XML 43 R28.htm IDEA: XBRL DOCUMENT v2.4.0.8
Receivables Held for Sale (Tables)
 9 Months Ended
Sep. 30, 2014
Receivables [Abstract]  
Summary of Activity of Real Estate Secured Receivables Either Transferred to REO or Sold in a Short Sale
The following table summarizes the activity of real estate secured receivables either transferred to REO or sold in a short sale during the three and nine months ended September 30, 2014 and 2013.
 
Three Months Ended
September 30,
 
Nine Months Ended
September 30,
 
2014
 
2013
 
2014
 
2013
 
(in millions)
Carrying value of real estate secured receivables:
 
 
 
 
 
 
 
Transferred to REO after obtaining title to the underlying collateral
$
43

 
$
175

 
$
160

 
$
405

Short sales
16

 
63

 
47

 
151

Impact to lower of amortized cost or fair value adjustment previously recorded resulting from the transfer to REO or short sales:
 
 
 
 
 
 
 
Transferred to REO after obtaining title to the underlying collateral
2

 
(1
)
 
4

 
(50
)
Short Sales
1

 
(11
)
 
2

 
(22
)
Summary of Activity in Receivables Held for Sale
The following table summarizes the activity in receivables held for sale during the three and nine months ended September 30, 2014:
 
2014
 
(in millions)
Three Months Ended September 30, 2014:
 
Real estate secured receivables held for sale at beginning of period
$
1,874

Real estate secured receivables sold
(272
)
Lower of amortized cost or fair value adjustment on real estate secured receivables held for sale
94

Carrying value of real estate secured receivables held for sale settled through short sale or transfer to REO
(59
)
Change in real estate secured receivable balance, including collections
(11
)
Transfer of real estate secured receivables into held for sale at the lower of amortized cost or fair value(2)
214

Real estate secured receivables held for sale at end of period(3)
$
1,840

 
 
Nine Months Ended September 30, 2014:
 
Real estate secured receivables held for sale at beginning of period
$
2,047

Real estate secured receivables sold
(1,156
)
Lower of amortized cost or fair value adjustment on real estate secured receivables held for sale
404

Carrying value of real estate secured receivables held for sale settled through short sale or transfer to REO
(207
)
Change in real estate secured receivable balance, including collections
12

Transfer of real estate secured receivables into held for investment at the lower of amortized cost or fair value(1)
(8
)
Transfer of real estate secured receivables into held for sale at the lower of amortized cost or fair value(2)
748

Real estate secured receivables held for sale at end of period(3)
$
1,840

 
(1) 
During the first quarter of 2014, we identified a small pool of receivables held for sale which did not meet our criteria to be classified as held for sale. As a result we transferred these receivables to held for investment at the lower of amortized cost or fair value.
(2) 
The initial lower of amortized cost or fair value adjustment on receivables transferred into held for sale during the three and nine months ended September 30, 2014 totaled $10 million and $112 million, respectively.
(3) 
The following table provides a rollforward of our valuation allowance for the three and nine months ended September 30, 2014. The valuation allowance has been reduced to zero as the fair value of the pool of receivables held for sale at September 30, 2014 exceeds the carrying value as these receivables are carried at the lower of amortized cost or fair value. See Note 14, "Fair Value Measurements," for a discussion of the factors impacting the fair value of these receivables.
 
Three Months Ended September 30, 2014
 
Nine Months Ended September 30, 2014
 
(in millions)
Balance at beginning of period
$
—

 
$
329

Initial valuation allowance for real estate secured receivables transferred to held for sale during the period
10

 
112

Release of valuation allowance resulting from improvements in fair value
(94
)
 
(404
)
Valuation allowance on real estate secured receivables transferred to held for investment
—

 
(4
)
Change in valuation allowance for loans sold
103

 
129

Change in valuation allowance for collections, charged-off, transferred to REO or short sale
(19
)
 
(162
)
Balance at end of period
$
—

 
$
—
Summary of Components of Cumulative Lower of Amortized Cost or Fair Value Adjustment
The following table summarizes the components of the lower of amortized cost or fair value adjustment recorded in other revenues during the three and nine months ended September 30, 2014 and 2013:
 
Lower of Amortized Cost or Fair Value Adjustments Associated With
 
 
 
Fair Value
 
REO
 
Short Sales
 
Total
 
(in millions)
(Income)/Expense:
 
 
 
 
 
 
 
Three Months Ended September 30, 2014:
 
 
 
 
 
 
 
Initial lower of amortized cost or fair value adjustment
$
10

 
$
—

 
$
—

 
$
10

Subsequent to initial transfer to held for sale
(97
)
 
2

 
1

 
(94
)
Lower of amortized cost or fair value adjustment recorded through other revenues
$
(87
)
 
$
2

 
$
1

 
$
(84
)
 
 
 
 
 
 
 
 
Three Months Ended September 30, 2013:
 
 
 
 
 
 
 
Initial lower of amortized cost or fair value adjustment
$
46

 
$
—

 
$
—

 
$
46

Subsequent to initial transfer to held for sale
(100
)
 
(1
)
 
(11
)
 
(112
)
Lower of amortized cost or fair value adjustment recorded through other revenues
$
(54
)
 
$
(1
)
 
$
(11
)
 
$
(66
)
 
 
 
 
 
 
 
 
Nine Months Ended September 30, 2014:
 
 
 
 
 
 
 
Initial lower of amortized cost or fair value adjustment
$
112

 
$
—

 
$
—

 
$
112

Subsequent to initial transfer to held for sale
(410
)
 
4

 
2

 
(404
)
Lower of amortized cost or fair value adjustment recorded through other revenues
$
(298
)
 
$
4

 
$
2

 
$
(292
)
 
 
 
 
 
 
 
 
Nine Months Ended September 30, 2013:
 
 
 
 
 
 
 
Initial lower of amortized cost or fair value adjustment
$
145

 
$
—

 
$
—

 
$
145

Subsequent to initial transfer to held for sale
(965
)
 
(50
)
 
(22
)
 
(1,037
)
Lower of amortized cost or fair value adjustment recorded through other revenues
$
(820
)
 
$
(50
)
 
$
(22
)
 
$
(892
)