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CREDIT FACILITIES AND LONG-TERM DEBT | 6 Months Ended
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Jun. 30, 2023
Debt Disclosure [Abstract] |
CREDIT FACILITIES AND LONG-TERM DEBT | CREDIT FACILITIES AND LONG-TERM DEBT The following tables summarize certain details related to the Company's credit facilities and long-term debt as of June 30, 2023 and December 31, 2022 (in millions, except interest rates):
|  |  |  | Outstanding Amount |  |  |  |  |  |
June 30, 2023 |  | Borrowing Capacity |  | Current |  | Non-Current |  | Weighted Average Interest Rate |  | End of Revolving / Withdrawal Period |  | Final Maturity Date
Non-Recourse Asset-backed Debt: |  |  |  |  |  |  |  |  |  |  |  |
Asset-backed Senior Revolving Credit Facilities |  |  |  |  |  |  |  |  |  |  |  |
Revolving Facility 2018-2 |  | $ | 1,000 |  |  | $ | 15 |  |  | $ | — |  |  | 7.48 | % |  | June 30, 2025 |  | June 30, 2025
Revolving Facility 2018-3 |  | 1,000 |  |  | — |  |  | — |  |  | 6.82 | % |  | October 20, 2025 |  | October 20, 2025
Revolving Facility 2019-1 |  | 600 |  |  | — |  |  | — |  |  | 7.34 | % |  | July 31, 2023 |  | July 31, 2023
Revolving Facility 2019-2 |  | 1,850 |  |  | — |  |  | — |  |  | 6.83 | % |  | July 8, 2023 |  | July 8, 2023
Revolving Facility 2019-3 |  | 925 |  |  | — |  |  | — |  |  | — | % |  | April 5, 2024 |  | April 4, 2025
Asset-backed Senior Term Debt Facilities |  |  |  |  |  |  |  |  |  |  |  |
Term Debt Facility 2021-S1 |  | 100 |  |  | — |  |  | 100 |  |  | 3.48 | % |  | January 2, 2025 |  | April 1, 2025
Term Debt Facility 2021-S2 |  | 600 |  |  | — |  |  | 500 |  |  | 3.20 | % |  | September 10, 2024 |  | September 10, 2025
Term Debt Facility 2021-S3 |  | 1,000 |  |  | — |  |  | 750 |  |  | 3.75 | % |  | January 31, 2027 |  | July 31, 2027
Term Debt Facility 2022-S1 |  | 250 |  |  | — |  |  | 250 |  |  | 4.07 | % |  | March 1, 2025 |  | September 1, 2025
Total |  | $ | 7,325 |  |  | $ | 15 |  |  | $ | 1,600 |  |  |  |  |  |  |
Issuance Costs |  |  |  | — |  |  | (15) |  |  |  |  |  |  |
Carrying Value |  |  |  | $ | 15 |  |  | $ | 1,585 |  |  |  |  |  |  |
Asset-backed Mezzanine Term Debt Facilities |  |  |  |  |  |  |  |  |  |  |  |
Term Debt Facility 2020-M1 |  | 2,300 |  |  | — |  |  | 800 |  |  | 10.00 | % |  | April 1, 2025 |  | April 1, 2026
Term Debt Facility 2022-M1 |  | 500 |  |  | — |  |  | 150 |  |  | 10.00 | % |  | September 15, 2025 |  | September 15, 2026
Total |  | $ | 2,800 |  |  | $ | — |  |  | $ | 950 |  |  |  |  |  |  |
Issuance Costs |  |  |  |  |  | (8) |  |  |  |  |  |  |
Carrying Value |  |  |  |  |  | $ | 942 |  |  |  |  |  |  |
Total Non-Recourse Asset-backed Debt |  | $ | 10,125 |  |  | $ | 15 |  |  | $ | 2,527 |  |  |  |  |  |  |
|  | Outstanding Amount |  |
December 31, 2022 |  | Current |  | Non-Current |  | Weighted Average Interest Rate
Non-Recourse Asset-backed Debt: |  |  |  |  |  |
Asset-backed Senior Revolving Credit Facilities |  |  |  |  |  |
Revolving Facility 2018-2 |  | $ | 472 |  |  | $ | — |  |  | 4.86 | %
Revolving Facility 2018-3 |  | 194 |  |  | — |  |  | 3.98 | %
Revolving Facility 2019-1 |  | 55 |  |  | — |  |  | 4.41 | %
Revolving Facility 2019-2 |  | 167 |  |  | — |  |  | 3.92 | %
Revolving Facility 2019-3 |  | — |  |  | — |  |  | 3.86 | %
Revolving Facility 2022-1 |  | 289 |  |  | — |  |  | 8.15 | %
Asset-backed Senior Term Debt Facilities |  |  |  |  |  |
Term Debt Facility 2021-S1 |  | — |  |  | 400 |  |  | 3.48 | %
Term Debt Facility 2021-S2 |  | — |  |  | 500 |  |  | 3.20 | %
Term Debt Facility 2021-S3 |  | — |  |  | 750 |  |  | 3.75 | %
Term Debt Facility 2022-S1 |  | — |  |  | 250 |  |  | 4.07 | %
Term Debt Facility 2022-S2 |  | 200 |  |  | — |  |  | 8.48 | %
Total |  | $ | 1,377 |  |  | $ | 1,900 |  |  |
Issuance Costs |  | (1) |  |  | (17) |  |  |
Carrying Value |  | $ | 1,376 |  |  | $ | 1,883 |  |  |
Asset-backed Mezzanine Term Debt Facilities |  |  |  |  |  |
Term Debt Facility 2020-M1 |  | $ | — |  |  | $ | 1,000 |  |  | 10.00 | %
Term Debt Facility 2022-M1 |  | $ | — |  |  | $ | 150 |  |  | 10.00 | %
Total |  | $ | — |  |  | $ | 1,150 |  |  |
Issuance Costs |  |  |  | (13) |  |  |
Carrying Value |  |  |  | $ | 1,137 |  |  |
Total Non-Recourse Asset-backed Debt |  | $ | 1,376 |  |  | $ | 3,020 |  |  |
Non-Recourse Asset-backed Debt The Company utilizes inventory financing facilities consisting of asset-backed senior debt facilities and asset-backed mezzanine term debt facilities to provide financing for the Company’s real estate inventory purchases and renovation. These inventory financing facilities are typically secured by some combination of restricted cash, equity in real estate owning subsidiaries and related holding companies, and, for senior facilities, the real estate inventory financed by the relevant facility and/or beneficial interests in such inventory. Each of the borrowers under the inventory financing facilities is a consolidated subsidiary of Opendoor and a separate legal entity. Neither the assets nor credit of any such borrower subsidiaries are generally available to satisfy the debts and other obligations of any other Opendoor entities. The inventory financing facilities are non-recourse to the Company and are non-recourse to Opendoor subsidiaries not party to the relevant facilities, except for limited guarantees provided by an Opendoor subsidiary for certain obligations in situations involving “bad acts” by an Opendoor entity and certain other limited circumstances. As of June 30, 2023, the Company had total borrowing capacity with respect to its non-recourse asset-backed debt of $10.1 billion. Borrowing capacity amounts under non-recourse asset-backed debt as reflected in the table above are in some cases not fully committed and any borrowings above the committed amounts are subject to the applicable lender’s discretion. Any amounts repaid for senior term and mezzanine term debt facilities reduce total borrowing capacity as repaid amounts are not available to be reborrowed. As of June 30, 2023, the Company had committed borrowing capacity with respect to the Company’s non-recourse asset-backed debt of $4.3 billion; this committed borrowing capacity is comprised of $1.7 billion for senior revolving credit facilities, $1.6 billion for senior term debt facilities, and $950 million for mezzanine term debt facilities. Asset-backed Senior Revolving Credit Facilities The Company classifies the senior revolving credit facilities as current liabilities on the Company’s condensed consolidated balance sheets as amounts drawn to acquire and renovate homes are required to be repaid as the related real estate inventory is sold, which the Company expects to occur within 12 months. The senior revolving credit facilities are typically structured with an initial revolving period of up to 24 months during which time amounts can be borrowed, repaid and borrowed again. The borrowing capacity is generally available until the end of the applicable revolving period as reflected in the table above. Outstanding amounts drawn under each senior revolving credit facility are required to be repaid on the facility maturity date or earlier if accelerated due to an event of default or other mandatory repayment event. The final maturity dates and revolving period end dates reflected in the table above are inclusive of any extensions that are at the sole discretion of the Company. These facilities may also have extensions subject to lender discretion that are not reflected in the table above. The Company has entered into short-term extensions under Revolving Facilities 2019-1 and 2019-2 with the intention of entering into longer duration renewals with respect to each facility. Borrowings under the senior revolving credit facilities accrue interest at various floating rates based on a London Interbank Offered Rate ("LIBOR") or a secured overnight financing rate ("SOFR"), plus a margin that varies by facility. Effective November 2022, all such floating rates are based on SOFR. The Company may also pay fees on certain unused portions of committed borrowing capacity. The Company’s senior revolving credit facility arrangements typically include upfront fees that may be paid at execution of the applicable agreements or be earned at execution and payable over time. These facilities are generally fully prepayable at any time without penalty other than customary breakage costs. The senior revolving credit facilities have aggregated borrowing bases, which increase or decrease based on the cost and value of the properties financed under a given facility and the time that those properties are in the Company’s possession. When the Company resells a home, the proceeds are used to reduce the outstanding balance under the related senior revolving credit facility. The borrowing base for a given facility may be reduced as properties age beyond certain thresholds or the performance of the properties financed under that facility declines, and any borrowing base deficiencies may be satisfied through contributions of additional properties or partial repayment of the facility. Asset-backed Senior Term Debt Facilities The Company classifies its senior term debt facilities as non-current liabilities on the Company’s condensed consolidated balance sheets because its borrowings under these facilities are generally not required to be repaid until the final maturity date. The senior term debt facilities are typically structured with an initial withdrawal period up to 60 months during which the outstanding principal amounts are generally not required to be repaid when homes financed through those facilities are sold and instead are intended to remain outstanding until final maturity for each facility. Outstanding amounts drawn under each senior term debt facility are required to be repaid on the facility maturity date or earlier if accelerated due to an event of default or other mandatory repayment event. The final maturity dates and withdrawal period end dates reflected in the table above are inclusive of any extensions that are at the sole discretion of the Company. These facilities may also have extensions subject to lender discretion that are not reflected in the table above. Borrowings under the senior term debt facilities accrue interest at a fixed rate with the exception of Term Debt Facility 2022-S2, which accrued interest at a floating rate based on SOFR plus a margin. The Company's senior term debt facilities may include upfront issuance costs that are capitalized as part of the facilities' respective carrying values. These facilities are fully prepayable at any time but may be subject to certain customary prepayment penalties. The senior term debt facilities have aggregated property borrowing bases, which increase or decrease based on the cost and value of the properties financed under a given facility, the time those properties are in the Company’s possession and the amount of cash collateral pledged by the relevant borrowers. The borrowing base for a given facility may be reduced as properties age or collateral performance declines beyond certain thresholds, and any borrowing base deficiencies may be satisfied through contributions of additional properties, cash or through partial repayment of the facility. Asset-backed Mezzanine Term Debt Facilities The Company classifies its mezzanine term debt facilities as long-term liabilities on the Company’s condensed consolidated balance sheets because its borrowings under these facilities are generally not required to be repaid until the applicable final maturity date. These facilities are structurally and contractually subordinated to the related asset-backed senior debt facilities. The mezzanine term debt facilities have been structured with an initial 42-month withdrawal period during which the outstanding principal amounts are generally not required to be repaid when homes financed through those facilities are sold and instead are intended to remain outstanding until final maturity. Outstanding amounts drawn under the mezzanine term debt facilities are required to be repaid on the facility maturity date or earlier if accelerated due to an event of default or other mandatory repayment event. The final maturity date and withdrawal period end date reflected in the table above are inclusive of any extensions that are at the sole discretion of the Company. These facilities may also have extensions subject to lender discretion that are not reflected in the table above. Borrowings under a given term debt facility accrue interest at a fixed rate. The mezzanine term debt facilities include upfront issuance costs that are capitalized as part of the facilities’ respective carrying values. These facilities are fully prepayable at any time but may be subject to certain prepayment penalties. The mezzanine term debt facilities have aggregated property borrowing bases, which increase or decrease based on the cost and the value of the properties financed under a given facility and time in the Company’s possession of those properties and the amount of cash collateral pledged by the relevant borrowers. The borrowing base for a given facility may be reduced as properties age or collateral performance declines beyond certain thresholds, and any borrowing base deficiencies may be satisfied through contributions of additional properties or cash or through partial repayment of the facility. Covenants The Company’s inventory financing facilities include customary representations and warranties, covenants and events of default. Financed properties are subject to customary eligibility criteria and concentration limits. The terms of these inventory financing facilities and related financing documents require an Opendoor subsidiary to comply with customary financial covenants, such as maintaining certain levels of liquidity, tangible net worth or leverage (ratio of debt to tangible net worth). Certain of these financial covenants are calculated by reference to Opendoor Labs Inc. and its consolidates subsidiaries' assets and liabilities. As a result, under certain circumstances, this may limit our flexibility to transfer assets from Opendoor subsidiaries to the Parent Company. At June 30, 2023 and December 31, 2022, $500 million and $565 million, respectively, of the Company’s net assets were restricted as they reflect minimum net asset requirements at Opendoor Labs Inc. As of June 30, 2023, the Company was in compliance with all financial covenants and no event of default had occurred. Mortgage Financing In 2022, the Company ceased providing correspondent lending or mortgage brokering services. As a result, the Company no longer requires mortgage financing and terminated its master repurchase agreement (the “Repurchase Agreement”) in October 2022. From March 2019 through its exit of mortgage lending and brokering services, the Company utilized the Repurchase Agreement to provide capital for Opendoor Home Loans. The facility, which was classified as a current liability on the Company’s condensed consolidated balance sheets, provided short-term financing between the issuance of a mortgage loan and when Opendoor Home Loans sold the loan to an investor. In accordance with the Repurchase Agreement, the lender agreed to pay Opendoor Home Loans a negotiated purchase price for eligible loans and Opendoor Home Loans simultaneously agreed to repurchase such loans from the lender within a specified timeframe and at an agreed upon price that included interest. Opendoor Labs Inc. was the guarantor with respect to the Repurchase Agreement and the obligation to repurchase loans previously transferred under the arrangement for the benefit of the lender. This financing arrangement was an important component of Opendoor Home Loans’ operations as a correspondent lender. Convertible Senior Notes In August 2021, the Company issued 0.25% senior notes due in 2026 (the “2026 Notes”) with an aggregate principal amount of $978 million. The tables below summarize certain details related to the 2026 Notes (in millions, except interest rates):
June 30, 2023 |  | Remaining Aggregate Principal Amount |  | Unamortized Debt Issuance Costs |  | Net Carrying Amount
2026 Notes |  | $ | 510 |  |  | $ | (9) |  |  | $ | 501 |
June 30, 2023 |  | Maturity Date |  | Stated Cash Interest Rate |  | Effective Interest Rate |  | Semi-Annual Interest Payment Dates |  | Conversion Rate |  | Conversion Price
2026 Notes |  | August 15, 2026 |  | 0.25 | % |  | 0.78 | % |  | February 15; August 15 |  | 51.9926 |  | $ | 19.23 |
The 2026 Notes will be convertible at the option of the holders before February 15, 2026 only upon the occurrence of certain events. Beginning on August 20, 2024, the Company has the option to redeem the 2026 Notes upon meeting certain conditions related to price of the Company's common stock. Beginning on February 15, 2026 and until the close of business on the second scheduled trading day immediately preceding the maturity date, the 2026 Notes are convertible at any time at election of each holder. The conversion rate and conversion price are subject to customary adjustments under certain circumstances. In addition, if certain corporate events that constitute a make-whole fundamental change occur, then the conversion rate will be adjusted in accordance with the make-whole table within the Indenture. Upon conversion, the Company may satisfy its obligation by paying cash for the outstanding principal balance, and, a combination of cash and the Company's common stock, at the Company's election, for the remaining amount, if any, based on the applicable conversion rate. In March 2023, the Company entered into separate, privately negotiated transactions to repurchase a portion of the outstanding 2026 Notes (“Repurchased 2026 Notes”). The holders of the Repurchased 2026 Notes exchanged $189 million in aggregate principal amount for an aggregate payment of $101 million in cash for full settlement of the principal value and accrued interest on such date. The Company accounted for the repurchase as a debt extinguishment. Accordingly, on the repurchase date, the Company: (i) reduced the carrying value of the Repurchased 2026 Notes by $189 million, (ii) reduced outstanding deferred issuance costs by $3 million, (iii) incurred fees of $1 million and (iv) recorded $84 million of gain on debt extinguishment. The Company elected to leave the Capped Calls associated with the Repurchased 2026 Notes outstanding. In May 2023, the Company entered into separate, privately negotiated transactions to repurchase a portion of the outstanding 2026 Notes (“Additional Repurchased 2026 Notes”). The holders of the Additional Repurchased 2026 Notes exchanged $279 million in aggregate principal amount for an aggregate payment of $169 million in cash for full settlement of the principal value and accrued interest on such date. The Company accounted for the repurchase as a debt extinguishment. Accordingly, on the repurchase date, the Company: (i) reduced the carrying value of the Additional Repurchased 2026 Notes by $279 million, (ii) reduced outstanding deferred issuance costs by $5 million, (iii) incurred fees of $1 million and (iv) recorded $104 million of gain on debt extinguishment. The Company elected to leave the Capped Calls associated with the Additional Repurchased 2026 Notes outstanding. For the three and six months ended June 30, 2023, total interest expense on the Company's convertible senior notes was $1 million and $3 million, respectively. For the three and six months ended June 30, 2022, total interest expense on the Company's convertible senior notes was $2 million and $4 million, respectively. Capped Calls In August 2021, in connection with the issuance of the 2026 Notes, the Company purchased capped calls (the “Capped Calls”) from certain financial institutions at a cost of $119 million. The Capped Calls cover, subject to customary adjustments, the number of shares of the Company's common stock underlying the 2026 Notes. By entering into the Capped Calls, the Company expects to reduce the potential dilution to its common stock (or, in the event of a conversion of the 2026 Notes settled in cash, to reduce its cash payment obligation) in the event that at the time of conversion of the 2026 Notes its common stock price exceeds the conversion price. The Capped Calls have an initial strike price of $19.23 per share and an initial cap price of $29.59 per share or a cap price premium of 100%.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1B -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(c)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 470 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//470/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1B -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1B -Subparagraph (g) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1B -Subparagraph (i) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1C -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1C -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1C -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1E -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1E Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1I -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1I -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1I -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I + Details
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