Short-Term Debt

We enter into repurchase agreements, bank warehouse agreements, and other forms of collateralized (and generally uncommitted) short-term borrowings with several banks and major investment banking firms. At March 31, 2018, we had outstanding agreements with several counterparties and we were in compliance with all of the related covenants. For additional information about these financial covenants and our short-term debt, see Part I, Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations of this Quarterly Report on Form 10-Q and Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2017.

The table below summarizes our short-term debt, including the facilities that are available to us, the outstanding balances, the weighted average interest rate, and the maturity information at March 31, 2018 and December 31, 2017.

Table 11.1 – Short-Term Debt



	March 31, 2018
(Dollars in Thousands)	Number of Facilities	Outstanding Balance		Limit		Weighted Average Interest Rate		Maturity	Weighted Average Days Until Maturity
Facilities
Residential loan warehouse	4	$	661,782	$	1,425,000	3.51	%	8/2018-3/2019	246
Real estate securities repo	8	592,294		—		3.03	%	4/2018-6/2018	27
Total Short-Term Debt Facilities	12	1,254,076
Convertible notes, net	N/A	250,384		—		4.63	%	4/2018	15
Total Short-Term Debt		$	1,504,460



	December 31, 2017
(Dollars in Thousands)	Number of Facilities	Outstanding Balance		Limit		Weighted Average Interest Rate		Maturity	Weighted Average Days Until Maturity
Facilities
Residential loan warehouse	4	$	1,039,666	$	1,575,000	3.17	%	1/2018-12/2018	197
Real estate securities repo	9	648,746		—		2.69	%	1/2018-3/2018	28
Total Short-Term Debt Facilities	13	1,688,412
Convertible notes, net	N/A	250,270		—		4.63	%	4/2018	105
Total Short-Term Debt		$	1,938,682

Borrowings under our facilities are generally charged interest based on a specified margin over the one-month LIBOR interest rate. At March 31, 2018, all of these borrowings were under uncommitted facilities and were due within 364 days (or less) of the borrowing date.

The fair value of held-for-sale residential loans and real estate securities pledged as collateral under our short-term debt facilities was $718 million and $721 million, respectively, at March 31, 2018 and $1.15 billion and $788 million, respectively, at December 31, 2017. At March 31, 2018, the fair value of our real estate securities pledged as collateral included $57 million of securities retained from our consolidated Sequoia Choice securitizations. For the three months ended March 31, 2018 and 2017, the average balances of our short-term debt facilities were $1.37 billion and $794 million, respectively. At both March 31, 2018 and December 31, 2017, accrued interest payable on our short-term debt facilities was $2 million.

During the second quarter of 2017, $288 million principal amount of 4.625% convertible senior notes and $2 million of unamortized deferred issuance costs were reclassified from long-term debt to short-term debt, as the maturity of the notes was less than one year as of April 2017. Additionally, during the second quarter of 2017, we repurchased $37 million par value of these notes at a premium and recorded a loss on extinguishment of debt of $1 million in Realized gains, net on our consolidated statements of income. At March 31, 2018, the accrued interest payable balance on this debt was $5 million. In April 2018, we repaid these $250 million convertible notes and all related accrued interest in full. See Note 13 for additional information on our convertible notes.

We also maintain a $10 million committed line of credit with a financial institution that is secured by certain mortgage-backed securities with a fair market value of $5 million at March 31, 2018. At both March 31, 2018 and December 31, 2017, we had no outstanding borrowings on this facility.

Remaining Maturities of Short-Term Debt

The following table presents the remaining maturities of our secured short-term debt by the type of collateral securing the debt as well as our convertible notes at March 31, 2018.

Table 11.2 – Short-Term Debt by Collateral Type and Remaining Maturities



	March 31, 2018
(In Thousands)	Within 30 days		31 to 90 days		Over 90 days		Total
Collateral Type
Held-for-sale residential loans	$	—	$	—	$	661,782	$	661,782
Real estate securities	445,380		146,914		—		592,294
Total Secured Short-Term Debt	445,380		146,914		661,782		1,254,076
Convertible notes, net	250,384		—		—		250,384
Total Short-Term Debt	$	695,764	$	146,914	$	661,782	$	1,504,460