Long-Term Debt

9 Months Ended

Sep. 30, 2022

The tables below summarize our long-term debt, including the facilities that are available to us, the outstanding balances, the weighted average interest rate, and the maturity information at September 30, 2022 and December 31, 2021.

Table 16.1 – Long-Term Debt


	September 30, 2022
(Dollars in Thousands)	Borrowings		Unamortized Deferred Issuance Costs / Discount		Net Carrying Value		Limit		Weighted Average Interest Rate (1)		Final Maturity
Facilities
Recourse Subordinate Securities Financing
Facility A	$	131,316	$	—	$	131,316	N/A		4.21	%	9/2024
CAFL
Facility B	102,006		(126)		101,880		N/A		4.21	%	2/2025
Facility C	71,792		(189)		71,603		N/A		4.75	%	6/2026
Non-Recourse BPL Financing
Facility D	565,028		(976)		564,052		$	750,000	L + 2.51%		N/A
Recourse BPL Financing
Facility G	—		—		—		500,000		SOFR + 2.25% - 2.50%		9/2024

Total Long-Term Debt Facilities	870,142		(1,291)		868,851
Convertible notes

5.625% convertible senior notes	150,200		(1,484)		148,716		N/A		5.625	%	7/2024
5.75% exchangeable senior notes	172,092		(2,769)		169,323		N/A		5.75	%	10/2025
7.75% convertible senior notes	215,000		(6,419)		208,581		N/A		7.75	%	6/2027
Trust preferred securities and subordinated notes	139,500		(745)		138,755		N/A		L + 2.25%		7/2037
Total Long-Term Debt	$	1,546,934	$	(12,708)	$	1,534,226


	December 31, 2021
(Dollars in Thousands)	Borrowings		Unamortized Deferred Issuance Costs / Discount		Net Carrying Value		Limit		Weighted Average Interest Rate (1)		Final Maturity
Facilities
Recourse Subordinate Securities Financing
Facility A	$	144,385	$	(313)	$	144,072	N/A		4.21	%	9/2024
CAFL
Facility B	102,351		(353)		101,998		N/A		4.21	%	2/2025
Facility C	91,707		(376)		91,331		N/A		4.75	%	6/2026
Non-Recourse BPL Financing
Facility D	307,215		(507)		306,708		$	400,000	L + 2.75%		N/A
Recourse BPL Financing
Facility E	234,349		(123)		234,226		450,000		L + 2.21%		9/2023
Facility F	110,148		—		110,148		450,000		L + 3.35%		6/2023
Total Long-Term Debt Facilities	990,155		(1,672)		988,483
Convertible notes
4.75% convertible senior notes	198,629		(1,836)		196,793		N/A		4.75	%	8/2023
5.625% convertible senior notes	150,200		(2,072)		148,128		N/A		5.625	%	7/2024
5.75% exchangeable senior notes	172,092		(3,384)		168,708		N/A		5.75	%	10/2025
Trust preferred securities and subordinated notes	139,500		(779)		138,721		N/A		L + 2.25%		7/2037
Total Long-Term Debt	$	1,650,576	$	(9,743)	$	1,640,833

(1)Variable rate borrowings are based on 1- or 3-month LIBOR ("L" in the table above) or 1-month SOFR plus an applicable spread.

Refer to Note 15 to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2021, for a full description of our long-term debt.

Non-Recourse BPL Financing Facility

During the three months ended March 31, 2022, we amended facility D (see Table 16.1 above) to increase the borrowing limit from $400 million to $600 million. During the three months ended September 30, 2022, we amended facility D to increase the borrowing limit from $600 million to $750 million.

Recourse BPL Financing Facilities

During the three months ended September 30, 2022, a subsidiary of Redwood entered into a repurchase agreement providing non-marginable financing for business purpose bridge loan and single-family rental loans (Facility G in Table 16.1 above). At September 30, 2022, there were no borrowings under this facility. During the three months ended September 30, 2022, Facility E was reclassified to short-term debt as the maturity of this facility was less than one year.

During the three months ended June 30, 2022, Facility F was reclassified to short-term debt as the maturity of this facility was less than one year. During the three months ended March 31, 2022, we amended the interest rate for Facilities E and F (see Table 16.1 above) to be indexed to a spread over one-month SOFR compared to a LIBOR-indexed spread.

Convertible Notes

In June 2022, we issued $215 million principal amount of 7.75% convertible senior notes due 2027. These notes require semi-annual interest payments at a fixed annual coupon rate of 7.75% until maturity or conversion, which will be no later than June 15, 2027. After deducting the underwriting discount and offering costs, we received $208 million of net proceeds. Including amortization of deferred debt issuance costs, the effective interest expense yield on these notes was approximately 8.50% per annum. We may elect to settle conversions either entirely in cash or in a combination of cash and shares of common stock. Upon conversion, the conversion value will be paid in cash up to at least the principal amount of the notes being converted. The initial conversion rate of the notes is 95.6823 common shares per $1,000 principal amount of notes (equivalent to a conversion price of $10.45 per common share).

During the three months ended September 30, 2022, $199 million principal amount of 4.75% convertible debt and $1 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 August 2022.

The following table below presents the value of loans, securities, and other assets pledged as collateral under our long-term debt at September 30, 2022 and December 31, 2021.

Table 16.2 – Collateral for Long-Term Debt


(In Thousands)	September 30, 2022		December 31, 2021
Collateral Type
Bridge loans	$	699,704	$	554,597
Single-family rental loans	—		244,703
Real estate securities
Sequoia securitizations (1)	184,363		247,227
CAFL securitizations (1)	240,683		260,405



Total Collateral for Long-Term Debt	$	1,124,750	$	1,306,932

(1)Represents securities we have retained from consolidated securitization entities. For GAAP purposes, we consolidate the loans and non-recourse ABS debt issued from these securitizations.

The following table summarizes the accrued interest payable on long-term debt at September 30, 2022 and December 31, 2021.

Table 16.3 – Accrued Interest Payable on Long-Term Debt


(In Thousands)	September 30, 2022		December 31, 2021
Long-term debt facilities	$	2,685	$	815
Convertible notes
4.75% convertible senior notes	—		3,564
5.625% convertible senior notes	1,784		3,896
5.75% exchangeable senior notes	4,947		2,474
7.75% convertible senior notes	5,184		—
Trust preferred securities and subordinated notes	1,228		581
Total Accrued Interest Payable on Long-Term Debt	$	15,828	$	11,330