Segment Information

3 Months Ended

Sep. 30, 2023

Segment Reporting [Abstract]

Segment Information

17. Segment Information

The Company’s segments reflect the internal reporting the chief operating decision maker uses to evaluate operating performance and are based upon the Company’s organizational structure, which focuses primarily on the services offered. A brief description of our current business segments is as follows:

Servicing: This segment performs operational activities on behalf of investors or owners of the underlying mortgages and mortgage servicing rights, including collecting and disbursing borrower payments, investor reporting, customer service, modifying loans where appropriate to help borrowers stay current, and when necessary performing collections, foreclosures, and the sale of REO.

During the three months ended September 30, 2023, the Company collapsed a securitization with a bond balance of $82, secured by mortgage loans with an approximate UPB of $207. The loans were sold to a third party. A net gain on sale of $67 was recorded on the transaction, which was included in “gain on mortgage loans held for sale”, within the condensed statements of operations and reported under Servicing.

Originations: This segment originates residential mortgage loans through our direct-to-consumer channel, which provides refinance options for our existing customers, and through our correspondent channel, which purchases or originates loans from mortgage bankers.

Corporate/Other: Functional expenses are allocated to individual segments based on the actual cost of services performed, direct resource utilization, or headcount percentage for shared services. During the fourth quarter of 2022, the Company began allocating shared services based on headcount instead of an estimate of percentage use as it changed its segment measures provided to and used by the chief operating decision maker. As a result, all costs for shared services are allocated to individual segments based on headcount. The Company recast segment information for the historical periods presented herein to reflect the allocation method change and to conform to the current presentation. The change affects total expenses for Servicing and Originations segments and Corporate/Other, but had no effect on condensed consolidated statements of operations. Non-allocated corporate expenses include the administrative costs of executive management and other corporate functions that are not directly attributable to the Company’s operating segments. Revenues generated on inter-segment services performed are valued based on similar services provided to external parties. Eliminations are included in Corporate/Other, including the eliminations related to intersegment hedge fair value changes.

The following tables present financial information by segment:

	Three Months Ended September 30, 2023
Financial Information by Segment	Servicing		Originations		Corporate/Other		Consolidated
Revenues
Service related, net	$	392	$	18	$	22	$	432
Net gain on mortgage loans held for sale	72		70		—		142
Total revenues	464		88		22		574
Total expenses	172		58		71		301
Interest income	157		10		—		167
Interest expense	(88)		(11)		(47)		(146)
Other income, net	—		—		58		58
Total other income (expenses), net	69		(1)		11		79
Income (loss) before income tax expense	$	361	$	29	$	(38)	$	352
Depreciation and amortization for property and equipment and intangible assets	$	4	$	2	$	4	$	10
Total assets	$	10,916	$	868	$	1,643	$	13,427

	Three Months Ended September 30, 2022
Financial Information by Segment	Servicing		Originations		Corporate/Other		Consolidated
Revenues
Service related, net	$	353	$	20	$	22	$	395
Net (loss) gain on mortgage loans held for sale	(21)		136		—		115
Total revenues	332		156		22		510
Total expenses	147		111		58		316
Interest income	71		12		—		83
Interest expense	(53)		(11)		(40)		(104)
Other expense, net	—		—		(20)		(20)
Total other income (expenses), net	18		1		(60)		(41)
Income (loss) before income tax expense	$	203	$	46	$	(96)	$	153
Depreciation and amortization for property and equipment and intangible assets	$	6	$	5	$	(2)	$	9
Total assets	$	9,703	$	1,252	$	1,860	$	12,815