Reverse Mortgages

12 Months Ended

Dec. 31, 2021

Note 5 – Reverse Mortgages


	Years Ended December 31,
	2021				2020				2019
	Loans Held for Investment - Reverse Mortgages		HMBS - Related Borrowings (2)		Loans Held for Investment - Reverse Mortgages		HMBS - Related Borrowings (2)		Loans Held for Investment - Reverse Mortgages		HMBS - Related Borrowings
Beginning balance	$	6,997,127	$	(6,772,711)	$	6,269,596	$	(6,063,435)	$	5,472,199	$	(5,380,448)
Cumulative effect of fair value election (1)	—		—		47,038		—		—		—
Originations	1,763,418		—		1,203,645		—		1,026,154		—
Securitization of HECM loans accounted for as a financing (incl. realized fair value changes)	—		(1,674,914)		—		(1,232,641)		—		(962,113)
Additional proceeds from securitization of HECM loans and tails	—		(44,613)		—		(40,934)		—		(19,086)
Repayments (principal payments received)	(1,626,428)		1,614,295		(944,699)		935,778		(558,720)		549,600
Transfers from (to):
Loans held for sale, at fair value	(3,383)		—		(3,084)		—		(1,892)		—
Receivables, net	(333)		—		(236)		—		(327)		—
REO (Other assets)	(348)		—		(511)		—		(513)		—
Change in fair value	69,709		(7,079)		425,378		(371,479)		332,695		(251,388)
Ending Balance	$	7,199,762	$	(6,885,022)	$	6,997,127	$	(6,772,711)	$	6,269,596	$	(6,063,435)
Securitized loans (pledged to HMBS-Related Borrowings)	$	6,979,100	$	(6,885,022)	$	6,872,252	$	(6,772,711)	$	6,120,933	$	(6,063,435)
Unsecuritized loans	220,662				124,875				148,663
Total	$	7,199,762			$	6,997,127			$	6,269,596

(1)In conjunction with the adoption of ASU 2016-13, we elected the fair value option for future draw commitments (tails) on HECM reverse mortgage loans purchased or originated before December 31, 2018, which resulted in the recognition of the fair value of such tails through stockholders’ equity on January 1, 2020.

(2)Represents amounts due to the holders of beneficial interests in Ginnie Mae guaranteed HMBS that did not qualify for sale accounting treatment of HECM loans. Under this accounting treatment, the HECM loans securitized with Ginnie Mae remain on our consolidated balance sheets and the proceeds from the sale are recognized as a financing liability, which is recorded at fair value consistent with the related HECM loans. The beneficial interests in Ginnie Mae guaranteed HMBS have no maturity dates, and the borrowings mature as the related loans are repaid. The interest rate is 1ML plus an applicable margin based on the pass-through rate of the loans. See Note 2 — Securitizations and Variable Interest Entities.


Reverse Mortgage Revenue, Net	Years Ended December 31,
	2021		2020		2019
Gain on new originations (1)	$	64,971	$	46,326	$	17,849
Change in fair value of securitized loans held for investment and HMBS-related borrowings, net	(2,341)		7,573		63,459
Change in fair value included in earnings, net	62,630		53,899		81,308
Loan fees and other	17,046		6,827		5,001
	$	79,676	$	60,726	$	86,309

(1)Includes the changes in fair value of newly originated loans held for investment in the period through securitization date.