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Business Segment Reporting | 9 Months Ended
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Sep. 30, 2023
Segment Reporting [Abstract] |
Business Segment Reporting |
Note 17 – Business Segment Reporting
Our business segments reflect the internal reporting that we use to evaluate our operating and financial performance and to assess the allocation of our resources. Our reportable business segments consist of Servicing, Originations, and Corporate Items and Other. During the nine months ended September 30, 2023, there have been no changes to our business segments as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2022. Financial information for our segments is as follows:
| Three Months Ended September 30, 2023
Results of Operations | Servicing |  | Originations |  | Corporate Items and Other |  | Corporate Eliminations (1) |  | Business Segments Consolidated
Servicing and subservicing fees | $ | 236.9 |  |  | $ | 0.8 |  |  | $ | — |  |  | $ | — |  |  | $ | 237.8 |
Gain (loss) on reverse loans held for investment and HMBS-related borrowings, net | (6.1) |  |  | 5.7 |  |  | — |  |  | — |  |  | (0.4) |
Gain on loans held for sale, net (1) | (0.8) |  |  | 9.0 |  |  | — |  |  | — |  |  | 8.2 |
Other revenue, net | 1.2 |  |  | 5.5 |  |  | 3.2 |  |  | — |  |  | 10.0 |
Revenue | 231.3 |  |  | 21.0 |  |  | 3.2 |  |  | — |  |  | 255.5 |
MSR valuation adjustments, net (1) | (21.0) |  |  | 4.6 |  |  | — |  |  | — |  |  | (16.4) |
Operating expenses | 71.2 |  |  | 22.3 |  |  | 16.5 |  |  | — |  |  | 110.0 |
Other income (expense): |  |  |  |  |  |  |  |  |
Interest income | 5.9 |  |  | 18.7 |  |  | 1.2 |  |  | — |  |  | 25.9 |
Interest expense | (43.3) |  |  | (20.0) |  |  | (11.0) |  |  | — |  |  | (74.3) |
Pledged MSR liability expense | (76.5) |  |  | — |  |  | — |  |  | — |  |  | (76.5) |
Earnings of equity method investee | 2.8 |  |  | — |  |  | — |  |  | — |  |  | 2.8 |
Gain on extinguishment of debt | — |  |  | — |  |  | 1.2 |  |  | — |  |  | 1.2 |
Other | 1.2 |  |  | (0.1) |  |  | 0.2 |  |  | — |  |  | 1.3 |
Other expense, net | (109.9) |  |  | (1.5) |  |  | (8.3) |  |  | — |  |  | (119.7) |
Income (loss) before income taxes | $ | 29.3 |  |  | $ | 1.9 |  |  | $ | (21.6) |  |  | $ | — |  |  | $ | 9.5 |
| Three Months Ended September 30, 2022
Results of Operations | Servicing |  | Originations |  | Corporate Items and Other |  | Corporate Eliminations (1) |  | Business Segments Consolidated
Servicing and subservicing fees | $ | 215.0 |  |  | $ | 0.6 |  |  | $ | — |  |  | $ | — |  |  | 215.6 |
Gain (loss) on reverse loans held for investment and HMBS-related borrowings, net | (3.6) |  |  | 10.5 |  |  | — |  |  | — |  |  | 6.9 |
Gain (loss) on loans held for sale, net (1) | 0.2 |  |  | 20.7 |  |  | — |  |  | (2.0) |  |  | 18.9 |
Other revenue, net | 0.3 |  |  | 6.5 |  |  | 1.5 |  |  | — |  |  | 8.3 |
Revenue | 211.8 |  |  | 38.3 |  |  | 1.5 |  |  | (2.0) |  |  | 249.7 |
MSR valuation adjustments, net (1) | 22.3 |  |  | 3.6 |  |  | — |  |  | 2.0 |  |  | 27.9 |
Operating expenses (2) | 86.1 |  |  | 33.3 |  |  | 22.1 |  |  | — |  |  | 141.4 |
Other income (expense): |  |  |  |  |  |  |  |  |
Interest income | 2.9 |  |  | 10.4 |  |  | 0.5 |  |  | — |  |  | 13.7 |
Interest expense | (30.9) |  |  | (8.9) |  |  | (10.6) |  |  | — |  |  | (50.4) |
Pledged MSR liability expense | (65.7) |  |  | — |  |  | — |  |  | — |  |  | (65.6) |
Earnings of equity method investee | 3.3 |  |  | — |  |  | — |  |  | — |  |  | 3.3 |
Gain (loss) on extinguishment of debt | — |  |  | — |  |  | — |  |  | — |  |  | — |
Other | (2.7) |  |  | (0.6) |  |  | (0.9) |  |  | — |  |  | (4.3) |
Other income (expense), net | (93.1) |  |  | 0.8 |  |  | (11.0) |  |  | — |  |  | (103.2) |
Income (loss) before income taxes | $ | 55.0 |  |  | $ | 9.5 |  |  | $ | (31.5) |  |  | $ | — |  |  | $ | 33.0 |
| Nine Months Ended September 30, 2023
Results of Operations | Servicing |  | Originations |  | Corporate Items and Other |  | Corporate Eliminations (1) |  | Business Segments Consolidated
Servicing and subservicing fees | $ | 705.9 |  |  | $ | 1.6 |  |  | $ | — |  |  | $ | — |  |  | $ | 707.5 |
Gain on reverse loans held for investment and HMBS-related borrowings, net | 3.9 |  |  | 17.7 |  |  | — |  |  | — |  |  | 21.5 |
Gain on loans held for sale, net (1) | 13.0 |  |  | 23.3 |  |  | — |  |  | — |  |  | 36.3 |
Other revenue, net | 2.0 |  |  | 12.6 |  |  | 9.4 |  |  | — |  |  | 24.0 |
Revenue | 724.8 |  |  | 55.2 |  |  | 9.4 |  |  | — |  |  | 789.4 |
MSR valuation adjustments, net (1) | (142.4) |  |  | 8.2 |  |  | — |  |  | — |  |  | (134.2) |
Operating expenses | 230.5 |  |  | 62.1 |  |  | 15.8 |  |  | — |  |  | 308.4 |
Other income (expense): |  |  |  |  |  |  |  |  |
Interest income | 16.0 |  |  | 40.8 |  |  | 3.4 |  |  | — |  |  | 60.2 |
Interest expense | (128.2) |  |  | (44.0) |  |  | (32.6) |  |  | — |  |  | (204.8) |
Pledged MSR liability expense | (219.9) |  |  | — |  |  | 0.1 |  |  | — |  |  | (219.8) |
Earnings of equity method investee | 5.9 |  |  | — |  |  | — |  |  | — |  |  | 5.9 |
Gain on extinguishment of debt | — |  |  | — |  |  | 1.2 |  |  | — |  |  | 1.2 |
Other | (2.2) |  |  | (0.1) |  |  | 0.5 |  |  | — |  |  | (1.9) |
Other expense, net | (328.4) |  |  | (3.4) |  |  | (27.4) |  |  | — |  |  | (359.2) |
Income (loss) before income taxes | $ | 23.5 |  |  | $ | (2.2) |  |  | $ | (33.8) |  |  | $ | — |  |  | $ | (12.5) |
| Nine months ended September 30, 2022
Results of Operations | Servicing |  | Originations |  | Corporate Items and Other |  | Corporate Eliminations (1) |  | Business Segments Consolidated
Servicing and subservicing fees | $ | 641.7 |  |  | $ | 1.6 |  |  | $ | — |  |  | $ | — |  |  | $ | 643.3 |
Gain (loss) on reverse loans held for investment and HMBS-related borrowings, net | (34.5) |  |  | 51.9 |  |  | — |  |  | — |  |  | 17.4 |
Gain (loss) on loans held for sale, net (1) | (14.0) |  |  | 46.1 |  |  | — |  |  | (15.4) |  |  | 16.7 |
Other revenue, net | 1.1 |  |  | 20.0 |  |  | 5.0 |  |  | — |  |  | 26.1 |
Revenue | 594.3 |  |  | 119.6 |  |  | 5.0 |  |  | (15.4) |  |  | 703.4 |
MSR valuation adjustments, net (1) | 62.7 |  |  | 7.3 |  |  | — |  |  | 15.4 |  |  | 85.4 |
Operating expenses (2) | 242.9 |  |  | 122.0 |  |  | 47.9 |  |  | — |  |  | 412.8 |
Other income (expense): |  |  |  |  |  |  |  |  |
Interest income | 9.9 |  |  | 19.9 |  |  | 0.7 |  |  | — |  |  | 30.6 |
Interest expense | (76.3) |  |  | (18.3) |  |  | (31.5) |  |  | — |  |  | (126.1) |
Pledged MSR liability expense | (188.4) |  |  | — |  |  | 0.1 |  |  | — |  |  | (188.3) |
Earnings of equity method investee | 19.3 |  |  | — |  |  | — |  |  | — |  |  | 19.3 |
Gain on extinguishment of debt | — |  |  | — |  |  | 0.9 |  |  | — |  |  | 0.9 |
Other | (6.3) |  |  | (1.7) |  |  | (0.6) |  |  | — |  |  | (8.6) |
Other expense, net | (241.8) |  |  | (0.1) |  |  | (30.5) |  |  | — |  |  | (272.3) |
Income (loss) before income taxes | $ | 172.3 |  |  | $ | 4.8 |  |  | $ | (73.4) |  |  | $ | — |  |  | $ | 103.7 |
(1)Corporate Eliminations includes inter-segment derivatives eliminations of $2.0 million and $15.4 million for the three and nine months ended September 30, 2022, respectively, reported as Gain on loans held for sale, net in Originations with a corresponding offset in MSR valuation adjustments, net in Servicing. No such derivatives eliminations were recognized during the three and nine months ended September 30, 2023. (2)Included in Professional services expense are reimbursements received from mortgage loan investors related to prior year legal expenses and payments received following resolution of legacy litigation matters of $4.3 million (Servicing) and $25.3 million ($18.4 million Servicing and $6.9 million Corporate) during the three and nine months ended September 30, 2022, respectively.
Total Assets | Servicing |  | Originations |  | Corporate Items and Other |  |  |  | Business Segments Consolidated
September 30, 2023 | $ | 11,900.5 |  |  | $ | 842.5 |  |  | $ | 268.7 |  |  |  |  | $ | 13,011.7 |
December 31, 2022 | $ | 11,535.0 |  |  | $ | 570.5 |  |  | $ | 293.7 |  |  |  |  | $ | 12,399.2 |
September 30, 2022 | $ | 11,322.6 |  |  | $ | 731.1 |  |  | $ | 306.4 |  |  |  |  | $ | 12,360.1 |
Depreciation and Amortization Expense | Servicing |  | Originations |  | Corporate Items and Other |  | Business Segments Consolidated
Three months ended September 30, 2023
Depreciation expense | $ | 0.2 |  |  | $ | — |  |  | $ | 1.3 |  |  | $ | 1.5 |
Amortization of debt issuance costs and discount | 3.1 |  |  | — |  |  | 2.8 |  |  | 5.9 |
Amortization of intangibles | 1.2 |  |  | — |  |  | — |  |  | 1.2 |
Three months ended September 30, 2022
Depreciation expense | $ | 0.2 |  |  | $ | 0.1 |  |  | $ | 2.1 |  |  | $ | 2.5 |
Amortization of debt issuance costs and discount | 0.2 |  |  | — |  |  | 2.2 |  |  | 2.4 |
Amortization of intangibles | 1.2 |  |  | — |  |  | — |  |  | 1.2 |
Nine months ended September 30, 2023
Depreciation expense | $ | 0.6 |  |  | $ | 0.2 |  |  | $ | 4.1 |  |  | $ | 4.9 |
Amortization of debt issuance costs and discount | 3.8 |  |  | — |  |  | 8.2 |  |  | 12.0 |
Amortization of intangibles | 4.2 |  |  | — |  |  | — |  |  | 4.2 |
Nine months ended September 30, 2022
Depreciation expense | $ | 0.7 |  |  | $ | 0.3 |  |  | $ | 6.7 |  |  | $ | 7.6 |
Amortization of debt issuance costs and discount | 0.6 |  |  | — |  |  | 6.9 |  |  | 7.5 |
Amortization of intangibles | 3.3 |  |  | — |  |  | — |  |  | 3.3 |

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI https://asc.fasb.org/topic&trid=2134510 + Details
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