
September 30, 2025	Unsecuritized Jumbo Loans		Securitized Jumbo Loans		Securitized Re-Performing Loans
(In Thousands)							Total
Held-for-sale at fair value	$	2,455,559	$	—	$	1,248,236	$	3,703,795
Held-for-investment at fair value	—		13,079,486		—		13,079,486
Total Residential Consumer Loans	$	2,455,559	$	13,079,486	$	1,248,236	$	16,783,281


December 31, 2024	Unsecuritized Jumbo Loans		Securitized Jumbo Loans		Securitized Re-Performing Loans
(In Thousands)							Total
Held-for-sale at fair value	$	1,013,547	$	—	$	—	$	1,013,547
Held-for-investment at fair value	—		8,819,554		1,244,722		10,064,276
Total Residential Consumer Loans	$	1,013,547	$	8,819,554	$	1,244,722	$	11,077,823

At September 30, 2025, we owned mortgage servicing rights associated with $2.4 billion (principal balance) of residential consumer loans that were purchased from third-party originators. The value of these MSRs is included in the carrying value of the associated loans on our consolidated balance sheets. We contract with licensed sub-servicers that perform servicing functions for these loans. Refer to Note 16 for further information on our consolidated VIEs.


September 30, 2025	Unsecuritized Jumbo Loans			Securitized Re-Performing Loans (1)
(Dollars in Thousands)

UPB	$	2,394,909		$	1,447,610
Fair value of loans	$	2,455,559		$	1,248,236
Market value of loans pledged as collateral under short-term borrowing agreements	$	2,437,510		N/A
Weighted average coupon	6.84		%	4.49		%

Delinquency information

UPB of loans with 90+ day delinquencies	$	439		$	97,615
Average 90+ days delinquent balance (UPB)	439			167
UPB of loans in foreclosure	—			34,709
Average foreclosure balance (UPB)	—			187


December 31, 2024	Unsecuritized Jumbo Loans
(Dollars in Thousands)

UPB	$	1,000,663
Fair value of loans	$	1,013,547
Market value of loans pledged as collateral under short-term borrowing agreements	$	1,005,926
Weighted average coupon	6.56		%

Delinquency information

UPB of loans with 90+ day delinquencies	$	—
Average UPB of 90+ days delinquent loans	—
UPB of loans in foreclosure	—
Average foreclosure balance (UPB)	—

During the three and nine months ended September 30, 2025 and 2024, mortgage banking activities, net were $29 million and $27 million and $75 million and $41 million, respectively, and included changes in fair value of residential consumer loans held-for-sale, loan purchase commitments, and related risk management derivatives in our Sequoia Mortgage Banking segment. See Note 5 for additional information.

Table 7.3 – Activity of Residential Consumer Loans Held-for-Sale


	Three Months Ended September 30,				Nine Months Ended September 30,
(In Thousands)	2025		2024		2025		2024
Principal balance of loans acquired	$	3,845,429	$	1,999,621	$	9,158,820	$	4,873,608
Principal balance of loans sold	861,850		39,497		2,123,601		246,641
Principal balance of loans transferred from HFS to HFI	1,878,024		1,528,163		5,551,389		4,140,150

We invest in residential subordinate securities issued by Securitized Jumbo and Securitized Re-Performing Loans securitization trusts and consolidate the underlying residential consumer loans owned by these entities for financial reporting purposes in accordance with GAAP. During the nine months ended September 30, 2025 we transferred our Securitized Re-Performing Loans to Held-for-Sale. The following tables summarize the characteristics of the securitized residential consumer loans held-for-investment at September 30, 2025 and December 31, 2024.

Table 7.4 – Characteristics of Residential Consumer Loans Held-for-Investment


September 30, 2025	Securitized Jumbo Loans
(Dollars in Thousands)

UPB	$	13,351,590
Average loan balance (UPB)	$	899
Fair value of loans (1)	$	13,079,486
Weighted average coupon	5.67		%

Delinquency information

UPB of loans with 90+ day delinquencies (2)	$	41,396


Average 90+ days delinquent balance (UPB)	753
UPB of loans in foreclosure	12,132
Average foreclosure balance (UPB)	607


December 31, 2024	Securitized Jumbo Loans			Securitized Re-Performing Loans
(Dollars in Thousands)

UPB	$	9,350,286		$	1,514,432
Average loan balance (UPB)	$	842		$	155
Fair value of loans (1)	$	8,819,554		$	1,244,722
Weighted average coupon	5.35		%	4.49		%

Delinquency information

UPB of loans with 90+ day delinquencies (2)	$	19,480		$	106,910

Average 90+ days delinquent balance (UPB)	$	573		$	172

UPB of loans in foreclosure	$	10,493		$	41,913
Average foreclosure balance (UPB)	$	552		$	185

(1)The fair value of the loans held by consolidated entities was based on the fair value of the ABS issued by these entities, including securities we own, which we determined were more readily observable, in accordance with the accounting guidance for CFEs, and are recorded in Investment fair value changes, net on our consolidated statements of income (loss).


	Three Months Ended September 30,			Nine Months Ended September 30,
(In Thousands)	2025		2024		2025				2024


Principal value of loans transferred from HFS to HFI (1)	$	1,878,024			$	1,528,163	$	5,551,389		$	4,140,150
Net market valuation gains (losses) recorded	102,295				256,034		236,432			152,635


September 30, 2025	Residential Investor Term				Residential Investor Bridge
(In Thousands)	Unsecuritized		Securitized		Unsecuritized		Securitized		Total
Held-for-sale at fair value (1)	$	157,339	$	—	$	625,932	$	—	$	783,271
Held-for-investment at fair value	—		2,143,226		—		931,100		3,074,326
Total Residential Investor Loans	$	157,339	$	2,143,226	$	625,932	$	931,100	$	3,857,597


December 31, 2024	Residential Investor Term				Residential Investor Bridge
(In Thousands)	Unsecuritized		Securitized		Unsecuritized		Securitized		Total
Held-for-sale at fair value	$	158,637	$	—	$	78,587	$	—	$	237,224
Held-for-investment at fair value	—		2,485,069		1,041,694		823,103		4,349,866
Total Residential Investor Loans	$	158,637	$	2,485,069	$	1,120,281	$	823,103	$	4,587,090

During the third quarter of 2025, as part of our plans to accelerate the wind-down of the Legacy Investments portfolio, we transferred a portfolio totaling $484 million in fair value of legacy unsecuritized bridge loans and REO assets to the Legacy Trust. These transfers met the criteria to be accounted for as sales for financial reporting purposes, in accordance with GAAP. We determined that the Legacy Trust is a variable-interest entity ("VIE") but that Redwood is not the primary beneficiary, as we do not have the power to direct the activities that most significantly affect the Legacy Trust’s economic performance. Accordingly, the Legacy Trust is not consolidated in our financial statements. In connection with this transfer, we recognized a negative $6 million investment fair value change within our Consolidated Statements of (Loss) Income, reflecting adjustments associated with completing the transaction. As part of the transaction, we retained a $182 million subordinate beneficial interest in the Legacy Trust, which is recorded as an AFS real estate security on our Consolidated balance sheet, as well as a funding commitment to provide capital support if the Legacy Trust’s portfolio loan-to-value ratios exceed specified thresholds. See Notes 9 and 19 for further discussion on the beneficial interest and the funding commitment, respectively.

The change in fair value of residential investor loans from December 31, 2024 to September 30, 2025 reflects both realized and anticipated changes in portfolio performance and composition. The overall decline in fair value was primarily attributable to the unsecuritized residential investor bridge loan portfolio, which decreased to $626 million at September 30, 2025 from $1.1 billion at December 31, 2024. This decline was primarily driven by the sale transaction to the Legacy Trust and other resolutions in the third quarter of 2025. During the nine month period ended September 30, 2025, losses also reflected adverse market developments and the acceleration of resolution activity and further anticipated near-term resolutions on these loans, as well as changes in the underlying performance on certain of these loans, particularly those of the 2021 and 2022 vintage.

Fair value changes also reflect the impact of loan modifications during the period, particularly rate changes and interest deferrals, which may have resulted in downward adjustments to loan valuations. These modifications were predominantly related to bridge loans with underlying project delays, borrower financial stress, or market-driven refinancing challenges. The fair value impact of such modifications is incorporated into the Company’s valuation models and contributed to the overall movement in loan values during the period.

At September 30, 2025, we had $261 million in commitments to fund additional advances on existing residential investor bridge loans, of which $84 million related to loans currently in securitizations co-sponsored by one of our joint ventures. See Note 19 for additional information on these commitments. During the three and nine months ended September 30, 2025, we sold $114 million and $416 million of residential investor bridge loans, net of $6 million and $38 million of construction draws to one of our joint ventures, respectively. See Note 12 for additional information on these joint ventures.

During the three and nine months ended September 30, 2025 and 2024, income from mortgage banking activities, net were $11 million and $39 million, and $13 million and $32 million, respectively, and included changes in fair value of residential investor loans held-for-sale, interest rate lock commitments, and related risk management derivatives in our CoreVest Mortgage Banking segment. See Note 5 for additional information. During the three and nine months ended September 30, 2025, Fee income, net was $5 million and $9 million, respectively, and primarily included portfolio administration fees earned on term and bridge loans.

Table 8.2 – Activity of Unsecuritized Residential Investor Loans


	Three Months Ended September 30,
	2025				2024
(In Thousands)	Unsecuritized Term Loans		Unsecuritized Bridge Loans		Unsecuritized Term Loans		Unsecuritized Bridge Loans
Principal balance of loans originated	$	228,298	$	258,594	$	158,584	$	286,833
Principal balance of loans acquired (1)	530		80,223		3,145		—
Principal balance of loans sold to third parties (2)	228,741		625,196		206,380		67,655
Transfer of loans between portfolios (3)	—		38,179		—		(62,386)


	Nine Months Ended September 30,
	2025				2024
(In Thousands)	Unsecuritized Term Loans		Unsecuritized Bridge Loans		Unsecuritized Term Loans		Unsecuritized Bridge Loans
Principal balance of loans originated	$	645,061	$	666,494	$	493,212	$	714,977
Principal balance of loans acquired (1)	43,567		105,456		3,793		15,677
Principal balance of loans sold to third parties (2)	661,951		1,007,770		464,836		277,170
Transfer of loans between portfolios (3)	—		63,554		—		(250,319)

(2)For the three and nine months ended September 30, 2025 and 2024 the principal balance of loans sold to third parties is net of $6 million and $13 million, and $38 million and $34 million, respectively, related to construction draws on residential investor bridge loans sold to our joint ventures. See Note 12 for additional information on these joint ventures.

(3)Transfers of unsecuritized residential investor term loans between portfolios represents the transfer of loans from held-for-sale to held-for-investment associated with consolidated term securitizations. Transfers of unsecuritized bridge loans, represents the transfer of residential investor bridge loans from "Unsecuritized Bridge" to "Securitized Bridge" resulting from their inclusion in one of our bridge loan securitizations, which generally have replenishment features for a set period of time from the closing.

We invest in securities issued by securitizations sponsored by CoreVest and consolidate the underlying residential investor term loans and bridge loans owned by these entities. For loans held at our consolidated securitization entities, market value changes are based on the fair value of the associated ABS issued, including securities we own, pursuant to CFE guidelines, and are recorded through Investment fair value changes, net on our consolidated statements of income (loss). We did not elect to account for some of our Bridge securitizations under the CFE guidelines, but have elected to account for the loans in these securitizations at fair value, and changes in fair value for these loans are recorded through Investment fair value changes, net on our consolidated statements of income. See further discussion in Note 16.


	Three Months Ended September 30,
	2025				2024
(In Thousands)	Securitized Term		Securitized Bridge		Securitized Term		Securitized Bridge
Net market valuation gains (losses) recorded	$	20,614	$	6,384	$	78,275	$	1,623
Fair value of loans transferred to HFI	—		38,179		—		62,386


	Nine Months Ended September 30,
	2025				2024
(In Thousands)	Securitized Term		Securitized Bridge		Securitized Term		Securitized Bridge
Net market valuation gains (losses) recorded	$	34,667	$	(1,901)	$	89,388	$	443
Fair value of loans transferred to HFI	—		164,792		—		250,319


September 30, 2025	Unsecuritized Term			Securitized Term(1)			Unsecuritized Bridge			Securitized Bridge(1)
(Dollars in Thousands)


Unpaid principal balance	$	163,683		$	2,251,096		$	665,040		$	917,991
Average UPB of loans	1,129			3,063			1,945			1,237
Fair value of loans	157,339			2,143,226			625,932			931,100
Weighted average coupon	6.94		%	5.28		%	8.93		%	9.41		%
Weighted average remaining loan term (years)	13			4			1			1
Market value of loans pledged as collateral under debt facilities	$	86,413		N/A			$	400,527		N/A

Delinquency information


Unpaid principal balance of loans with 90+ day delinquencies (2)	$	53,756		$	171,284		$	198,858		$	26,938
Average UPB of 90+ days delinquent loans (2)	5,973			4,078			11,048			1,418
Fair value of loans with 90+ day delinquencies (2)	44,491			N/A			159,437			N/A


Unpaid principal balance of loans in foreclosure (3)	—			37,206			22,838			19,803
Average UPB of loans in foreclosure (3)	—			5,315			22,838			1,238
Fair value of loans in foreclosure (3)	—			N/A			17,128			N/A


December 31, 2024	Unsecuritized Term			Securitized Term(1)			Unsecuritized Bridge			Securitized Bridge(1)
(Dollars in Thousands)


Unpaid principal balance	$	177,618		$	2,639,485		$	1,166,213		$	810,285
Average UPB of loans	1,759			3,084			5,350			1,605
Fair value of loans	158,637			2,485,069			1,120,281			823,103
Weighted average coupon	6.84		%	5.35		%	9.11		%	9.76		%
Weighted average remaining loan term (years)	9			4			1			1
Market value of loans pledged as collateral under debt facilities	$	120,417		N/A			$	1,070,327		N/A

Delinquency information


Unpaid principal balance of loans with 90+ day delinquencies (2)	$	33,065		$	194,143		$	129,229		$	20,964
Average UPB of 90+ days delinquent loans (2)	8,266			3,734			8,077			1,233
Fair value of loans with 90+ day delinquencies (2)	12,366			N/A			102,321			N/A


Unpaid principal balance of loans in foreclosure (3)	27,529			24,648			86,260			3,663
Average UPB of loans in foreclosure (3)	27,529			2,465			6,635			916
Fair value of loans in foreclosure (3)	8,500			N/A			67,858			N/A

(1)The fair value of the Term and Bridge loans held by consolidated entities were based on the fair value of the ABS issued by these entities, including securities we own, which we determined were more readily observable, in accordance with the accounting guidance for CFEs.

Table 8.5 – Residential Investor Loans Collateral/Strategy Type


September 30, 2025	Unsecuritized Term		Securitized Term		Unsecuritized Bridge		Securitized Bridge
(Dollars in Thousands)
Term
Single-family rental	$	106,597	$	1,751,988	$	—	$	—
Multifamily	57,086		499,108		—		—
Bridge
Renovate / Build for Rent ("BFR") (1)	—		—		196,810		316,490
Single Asset Bridge ("SAB") (2)	—		—		61,259		488,545
Multifamily (3)	—		—		300,100		111,901
Third-Party Originated	—		—		106,871		1,055
Total Residential Investor Loans	$	163,683	$	2,251,096	$	665,040	$	917,991

For the three months ended September 30, 2025, consistent with our strategic transition from non-core legacy assets, we have adopted a more accelerated approach to resolving modified and legacy loans, accelerating the wind-down of underperforming or non-core legacy assets to proactively reduce long-term exposure. This includes pursuing loan and REO sales, executing structured exits, and, where necessary, accelerating foreclosure or liquidation processes on assets with limited workout potential.

We utilize a rigorous and consistently implemented fair value process when evaluating these loans, which involves management’s review of updated appraisals, collateral performance, sales cost estimates, and independent market data when available. This approach, conducted in accordance with GAAP, is designed to ensure that valuations reflect current conditions and project-specific risks. The actual amounts ultimately recovered—whether through foreclosure, collateral sale, or alternative resolutions, such as discounted payoffs or loan sales—may differ significantly from our estimates and could materially affect future earnings. In exchange for a modification, we may receive a partial repayment of principal, a short-term accrual of capitalized interest for a portion of interest due, a capital infusion to replenish interest or capital improvement reserves, and/or termination of all or a portion of the remaining unfunded loan commitment.

For the three months ended September 30, 2025 and December 31, 2024, we modified or put into forbearance loans with a total aggregate UPB of $130 million and $353 million, respectively. This balance primarily included modifications involving extensions of loan maturities and/or covenant terms ("Simple Modifications"). An increase in maturity extensions would increase the expected time to repayment with a potential impact on fair values and credit losses. However, given the overall short duration nature of our bridge loans, a certain level of maturity extensions are a routine asset management outcome for these loans, irrespective of market conditions. Additionally, modifications also include changes to the contractual interest rates (including, in certain cases, deferrals of interest) on loans ("Complex Modifications"). Certain loans may represent subsequent modifications of loans that had been previously modified in a prior reporting period. These further modifications may include adjustments to pay rates, deferred interest (floating-to-fixed conversions), maturity extensions (with forbearance or partial repayments), and changes to interest reserves or project completion milestones.

Table 8.6 – Loan Modifications Characteristics by Strategy Type


September 30, 2025	Unpaid Principal Balance		Weighted Average Contractual Interest Rate		Weighted Average Deferred Interest Rate		Average Month Length of Maturity Extensions
(Dollars in Thousands)
Simple Modifications (Extensions)	$	126,254	N/A		N/A		5
Complex Modifications	3,895		10.73	%	4.73	%	5
Total Loan Modifications (1)	$	130,149

For the three months ended December 31, 2024, loans with an aggregate UPB of $186 million were Simple Modifications and involved the extension of maturities and/or covenant terms. Of this balance, we further modified loans that had been previously modified in a prior period with an aggregate unpaid principal balance of $103 million.

For the three months ended December 31, 2024, loans with an aggregate UPB of $167 million were Complex Modifications and primarily involved adjustments to contractual interest pay rates (including, in certain cases, deferrals of interest). Modifications on these loans maintained a contractual interest rate of approximately 8.64%, of which 5.39% represented deferred interest. Of this population, we further modified loans that had been previously modified in a prior period, with an aggregate unpaid principal balance of $24 million.

While we continue to actively engage with certain borrowers to address the impacts of rising interest rates, elongated project timelines, or other issues, further increases in delinquencies or modifications within our residential investor bridge loan portfolio could ultimately result in further decreases in net interest income and the fair value of our bridge loans held for investment, and further instances of borrower/sponsor financial stress could lead to realized credit losses. An increase in maturity extensions in the residential investor bridge portfolio would increase the expected time to repayment with a potential impact on fair values and credit losses. However, given the overall short duration nature of our bridge loans, a certain level of maturity extensions are a routine asset management outcome for these loans, irrespective of market conditions.

A loan is generally placed on non-accrual status when it is probable that all principal and interest due under the contractual terms will not be collected and a loan is past due more than 90 days. At the time a loan is placed on non-accrual status, all previously accrued but uncollected interest is written off against interest income and interest subsequently collected is recognized on a cash basis when it is received. A loan remains on non-accrual status until the loan balance is deemed collectible or until such time the loan qualifies to be placed back on accrual status. Generally, a loan is placed back on accrual status when the loan becomes contractually current or the collection of past due and future payments is reasonably assured either through reinstatement by the borrower, recoverability on the estimated net equity in the underlying real estate property or both.


September 30, 2025	Non-Accrual of Contractual Coupon Interest		Non-Accrual of Deferred Interest Only		Total Unpaid Principal Balance		Fair Value
(Dollars in Thousands)
Legacy Investments
Multifamily (1)	$	193,759	$	104,216	$	297,975	$	257,895
Renovate / Build for Rent ("BFR") (2)	15,856		24,917		40,773		32,308
Single Asset Bridge ("SAB") (3)	670		—		670		637
Other	6,247		—		6,247		3,679
Redwood Investments
Renovate / Build for Rent ("BFR") (2)	4,817		—		4,817		4,841
Single Asset Bridge ("SAB") (3)	7,787		—		7,787		7,751
Total Non-Accrual Loans	$	229,136	$	129,133	$	358,269	$	307,111

At December 31, 2024, residential investor loans with an aggregate UPB of $343 million and an aggregate fair value of $282 million, respectively, were on non-accrual status. Of this balance, loans with $151 million aggregate UPB were on full non-accrual of the contractual coupon interest and loans with $192 million aggregate UPB were on non-accrual of deferred interest.