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Business Acquisitions (Tables) | 9 Months Ended
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Sep. 30, 2019
Business Combinations [Abstract] |
Schedule of Purchase Price Allocation of Assets Acquired and Liabilities Assumed | The purchase price allocation provided in the table below reflects the final determination of the fair value of assets acquired and liabilities assumed in the acquisition of PHH, with the excess of total identifiable net assets over total consideration paid recorded as a bargain purchase gain. Independent valuation specialists conducted analyses to assist management in determining the fair value of certain acquired assets and assumed liabilities. Management is responsible for these third-party valuations and appraisals. The methodologies that we use and key assumptions that we made to estimate the fair value of the acquired assets and assumed debt are described in Note 5 – Fair Value.
Purchase Price Allocation | October 4, 2018 |  | Adjustments |  | Revised
Cash | $ | 423,088 |  |  | $ | — |  |  | $ | 423,088 |
Restricted cash | 38,813 |  |  | — |  |  | 38,813 |
MSRs | 518,127 |  |  | — |  |  | 518,127 |
Advances, net | 96,163 |  |  | — |  |  | 96,163 |
Loans held for sale | 42,324 |  |  | 358 |  |  | 42,682 |
Receivables, net | 46,838 |  |  | (96 | ) |  | 46,742 |
Premises and equipment, net | 15,203 |  |  | — |  |  | 15,203 |
REO | 3,289 |  |  | — |  |  | 3,289 |
Other assets | 6,293 |  |  | — |  |  | 6,293 |
Assets related to discontinued operations | 2,017 |  |  | — |  |  | 2,017 |
Financing liabilities (MSRs pledged, at fair value) | (481,020 | ) |  | — |  |  | (481,020 | )
Other secured borrowings, net | (27,594 | ) |  | — |  |  | (27,594 | )
Senior notes, net (Senior unsecured notes) | (120,624 | ) |  | — |  |  | (120,624 | )
Accrued legal fees and settlements | (9,960 | ) |  | — |  |  | (9,960 | )
Other accrued expenses | (36,889 | ) |  | — |  |  | (36,889 | )
Loan repurchase and indemnification liability | (27,736 | ) |  | — |  |  | (27,736 | )
Unfunded pension liability | (9,815 | ) |  | — |  |  | (9,815 | )
Other liabilities | (34,131 | ) |  | (643 | ) |  | (34,774 | )
Liabilities related to discontinued operations | (21,954 | ) |  | — |  |  | (21,954 | )
Total identifiable net assets | 422,432 |  |  | (381 | ) |  | 422,051 |
Total consideration paid to seller | (358,396 | ) |  | — |  |  | (358,396 | )
Bargain purchase gain | $ | 64,036 |  |  | $ | (381 | ) |  | $ | 63,655 |
Schedule of Supplemental Pro forma Information | The table below presents supplemental pro forma information for Ocwen for the three and nine months ended September 30, 2018 as if the PHH acquisition occurred on January 1, 2017. Pro forma adjustments include the following:
Description | Three Months Ended September 30, 2018 |  | Nine Months Ended September 30, 2018
Increase in MSR valuation adjustments, net for acquired MSRs to conform the accounting for MSRs to the valuation policies of Ocwen | $ | 23,360 |  |  | $ | 24,442 |
Adjust interest expense for a total net decline (1) | (18,382 | ) |  | (30,598 | )
Report Ocwen and PHH acquisition-related charges for professional services as if they had been incurred in 2017 rather than 2018 | (9,384 | ) |  | (18,548 | )
Total net increase in revenue (2) | 39,156 |  |  | 120,616 |
Adjust depreciation expense to amortize internally developed software acquired from PHH on a straight-line basis based on a useful life of three years | 245 |  |  | 735 |
Income tax expense (benefit) based on management’s estimate of the blended applicable statutory tax rates and observing the continued need for a valuation allowance (3) | 1,158 |  |  | (300 | )
(1) | Primarily pertains to fair value adjustments of $18.6 million and $31.4 million for the three and nine months ended September 30, 2018, respectively, related to the assumed MSR secured liability using valuation assumptions consistent with Ocwen’s methodology, excluding the gross-up of PHH MSRs sold and accounted for as a secured borrowing.
(2) | Primarily pertains to an increase to revenue of $40.3 million and $127.7 million for the three and nine months ended September 30, 2018, respectively, for the gross-up of PHH MSRs sold and accounted for as a secured borrowing. The offset of the remaining adjustments are expenses, interest income and interest expense, with no net effect on earnings.
(3) | The net income tax benefit recorded as a result of pro forma adjustments represents lower current federal tax under the new base erosion and anti-abuse tax (BEAT) provision of the 2017 Tax Cuts and Jobs Act (Tax Act) assuming Ocwen and PHH would file a consol idated federal tax return beginning January 1, 2017. The pro forma tax adjustments contemplate the effects of the Tax Act.
Schedule of Pro Forma Results of Operations |
| Three Months Ended September 30, 2018 |  | Nine Months Ended September 30, 2018
Revenues | $ | 314,675 |  |  | $ | 995,043 |
Net loss from continuing operations | (65,168 | ) |  | (133,594 | )

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- Definition Tabular disclosure of the nature and amount of any material, nonrecurring adjustments directly attributable to the business combination(s) included in the reported pro forma revenue and earnings (supplemental pro forma information). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (h)(4) -URI http://asc.fasb.org/extlink&oid=79982066&loc=d3e1392-128463 + Details
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- Definition Tabular disclosure of pro forma results of operations for a material business acquisition or series of individually immaterial business acquisitions that are material in the aggregate. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (h)(2) -URI http://asc.fasb.org/extlink&oid=79982066&loc=d3e1392-128463 Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (h)(3) -URI http://asc.fasb.org/extlink&oid=79982066&loc=d3e1392-128463 + Details
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- Definition Tabular disclosure of a material business combination completed during the period, including background, timing, and recognized assets and liabilities. This table does not include leveraged buyouts. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=79982066&loc=d3e1486-128463 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=79982066&loc=d3e1392-128463 + Details
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