Commitments

9 Months Ended

Sep. 30, 2022


Note 21 — Commitments

Unfunded Lending Commitments

We have originated floating-rate reverse mortgage loans under which the borrowers have additional borrowing capacity of $1.7 billion at September 30, 2022. This additional borrowing capacity is available on a scheduled or unscheduled payment basis. During the nine months ended September 30, 2022, we funded $181.2 million out of the $1.5 billion borrowing capacity as of December 31, 2021. We also had short-term commitments to lend $1.3 billion and $19.2 million in connection with our forward and reverse mortgage loan IRLCs, respectively, outstanding at September 30, 2022. We finance originated and purchased forward and reverse mortgage loans with repurchase and participation agreements, referred to as warehouse lines.

HMBS Issuer Obligations

As an HMBS issuer, we are required to purchase loans out of the Ginnie Mae securitization pools once the outstanding principal balance of a reverse mortgage loan is equal to or greater than 98% of the maximum claim amount (MCA repurchases),

or when they become inactive (the borrower is deceased, no longer occupies the property or is delinquent on tax and insurance payments). Our subservicing clients bear the financial obligation and risks associated with purchasing loans out of securitization pools within the portfolio we subservice.

Activity with regard to HMBS repurchases, primarily MCA repurchases, are as follows:


	Nine Months Ended September 30, 2022
	Active			Inactive			Total
	Number	Amount		Number	Amount		Number	Amount
Beginning balance	138	$	35,322	448	$	93,813	586	$	129,135
Additions	435	115,149		154	39,118		589	154,267
Recoveries, net (1)	(370)	(98,782)		(147)	(34,732)		(517)	(133,514)
Transfers	(11)	(4,791)		11	4,791		—	—
Changes in value	—	74		—	(2,787)		—	(2,713)
Ending balance	192	$	46,972	466	$	100,203	658	$	147,175

(1)Includes amounts received upon assignment of loan to HUD, loan payoff, REO liquidation and claim proceeds less any amounts charged off as unrecoverable.

Rithm Relationship (formerly NRZ)

Our Servicing segment has exposure to concentration risk and client retention risk. As of September 30, 2022, our servicing portfolio included significant client relationships with Rithm which represented 18% and 28% of our total servicing portfolio UPB and loan count, respectively, and approximately 69% of all delinquent loans that Ocwen services. Our Subservicing Agreements and Servicing Addendum with Rithm are in their Second Terms that end December 31, 2023. At the end of the Second Term, subject to notice by October 1, 2023, Rithm has the right to terminate the Subservicing Agreements and Servicing Addendum for convenience. If Rithm exercised its right to terminate all or some of the agreements for convenience at the end of the Second Term on December 31, 2023, we might need to right-size certain aspects of our servicing business as well as the related corporate support functions. Receivables and Other liabilities recorded on our consolidated balance sheets as well as the impacts to our consolidated statements of operations in connection with our Rithm agreements are disclosed in Note 8 — MSR Transfers Not Qualifying for Sale Accounting.