Loans Held for Sale

12 Months Ended

Dec. 31, 2020

Note 6 — Loans Held for Sale


Loans Held for Sale - Fair Value	Years Ended December 31,
	2020		2019		2018
Beginning balance	$	208,752	$	176,525	$	214,262
Originations and purchases	7,552,026		1,168,885		944,627
Proceeds from sales	(7,344,151)		(1,124,247)		(1,019,211)
Principal collections	(25,976)		(23,116)		(20,774)
Acquired in connection with the acquisition of PHH	—		—		42,324
Transfers from (to):
Loans held for investment, at fair value	3,084		1,892		1,038

Receivables	(85,001)		(2,480)		(1,132)
REO (Other assets)	(3,657)		(2,520)		(1,886)
Gain on sale of loans	50,248		25,253		34,724
(Decrease) increase in fair value of loans	1,075		(589)		(13,435)
Other	9,964		(10,851)		(4,012)
Ending balance (1) (2)	$	366,364	$	208,752	$	176,525

(1)At December 31, 2020, 2019 and 2018, the balances include $(6.7) million, $(7.8) million and $(7.2) million, respectively, of fair value adjustments.

(2)At December 31, 2020, the balances include $51.1 million of loans that we repurchased from Ginnie Mae guaranteed securitizations pursuant to Ginnie Mae servicing guidelines. As disclosed in Note 5 — Fair Value, effective January 1, 2020, we elected to classify repurchased loans as Loans held for sale at fair value. See table below. We may repurchase loans that have been modified, to facilitate loss reduction strategies, or as otherwise obligated as a Ginnie Mae servicer. Repurchased loans may be modified or otherwise remediated through loss mitigation activities, may be sold to a third party, or are reclassified to Receivables.


Loans Held for Sale - Lower of Cost or Fair Value	Years Ended December 31,
	2020		2019		2018
Beginning balance	$	66,517	$	66,097	$	24,096
Purchases (1)	—		320,089		770,563
Proceeds from sales	(58,575)		(221,471)		(569,718)
Principal collections	(1,842)		(11,304)		(15,413)
Transfers from (to):
Receivables, net	61		(104,635)		(155,586)
REO (Other assets)	—		(4,116)		(2,355)

Gain on sale of loans	11,189		4,974		3,659
Decrease (increase) in valuation allowance	463		4,926		(4,251)
Other	3,659		11,957		15,102
Ending balance (2)	$	21,472	$	66,517	$	66,097

(1)We elected the fair value option for all newly repurchased loans after December 31, 2019.

(2)At December 31, 2020, 2019 and 2018, the balances include $12.5 million, $60.6 million and $51.8 million, respectively, of loans that we repurchased from Ginnie Mae guaranteed securitizations pursuant to Ginnie Mae servicing guidelines.


Valuation Allowance - Loans Held for Sale at Lower of Cost or Fair Value	Years Ended December 31,
	2020		2019		2018
Beginning balance	$	6,643	$	11,569	$	7,318
Provision	1,144		2,537		4,033
Transfer from Liability for indemnification obligations (Other liabilities)	68		403		2,021
Sales of loans	(1,675)		(7,866)		(1,824)
Other	—		—		21
Ending balance	$	6,180	$	6,643	$	11,569


	Years Ended December 31,
Gains on Loans Held for Sale, Net	2020		2019		2018
Gain on sales of loans, net
MSRs retained on transfers of forward mortgage loans	$	68,734	$	7,458	$	7,412

Gain on sale of forward mortgage loans	45,459		25,310		34,216
Gain on sale of repurchased Ginnie Mae loans	15,947		4,764		3,659

	130,140		37,532		45,287
Change in fair value of IRLCs	17,479		756		3,809
Change in fair value of loans held for sale	2,280		3,005		(11,569)
(Loss) gain on economic hedge instruments	(10,069)		(2,689)		136
Other	(2,594)		(304)		(327)
	$	137,236	$	38,300	$	37,336