Mortgage Loans Held-for-Sale |
Note 2.—Mortgage Loans Held-for-Sale
A summary of the unpaid principal balance (UPB) of mortgage loans held-for-sale by type is presented below:
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December 31,
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December 31,
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2019
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2018
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Government (1)
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$
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51,019
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$
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39,522
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Conventional (2)
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436,040
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53,148
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Non-qualified mortgages (NonQM)
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274,834
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256,491
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Fair value adjustment (3)
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20,250
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4,440
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Total mortgage loans held-for-sale
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$
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782,143
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$
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353,601
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(1)
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Includes all government-insured loans including Federal Housing Administration (FHA), Veterans Affairs (VA) and United States Department of Agriculture (USDA). |
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(2)
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Includes loans eligible for sale to Federal National Mortgage Association (Fannie Mae or FNMA) and Federal home Loan Mortgage Corporation (Freddie Mac or FHLMC). |
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(3)
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Changes in fair value are included in gain on sale of loans, net on the accompanying consolidated statements of operations and comprehensive loss. |
As of December 31, 2019, the Company had $4.5 million in UPB of mortgage loans held-for-sale that were in nonaccrual status as the loans were 90 days or more delinquent. The carrying value of these nonaccrual loans as of December 31, 2019 were $4.2 million. As of December 31, 2018, there were $2.3 million in UPB of mortgage loans held -for-sale that were in nonaccrual status as the loans were 90 days or more delinquent. The carrying value of these nonaccrual loans as of December 31, 2018 were $1.8 million.
Gain on sale of loans, net in the consolidated statements of operations and comprehensive loss is comprised of the following for the years ended December 31, 2019 and 2018:
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For the Year Ended
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December 31,
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2019
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2018
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Gain on sale of mortgage loans
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$
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111,787
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$
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102,899
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Premium from servicing retained loan sales
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2,491
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24,879
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Unrealized gains (losses) from derivative financial instruments
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4,472
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(2,025)
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Realized (losses) gains from derivative financial instruments
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(5,627)
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11,878
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Mark to market gain (loss) on LHFS
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15,810
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(14,762)
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Direct origination expenses, net
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(24,616)
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(51,045)
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Provision for repurchases
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(5,487)
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(5,074)
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Total gain on sale of loans, net
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$
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98,830
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$
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66,750
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