Debt Obligations, Net

9 Months Ended

Sep. 30, 2025

We enter into loan warehouse facilities, repurchase agreements ("repo"), recourse subordinate securities financings, and other forms of collateralized (and generally uncommitted) borrowings with several banks and major investment banking firms. We use debt to finance the acquisition and/or origination of residential consumer and residential investor mortgage loans (including those we acquire or originate in anticipation of sale or securitization), and to finance investments in securities and other investments. Additionally, we use corporate debt obligations to fund other aspects of our business and operations, including the repurchase of shares of our capital stock.

At September 30, 2025, we had outstanding agreements on debt obligations with several counterparties and we were in compliance with all of the related covenants. Refer to Note 3 to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2024 for additional information regarding these investments. Refer to Note 17 to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2024 for additional information regarding our debt obligations.

The following tables summarize our debt obligations at September 30, 2025 and December 31, 2024.

Table 18.1 – Debt Obligations, Net


	September 30, 2025
(Dollars in Thousands)	Number of Facilities or Issuances	Principal Amount		Carrying Value (1)		Facility Capacity		Weighted Average Interest Rate (2)		Final Stated Maturity	Carrying Value of Collateral

Short-Term Facilities:
Residential consumer loan warehouse facilities	8	$	2,264,410	$	2,264,409	$	3,369,258	5.94	%	10/2025-7/2026	$	2,437,510
Residential investor loan warehouse facilities	4	206,304		206,207		1,150,000		6.69	%	5/2026-8/2026	281,491
Real estate securities repurchase facilities	5	27,585		27,585		—		5.75	%	10/2025	35,481
Real estate securities repurchase facilities IO	1	—		—		75,000		7.45	%	6/2026	—
Residential MSR warehouse facility	1	89,403		89,403		125,000		7.38	%	10/2025	183,907
HEI warehouse facility	1	27,848		27,848		150,000		8.67	%	12/2025	55,486

Recourse Subordinate Securities Financing:
CAFL securities (3)	1	263,664		262,873		(6)		7.11	%	9/2028	333,457
Sequoia and other third-party securities (3)	1	90,141		90,141		(6)		7.27	%	6/2027	114,768

Long-Term Facilities:
Residential investor loan warehouse facilities	3	199,404		198,173		1,030,000		7.52	%	10/2026-4/2027	290,414
Servicer advance financing	1	151,491		151,024		200,000		6.09	%	12/2026	214,641
Secured revolving financing facility (4)	1	250,000		248,094		250,000		7.27	%	3/2026	500,786

Corporate Debt:
Promissory notes (3) (5)	3	10,900		10,900		(6)		7.05	%	N/A	(7)
5.75% exchangeable senior notes (3)	1	123,574		123,574		(6)		5.75	%	10/2025	(7)
7.75% convertible senior notes (3)	1	297,170		292,425		(6)		7.75	%	6/2027	(7)
Trust preferred securities and subordinated notes	2	139,500		138,894		(6)		6.82	%	1/2037, 7/2037	(7)
9.125% Senior Notes (3)	1	59,127		57,350		(6)		9.13	%	3/2029	(7)
9.0% Senior Notes (3)	1	84,015		81,536		(6)		9.00	%	9/2029	(7)
9.125% Senior Notes (3)	1	89,232		86,225		(6)		9.13	%	3/2030	(7)
Total Debt Obligations		$	4,373,768	$	4,356,661						$	4,447,941


	December 31, 2024
(Dollars in Thousands)	Number of Facilities or Issuances	Principal Amount		Carrying Value (1)		Facility Capacity		Weighted Average Interest Rate (2)		Final Stated Maturity	Carrying Value of Collateral
Short-Term Facilities:
Residential consumer loan warehouse facilities	7	$	956,010	$	956,010	$	2,175,000	6.24	%	3/2025-10/2025	$	1,005,926
Residential investor loan warehouse facilities	2	223,975		223,876		800,000		7.31	%	6/2025-7/2025	300,843
Real estate securities repurchase facilities	6	210,352		210,352		—		5.81	%	1/2025-3/2025	281,997
Residential MSR warehouse facility	1	58,164		58,164		75,000		7.65	%	10/2025	91,506
HEI warehouse facility	1	97,497		97,497		150,000		9.00	%	12/2025	207,097

Recourse Subordinate Securities Financings:
CAFL securities (3)	1	268,240		267,140		(6)		7.54	%	9/2028	318,106

Long Term Facilities:
Residential investor loan warehouse facilities	5	615,036		613,129		1,530,000		7.83	%	5/2026-4/2027	889,901
Servicer advance financing	1	159,798		159,031		200,000		6.32	%	12/2026	233,820
Secured revolving financing facility (4)	1	225,000		220,234		250,000		9.50	%	3/2026	372,396

Corporate Debt:
Promissory notes (3) (5)	3	12,859		12,859		(6)		7.06	%	N/A	(7)
5.75% exchangeable senior notes (3)	1	123,574		123,087		(6)		5.75	%	10/2025	(7)
7.75% convertible senior notes (3)	1	247,170		242,652		(6)		7.75	%	6/2027	(7)
Trust preferred securities and subordinated notes	2	139,500		138,860		(6)		7.10	%	1/2037, 7/2037	(7)
9.125% Senior Notes (3)	1	60,000		57,877		(6)		9.13	%	3/2029	(7)
9.0% Senior Notes (3)	1	85,000		82,112		(6)		9.00	%	9/2029	(7)
Total Debt Obligations		$	3,482,175	$	3,462,880						$	3,701,592

(1)Carrying value presented net of total deferred issuance costs of $17 million and $20 million at September 30, 2025 and December 31, 2024, respectively.

(2)Variable rate borrowings are based on 1- or 3-month SOFR, plus an applicable spread.

(3)Borrowing has a fixed interest rate at period end.

(4)Facility may be extended for one year at our option.

(5)Promissory notes payable on demand to lender with 90-day notice.

(6)Outstanding principal balance represents facility capacity at period end.

(7)Unsecured corporate debt; no related collateral at period end.

In January 2025, Redwood issued $90 million of 9.125% Senior Notes due in 2030. The Senior Notes are senior unsecured obligations of Redwood and bear interest at a rate equal to 9.125% per year, payable quarterly in arrears on March 1, June 1, September 1 and December 1 of each year, beginning on June 1, 2025. The Senior Notes mature on March 1, 2030. We may redeem the Senior Notes, in whole or in part, at any time on or after March 1, 2027 at a redemption price equal to 100% of the principal amount redeemed plus accrued and unpaid interest.

In June 2025, we entered into a new recourse subordinate securities financing facility providing non-marginable debt financing of certain securities retained from our consolidated Sequoia securitizations and other third-party issued interest-only securities. This financing is fully and unconditionally guaranteed by Redwood, with an interest rate of approximately 7.27% through June 2027, increasing to 10.27% from June 2027 through July 2028. This financing facility may be terminated at our option, beginning in June 2026, and has a final stated maturity in June 2027.

In August 2025, we issued an additional $50 million of these 7.75% senior notes due in 2027, resulting in net proceeds of approximately $48 million. 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. At September 30, 2025, the conversion rate of the notes was 95.6823 common shares per $1,000 principal amount of notes (equivalent to a conversion price of $10.45 per common share).