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DEBT OBLIGATIONS | 3 Months Ended
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Mar. 31, 2025
Debt Disclosure [Abstract] |
DEBT OBLIGATIONS | WAREHOUSE AND OTHER LINES OF CREDIT At March 31, 2025, the Company was a party to nine revolving lines of credit with lenders providing $3.7 billion of warehouse and securitization facilities. The facilities are used to fund, and are secured by, residential mortgage loans held for sale. The facilities are repaid using proceeds from the sale of loans. Interest is generally payable monthly in arrears or on the repurchase date of a loan, and outstanding principal is payable upon receipt of loan sale proceeds or on the repurchase date of a loan. Outstanding principal related to a particular loan must also be repaid after the expiration of a contractual period of time or, if applicable, upon the occurrence of certain events of default with respect to the underlying loan. Interest expense is recorded to interest expense on the consolidated statements of operations. The base interest rates on the facilities bear interest at a derivative of the secured overnight financing rate (“SOFR”), plus a margin. Some of the facilities carry additional fees charged on the total line amount, commitment fees charged on the committed portion of the line, and non-usage fees charged when monthly usage falls below a certain utilization percentage. As of March 31, 2025, the interest rate was comprised of the applicable base rate plus a spread ranging from 1.50% to 2.25%. The base interest rate for warehouse facilities is subject to increase based upon the characteristics of the underlying loans collateralizing the lines of credit, including, but not limited to product type and number of days held for sale. The warehouse lines have maturities staggered from September 2025 through September 2026. As of March 31, 2025, there was one securitization facility with an original two year term scheduled to expire in 2026. All other warehouse lines and other lines of credit are subject to renewal based on an annual credit review conducted by the lender. Certain warehouse line lenders require the Company to maintain cash accounts with minimum required balances at all times. As of March 31, 2025 and December 31, 2024, the Company had posted a total of $8.7 million and $15.6 million, respectively, of restricted cash as collateral with our warehouse lenders and securitization facilities of which $4.8 million were the minimum required balances. Under the terms of these warehouse lines, the Company is required to maintain various covenants. As of March 31, 2025, the Company was in compliance with all covenants under the warehouse lines. Securitization Facilities In September 2024, in connection with the termination of a securitization facility issued in 2021, the Company issued notes and a class of owner trust certificates through an additional securitization facility (“2024-1 Securitization Facility”) backed by a revolving warehouse line of credit. The 2024-1 Securitization Facility is secured by first-lien, fixed-rate or adjustable-rate, residential mortgage loans originated in accordance with the criteria of Fannie Mae and Freddie Mac for the purchase of mortgage loans or in accordance with the criteria of Ginnie Mae for the guarantee of securities backed by mortgage loans. The 2024-1 Securitization Facility issued $300.0 million in notes that bear interest at SOFR, plus a margin. The 2024-1 Securitization Facility will terminate on the earlier of (i) the two-year anniversary of the initial purchase date, (ii) the Company exercising its right to optional prepayment in full, or (iii) the date of the occurrence and continuance of an event of default. The following table presents information on warehouse and securitization facilities and the outstanding balance as of March 31, 2025 and December 31, 2024:
|  |  |  |  |  |  |  | Outstanding Balance
|  | Committed Amount |  | Uncommitted Amount |  | Total Facility Amount | Expiration Date | March 31, 2025 |  | December 31, 2024 |  |
Facility 1(1) |  | $ | 400,000 |  |  | $ | 600,000 |  |  | $ | 1,000,000 |  | 9/23/2025 | $ | 596,587 |  |  | $ | 504,332 |  |  |
Facility 2(1) |  | 1,000 |  |  | 299,000 |  |  | 300,000 |  | 9/22/2025 | 276,618 |  |  | 201,735 |  |  |
Facility 3(3) |  | — |  |  | 225,000 |  |  | 225,000 |  | 4/15/2025 | 166,107 |  |  | 136,222 |  |  |
Facility 4 |  | — |  |  | 175,000 |  |  | 175,000 |  | 10/29/2025 | 140,913 |  |  | 91,160 |  |  |
Facility 5(1) |  | — |  |  | 200,000 |  |  | 200,000 |  | N/A | — |  |  | 332 |  |  |
Facility 6 |  | — |  |  | 300,000 |  |  | 300,000 |  | 9/19/2025 | 246,798 |  |  | 276,799 |  |  |
Facility 7(2) |  | 300,000 |  |  | — |  |  | 300,000 |  | 9/25/2026 | 300,000 |  |  | 300,000 |  |  |
Facility 8 |  | 250,000 |  |  | 350,000 |  |  | 600,000 |  | 11/13/2025 | 455,973 |  |  | 400,703 |  |  |
Facility 9(1) |  | — |  |  | 600,000 |  |  | 600,000 |  | 10/30/2025 | 307,451 |  |  | 465,844 |  |  |
Total |  | $ | 951,000 |  |  | $ | 2,749,000 |  |  | $ | 3,700,000 |  |  | $ | 2,490,447 |  |  | $ | 2,377,127 |  |  |
(1)In addition to the warehouse line, the lender provides a separate gestation facility to finance recently sold MBS up to the MBS settlement date. (2)Securitization backed by a revolving warehouse facility to finance newly originated first-lien fixed and adjustable rate mortgage loans. (3)In April 2025, the maturity date was extended to April 2026. The following table presents information on borrowings under warehouse and securitization facilities:
|  | Three Months Ended March 31, |  |
|  | 2025 |  | 2024 |  |  |  |
Maximum outstanding balance during the period |  | $ | 2,490,447 |  |  | $ | 2,070,875 |  |  |  |  |
Average balance outstanding during the period |  | 1,839,404 |  |  | 1,625,164 |  |  |  |  |
Collateral pledged (loans held for sale) |  | 2,709,524 |  |  | 2,181,270 |  |  |  |  |
Weighted average interest rate during the period |  | 6.40 | % |  | 7.24 | % |  |  |  |
DEBT OBLIGATIONS The following table presents the outstanding debt as of March 31, 2025 and December 31, 2024:
|  | March 31, 2025 |  | December 31, 2024 |  |  |  |
Secured debt obligations, net: |  |  |  |  |  |  |  |
Secured credit facilities |  |  |  |  |  |  |  |
MSR facilities |  | $ | 768,503 |  |  | $ | 762,319 |  |  |  |  |
Securities financing facilities |  | 81,184 |  |  | 82,465 |  |  |  |  |
Servicing advance facilities |  | 57,136 |  |  | 72,530 |  |  |  |  |
Total secured credit facilities |  | 906,823 |  |  | 917,314 |  |  |  |  |
Term Notes |  | 200,000 |  |  | 200,000 |  |  |  |  |
Other secured financings |  | 95,046 |  |  | 97,767 |  |  |  |  |
Total secured debt obligations, net |  | 1,201,869 |  |  | 1,215,081 |  |  |  |  |
Other debt obligations, net: |  |  |  |  |  |  |  |
Senior Notes |  | 815,626 |  |  | 812,122 |  |  |  |  |
Total debt obligations, net |  | $ | 2,017,495 |  |  | $ | 2,027,203 |  |  |  |  |
Certain of the Company’s secured debt obligations require us to satisfy financial covenants, including minimum levels of profitability, tangible net worth, liquidity, and maximum levels of consolidated leverage. The Company was in compliance with all such financial covenants as of March 31, 2025. Secured Credit Facilities Secured credit facilities are revolving facilities collateralized by MSRs, trading securities, and servicing advances. MSR Facilities In August 2017, the Company established the GMSR Trust to finance its Ginnie Mae mortgage servicing rights through the issuance of variable or term funding notes. Both are secured by participation certificates representing beneficial interests in Ginnie Mae mortgage servicing rights held by the GMSR Trust with a fair value of $627.5 million as of March 31, 2025. As of March 31, 2025 there were $200 million in Term Notes outstanding. In January 2024, the Company secured a new facility to issue variable funding notes that accrue interest at SOFR plus a margin per annum, providing $250.0 million in borrowing capacity and extending their maturity to July 2026. As of March 31, 2025, the Company had $202.0 million in outstanding variable funding notes and $3.1 million in unamortized deferred financial costs. In January 2025, the Company entered into a credit facility agreement to provide for $400.0 million in borrowing capacity to replace a previous credit facility that was originally entered into in December of 2021. This facility is secured by Freddie Mac mortgage servicing rights with a fair value of $488.6 million as of March 31, 2025. This facility bears interest at SOFR, plus a margin per annum and matures in January 2027. At March 31, 2025, there was $318.2 million outstanding on this facility and $1.9 million in unamortized deferred financing costs. In January 2022, the Company entered into a credit facility agreement. The agreement was amended in July 2024 to provide for $450.0 million in borrowing capacity. The facility is secured by Fannie Mae mortgage servicing rights with a fair value of $416.8 million as of March 31, 2025. The facility bears interest at SOFR, plus a margin per annum and matures in January 2026. At March 31, 2025, there was $253.5 million outstanding on this facility and $0.1 million in unamortized deferred financing costs. Securities Financing Facilities The Company has entered into master repurchase agreements to finance retained interest securities related to its securitizations. The securities financing facilities have an advance rate between 50% and 85% based on classes of the securities and accrue interest at a rate of 90-day SOFR, plus a margin. The securities financing facilities are secured by the trading securities, which represent retained interests in the credit risk of the assets collateralizing certain securitization transactions. As of March 31, 2025, the trading securities had a fair value of $87.4 million on the consolidated balance sheets and there were $81.2 million in securities financing facilities outstanding. Servicing Advance Facilities In September 2020, the Company, through its indirect-wholly owned subsidiary loanDepot Agency Advance Receivables Trust (the “Advance Receivables Trust”), entered into a variable funding note facility for the financing of servicing advance receivables with respect to residential mortgage loans serviced by it on behalf of Fannie Mae and Freddie Mac. Pursuant to an indenture, the Advance Receivables Trust can issue up to $100.0 million in variable funding notes (the “2020-VF1 Notes”). The 2020-VF1 Notes accrue interest at SOFR plus a margin per annum. In September 2024, the 2020-VF1 Notes were extended to mature in September 2025 (unless earlier redeemed in accordance with their terms). At March 31, 2025, there was $20.1 million in 2020-VF1 Notes outstanding, with pledged servicing advances of $24.4 million. In November 2021, the Company, through the GMSR Trust, issued variable funding notes secured by principal and interest advance receivables and servicing advance receivables related to residential mortgage loans serviced on behalf of Ginnie Mae. These variable funding notes bear interest at SOFR plus a margin per annum and were scheduled to mature in January 2024. In January 2024, the Company secured a new facility to issue up to $250.0 million in variable funding notes and to extend their maturity to July 2026. As of March 31, 2025, there was $37.0 million outstanding on the variable funding notes, with pledged servicing advances of $55.3 million. Term Notes In October 2018, the Company, through the GMSR Trust issued the Series 2018-GT1 Term Notes (“Term Notes”). In September 2023, the Term Notes were extended to mature in October 2025 and accrue interest at SOFR plus a margin per annum. At March 31, 2025, there were $200.0 million in Term Notes outstanding and no unamortized deferred financing costs. Other Secured Financings In April 2024, the Company executed a securitization of a pool of approximately $150.0 million fixed-rate and adjustable-rate, performing, re-performing and non-performing residential mortgage loans, whereby the loans were transferred to statutory trust MMCA 2024-SD1. The Company evaluated the sale of loans according to ASC 860 - Transfers and Servicing and determined that the transaction does not qualify for sale treatment. As a result, the securitization was recorded as a secured borrowing in which the loans remain on the consolidated balance sheet as loans held for investment, at fair value and the securitization debt is also recognized on the consolidated balance sheet in debt obligations, net. The secured financing is collateralized by and indexed to the pool of residential mortgage loans held by a VIE. As of March 31, 2025, there was $95.0 million outstanding in other secured financings, net of $7.1 million in debt discount and $1.1 million in unamortized deferred financing costs. Senior Notes In October 2020, the Company issued $500.0 million in aggregate principal amount of 6.50% unsecured senior notes due 2025, (the “2025 Senior Notes”). The 2025 Senior Notes will mature on November 1, 2025. Interest on the 2025 Senior Notes accrues at a rate of 6.50% per annum, payable semi-annually in arrears on May 1 and November 1 of each year. The Company may redeem the 2025 Senior Notes, in whole or in part, at various redemption prices. In June 2024, the Company completed an offer to exchange any and all of the outstanding 2025 Senior Notes for newly issued Senior Secured Notes due November 2027 (the “2027 Senior Notes”). The offer was an exchange for a mixed consideration of $1,100 in cash and principal amount of 2027 Senior Notes for each $1,000 principal amount of 2025 Senior Notes tendered at or prior to the expiration date. At the time of expiration, the Company repurchased $478.0 million of 2025 Senior Notes in exchange for $340.6 million of 2027 Senior Notes and cash of $185.0 million resulting in a loss on extinguishment of debt of $5.7 million. Interest on the 2027 Senior Notes accrues at a rate of 8.750% per annum, payable semi-annually in arrears on May 1 and November 1 of each year. The Company may redeem the 2027 Senior Notes, in whole or in part, at various redemption prices. The 2027 Senior Notes are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by certain of LD Holding’s wholly-owned restricted subsidiaries, and secured by a first priority security interest (subject to permitted liens) in (1) a securities account holding certain risk retention securities (trading securities) held by MCS, a guarantor of the 2027 Senior Notes, (2) certain unencumbered non-agency mortgage servicing rights held by LDLLC, a guarantor of the 2027 Senior Notes, with a fair value of up to $60.0 million, and (3) a securities account holding $100.6 million aggregate principal amount of LD Holding’s 6.125% 2028 Senior Notes that were previously repurchased by LD Holdings held by ART, a guarantor of the 2027 Senior Notes. The Company evaluated the debt exchange under the guidance in ASC 470-50 Debt - Modifications and Extinguishments. As the present value of the cash flows under the 2027 Senior Notes differed by more than 10% from the present value of the remaining cash flows under the terms of the 2025 Senior Notes, it was determined that the debt was substantially different, and therefore, the transaction was accounted for as a debt extinguishment. As of March 31, 2025, there were $19.8 million in 2025 Senior Notes outstanding and $46 thousand in unamortized deferred financing costs. As of March 31, 2025. there were $340.6 million in 2027 Senior Notes outstanding, $35.9 million of unamortized debt discount and $5.1 million in unamortized deferred financing costs. In March 2021, the Company issued $600.0 million in aggregate principal amount of 6.125% unsecured senior notes due 2028 (the “2028 Senior Notes” and together with the 2025 Senior Notes and 2027 Senior Notes, the "Senior Notes"). The 2028 Senior Notes will mature on April 1, 2028. Interest on the 2028 Senior Notes accrues at a rate of 6.125% per annum, payable semi-annually in arrears on April 1 and October 1 of each year. The Company may redeem the 2028 Senior Notes at various redemption prices. As of March 31, 2025, there were $499.4 million in 2028 Senior Notes outstanding and $3.2 million in unamortized deferred financing costs. Interest Expense Interest expense on all outstanding debt obligations with variable rates is paid based on SOFR, or other alternative base rate, plus a margin ranging from 0.90% - 4.25%.

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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 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481544/470-10-50-6 Reference 2: 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