Separate Financial Information of Subsidiary Guarantors of Indebtedness

In accordance with the indenture governing the 7.875% Senior Notes due December 2021, certain existing and future 100% owned domestic subsidiaries of the Company have fully and unconditionally guaranteed the Senior Notes on a joint and several basis. These guarantor subsidiaries also guarantee the Company's obligations under the 2013 Secured Credit Facilities. The indenture governing the Senior Notes contains customary exceptions under which a guarantor subsidiary may be released from its guarantee without the consent of the holders of the Senior Notes, including (i) the permitted sale, transfer or other disposition of all or substantially all of a guarantor subsidiary's assets or common stock; (ii) the designation of a restricted guarantor subsidiary as an unrestricted subsidiary; (iii) the release of a guarantor subsidiary from its obligation under the 2013 Secured Credit Facilities and its guarantee of all other indebtedness of the Company and other guarantor subsidiaries; and (iv) the defeasance of the obligations of the guarantor subsidiary by payment of the Senior Notes.

Presented below are the condensed consolidating financial information of the Company, the guarantor subsidiaries on a combined basis, and the non-guarantor subsidiaries on a combined basis.



Condensed Consolidating Balance Sheet
December 31, 2014
(in thousands)

	Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries and VIEs		Eliminations and Reclassifications			Consolidated
ASSETS
Cash and cash equivalents	$	3,162	$	311,810	$	5,203	$	—		$	320,175
Restricted cash and cash equivalents	10,507		617,774		104,734		—			733,015
Residential loans at amortized cost, net	13,302		8,456		1,292,781		—			1,314,539
Residential loans at fair value	—		11,246,197		586,433		—			11,832,630
Receivables, net	16,363		172,579		26,687		—			215,629
Servicer and protective advances, net	—		527,758		1,192,473		40,851			1,761,082
Servicing rights, net	—		1,730,216		—		—			1,730,216
Goodwill	—		575,468		—		—			575,468
Intangible assets, net	—		97,248		6,255		—			103,503
Premises and equipment, net	157		124,769		—		—			124,926
Other assets	69,780		164,815		46,199		—			280,794
Due from affiliates, net	697,979		—		—		(697,979		)	—
Investments in consolidated subsidiaries and variable interest entities	2,641,527		15,756		—		(2,657,283		)	—
Total assets	$	3,452,777	$	15,592,846	$	3,260,765	$	(3,314,411	)	$	18,991,977

LIABILITIES AND STOCKHOLDERS' EQUITY
Payables and accrued liabilities	$	42,076	$	616,445	$	14,294	$	(8,986	)	$	663,829
Servicer payables	—		584,567		—		—			584,567
Servicing advance liabilities	—		205,628		1,160,257		—			1,365,885
Warehouse borrowings	—		1,176,956		—		—			1,176,956
Excess servicing spread liability at fair value	—		66,311		—		—			66,311
Corporate debt	2,265,668		2,131		—		—			2,267,799
Mortgage-backed debt	—		—		1,751,459		—			1,751,459
HMBS related obligations at fair value	—		9,951,895		—		—			9,951,895
Deferred tax liability, net	68,374		15,353		2,869		21			86,617
Obligation to fund non-guarantor VIEs	—		32,902		—		(32,902		)	—
Due to affiliates, net	—		583,331		114,648		(697,979		)	—
Total liabilities	2,376,118		13,235,519		3,043,527		(739,846		)	17,915,318

Stockholders' equity:
Total stockholders' equity	1,076,659		2,357,327		217,238		(2,574,565		)	1,076,659
Total liabilities and stockholders' equity	$	3,452,777	$	15,592,846	$	3,260,765	$	(3,314,411	)	$	18,991,977



Condensed Consolidating Balance Sheet
December 31, 2013
(in thousands)

	Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries and VIEs		Eliminations and Reclassifications			Consolidated
ASSETS
Cash and cash equivalents	$	100,009	$	388,644	$	3,232	$	—		$	491,885
Restricted cash and cash equivalents	14,753		732,582		57,468		—			804,803
Residential loans at amortized cost, net	6,341		10,819		1,377,711		—			1,394,871
Residential loans at fair value	—		9,754,110		587,265		—			10,341,375
Receivables, net	51,681		223,767		43,747		—			319,195
Servicer and protective advances, net	—		1,337,218		62,647		(18,431		)	1,381,434
Servicing rights, net	—		1,304,900		—		—			1,304,900
Goodwill	—		657,737		—		—			657,737
Intangible assets, net	—		115,364		7,042		—			122,406
Premises and equipment, net	277		155,570		—		—			155,847
Other assets	65,293		291,529		56,254		—			413,076
Due from affiliates, net	711,797		—		—		(711,797		)	—
Investments in consolidated subsidiaries and variable interest entities	2,621,934		9,487		—		(2,631,421		)	—
Total assets	$	3,572,085	$	14,981,727	$	2,195,366	$	(3,361,649	)	$	17,387,529

LIABILITIES AND STOCKHOLDERS' EQUITY
Payables and accrued liabilities	$	57,187	$	429,199	$	32,205	$	(24,452	)	$	494,139
Servicer payables	—		735,225		—		—			735,225
Servicing advance liabilities	—		903,381		67,905		—			971,286
Warehouse borrowings	—		1,085,563		—		—			1,085,563
Corporate debt	2,267,979		4,106		—		—			2,272,085
Mortgage-backed debt	—		—		1,887,862		—			1,887,862
HMBS related obligations at fair value	—		8,652,746		—		—			8,652,746
Deferred tax liability, net	79,903		38,846		2,920		(62		)	121,607
Obligation to fund non-guarantor VIEs	—		45,194		—		(45,194		)	—
Due to affiliates, net	—		703,170		6,139		(709,309		)	—
Total liabilities	2,405,069		12,597,430		1,997,031		(779,017		)	16,220,513

Stockholders' equity:
Total stockholders' equity	1,167,016		2,384,297		198,335		(2,582,632		)	1,167,016
Total liabilities and stockholders' equity	$	3,572,085	$	14,981,727	$	2,195,366	$	(3,361,649	)	$	17,387,529



Condensed Consolidating Statement of Comprehensive Income (Loss)
For the Year Ended December 31, 2014
(in thousands)

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries and VIEs		Eliminations and Reclassifications			Consolidated
REVENUES
Net servicing revenue and fees	$	—		$	619,152		$	185	$	(17,827	)	$	601,510
Net gains on sales of loans	—			462,172			—		—			462,172
Interest income on loans	1,007			587			132,961		—			134,555
Net fair value gains on reverse loans and related HMBS obligations	—			109,972			—		—			109,972
Insurance revenue	—			66,051			5,854		(895		)	71,010
Other revenues	1,456			106,041			20,253		(19,816		)	107,934
Total revenues	2,463			1,363,975			159,253		(38,538		)	1,487,153

EXPENSES
Salaries and benefits	19,311			559,316			—		—			578,627
General and administrative	32,198			597,331			30,221		(82,244		)	577,506
Interest expense	147,633			72,203			83,379		(112		)	303,103
Depreciation and amortization	120			71,815			786		—			72,721
Goodwill impairment	—			82,269			—		—			82,269
Corporate allocations	(46,764		)	46,764			—		—			—
Other expenses, net	1,598			2,542			6,663		—			10,803
Total expenses	154,096			1,432,240			121,049		(82,356		)	1,625,029

OTHER GAINS (LOSSES)
Other net fair value gains (losses)	(54		)	(792		)	20,126		—			19,280
Other	—			(744		)	—		—			(744		)
Total other gains (losses)	(54		)	(1,536		)	20,126		—			18,536

Income (loss) before income taxes	(151,687		)	(69,801		)	58,330		43,818			(119,340		)
Income tax expense (benefit)	(49,405		)	17,220			5,665		17,508			(9,012		)
Income (loss) before equity in earnings of consolidated subsidiaries and variable interest entities	(102,282		)	(87,021		)	52,665		26,310			(110,328		)
Equity in earnings (losses) of consolidated subsidiaries and variable interest entities	(8,046		)	21,238			—		(13,192		)	—
Net income (loss)	$	(110,328	)	$	(65,783	)	$	52,665	$	13,118		$	(110,328	)

Comprehensive income (loss)	$	(110,431	)	$	(65,702	)	$	52,435	$	13,267		$	(110,431	)



Condensed Consolidating Statement of Comprehensive Income
For the Year Ended December 31, 2013
(in thousands)

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries and VIEs		Eliminations and Reclassifications			Consolidated
REVENUES
Net servicing revenue and fees	$	—		$	802,557		$	111	$	(19,279	)	$	783,389
Net gains on sales of loans	—			598,974			—		—			598,974
Interest income on loans	612			718			143,321		—			144,651
Net fair value gains on reverse loans and related HMBS obligations	—			120,382			—		—			120,382
Insurance revenue	—			78,469			6,009		—			84,478
Other revenues	739			69,184			20,135		(19,433		)	70,625
Total revenues	1,351			1,670,284			169,576		(38,712		)	1,802,499

EXPENSES
Salaries and benefits	16,911			532,881			7		—			549,799
General and administrative	55,023			431,897			30,387		(36,930		)	480,377
Interest expense	123,629			60,064			89,521		(559		)	272,655
Depreciation and amortization	124			70,068			835		—			71,027
Corporate allocations	(40,519		)	40,519			—		—			—
Other expenses, net	759			1,443			7,193		—			9,395
Total expenses	155,927			1,136,872			127,943		(37,489		)	1,383,253

OTHER GAINS (LOSSES)
Losses on extinguishments	(12,489		)	—			—		—			(12,489		)
Other net fair value gains (losses)	(4,813		)	(657		)	11,531		—			6,061
Total other gains (losses)	(17,302		)	(657		)	11,531		—			(6,428		)

Income (loss) before income taxes	(171,878		)	532,755			53,164		(1,223		)	412,818
Income tax expense (benefit)	(55,556		)	208,459			6,921		(473		)	159,351
Income (loss) before equity in earnings of consolidated subsidiaries and variable interest entities	(116,322		)	324,296			46,243		(750		)	253,467
Equity in earnings of consolidated subsidiaries and variable interest entities	369,789			13,009			—		(382,798		)	—
Net income	$	253,467		$	337,305		$	46,243	$	(383,548	)	$	253,467

Comprehensive income	$	253,472		$	337,337		$	46,168	$	(383,505	)	$	253,472



Condensed Consolidating Statement of Comprehensive Income (Loss)
For the Year Ended December 31, 2012
(in thousands)

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries and VIEs			Eliminations and Reclassifications			Consolidated
REVENUES
Net servicing revenue and fees	$	—		$	387,087		$	2,375		$	(20,953	)	$	368,509
Net gains on sales of loans	—			648			—			—			648
Interest income on loans	328			696			153,327			—			154,351
Net fair value gains on reverse loans and related HMBS obligations	—			7,279			—			—			7,279
Insurance revenue	—			66,637			6,786			(174		)	73,249
Other revenues	382			17,729			19,286			(17,626		)	19,771
Total revenues	710			480,076			181,774			(38,753		)	623,807

EXPENSES
Salaries and benefits	19,708			207,192			3,207			—			230,107
General and administrative	17,528			121,548			38,791			(41,631		)	136,236
Interest expense	77,645			3,472			99,103			(549		)	179,671
Depreciation and amortization	131			47,955			1,181			—			49,267
Corporate allocations	(25,393		)	25,393			—			—			—
Other expenses, net	1,350			936			20,333			—			22,619
Total expenses	90,969			406,496			162,615			(42,180		)	617,900

OTHER GAINS (LOSSES)
Losses on extinguishments	(48,579		)	—			—			—			(48,579		)
Other net fair value gains (losses)	(1,197		)	(1,178		)	9,596			—			7,221
Total other gains (losses)	(49,776		)	(1,178		)	9,596			—			(41,358		)

Income (loss) before income taxes	(140,035		)	72,402			28,755			3,427			(35,451		)
Income tax expense (benefit)	(48,808		)	28,569			5,535			1,387			(13,317		)

Income (loss) before equity in earnings of consolidated subsidiaries and variable interest entities	(91,227		)	43,833			23,220			2,040			(22,134		)
Equity in earnings (losses) of consolidated subsidiaries and variable interest entities	69,093			6,300			(438		)	(74,955		)	—
Net income (loss)	$	(22,134	)	$	50,133		$	22,782		$	(72,915	)	$	(22,134	)

Comprehensive income (loss)	$	(22,057	)	$	50,082		$	22,884		$	(72,966	)	$	(22,057	)



Condensed Consolidating Statement of Cash Flows
For the Year Ended December 31, 2014
(in thousands)

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries and VIEs			Eliminations and Reclassifications			Consolidated
Cash flows provided by (used in) operating activities	$	(74,452	)	$	1,005,449		$	(1,137,754	)	$	2,487		$	(204,270	)

Investing activities
Purchases and originations of reverse loans held for investment	—			(1,505,215		)	—			—			(1,505,215		)
Principal payments received on reverse loans held for investment	—			548,660			—			—			548,660
Principal payments received on mortgage loans related to Residual Trusts	535			399			102,703			—			103,637
Principal payments received on mortgage loans related to Non-Residual Trusts	—			—			58,620			—			58,620
Payments received on charged-off loans held for investment	—			14,929			—			—			14,929
Payments received on receivables related to Non-Residual Trusts	—			—			9,471			—			9,471
Cash proceeds from sales of real estate owned, net related to Residual Trusts	227			244			10,371			—			10,842
Cash proceeds from sales of other real estate owned, net related to Non-Residual Trusts and other	—			39,208			5,256			—			44,464
Purchases of premises and equipment	—			(21,573		)	—			—			(21,573		)
Decrease in restricted cash and cash equivalents	4,246			3,723			3,364			—			11,333
Payments for acquisitions of businesses, net of cash acquired	—			(197,061		)	—			—			(197,061		)
Acquisitions of servicing rights	—			(268,618		)	—			—			(268,618		)
Sales of servicing rights	—			9,499			—			—			9,499
Acquisitions of charged-off loans held for investment	—			(64,548		)	—			—			(64,548		)
Capital contributions to subsidiaries and variable interest entities	(83,544		)	(131		)	—			83,675			—
Returns of capital from subsidiaries and variable interest entities	76,214			28,085			—			(104,299		)	—
Change in due from affiliates	88,360			214,613			250,108			(553,081		)	—
Other	(2,283		)	3,732			—			—			1,449
Cash flows provided by (used in) investing activities	83,755			(1,194,054		)	439,893			(573,705		)	(1,244,111		)

Financing activities
Payments on corporate debt	(15,000		)	(2,220		)	—			—			(17,220		)
Proceeds from securitizations of reverse loans	—			1,617,399			—			—			1,617,399
Payments on HMBS related obligations	—			(637,272		)	—			—			(637,272		)
Issuances of servicing advance liabilities	—			874,729			1,425,201			—			2,299,930
Payments on servicing advance liabilities	—			(1,572,482		)	(332,849		)	—			(1,905,331		)
Net change in warehouse borrowings related to mortgage loans	—			75,726			—			—			75,726
Net change in warehouse borrowings related to reverse loans	—			15,667			—			—			15,667
Proceeds from sale of excess servicing spread	—			75,426			—			—			75,426
Payments on excess servicing spread liability	—			(6,822		)	—			—			(6,822		)
Other debt issuance costs paid	—			(17,264		)	(17		)	—			(17,281		)
Payments on mortgage-backed debt related to Residual Trusts	—			—			(104,542		)	—			(104,542		)
Payments on mortgage-backed debt related to Non-Residual Trusts	—			—			(76,613		)	—			(76,613		)
Capital contributions	—			83,544			131			(83,675		)	—
Capital distributions	—			(24,874		)	(79,425		)	104,299			—
Change in due to affiliates	(98,071		)	(329,277		)	(123,246		)	550,594			—
Other	6,921			(40,509		)	(8,808		)	—			(42,396		)
Cash flows provided by (used in) financing activities	(106,150		)	111,771			699,832			571,218			1,276,671

Net increase (decrease) in cash and cash equivalents	(96,847		)	(76,834		)	1,971			—			(171,710		)
Cash and cash equivalents at the beginning of the year	100,009			388,644			3,232			—			491,885
Cash and cash equivalents at the end of the year	$	3,162		$	311,810		$	5,203		$	—		$	320,175



Condensed Consolidating Statement of Cash Flows
For the Year Ended December 31, 2013
(in thousands)

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries and VIEs			Eliminations and Reclassifications			Consolidated
Cash flows provided by (used in) operating activities	$	(99,050	)	$	(1,741,415	)	$	29,860		$	130		$	(1,810,475	)

Investing activities
Purchases and originations of reverse loans held for investment	—			(3,020,937		)	—			—			(3,020,937		)
Principal payments received on reverse loans held for investment	—			372,375			—			—			372,375
Principal payments received on mortgage loans related to Residual Trusts	84			458			107,732			—			108,274
Principal payments received on mortgage loans related to Non-Residual Trusts	—			—			61,385			—			61,385
Payments received on receivables related to Non-Residual Trusts	—			—			14,804			—			14,804
Cash proceeds from sales of real estate owned, net related to Residual Trusts	254			80			7,396			—			7,730
Cash proceeds from sales of other real estate owned, net	—			23,184			7,510			—			30,694
Purchases of premises and equipment	—			(38,639		)	—			—			(38,639		)
Increase in restricted cash and cash equivalents	(752		)	(7,282		)	(122		)	—			(8,156		)
Payments for acquisitions of businesses, net of cash acquired	(477,021		)	(15,262		)	—			—			(492,283		)
Acquisitions of servicing rights	—			(797,165		)	—			—			(797,165		)
Capital contributions to subsidiaries and variable interest entities	(331,107		)	(16,010		)	—			347,117			—
Returns of capital from subsidiaries and variable interest entities	37,796			30,307			—			(68,103		)	—
Change in due from affiliates	(688,070		)	(65,619		)	(78,976		)	832,665			—
Other	(15,200		)	1,035			—			—			(14,165		)
Cash flows provided by (used in) investing activities	(1,474,016		)	(3,533,475		)	119,729			1,111,679			(3,776,083		)

Financing activities
Proceeds from issuance of corporate debt, net of debt issuance costs	3,106,263			—			—			—			3,106,263
Payments on corporate debt	(360,826		)	(2,105		)	—			—			(362,931		)
Proceeds from securitizations of reverse loans	—			3,216,096			—			—			3,216,096
Payments on HMBS related obligations	—			(409,331		)	—			—			(409,331		)
Issuances of servicing advance liabilities	—			1,597,043			7,229			—			1,604,272
Payments on servicing advance liabilities	—			(729,274		)	(3,876		)	—			(733,150		)
Net change in warehouse borrowings related to mortgage loans	—			929,015			—			—			929,015
Net change in warehouse borrowings related to reverse loans	—			(98,837		)	—			—			(98,837		)
Other debt issuance costs paid	(1,936		)	(7,897		)	—			—			(9,833		)
Payments on mortgage-backed debt related to Residual Trusts	—			—			(112,449		)	—			(112,449		)
Payments on mortgage-backed debt related to Non-Residual Trusts	—			—			(87,920		)	—			(87,920		)
Extinguishments and settlement of debt	(1,405,424		)	—			—			—			(1,405,424		)
Capital contributions	—			331,107			16,010			(347,117		)	—
Capital distributions	—			(10,837		)	(57,266		)	68,103			—
Change in due to affiliates	(29,618		)	772,554			90,284			(833,220		)	—
Other	(1,777		)	2,007			(37		)	425			618
Cash flows provided by (used in) financing activities	1,306,682			5,589,541			(148,025		)	(1,111,809		)	5,636,389

Net increase (decrease) in cash and cash equivalents	(266,384		)	314,651			1,564			—			49,831
Cash and cash equivalents at the beginning of the year	366,393			73,993			1,668			—			442,054
Cash and cash equivalents at the end of the year	$	100,009		$	388,644		$	3,232		$	—		$	491,885



Condensed Consolidating Statement of Cash Flows
For the Year Ended December 31, 2012
(in thousands)

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries and VIEs			Eliminations and Reclassifications			Consolidated
Cash flows provided by (used in) operating activities	$	(78,619	)	$	118,733		$	25,633		$	3,873		$	69,620

Investing activities
Purchases and originations of reverse loans held for investment	—			(594,315		)	—			—			(594,315		)
Principal payments received on reverse loans held for investment	—			29,658			—			—			29,658
Principal payments received on mortgage loans related to Residual Trusts	148			124			96,766			—			97,038
Principal payments received on mortgage loans related to Non-Residual Trusts	—			—			62,884			—			62,884
Payments received on receivables related to Non-Residual Trusts	—			—			16,096			—			16,096
Cash proceeds from sales of real estate owned, net related to Residual Trusts	670			319			6,872			—			7,861
Cash proceeds from sales of other real estate owned, net	—			3,198			8,185			—			11,383
Purchases of premises and equipment	—			(11,408		)	—			—			(11,408		)
Increase in restricted cash and cash equivalents	31,175			1,931			8,226			—			41,332
Payments for acquisitions of businesses, net of cash acquired	(130,000		)	—			—			26,408			(103,592		)
Acquisitions of servicing rights	—			(5,539		)	—			—			(5,539		)
Capital contributions to subsidiaries and variable interest entities	(31,118		)	(4,195		)	—			35,313			—
Returns of capital from subsidiaries and variable interest entities	37,536			2,257			—			(39,793		)	—
Change in due from affiliates	12,469			(204,144		)	(174,258		)	365,933			—
Other	—			(2,751		)	—			—			(2,751		)
Cash flows provided by (used in) investing activities	(79,120		)	(784,865		)	24,771			387,861			(451,353		)

Financing activities
Proceeds from issuance of corporate debt, net of debt issuance costs	962,524			—			—			(5,487		)	957,037
Payments on corporate debt	(65,000		)	(10,292		)	—			—			(75,292		)
Debt prepayment penalty	(29,440		)	—			—			—			(29,440		)
Proceeds from securitizations of reverse loans	—			583,925			—			—			583,925
Payments on HMBS related obligations	—			(33,496		)	—			—			(33,496		)
Issuances of servicing advance liabilities	—			242,080			21,753			—			263,833
Payments on servicing advance liabilities	—			(264,771		)	(5,937		)	—			(270,708		)
Net change in warehouse borrowings related to mortgage loans	—			6,055			—			—			6,055
Net change in warehouse borrowings related to reverse loans	—			11,832			—			—			11,832
Other debt issuance costs paid	(6,179		)	(188		)	(825		)	—			(7,192		)
Payments on mortgage-backed debt related to Residual Trusts	—			—			(98,105		)	—			(98,105		)
Payments on mortgage-backed debt related to Non-Residual Trusts	—			—			(92,716		)	—			(92,716		)
Extinguishments and settlement of debt	(690,000		)	—			—			—			(690,000		)
Secondary equity offering, net of issuance costs	276,013			—			—			—			276,013
Capital contributions	—			32,011			29,710			(61,721		)	—
Capital distributions	—			(4,225		)	(35,568		)	39,793			—
Change in due to affiliates	72,588			161,134			130,597			(364,319		)	—
Other	3,076			226			—			—			3,302
Cash flows provided by (used in) financing activities	523,582			724,291			(51,091		)	(391,734		)	805,048

Net increase (decrease) in cash and cash equivalents	365,843			58,159			(687		)	—			423,315
Cash and cash equivalents at the beginning of the year	550			15,834			2,355			—			18,739
Cash and cash equivalents at the end of the year	$	366,393		$	73,993		$	1,668		$	—		$	442,054