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Borrowings | 12 Months Ended
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Dec. 31, 2016
Debt Disclosure [Abstract] |
Borrowings | Note 13 — Borrowings Match Funded Liabilities Match funded liabilities are comprised of the following at December 31:
Borrowing Type |  | Interest Rate |  | Maturity (1) |  | Amortization Date (1) |  | Available Borrowing Capacity (2) |  | 2016 |  | 2015
Advance Receivables Backed Notes, Series 2014-VF3, Class A (4) |  | 1ML (3) + 185 bps |  | Aug. 2047 |  | Aug. 2017 |  | $ | 53,287 |  |  | $ | 59,892 |  |  | $ | 132,651 |
Advance Receivables Backed Notes - Series 2014-VF3, Class B (4) |  | 1ML + 250 bps |  | Aug. 2047 |  | Aug. 2017 |  | 2,458 |  |  | 2,879 |  |  | 6,330 |
Advance Receivables Backed Notes - Series 2014-VF3, Class C (4) |  | 1ML + 380 bps |  | Aug. 2047 |  | Aug. 2017 |  | 2,716 |  |  | 3,189 |  |  | 6,977 |
Advance Receivables Backed Notes - Series 2014-VF3, Class D (4) |  | 1ML + 545 bps |  | Aug. 2047 |  | Aug. 2017 |  | 7,145 |  |  | 8,434 |  |  | 18,427 |
Advance Receivables Backed Notes - Series 2014-VF4, Class A (4) |  | 1ML + 185 bps |  | Aug. 2047 |  | Aug. 2017 |  | 53,287 |  |  | 59,892 |  |  | 132,651 |
Advance Receivables Backed Notes - Series 2014-VF4, Class B (4) |  | 1ML + 250 bps |  | Aug. 2047 |  | Aug. 2017 |  | 2,458 |  |  | 2,879 |  |  | 6,330 |
Advance Receivables Backed Notes - Series 2014-VF4, Class C (4) |  | 1ML + 380 bps |  | Aug. 2047 |  | Aug. 2017 |  | 2,716 |  |  | 3,189 |  |  | 6,977 |
Advance Receivables Backed Notes - Series 2014-VF4, Class D (4) |  | 1ML + 545 bps |  | Aug. 2047 |  | Aug. 2017 |  | 7,145 |  |  | 8,434 |  |  | 18,427 |
Advance Receivables Backed Notes - Series 2015-VF5, Class A (4) |  | 1ML + 185 bps |  | Aug. 2047 |  | Aug. 2017 |  | 53,287 |  |  | 59,892 |  |  | 132,652 |
Advance Receivables Backed Notes - Series 2015-VF5, Class B (4) |  | 1ML + 250 bps |  | Aug. 2047 |  | Aug. 2017 |  | 2,458 |  |  | 2,879 |  |  | 6,330 |
Advance Receivables Backed Notes - Series 2015-VF5, Class C (4) |  | 1ML + 380 bps |  | Aug. 2047 |  | Aug. 2017 |  | 2,716 |  |  | 3,189 |  |  | 6,977 |
Borrowing Type |  | Interest Rate |  | Maturity (1) |  | Amortization Date (1) |  | Available Borrowing Capacity (2) |  | 2016 |  | 2015
Advance Receivables Backed Notes - Series 2015-VF5, Class D (4) |  | 1ML + 545 bps |  | Aug. 2047 |  | Aug. 2017 |  | 7,145 |  |  | 8,434 |  |  | 18,427 |
Advance Receivables Backed Notes - Series 2015-T1, Class A (5) |  | 2.5365% |  | Sep. 2046 |  | Sep. 2016 |  | — |  |  | — |  |  | 244,809 |
Advance Receivables Backed Notes - Series 2015-T1, Class B (5) |  | 3.0307% |  | Sep. 2046 |  | Sep. 2016 |  | — |  |  | — |  |  | 10,930 |
Advance Receivables Backed Notes - Series 2015-T1, Class C (5) |  | 3.5240% |  | Sep. 2046 |  | Sep. 2016 |  | — |  |  | — |  |  | 12,011 |
Advance Receivables Backed Notes - Series 2015-T1, Class D (5) |  | 4.1000% |  | Sep. 2046 |  | Sep. 2016 |  | — |  |  | — |  |  | 32,250 |
Advance Receivables Backed Notes - Series 2015-T2, Class A (5) |  | 2.5320% |  | Nov. 2046 |  | Nov. 2016 |  | — |  |  | — |  |  | 161,973 |
Advance Receivables Backed Notes - Series 2015-T2, Class B (5) |  | 3.3720% |  | Nov. 2046 |  | Nov. 2016 |  | — |  |  | — |  |  | 7,098 |
Advance Receivables Backed Notes - Series 2015-T2, Class C (5) |  | 3.7660% |  | Nov. 2046 |  | Nov. 2016 |  | — |  |  | — |  |  | 8,113 |
Advance Receivables Backed Notes - Series 2015-T2, Class D (5) |  | 4.2580% |  | Nov. 2046 |  | Nov. 2016 |  | — |  |  | — |  |  | 22,816 |
Advance Receivables Backed Notes - Series 2015-T3, Class A (5) |  | 3.2110% |  | Nov. 2047 |  | Nov. 2017 |  | — |  |  | 310,195 |  |  | 310,195 |
Advance Receivables Backed Notes - Series 2015-T3, Class B (5) |  | 3.7040% |  | Nov. 2047 |  | Nov. 2017 |  | — |  |  | 17,695 |  |  | 17,695 |
Advance Receivables Backed Notes - Series 2015-T3, Class C (5) |  | 4.1960% |  | Nov. 2047 |  | Nov. 2017 |  | — |  |  | 19,262 |  |  | 19,262 |
Advance Receivables Backed Notes - Series 2015-T3, Class D (5) |  | 4.6870% |  | Nov. 2047 |  | Nov. 2017 |  | — |  |  | 52,848 |  |  | 52,848 |
Advance Receivables Backed Notes - Series 2016-T1, Class A (5) |  | 2.5207% |  | Aug. 2048 |  | Aug. 2018 |  | — |  |  | 216,700 |  |  | — |
Advance Receivables Backed Notes - Series 2016-T1, Class B (5) |  | 3.0643% |  | Aug. 2048 |  | Aug. 2018 |  | — |  |  | 9,000 |  |  | — |
Advance Receivables Backed Notes - Series 2016-T1, Class C (5) |  | 3.6067% |  | Aug. 2048 |  | Aug. 2018 |  | — |  |  | 10,800 |  |  | — |
Advance Receivables Backed Notes - Series 2016-T1, Class D (5) |  | 4.2462% |  | Aug. 2048 |  | Aug. 2018 |  | — |  |  | 28,500 |  |  | — |
Advance Receivables Backed Notes - Series 2016-T2, Class A (5) |  | 2.7215% |  | Aug. 2049 |  | Aug. 2019 |  | — |  |  | 188,300 |  |  | — |
Advance Receivables Backed Notes - Series 2016-T2, Class B (5) |  | 3.2647% |  | Aug. 2049 |  | Aug. 2019 |  | — |  |  | 8,500 |  |  | — |
Borrowing Type |  | Interest Rate |  | Maturity (1) |  | Amortization Date (1) |  | Available Borrowing Capacity (2) |  | 2016 |  | 2015
Advance Receivables Backed Notes - Series 2016-T2, Class C (5) |  | 3.8066% |  | Aug. 2049 |  | Aug. 2019 |  | — |  |  | 10,300 |  |  | — |
Advance Receivables Backed Notes - Series 2016-T2, Class D (5) |  | 4.4456% |  | Aug. 2049 |  | Aug. 2019 |  | — |  |  | 27,900 |  |  | — |
Total Ocwen Master Advance Receivables Trust (OMART) |  |  |  |  |  |  |  | 196,818 |  |  | 1,123,182 |  |  | 1,393,156 |
Advance Receivables Backed Notes, Series 2014-VF1, Class A |  | Cost of Funds + 230 bps |  | Dec. 2047 |  | Dec. 2017 |  | 8,171 |  |  | 43,229 |  |  | 31,343 |
Advance Receivables Backed Notes, Series 2014-VF1, Class B |  | Cost of Funds + 360 bps |  | Dec. 2047 |  | Dec. 2017 |  | 597 |  |  | 3,403 |  |  | 4,157 |
Advance Receivables Backed Notes, Series 2014-VF1, Class C |  | Cost of Funds + 410 bps |  | Dec. 2047 |  | Dec. 2017 |  | 879 |  |  | 4,421 |  |  | 4,564 |
Advance Receivables Backed Notes, Series 2014-VF1, Class D |  | Cost of Funds + 470 bps |  | Dec. 2047 |  | Dec. 2017 |  | 2,260 |  |  | 12,040 |  |  | 11,351 |
Total Ocwen Servicer Advance Receivables Trust III (OSART III) (6) |  |  |  |  |  |  |  | 11,907 |  |  | 63,093 |  |  | 51,415 |
Advance Receivables Backed Notes, Series 2015-VF1, Class A |  | 1ML + 240 bps |  | Jun. 2047 |  | Jun. 2017 |  | 44,395 |  |  | 74,605 |  |  | 112,882 |
Advance Receivables Backed Notes, Series 2015-VF1, Class B |  | 1ML + 340 bps |  | Jun. 2047 |  | Jun. 2017 |  | 8,091 |  |  | 7,909 |  |  | 12,268 |
Advance Receivables Backed Notes, Series 2015-VF1, Class C |  | 1ML + 400 bps |  | Jun. 2047 |  | Jun. 2017 |  | 3,594 |  |  | 3,406 |  |  | 5,951 |
Advance Receivables Backed Notes, Series 2015-VF1, Class D |  | 1ML + 480 bps |  | Jun. 2047 |  | Jun. 2017 |  | 9,198 |  |  | 8,802 |  |  | 8,377 |
Total Ocwen Freddie Advance Funding (OFAF) (7) |  |  |  |  |  |  |  | 65,278 |  |  | 94,722 |  |  | 139,478 |
|  |  |  |  |  |  |  | $ | 274,003 |  |  | $ | 1,280,997 |  |  | $ | 1,584,049 |
Weighted average interest rate |  |  |  |  |  |  |  |  |  | 3.21 | % |  | 3.15 | %
(1) | The amortization date of our facilities is the date on which the revolving period ends under each advance facility note and repayment of the outstanding balance must begin if the note is not renewed or extended. The maturity date is the date on which all outstanding balances must be repaid. In all of our advance facilities, there are multiple notes outstanding. For each note, after the amortization date, all collections that represent the repayment of advances pledged to the facility must be applied to reduce the balance of the note outstanding, and any new advances are ineligible to be financed.
(2) | Borrowing capacity is available to us provided that we have additional eligible collateral to pledge. Collateral may only be pledged to one facility. At December 31, 2016, none of the available borrowing capacity could be used based on the amount of eligible collateral that had been pledged.
(3) | 1ML was 0.77% and 0.43% at December 31, 2016 and 2015, respectively.
(4) | On August 12, 2016, the supplemental indentures for the OMART facility variable funding notes were amended to reduce the borrowing capacity of each series from $200.0 million to $140.0 million or a total decrease in borrowing capacity of $180.0 million. There is a ceiling of 75 bps for 1ML in determining the interest rate for these variable rate notes.
(5) | Under the terms of the agreement, we must continue to borrow the full amount of the Series 2015-T3 Notes and the Series 2016-T1 and T2 Notes until the amortization date. If there is insufficient collateral to support the level of borrowing, the excess cash proceeds are not distributed to Ocwen but are held by the trustee, and interest expense continues to be based on the full amount of the term notes. On August 12, 2016, we issued the Series 2016-T1 and 2016-T2 Notes with a total borrowing capacity of $500.0 million. The proceeds from these notes were used to prepay at par the $500.0 million of Series 2015-T1 and 2015-T2 notes that were outstanding.
(6) | On December 15, 2016, we extended the term of this facility for an additional year and reduced the maximum borrowing capacity under the facility from $90.0 million to $75.0 million. There is a ceiling of 75 bps for 1ML in determining the interest rate for these variable rate notes.
(7) | On March 31, 2016, the combined borrowing capacity of the Series 2015-VF1 Notes was increased to $160.0 million. On June 10, 2016, the term of this facility was extended for an additional year. There is a ceiling of 125 bps for 1ML in determining the interest rate for these notes.
Pursuant to our agreements with NRZ, NRZ has assumed the obligation to fund new servicing advances with respect to the MSRs underlying the Rights to MSRs, or NRZ/HLSS Transactions. We are dependent upon NRZ for funding the servicing advance obligations for Rights to MSRs where we are the servicer. NRZ currently uses advance financing facilities in order to fund a substantial portion of the servicing advances that they are contractually obligated to purchase pursuant to our agreements with them. As of December 31, 2016, we were the servicer on Rights to MSRs sold to NRZ pertaining to approximately $118.7 billion in UPB and the associated outstanding servicing advances as of such date were approximately $4.1 billion. Should NRZ’s advance financing facilities fail to perform as envisaged or should NRZ otherwise be unable to meet its advance funding obligations, our liquidity, financial condition and business could be materially and adversely affected. As the servicer, we are contractually required under our servicing agreements to make the relevant servicing advances even if NRZ does not perform its contractual obligations to fund those advances. In addition, although we are not an obligor or guarantor under NRZ’s advance financing facilities, we are a party to certain of the facility documents as the servicer of the underlying loans on which advances are being financed. As the servicer, we make certain representations, warranties and covenants, including representations and warranties in connection with our sale of advances to NRZ. Financing Liabilities Financing liabilities are comprised of the following at December 31:
Borrowings |  | Collateral |  | Interest Rate |  | Maturity |  | 2016 |  | 2015
Financing liability – MSRs pledged |  | MSRs |  | (1) |  | (1) |  | $ | 477,707 |  |  | $ | 541,704 |
Secured Notes, Ocwen Asset Servicing Income Series, Series 2014-1 (2) |  | MSRs |  | (2) |  | Feb. 2028 |  | 81,131 |  |  | 96,546 |
Financing liability – Advances pledged (3) |  | Advances on loans |  | (3) |  | (3) |  | 20,193 |  |  | 59,643 |
HMBS-related borrowings (4) |  | Loans held for investment |  | 1ML + 260 bps |  | (4) |  | 3,433,781 |  |  | 2,391,362 |
|  |  |  |  |  |  |  | $ | 4,012,812 |  |  | $ | 3,089,255 |
(1) | This financing liability arose in connection with the NRZ/HLSS Transactions and has no contractual maturity or repayment schedule. The balance of the liability is adjusted each reporting period to its fair value based on the present value of the estimated future cash flows underlying the related MSRs.
(2) | OASIS noteholders are entitled to receive a monthly payment amount equal to the sum of: (a) the designated servicing fee amount (21 basis points of the UPB of the reference pool of Freddie Mac mortgages); (b) any termination payment amounts; (c) any excess refinance amounts; and (d) the note redemption amounts, each as defined in the indenture supplement for the notes. We accounted for this transaction as a financing. Monthly amortization of the liability is estimated using the proportion of monthly projected service fees on the underlying MSRs as a percentage of lifetime projected fees, adjusted for the term of the security.
(3) | Certain sales of advances in 2014 did not qualify for sales accounting treatment and were accounted for as a financing. This financing liability has no contractual maturity.
(4) | Represents amounts due to the holders of beneficial interests in Ginnie Mae guaranteed HMBS. The beneficial interests have no maturity dates, and the borrowings mature as the related loans are repaid.
Other Secured Borrowings Other secured borrowings are comprised of the following at December 31:
Borrowings |  | Collateral |  | Interest Rate |  | Maturity |  | Available Borrowing Capacity (1) |  | 2016 |  | 2015
Senior secured term loan (SSTL): |  |  |  |  |  |  |  |  |  |  |  |
SSTL (2) |  | (2) |  | 1-Month Euro-dollar rate + 425 bps with a Eurodollar floor of 125 bps |  | Feb. 2018 |  | $ | — |  |  | $ | — |  |  | $ | 398,454 |
SSTL (2) |  | (2) |  | 1-Month Euro-dollar rate + 500 bps with a Eurodollar floor of 100 bps (2) |  | Dec. 2020 |  | — |  |  | 335,000 |  |  | — |
|  |  |  |  |  |  |  | — |  |  | 335,000 |  |  | 398,454 |
Mortgage loan warehouse facilities: |  |  |  |  |  |  |  |  |  |  |  |
Repurchase agreement (3) |  | Loans held for sale (LHFS) |  | 1ML + 200 - 345 bps |  | Sep. 2017 |  | 37,630 |  |  | 12,370 |  |  | 42,973 |
Master repurchase agreement (4) |  | LHFS |  | 1ML + 200 bps; 1ML floor of 0.0% |  | Jan. 2017 (4) |  | 26,457 |  |  | 173,543 |  |  | 156,226 |
Participation agreement (5) |  | LHFS |  | N/A |  | Apr. 2017 (5) |  | — |  |  | 44,413 |  |  | 49,897 |
Participation agreement (5) |  | LHFS |  | N/A |  | Apr. 2017 (5) |  | — |  |  | 48,326 |  |  | 73,049 |
Mortgage warehouse agreement (6) |  | LHFS (reverse mortgages) |  | 1ML + 275 bps; 1ML floor of 300 or 350 bps |  | Aug. 2017 |  | — |  |  | 26,254 |  |  | 63,175 |
Master repurchase agreement (7) |  | LHFS (reverse mortgages) |  | 1ML + 275 bps; 1ML floor of 25 bps |  | Jan. 2018 |  | 49,877 |  |  | 50,123 |  |  | — |
|  |  |  |  |  |  |  | 113,964 |  |  | 355,029 |  |  | 385,320 |
|  |  |  |  |  |  |  | $ | 113,964 |  |  | 690,029 |  |  | 783,774 |
Unamortized debt issuance costs - SSTL |  |  |  | (7,612 | ) |  | (20,012 | )
Discount - SSTL |  |  |  | (3,874 | ) |  | (1,351 | )
|  |  |  |  |  |  |  |  |  |  | $ | 678,543 |  |  | $ | 762,411 |
Weighted average interest rate |  |  |  |  |  |  |  |  |  | 4.56 | % |  | 4.38 | %
(1) | For our mortgage loan warehouse facilities, available borrowing capacity does not consider the amount of the facility that the lender has extended on an uncommitted basis.
(2) | On December 5, 2016, we entered into an Amended and Restated Senior Secured Term Loan Facility Agreement (the Amended and Restated Agreement). The Amended and Restated Agreement establishes a new SSTL with a borrowing capacity of $335.0 million and a maturity date of December 5, 2020. We used the proceeds of the new SSTL to repay our obligations under the prior SSTL and to pay certain fees and expenses of the transaction. We may request increases to the loan amount of up to $100.0 million, with additional increases subject to certain limitations. We are required to make quarterly payments on the SSTL in an amount of $4.2 million commencing on March 31, 2017.
The borrowings under the SSTL are secured by a first priority security interest in substantially all of the assets of Ocwen, OLS and the other guarantors thereunder, excluding among other things, 35% of the capital stock of foreign subsidiaries, securitization assets and equity interests of securitization entities, assets securing permitted funding indebtedness and non-recourse indebtedness, REO assets, servicing agreements where an acknowledgment from the GSE has not been obtained, as well as other customary carve-outs. Borrowings bear interest, at the election of Ocwen, at a rate per annum equal to either (a) the base rate (the greatest of (i) the prime rate in effect on such day, (ii) the federal funds rate in effect on such day plus 0.50% and (iii) the one-month Eurodollar rate (1ML)), plus a margin of 4.00% and subject to a base rate floor of 2.00% or (b) the one month Eurodollar rate, plus a margin of 5.00% and subject to a one month Eurodollar floor of 1.00%. To date we have elected option (b) to determine the interest rate. The amended and restated agreement includes covenants that are substantially similar to the prior senior secured term loan, including the requirement that Ocwen maintain a loan-to-value ratio at a 40% level as of the last date of any fiscal quarter throughout the term of the SSTL.
(3) | Fifty percent of the maximum borrowing amount of $100.0 million is available on a committed basis and fifty percent is available at the discretion of the lender. On September 29, 2016, we renewed this facility through September 28, 2017 with no change in interest rates or maximum borrowing capacity. We use this facility to fund the repurchase of certain loans from Ginnie Mae guaranteed securitizations in connection with loan modifications and loan resolution activity as part of our contractual obligations as the servicer of the loans.
(4) | Under this repurchase agreement, the lender provides financing on a committed basis for $200.0 million. On November 28, 2016, we extended the term of this agreement to January 31, 2017 with no change in rates or maximum borrowing capacity, although a LIBOR floor of 0.0% was added to the terms of the facility effective September 30, 2016. On January 31, 2017, the term of this agreement was further extended to February 28, 2017.
(5) | Under these participation agreements, the lender provides financing for a combined total of $250.0 million at the discretion of the lender. The participation agreement allows the lender to acquire a 100% beneficial interest in the underlying mortgage loans. The transaction does not qualify for sale accounting treatment and is accounted for as a secured borrowing. The lender earns the stated interest rate of the underlying mortgage loans while the loans are financed under the participation agreement. On April 26, 2016, the term of these agreements was extended to April 30, 2017.
(6) | Under this participation agreement, the lender provides financing for $110.0 million at the discretion of the lender. The participation agreement allows the lender to acquire a 100% beneficial interest in the underlying mortgage loans. The transaction does not qualify for sale accounting treatment and is accounted for as a secured borrowing. The lender earns the stated interest rate of the underlying mortgage loans while the loans are financed under the participation agreement. On August 17, 2016, the term of this agreement was extended to August 17, 2017.
(7) | We entered into this agreement on January 5, 2016. The lender provides financing on a committed basis for $100.0 million. On December 23, 2016, the term of this agreement was extended to January 2, 2018. The other terms remained unchanged.
Senior Notes Senior notes, net are comprised of the following at December 31:
| 2016 |  | 2015
6.625% Senior unsecured notes | $ | 3,122 |  |  | $ | 350,000 |
8.375% Senior secured notes | 346,878 |  |  | — |
| 350,000 |  |  | $ | 350,000 |
Unamortized debt issuance costs | (3,211 | ) |  | (4,489 | )
| $ | 346,789 |  |  | $ | 345,511 |
Senior Unsecured Notes On May 12, 2014, Ocwen completed the issuance and sale of $350.0 million aggregate principal amount of 6.625% Senior Unsecured Notes due 2019 (Senior Unsecured Notes) in a private offering. On December 5, 2016, holders of $346.9 million principal amount of the Senior Unsecured Notes exchanged their notes for 8.375% Senior Secured Second Lien Notes issued by OLS that mature in 2022 (Senior Secured Notes). Ocwen may redeem all or a part of the remaining Senior Unsecured Notes, upon not less than 30 nor more than 60 days’ notice, at the redemption prices (expressed as percentages of principal amount) specified in the Indenture plus accrued and unpaid interest and additional interest, if any. The redemption prices during the twelve-month periods beginning on May 15 th of each year are as follows:
Year |  | Redemption Price
2016 |  | 104.969%
2017 |  | 103.313%
2018 and thereafter |  | 100.000%
In connection with our issuance of the Senior Unsecured Notes, we incurred certain costs that we capitalized and are amortizing over the period from the date of issuance to May 15, 2019. The unamortized balance of these issuance costs was $0.03 million and $4.5 million at December 31, 2016 and 2015, respectively. Senior Secured Notes On December 5, 2016, OLS completed a debt-for-debt exchange offer whereby OLS issued $346.9 million aggregate principal amount of Senior Secured Notes in exchange for $346.9 million aggregate principal amount (or 99.1%) of Ocwen’s Senior Unsecured Notes. The Senior Secured Notes will mature on November 15, 2022. Interest will be payable semiannually on each May 15 and November 15, commencing on May 15, 2017. The Senior Secured Notes are guaranteed by Ocwen and OMS, Homeward Residential Holdings, Inc., Homeward and ACS (the Guarantors). The Senior Secured Notes are secured by second priority liens on the assets and properties of OLS and the Guarantors that secure the first priority obligations under the SSTL, excluding certain MSRs. At any time, OLS may redeem all or a part of the Senior Secured Notes, upon not less than 30 nor more than 60 days’ notice at a specified redemption price, plus accrued and unpaid interest to the date of redemption. Prior to November 15, 2018, the Senior Secured Notes may be redeemed at a redemption price equal to 100.0% of the principal amount of the Senior Secured Notes redeemed, plus the applicable premium (as defined in the Indenture). On or after November 15, 2018, OLS may redeem all or a part of the Senior Secured Notes at the redemption prices (expressed as percentages of principal amount) specified in the Indenture. The redemption prices during the twelve-month periods beginning on November 15 th of each year are as follows:
Year |  | Redemption Price
2018 |  | 106.281%
2019 |  | 104.188%
2020 |  | 102.094%
2021 and thereafter |  | 100.000%
At any time, on or prior to November 15, 2018, OLS may, at its option, use the net cash proceeds of one or more equity offerings (as defined in the Indenture) to redeem up to 35.0% of the principal amount of all Senior Secured Notes issued at a redemption price equal to 108.375% of the principal amount of the Senior Secured Notes redeemed plus accrued and unpaid interest to the date of redemption, provided that: (i) at least 65.0% of the principal amount of all Senior Secured Notes issued under the Indenture (including any additional Senior Secured Notes) remains outstanding immediately after any such redemption; and (ii) OLS makes such redemption not more than 120 days after the consummation of any such Equity Offering. Upon the occurrence of a change of control (as defined in the Indenture), OLS is required to make an offer to the holders of the Senior Secured Notes to repurchase all or a portion of each holder’s Senior Secured Notes at a purchase price equal to 101.0% of the principal amount of the Senior Secured Notes purchased plus accrued and unpaid interest to the date of purchase. The Indenture contains certain covenants, including, but not limited to, limitations and restrictions on Ocwen’s ability and the ability of its restricted subsidiaries (including OLS) to (i) incur additional debt or issue preferred stock; (ii) pay dividends or make distributions on or purchase equity interests of Ocwen (iii) repurchase or redeem subordinated debt prior to maturity; (iv) make investments or other restricted payments; (v) create liens on assets to secure debt of OLS or any Guarantor; (vi) sell or transfer assets; (vii) enter into transactions with affiliates; and (viii) enter into mergers, consolidations, or sales of all or substantially all of the assets of Ocwen and its restricted subsidiaries, taken as a whole. As of the date of the Indenture, all of Ocwen’s subsidiaries are restricted subsidiaries. The restrictive covenants set forth in the Indenture are subject to important exceptions and qualifications. Many of the restrictive covenants will be suspended if (i) the Senior Secured Notes achieve an investment grade rating from both Moody’s and Standard & Poor’s Ratings Services (S&P) and (ii) no default or event of default has occurred and is continuing under the Indenture. Covenants that are suspended as a result of achieving these ratings will again apply if one or both of Moody’s and S&P withdraws its investment grade rating or downgrades the rating assigned to the Senior Secured Notes below an investment grade rating. In connection with our issuance of the Senior Secured Notes, we incurred certain costs that we capitalized and are amortizing over the period from the date of issuance to November 15, 2022. The unamortized balance of these issuance costs was $3.2 million at December 31, 2016. Covenants Under the terms of our debt agreements, we are subject to various qualitative and quantitative covenants. Collectively, these covenants include:
• | Financial covenants;
• | Covenants to operate in material compliance with applicable laws;
• | Restrictions on our ability to engage in various activities, including but not limited to incurring additional debt, paying dividends, repurchasing or redeeming capital stock or junior capital, transferring assets or making loans, investments or acquisitions;
• | Monitoring and reporting of various specified transactions or events, including specific reporting on defined events affecting collateral underlying certain debt agreements; and
• | Requirements to provide audited financial statements within specified timeframes, including a requirement under our SSTL that Ocwen’s financial statements and the related audit report be unqualified as to going concern.
Financial covenants in our debt agreements require that we maintain, among other things:
• | a specified loan to collateral value ratio, as defined under our SSTL; and
• | specified levels of tangible net worth and liquidity at the consolidated and OLS levels.
As of December 31, 2016, the most restrictive consolidated tangible net worth requirements were for a minimum of $1.1 billion at OLS under our match funded debt agreements and three repurchase agreements and $575.0 million at Ocwen under a master repurchase agreement. As a result of the covenants to which we are subject, we may be limited in the manner in which we conduct our business and may be limited in our ability to engage in favorable business activities or raise additional capital to finance future operations or satisfy future liquidity needs. In addition, breaches or events that may result in a default under our debt agreements include, among other things, noncompliance with our covenants, nonpayment of principal or interest, material misrepresentations, the occurrence of a material adverse change, insolvency, bankruptcy, certain material judgments and changes of control. Covenants and default provisions of this type are commonly found in debt agreements such as ours. Certain of these covenants and default provisions are open to subjective interpretation and, if our interpretation were contested by a lender, a court may ultimately be required to determine compliance or lack thereof. In addition, our debt agreements generally include cross default provisions such that a default under one agreement could trigger defaults under other agreements. If we fail to comply with our debt agreements and are unable to avoid, remedy or secure a waiver of any resulting default, we may be subject to adverse action by our lenders, including termination of further funding, acceleration of outstanding obligations, enforcement of liens against the assets securing or otherwise supporting our obligations and other legal remedies. Our lenders can waive their contractual rights in the event of a default. We believe that we are in compliance with all of the qualitative and quantitative covenants in our debt agreements as of the date of these financial statements. Maturities of Borrowings and Management’s Plans to Address Maturing Borrowings Aggregate expected maturities of our borrowings at December 31, 2016 are included in the table below. Certain of our borrowings mature within one year of the date of issuance of these financial statements. Based on management’s evaluation, we expect to renew, replace or extend all such borrowings to the extent necessary to finance our business on or prior to their respective maturities consistent with our historical experience.
|  | Expected Maturity Date (1) (2) (3) |  |  |  |
|  | 2017 |  | 2018 |  | 2019 |  | 2020 |  | 2021 |  | There- after |  | Total Balance |  | Fair Value
Match funded liabilities |  | $ | 780,997 |  |  | $ | 265,000 |  |  | $ | 235,000 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 1,280,997 |  |  | $ | 1,275,059 |
Other secured borrowings |  | 321,656 |  |  | 66,873 |  |  | 16,750 |  |  | 284,750 |  |  | — |  |  | — |  |  | 690,029 |  |  | 682,703 |
Senior notes |  | — |  |  | — |  |  | 3,122 |  |  | — |  |  | — |  |  | 346,878 |  |  | 350,000 |  |  | 355,303 |
|  | $ | 1,102,653 |  |  | $ | 331,873 |  |  | $ | 254,872 |  |  | $ | 284,750 |  |  | $ | — |  |  | $ | 346,878 |  |  | $ | 2,321,026 |  |  | $ | 2,313,065 |
(1) | Amounts are exclusive of any related discount or unamortized debt issuance costs.
(2) | For match funded liabilities, the expected maturity date is the date on which the revolving period ends for each advance financing facility note and repayment of the outstanding balance must begin if the note is not renewed or extended.
(3) | Excludes financing liabilities, which we recognized in connection with asset sales transactions that we accounted for as financings. Financing liabilities include $477.7 million recorded in connection with sales of Rights to MSRs and $3.4 billion recorded in connection with the securitizations of HMBS. The MSR-related financing liabilities have no contractual maturity and are amortized over the life of the transferred Rights to MSRs. The HMBS-related financing liabilities have no contractual maturity and are amortized as the related loans are repaid.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.19,20,22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
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