073 |
Total Liabilities |  | $ | 248,119 |  |  | $ | 1,903 |  |  | $ | 385,916 |  |  | $ | 170,337 |  |  | $ | 2,556 |  |  | $ | 8,234 |  |  | $ | 860,843 |  |  | $ | 2,310,483 |  |  | $ | 1,059,467 |  |  | $ | 5,047,858 |
December 31, 2024 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Servicer advance investments, at fair value |  | $ | 339,646 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 339,646 |
Residential mortgage loans, HFS, at fair value |  | — |  |  | — |  |  | 496,420 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 496,420 |
Consumer loans |  | — |  |  | — |  |  | — |  |  | 219,308 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 219,308 |
Assets of consolidated CFEs - investments |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 962,192 |  |  | 2,791,027 |  |  | 1,118,359 |  |  | 4,871,578 |
Cash and cash equivalents |  | 5,163 |  |  | 21,023 |  |  | — |  |  | — |  |  | 11,796 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 37,982 |
Restricted cash |  | 6,727 |  |  | — |  |  | 6,087 |  |  | 6,042 |  |  | — |  |  | — |  |  | 7,172 |  |  | 17,293 |  |  | 126,158 |  |  | 169,479 |
Other assets |  | 4 |  |  | 452 |  |  | — |  |  | 11,186 |  |  | 89,654 |  |  | — |  |  | 26,348 |  |  | — |  |  | 59,277 |  |  | 186,921 |
Total Assets |  | $ | 351,540 |  |  | $ | 21,475 |  |  | $ | 502,507 |  |  | $ | 236,536 |  |  | $ | 101,450 |  |  | $ | — |  |  | $ | 995,712 |  |  | $ | 2,808,320 |  |  | $ | 1,303,794 |  |  | $ | 6,321,334 |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Secured financing agreements |  | $ | — |  |  | $ | — |  |  | $ | 384,948 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 384,948 |
Secured notes and bonds payable |  | 258,183 |  |  | — |  |  | — |  |  | 185,460 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 443,643 |
Notes payable of consolidated CFEs |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 859,023 |  |  | 2,369,934 |  |  | 959,958 |  |  | 4,188,915 |
Accrued expenses and other liabilities |  | 1,975 |  |  | 1,854 |  |  | — |  |  | 226 |  |  | 1,589 |  |  | — |  |  | 1,099 |  |  | 17,626 |  |  | 140,604 |  |  | 164,973 |
Total Liabilities |  | $ | 260,158 |  |  | $ | 1,854 |  |  | $ | 384,948 |  |  | $ | 185,686 |  |  | $ | 1,589 |  |  | $ | — |  |  | $ | 860,122 |  |  | $ | 2,387,560 |  |  | $ | 1,100,562 |  |  | $ | 5,182,479 |
(A)Reflect assets of consolidated CFEs - investments, at fair value and other assets and liabilities of consolidated CFEs - notes payable, at fair value and other liabilities on the consolidated balance sheets. The Company transfers residential mortgage loans to securitization trusts, classified as VIEs and retains the right to service the transferred loans. The Company also retains interest in such VIEs pursuant to required risk retention regulations. The Company does not consolidate such VIEs, as it is not considered the primary beneficiary. The following table summarizes the carrying value of notes issued by unconsolidated VIEs and retained by the Company, which reflects the Company’s maximum exposure to loss, as well as the UPB of transferred loans. The retained notes are presented as non-Agency securities, at fair value within other assets on the consolidated balance sheets:
|  | March 31, 2025 |  | December 31, 2024
Residential mortgage loan UPB and other collateral |  | $ | 8,562,559 |  | $ | 8,152,970
Weighted average delinquency(A) |  | 4.7% |  | 5.2%
Net credit losses |  | $ | 162,406 |  | $ | 161,646
Face amount of debt held by third parties |  | $ | 7,923,955 |  | $ | 7,532,832
Carrying value of notes retained by Rithm Capital(B)(C) |  | $ | 555,393 |  | $ | 532,845
Cash flows received by Rithm Capital on these notes |  | $ | 23,416 |  | $ | 94,589
(A)Represents the percentage of the UPB that is 60+ days delinquent. (B)Includes real estate bonds retained pursuant to required risk retention regulations. (C)Classified within Level 3 of the fair value hierarchy as the valuation is based on certain unobservable inputs including discount rate, prepayment rates and loss severity. See Note 19 for details on unobservable inputs. The following table summarizes the Company’s involvement, through Sculptor, with VIEs that are not consolidated and is generally limited to providing asset management services and, in certain cases, investments in the VIEs. The maximum exposure to loss represents the potential loss of current investments or income and fees receivables from these entities, as well as the obligation to repay unearned revenues, primarily incentive income subject to clawback, in the event of any future fund losses, as well as unfunded commitments to certain funds that are VIEs. The Company does not provide, nor is it required to provide, any type of non-contractual financial or other support to its VIEs that are not consolidated beyond its share of capital and other commitments described in Note 25.
|  | March 31, 2025 |  | December 31, 2024
Maximum Risk of Loss as a Result of the Company’s Involvement with Unconsolidated VIEs: |  |  |  |
Unearned income and fees |  | $ | 14,882 |  | $ | 17,268
Income and fees receivable |  | 28,234 |  | 35,723
Investments |  | 691,818 |  | 577,849
Unfunded commitments(A) |  | 173,520 |  | 174,530
Other commitments |  | 25,521 |  | 25,521
Maximum Exposure to Loss |  | $ | 933,975 |  | $ | 830,891
(A)Includes commitments from certain current and former employees and executive managing directors in the amounts of $110.7 million and $133.9 million as of March 31, 2025 and December 31, 2024, respectively. The following table summarizes the carrying value of the Company’s unconsolidated commercial real estate projects which reflects the Company’s maximum exposure to loss. See Note 25 regarding certain guarantees provided in connection with the investments. These investments are presented as part of equity investments within other assets on the consolidated balance sheets:
|  | March 31, 2025 |  | December 31, 2024
Carrying value of commercial real estate held within unconsolidated VIEs |  | $ | 195,658 |  |  | $ | 190,258 |
Carrying value of Rithm Capital’s investments in unconsolidated commercial real estate VIEs |  | 60,342 |  |  | 57,846 |
This equity investment is presented within other assets on the consolidated balance sheets:
|  | March 31, 2025 |  | December 31, 2024
Membership interest in unconsolidated VIEs |  | $ | 194,378 |  |  | $ | 194,410 |
Schedule of Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net | Others’ interests in the equity of consolidated subsidiaries is computed as follows:
| March 31, 2025 |  | December 31, 2024
| Total Consolidated Equity |  | Others' Ownership Interest |  | Noncontrolling Interest in Equity of Consolidated Subsidiaries |  | Total Consolidated Equity |  | Others' Ownership Interest |  | Noncontrolling Interest in Equity of Consolidated Subsidiaries
Advance Purchaser | $ | 87,547 |  |  | 10.7 | % |  | $ | 9,361 |  |  | $ | 91,384 |  |  | 10.7 | % |  | $ | 9,770 |
Newrez Joint Ventures | 18,234 |  |  | 49.5 | % |  | 9,100 |  |  | 19,621 |  |  | 49.5 | % |  | 9,687 |
Excess MSRs | 131,347 |  |  | 20.0 | % |  | 26,269 |  |  | 136,645 |  |  | 20.0 | % |  | 27,329 |
Other investments | 89,810 |  |  | 25.7 | % |  | 23,058 |  |  | 50,778 |  |  | 10.0 | % |  | 4,608 |
Asset management | 917,145 |  |  | n/m |  | 40,928 |  |  | 844,669 |  |  | n/m(B) |  | 39,942 |
Others’ interests in the net income (loss) of consolidated subsidiaries is computed as follows:
| Three Months Ended March 31, |  |  |  |  |  |
| 2025 |  | 2024 |  |  |  |  |  |
| Net Income (Loss) |  | Others’ Ownership Interest as a Percent of Total |  | Noncontrolling Interest in Income (Loss) of Consolidated Subsidiaries |  | Net Income (Loss) |  | Others’ Ownership Interest as a Percent of Total |  | Noncontrolling Interest in Income (Loss) of Consolidated Subsidiaries |  |  |  |  |  |
Advance Purchaser | $ | (336) |  |  | 10.7 | % |  | $ | (36) |  |  | $ | 9,530 |  |  | 10.7 | % |  | $ | 1,018 |  |  |  |  |  |  |
Newrez Joint Ventures | 715 |  |  | 49.5 | % |  | 354 |  |  | 112 |  |  | 49.5 | % |  | 55 |  |  |  |  |  |  |
Consumer Loan Companies(A) | (1,550) |  |  | — | % |  | — |  |  | 2,192 |  |  | 46.5 | % |  | 1,019 |  |  |  |  |  |  |
Excess MSRs | 1,323 |  |  | 20.0 | % |  | 264 |  |  | — |  |  | N/A |  | — |  |  |  |  |  |  |
Other investments | 1,730 |  |  | 25.7 | % |  | 500 |  |  | — |  |  | N/A |  | — |  |  |  |  |  |  |
Asset management | (62,117) |  |  | n/m(B) |  | 4 |  |  | — |  |  | N/A |  | — |  |  |  |  |  |  |
(A)On June 28, 2024, Rithm Capital purchased the remaining 46.5% interest in the Consumer Loan Companies from the co-investor for a total purchase price of $22.0 million. Following the acquisition, Rithm Capital owns 100% interest in the Consumer Loan Companies. (B)Percentage in the table above deemed “n/m” are not meaningful. Noncontrolling interests related to asset management investments represents the ownership interests in certain funds held by entities or persons other than the Company. These interests substantially relate to interests held by employees in real estate and energy funds managed by the Company adjusted for their capital activity and allocated earnings in such funds. Such employees’ portion of carried interest is expensed and recorded within compensation and benefits on the consolidated statements of operations and therefore excluded in the calculation of noncontrolling interests.
Schedule of Redeemable Noncontrolling Interest | The following table presents the activity in redeemable noncontrolling interests:
| SPAC |  | Consolidated Entity |  | Total
Balance at December 31, 2024 | $ | — |  |  | $ | — |  |  | $ | — |
Initial carrying value | 214,389 |  |  | 25,601 |  |  | 239,990 |
Change in redemption value | 15,611 |  |  | — |  |  | 15,611 |
Comprehensive income (loss) | 810 |  |  | 3 |  |  | 813 |
Balance at March 31, 2025 | $ | 230,810 |  |  | $ | 25,604 |  |  | $ | 256,414 |

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- Definition Tabular disclosure of the significant judgments and assumptions made in determining whether a variable interest (as defined) held by the entity requires the variable interest entity (VIE) (as defined) to be consolidated and (or) disclose information about its involvement with the VIE, individually or in aggregate (as applicable); the nature of restrictions, if any, on the consolidated VIE's assets and on the settlement of its liabilities reported by an entity in its statement of financial position, including the carrying amounts of such assets and liabilities; the nature of, and changes in, the risks associated with involvement in the VIE; how involvement with the VIE affects the entity's financial position, financial performance, and cash flows; the lack of recourse if creditors (or beneficial interest holders) of the consolidated VIE have no recourse to the general credit of the primary beneficiary (if applicable); the terms of arrangements, giving consideration to both explicit arrangements and implicit variable interests, if any, that could require the entity to provide financial support to the VIE, including events or circumstances that could expose the entity to a loss; the methodology used by the entity for determining whether or not it is the primary beneficiary of the variable interest entity; the significant factors considered and judgments made in determining that the power to direct the activities of a VIE that most significantly impact the VIE's economic performance are shared (as defined); the carrying amounts and classification of assets and liabilities of the VIE included in the statement of financial position; the entity's maximum exposure to loss, if any, as a result of its involvement with the VIE, including how the maximum exposure is determined and significant sources of the entity's exposure to the VIE; a comparison of the carrying amounts of the assets and liabilities and the entity's maximum exposure to loss; information about any liquidity arrangements, guarantees, and (or) other commitments by third parties that may affect the fair value or risk of the entity's variable interest in the VIE; whether or not the entity has provided financial support or other support (explicitly or implicitly) to the VIE that it was not previously contractually required to provide or whether the entity intends to provide that support, including the type and amount of the support and the primary reasons for providing the support; and supplemental information the entity determines necessary to provide. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Name Accounting Standards Codification -Topic 810 -SubTopic 10 -Section 50 -Paragraph 3 -Publisher FASB -URI https://asc.fasb.org/1943274/2147481203/810-10-50-3 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Name Accounting Standards Codification -Topic 810 -SubTopic 10 -Section 50 -Paragraph 5A -Publisher FASB -URI https://asc.fasb.org/1943274/2147481203/810-10-50-5A Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Name Accounting Standards Codification -Topic 810 -SubTopic 10 -Section 50 -Paragraph 9 -Publisher FASB -URI https://asc.fasb.org/1943274/2147481203/810-10-50-9 Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Name Accounting Standards Codification -Topic 810 -SubTopic 10 -Section 50 -Paragraph 4 -Publisher FASB -URI https://asc.fasb.org/1943274/2147481203/810-10-50-4 Reference 5: http://fasb.org/us-gaap/role/ref/legacyRef -Name Accounting Standards Codification -Topic 810 -SubTopic 10 -Section 50 -Paragraph 6 -Publisher FASB -URI https://asc.fasb.org/1943274/2147481203/810-10-50-6 + Details
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