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Summary of Significant Accounting Policies (Tables)
 12 Months Ended
Dec. 31, 2015
Accounting Policies [Abstract]  
Schedule of New Accounting Pronouncements and Changes in Accounting Principles
The following table presents the assets and liabilities of the consolidated Sequoia entities at December 31, 2014 prior to the adoption of ASU 2014-13, the adjustments required to adopt the new standard, and the adjusted balances at January 1, 2015.
Table 3.1 – Impact of Adoption of ASU 2014-13 on Balance Sheet (1) 
(In Millions)
 
December 31, 2014
 
ASU 2014-13 Adjustment
 
January 1, 2015
Loan Principal
 
$
1,486

 
$
—

 
$
1,486

Loan unamortized premium
 
13

 
(13
)
 
—

Allowance for loan losses
 
(21
)
 
21

 
—

Loan market valuation adjustment
 
—

 
(113
)
 
(113
)
Residential loans held-for-investment
 
1,478

 
(105
)
 
1,373

Deferred bond issuance costs
 
1

 
(1
)
 
—

Other assets
 
5

 
—

 
5

Total assets
 
1,482

 
(105
)
 
1,377

 
 
 
 
 
 

ABS issued principal
 
1,428

 
—

 
1,428

ABS issued unamortized discount
 
(10
)
 
10

 
—

ABS market valuation adjustment
 
—

 
(125
)
 
(125
)
Total liabilities
 
1,418

 
(115
)
 
1,303

Redwood's investment in consolidated Sequoia entities
 
$
64

 
$
10

 
$
74

(1)
Certain totals may not foot due to rounding.
Offsetting of Financial Assets, Liabilities, and Collateral
The table below presents financial assets and liabilities that are subject to master netting arrangements or similar agreements categorized by financial instrument, together with corresponding financial instruments and corresponding collateral received or pledged at December 31, 2015 and December 31, 2014.
Table 3.2 – Offsetting of Financial Assets, Liabilities, and Collateral
 
 
Gross Amounts of Recognized Assets (Liabilities)
 
Gross Amounts Offset in Consolidated Balance Sheet
 
Net Amounts of Assets (Liabilities) Presented in Consolidated Balance Sheet
 
Gross Amounts Not Offset in Consolidated
Balance Sheet (1)
 
Net Amount
December 31, 2015
(In Thousands)
 
 
 
 
Financial Instruments
 
Cash Collateral (Received) Pledged
 
Assets (2)
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate agreements
 
$
7,781

 
$
—

 
$
7,781

 
$
(5,651
)
 
$
(1,917
)
 
$
213

Credit default index swaps
 
1,207

 
—

 
1,207

 
—

 
(720
)
 
487

TBAs
 
2,734

 
—

 
2,734

 
(1,898
)
 
(293
)
 
543

Total Assets
 
$
11,722

 
$
—

 
$
11,722

 
$
(7,549
)
 
$
(2,930
)
 
$
1,243

 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities (2)
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate agreements
 
$
(58,366
)
 
$
—

 
$
(58,366
)
 
$
5,651

 
$
52,715

 
$
—

TBAs
 
(2,519
)
 
—

 
(2,519
)
 
1,898

 
7

 
(614
)
Futures
 
(445
)
 
—

 
(445
)
 
—

 
445

 
—

Loan warehouse debt
 
(1,023,740
)
 
—

 
(1,023,740
)
 
1,023,740

 
—

 
—

Security repurchase agreements
 
(693,641
)
 
—

 
(693,641
)
 
693,641

 
—

 
—

Total Liabilities
 
$
(1,778,711
)
 
$
—

 
$
(1,778,711
)
 
$
1,724,930

 
$
53,167

 
$
(614
)



 
 
Gross Amounts of Recognized Assets (Liabilities)
 
Gross Amounts Offset in Consolidated Balance Sheet
 
Net Amounts of Assets (Liabilities) Presented in Consolidated Balance Sheet
 
Gross Amounts Not Offset in Consolidated
Balance Sheet (1)
 
Net Amount
December 31, 2014
(In Thousands)
 
 
 
 
Financial Instruments
 
Cash Collateral (Received) Pledged
 
Assets (2)
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate agreements
 
$
7,006

 
$
—

 
$
7,006

 
$
(1,160
)
 
$
(4,360
)
 
$
1,486

Credit default index swaps
 
1,598

 
—

 
1,598

 
—

 
(375
)
 
1,223

TBAs
 
6,653

 
—

 
6,653

 
(5,815
)
 
—

 
838

Total Assets
 
$
15,257

 
$
—

 
$
15,257

 
$
(6,975
)

$
(4,735
)
 
$
3,547

 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities (2)
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate agreements
 
$
(48,173
)
 
$
—

 
$
(48,173
)
 
$
1,160

 
$
47,013

 
$
—

TBAs
 
(9,506
)
 
—

 
(9,506
)
 
5,815

 
2,715

 
(976
)
Futures
 
(372
)
 
—

 
(372
)
 
—

 
372

 
—

Loan warehouse debt
 
(1,185,316
)
 
—

 
(1,185,316
)
 
1,185,316

 
—

 
—

Security repurchase agreements
 
(608,509
)
 
—

 
(608,509
)
 
608,509

 
—

 
—

Total Liabilities
 
$
(1,851,876
)
 
$
—

 
$
(1,851,876
)
 
$
1,800,800

 
$
50,100

 
$
(976
)
(1)
Amounts presented in these columns are limited in total to the net amount of assets or liabilities presented in the prior column by instrument. In certain cases, there is excess cash collateral or financial assets we have pledged to a counterparty (which may, in certain circumstances, be a clearinghouse) that exceed the financial liabilities subject to a master netting arrangement or similar agreement. Additionally, in certain cases, counterparties may have pledged excess cash collateral to us that exceeds our corresponding financial assets. In each case, any of these excess amounts are excluded from the table although they are separately reported in our consolidated balance sheets as assets or liabilities, respectively.
(2)
Interest rate agreements, TBAs, and futures are components of derivatives instruments on our consolidated balances sheets. Loan warehouse debt, which is secured by residential and commercial mortgage loans, and security repurchase agreements are components of short-term debt on our consolidated balance sheets.