Other Assets and Liabilities

9 Months Ended

Sep. 30, 2025

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Other Assets

Other assets at September 30, 2025 and December 31, 2024 are summarized in the following table.

Table 15.1 – Components of Other Assets


(In Thousands)	September 30, 2025		December 31, 2024
Accrued interest receivable	$	123,213	$	115,832
Margin receivable	73,082		28,313
Investment receivable	58,468		69,793
Real estate owned	47,731		91,927
Deferred tax asset	27,145		27,145
Intangible assets	12,634		19,049
Operating lease right-of-use assets	9,736		9,167
Fixed assets and leasehold improvements (1)	5,807		4,674




Other (2)	40,672		49,817
Total Other Assets	$	398,488	$	415,717

(1)Fixed assets and leasehold improvements had a basis of $20 million and accumulated depreciation of $14 million at September 30, 2025.

(2)Consists primarily of receivables related to escrow advances, prepaid assets and other receivables.

Real Estate Owned (REO)

The Company holds REO at the lower of the current carrying amount or fair value less estimated selling costs. The following table summarizes the activity and carrying values of REO assets held at consolidated securitization entities during the three and nine months ended September 30, 2025.

Table 15.2 – REO Activity


	Three Months Ended September 30, 2025
(In Thousands)	Bridge (1)		Sequoia		Securitized Re-Performing Loans		Securitized Term		Total
Balance at beginning of period	$	59,838	$	1,984	$	2,771	$	7,747	$	72,340
Transfers to REO	41,034		—		361		—		41,395
Liquidations (2)	(59,224)		—		(1,036)		—		(60,260)
Changes in fair value, net	(5,920)		—		176		—		(5,744)

Balance at End of Period	$	35,728	$	1,984	$	2,272	$	7,747	$	47,731


	Nine Months Ended September 30, 2025
(In Thousands)	Bridge (1)		Sequoia		Securitized Re-Performing Loans		Securitized Term		Total
Balance at beginning of period	$	77,678	$	—	$	2,987	$	11,262	$	91,927
Transfers to REO	53,104		1,984		2,449		—		57,537
Liquidations (2)	(67,012)		—		(4,070)		(3,515)		(74,597)
Changes in fair value, net	(28,042)		—		906		—		(27,136)

Balance at End of Period	$	35,728	$	1,984	$	2,272	$	7,747	$	47,731

(1)Includes REO that were previously either legacy unsecuritized bridge loans or bridge loans within consolidated securitization entities.

(2)For the three and nine months ended September 30, 2025, REO market valuation adjustments and liquidations resulted in net valuation losses of $6 million and $27 million, respectively, which were recorded in Investment fair value changes, net on our consolidated statements of income.

Accrued Expenses and Other Liabilities

Accrued expenses and other liabilities at September 30, 2025 and December 31, 2024 are summarized in the following table.

Table 15.3 – Components of Accrued Expenses and Other Liabilities


(In Thousands)	September 30, 2025		December 31, 2024
Payable to non-controlling interests	$	101,888	$	123,258
Accrued interest payable	91,971		70,988
Accrued compensation	34,235		34,002
Margin payable	31,844		20,340
Unsettled trades	19,322		5,127
Accrued taxes payable	13,518		—
Accrued operating expenses	12,668		11,074
Operating lease liabilities	11,600		11,028
Current accounts payable	10,842		6,803
Repurchase reserve	4,442		4,727
Guarantee obligations	1,660		2,806
Preferred stock dividends payable	1,478		1,478
Bridge loan holdbacks (1)	2,041		2,148
Other	25,517		19,958
Total Accrued Expenses and Other Liabilities	$	363,026	$	313,737

(1)Bridge loan holdbacks represent amounts withheld from the initial loan proceeds and are subsequently disbursed to the borrower to be used in the construction, rehabilitation or purchase of the mortgaged property or to fund interest on the bridge loan.

Legal and Repurchase Reserves

See Note 19 for additional information on legal and repurchase reserves.

Payable to Non-Controlling Interests

Redwood and a third-party co-investor, through two partnership entities consolidated by Redwood, purchased servicer advances and excess MSRs related to a portfolio of residential mortgage loans serviced by the co-investor (see Note 11 and Note 16 for additional information on the partnership entities and associated investments). We account for the co-investor’s interests in the entities as liabilities, and at September 30, 2025, the carrying value of their interests was $24 million, representing their current economic interest in the entities. Earnings from the partnership entities are allocated to the co-investors on a proportional basis and during the three and nine months ended September 30, 2025, we allocated $0.4 million and $0.8 million, respectively, of income to the co-investors, respectively, recorded in Other expenses on our consolidated statements of income.

Additionally, Redwood and a third-party investor co-sponsored the transfer and securitization of HEI through two HEI securitization entities. Other third-party investors contributed HEI into these securitizations through Redwood and retained subordinate beneficial interests issued by the securitization entities alongside Redwood. During the three months ending September 30, 2025, we called one of the HEI securitization entities and paid the remaining liabilities associated with the ABS and non-controlling interest. See Note 10 for a further discussion of the HEI securitizations. We account for the co-investor's interest in our HEI securitization entity as a liability, and at September 30, 2025, the carrying value of the interest was $44 million, representing the fair value of the economic interest in the beneficial interests issued by the HEI entity. During the three and nine months ended September 30, 2025, the third-party investors' share of earnings, net from their retained interests was $0.2 million and $8 million, respectively, recorded through HEI income, net on our consolidated statements of income.

During the nine months ended September 30, 2025, we completed a CAFL securitization of bridge loans sponsored by our joint venture. This transaction involved the transfer and securitization of bridge loans contributed from the joint venture and from Redwood through one bridge securitization entity. Each of the joint venture and Redwood retained its proportionate share of subordinate beneficial interests issued by the securitization entity. We account for the joint venture's interest in the bridge loan securitization entity

as a liability and at September 30, 2025, the carrying value of their interest was $17 million, representing the fair value of their economic interest in the beneficial interest issued. During the three and nine months ended September 30, 2025, the joint venture's share of earnings from their retained interest (for which positive earnings are reflected as an expense to Redwood in our consolidated statements of income) were negative $2 million and $10 million, respectively, net on our consolidated statements of income (loss).

In 2024, we completed a CAFL securitization of bridge loans sponsored by one of our joint ventures. This transaction involved the transfer and securitization of bridge loans contributed from the joint venture and from Redwood through one bridge securitization entity. Each of the joint venture and Redwood retained its proportionate share of subordinate beneficial interests issued by the securitization entity. We account for the joint venture's interest in the bridge loan securitization entity as a liability and at September 30, 2025, the carrying value of their interest was $17 million, representing the fair value of their economic interest in the beneficial interest issued. During the three and nine months ended September 30, 2025, the joint venture's share of earnings from their retained interest (for which positive earnings are reflected as an expense to Redwood in our consolidated statements of income) were negative $1 million and $4 million, respectively, on our consolidated statements of income (loss).