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
June 30, 2015
Unaudited
(in thousands)

	Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries and VIEs		Eliminations and Reclassifications			Consolidated
ASSETS
Cash and cash equivalents	$	7,160	$	334,620	$	2,000	$	—		$	343,780
Restricted cash and cash equivalents	10,510		758,986		81,037		—			850,533
Residential loans at amortized cost, net	14,334		10,047		518,511		—			542,892
Residential loans at fair value	—		12,368,893		553,410		—			12,922,303
Receivables, net	33,237		204,828		21,855		—			259,920
Servicer and protective advances, net	—		441,681		1,073,778		35,133			1,550,592
Servicing rights, net	—		1,917,551		—		—			1,917,551
Goodwill	—		518,929		—		—			518,929
Intangible assets, net	—		89,904		5,880		—			95,784
Premises and equipment, net	241		109,590		—		—			109,831
Other assets	51,598		165,741		15,078		—			232,417
Due from affiliates, net	831,224		—		—		(831,224		)	—
Investments in consolidated subsidiaries and VIEs	2,414,265		21,233		—		(2,435,498		)	—
Total assets	$	3,362,569	$	16,942,003	$	2,271,549	$	(3,231,589	)	$	19,344,532

LIABILITIES AND STOCKHOLDERS' EQUITY
Payables and accrued liabilities	$	40,453	$	582,722	$	4,973	$	(5,280	)	$	622,868
Servicer payables	—		704,318		—		—			704,318
Servicing advance liabilities	—		208,909		1,036,409		—			1,245,318
Warehouse borrowings	—		1,620,260		—		—			1,620,260
Excess servicing spread liability at fair value	—		64,556		—		—			64,556
Corporate debt	2,264,887		1,218		—		—			2,266,105
Mortgage-backed debt	—		—		1,108,032		—			1,108,032
HMBS related obligations at fair value	—		10,588,671		—		—			10,588,671
Deferred tax liability, net	41,180		64,060		2,844		271			108,355
Obligation to fund Non-Guarantor VIEs	—		33,665		—		(33,665		)	—
Due to affiliates, net	—		740,498		90,726		(831,224		)	—
Total liabilities	2,346,520		14,608,877		2,242,984		(869,898		)	18,328,483

Stockholders' equity:
Total stockholders' equity	1,016,049		2,333,126		28,565		(2,361,691		)	1,016,049
Total liabilities and stockholders' equity	$	3,362,569	$	16,942,003	$	2,271,549	$	(3,231,589	)	$	19,344,532



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 VIEs	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 Statement of Comprehensive Income (Loss)
For the Three Months Ended June 30, 2015
Unaudited
(in thousands)

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries and VIEs		Eliminations and Reclassifications			Consolidated
REVENUES
Net servicing revenue and fees	$	—		$	226,953		$	10	$	(3,048	)	$	223,915
Net gains on sales of loans	—			119,399			—		—			119,399
Interest income on loans	289			38			17,859		—			18,186
Net fair value gains on reverse loans and related HMBS obligations	—			6,815			—		—			6,815
Insurance revenue	—			10,469			1,170		(210		)	11,429
Other revenues	310			33,014			12,273		(12,908		)	32,689
Total revenues	599			396,688			31,312		(16,166		)	412,433

EXPENSES
Salaries and benefits	7,258			135,875			24		—			143,157
General and administrative	10,436			140,947			5,207		(14,490		)	142,100
Interest expense	37,065			12,484			19,797		(681		)	68,665
Depreciation and amortization	29			15,877			187		—			16,093
Goodwill impairment	—			56,539			—		—			56,539
Corporate allocations	(13,709		)	13,709			—		—			—
Other expenses, net	(1,086		)	2,113			374		—			1,401
Total expenses	39,993			377,544			25,589		(15,171		)	427,955

OTHER GAINS (LOSSES)
Other net fair value gains (losses)	—			(98		)	3,424		—			3,326
Other	(2,803		)	—			—		—			(2,803		)
Total other gains (losses)	(2,803		)	(98		)	3,424		—			523

Income (loss) before income taxes	(42,197		)	19,046			9,147		(995		)	(14,999		)
Income tax expense (benefit)	(13,602		)	36,150			970		(398		)	23,120
Income (loss) before equity in earnings of consolidated subsidiaries and VIEs	(28,595		)	(17,104		)	8,177		(597		)	(38,119		)
Equity in earnings (loss) of consolidated subsidiaries and VIEs	(9,524		)	3,565			—		5,959			—
Net income (loss)	$	(38,119	)	$	(13,539	)	$	8,177	$	5,362		$	(38,119	)

Comprehensive income (loss)	$	(38,030	)	$	(13,539	)	$	8,177	$	5,362		$	(38,030	)



Condensed Consolidating Statement of Comprehensive Income
For the Three Months Ended June 30, 2014
Unaudited
(in thousands)

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries and VIEs		Eliminations and Reclassifications			Consolidated
REVENUES
Net servicing revenue and fees	$	—		$	145,438		$	25	$	(4,487	)	$	140,976
Net gains on sales of loans	—			144,611			—		—			144,611
Interest income on loans	163			156			33,899		—			34,218
Net fair value gains on reverse loans and related HMBS obligations	—			26,936			—		—			26,936
Insurance revenue	—			18,396			1,410		—			19,806
Other revenues	267			46,693			5,137		(4,931		)	47,166
Total revenues	430			382,230			40,471		(9,418		)	413,713

EXPENSES
Salaries and benefits	6,632			138,870			—		—			145,502
General and administrative	5,384			140,580			6,065		(9,688		)	142,341
Interest expense	36,809			17,284			20,597		—			74,690
Depreciation and amortization	30			18,163			198		—			18,391
Goodwill impairment	—			82,269			—		—			82,269
Corporate allocations	(13,339		)	13,339			—		—			—
Other expenses, net	283			261			3,434		—			3,978
Total expenses	35,799			410,766			30,294		(9,688		)	467,171

OTHER GAINS (LOSSES)
Other net fair value gains (losses)	(5		)	(1,073		)	2,610		—			1,532
Total other gains (losses)	(5		)	(1,073		)	2,610		—			1,532

Income (loss) before income taxes	(35,374		)	(29,609		)	12,787		270			(51,926		)
Income tax expense (benefit)	(60,493		)	19,950			1,440		106			(38,997		)
Income (loss) before equity in earnings of consolidated subsidiaries and VIEs	25,119			(49,559		)	11,347		164			(12,929		)
Equity in earnings (loss) of consolidated subsidiaries and VIEs	(38,048		)	3,553			—		34,495			—
Net income (loss)	$	(12,929	)	$	(46,006	)	$	11,347	$	34,659		$	(12,929	)

Comprehensive income (loss)	$	(12,924	)	$	(46,006	)	$	11,343	$	34,663		$	(12,924	)



Condensed Consolidating Statement of Comprehensive Income (Loss)
For the Six Months Ended June 30, 2015
Unaudited
(in thousands)

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries and VIEs		Eliminations and Reclassifications			Consolidated
REVENUES
Net servicing revenue and fees	$	—		$	322,006		$	66	$	(7,270	)	$	314,802
Net gains on sales of loans	—			244,626			—		—			244,626
Interest income on loans	549			100			49,478		—			50,127
Net fair value gains on reverse loans and related HMBS obligations	—			37,589			—		—			37,589
Insurance revenue	—			23,391			2,592		(423		)	25,560
Other revenues	3,288			48,639			31,150		(32,491		)	50,586
Total revenues	3,837			676,351			83,286		(40,184		)	723,290

EXPENSES
Salaries and benefits	12,371			277,936			78		—			290,385
General and administrative	19,088			270,058			10,922		(29,321		)	270,747
Interest expense	73,799			23,428			47,748		(1,439		)	143,536
Depreciation and amortization	59			32,290			376		—			32,725
Goodwill impairment	—			56,539			—		—			56,539
Corporate allocations	(26,453		)	26,453			—		—			—
Other expenses, net	(813		)	3,043			3,218		—			5,448
Total expenses	78,051			689,747			62,342		(30,760		)	799,380

OTHER GAINS (LOSSES)
Other net fair value gains (losses)	—			(332		)	2,786		—			2,454
Other	8,959			—			—		—			8,959
Total other gains (losses)	8,959			(332		)	2,786		—			11,413

Income (loss) before income taxes	(65,255		)	(13,728		)	23,730		(9,424		)	(64,677		)
Income tax expense (benefit)	(18,494		)	24,672			2,038		(3,766		)	4,450
Income (loss) before equity in earnings of consolidated subsidiaries and VIEs	(46,761		)	(38,400		)	21,692		(5,658		)	(69,127		)
Equity in earnings (loss) of consolidated subsidiaries and VIEs	(22,366		)	9,388			—		12,978			—
Net income (loss)	$	(69,127	)	$	(29,012	)	$	21,692	$	7,320		$	(69,127	)

Comprehensive income (loss)	$	(69,011	)	$	(29,012	)	$	21,692	$	7,320		$	(69,011	)



Condensed Consolidating Statement of Comprehensive Income
For the Six Months Ended June 30, 2014
Unaudited
(in thousands)

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries and VIEs		Eliminations and Reclassifications			Consolidated
REVENUES
Net servicing revenue and fees	$	—		$	322,789		$	48	$	(9,069	)	$	313,768
Net gains on sales of loans	—			248,645			—		—			248,645
Interest income on loans	322			333			67,985		—			68,640
Net fair value gains on reverse loans and related HMBS obligations	—			44,172			—		—			44,172
Insurance revenue	—			40,334			2,860		—			43,194
Other revenues	536			64,275			9,928		(9,497		)	65,242
Total revenues	858			720,548			80,821		(18,566		)	783,661

EXPENSES
Salaries and benefits	7,900			273,499			—		—			281,399
General and administrative	16,806			241,455			12,845		(19,900		)	251,206
Interest expense	73,250			34,709			41,580		—			149,539
Depreciation and amortization	60			36,576			399		—			37,035
Goodwill impairment	—			82,269			—		—			82,269
Corporate allocations	(24,282		)	24,282			—		—			—
Other expenses, net	449			607			3,147					4,203
Total expenses	74,183			693,397			57,971		(19,900		)	805,651

OTHER GAINS (LOSSES)
Other net fair value gains (losses)	(54		)	(1,484		)	567		—			(971		)
Total other gains (losses)	(54		)	(1,484		)	567		—			(971		)

Income (loss) before income taxes	(73,379		)	25,667			23,417		1,334			(22,961		)
Income tax expense (benefit)	(70,973		)	40,013			2,983		568			(27,409		)
Income (loss) before equity in earnings of consolidated subsidiaries and VIEs	(2,406		)	(14,346		)	20,434		766			4,448
Equity in earnings (loss) of consolidated subsidiaries and VIEs	6,854			2,029			—		(8,883		)	—
Net income (loss)	$	4,448		$	(12,317	)	$	20,434	$	(8,117	)	$	4,448

Comprehensive income (loss)	$	4,457		$	(12,317	)	$	20,426	$	(8,109	)	$	4,457



Condensed Consolidating Statement of Cash Flows
For the Six Months Ended June 30, 2015
Unaudited
(in thousands)

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries and VIEs			Eliminations and Reclassifications			Consolidated
Cash flows provided by (used in) operating activities	$	(86,981	)	$	(340,671	)	$	158,896		$	—		$	(268,756	)

Investing activities
Purchases and originations of reverse loans held for investment	—			(922,422		)	—			—			(922,422		)
Principal payments received on reverse loans held for investment	—			385,073			—			—			385,073
Principal payments received on mortgage loans held for investment	386			—			69,280			—			69,666
Payments received on charged-off loans held for investment	—			12,249			—			—			12,249
Payments received on receivables related to Non-Residual Trusts	—			—			3,853			—			3,853
Cash proceeds from sales of real estate owned, net	2			32,689			4,853			—			37,544
Purchases of premises and equipment	(143		)	(9,605		)	—			—			(9,748		)
Decrease (increase) in restricted cash and cash equivalents	(3		)	(4,007		)	7,124			—			3,114
Payments for acquisitions of businesses, net of cash acquired	—			(2,810		)	—			—			(2,810		)
Acquisitions of servicing rights	—			(189,276		)	—			—			(189,276		)
Proceeds from sale of investment	14,376			—			—			—			14,376
Proceeds from sale of servicing rights	—			778			—			—			778
Proceeds from sale of residual interests in Residual Trusts	189,513			—			—			—			189,513
Capital contributions to subsidiaries and VIEs	(4,505		)	(4,296		)	—			8,801			—
Returns of capital from subsidiaries and VIEs	20,094			12,370			—			(32,464		)	—
Change in due from affiliates	(132,284		)	24,983			(21		)	107,322			—
Other	11,754			488			—			—			12,242
Cash flows provided by (used in) investing activities	99,190			(663,786		)	85,089			83,659			(395,848		)

Financing activities
Payments on corporate debt	(7,500		)	(914		)	—			—			(8,414		)
Proceeds from securitizations of reverse loans	—			951,234			—			—			951,234
Payments on HMBS related obligations	—			(466,188		)	—			—			(466,188		)
Issuances of servicing advance liabilities	—			141,555			284,341			—			425,896
Payments on servicing advance liabilities	—			(138,273		)	(408,190		)	—			(546,463		)
Net change in warehouse borrowings related to mortgage loans	—			454,012			—			—			454,012
Net change in warehouse borrowings related to reverse loans	—			(10,708		)	—			—			(10,708		)
Payments on excess servicing spread liability	—			(4,576		)	—			—			(4,576		)
Other debt issuance costs paid	—			(5,397		)	(197		)	—			(5,594		)
Payments on mortgage-backed debt	—			—			(81,795		)	—			(81,795		)
Capital contributions	—			4,235			4,566			(8,801		)	—
Capital distributions	—			(9,581		)	(22,883		)	32,464			—
Change in due to affiliates	(961		)	132,184			(23,901		)	(107,322		)	—
Other	250			(20,316		)	871			—			(19,195		)
Cash flows provided by (used in) financing activities	(8,211		)	1,027,267			(247,188		)	(83,659		)	688,209

Net increase (decrease) in cash and cash equivalents	3,998			22,810			(3,203		)	—			23,605
Cash and cash equivalents at the beginning of the period	3,162			311,810			5,203			—			320,175
Cash and cash equivalents at the end of the period	$	7,160		$	334,620		$	2,000		$	—		$	343,780



Condensed Consolidating Statement of Cash Flows
For the Six Months Ended June 30, 2014
Unaudited
(in thousands)

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries and VIEs			Eliminations and Reclassifications			Consolidated
Cash flows used in operating activities	$	(6,374	)	$	(49,030	)	$	(18,007	)	$	(431	)	$	(73,842	)

Investing activities
Purchases and originations of reverse loans held for investment	—			(715,969		)	—			—			(715,969		)
Principal payments received on reverse loans held for investment	—			234,779			—			—			234,779
Principal payments received on mortgage loans held for investment	56			273			79,616			—			79,945
Payments received on charged-off loans held for investment	—			2,055			—			—			2,055
Payments received on receivables related to Non-Residual Trusts	—			—			5,696			—			5,696
Cash proceeds from sales of real estate owned, net	178			13,498			8,717			—			22,393
Purchases of premises and equipment	—			(12,958		)	—			—			(12,958		)
Decrease (increase) in restricted cash and cash equivalents	(752		)	4,749			(1,576		)	—			2,421
Payments for acquisitions of businesses, net of cash acquired	—			(167,955		)	—			—			(167,955		)
Acquisitions of servicing rights	—			(101,244		)	—			—			(101,244		)
Acquisitions of charged-off loans held for investment	—			(57,052		)	—			—			(57,052		)
Capital contributions to subsidiaries and VIEs	(33,431		)	(4,127		)	—			37,558			—
Returns of capital from subsidiaries and VIEs	20,721			7,653			—			(28,374		)	—
Change in due from affiliates	(64,028		)	(23,326		)	(28,200		)	115,554			—
Other	—			(4,962		)	—			—			(4,962		)
Cash flows provided by (used in) investing activities	(77,256		)	(824,586		)	64,253			124,738			(712,851		)

Financing activities
Payments on corporate debt	(7,500		)	(1,393		)	—			—			(8,893		)
Proceeds from securitizations of reverse loans	—			839,431			—			—			839,431
Payments on HMBS related obligations	—			(267,904		)	—			—			(267,904		)
Issuances of servicing advance liabilities	—			468,376			143,519			—			611,895
Payments on servicing advance liabilities	—			(432,639		)	(110,101		)	—			(542,740		)
Net change in warehouse borrowings related to mortgage loans	—			126,425			—			—			126,425
Net change in warehouse borrowings related to reverse loans	—			(60,772		)	—			—			(60,772		)
Other debt issuance costs paid	—			(13,509		)	—			—			(13,509		)
Payments on mortgage-backed debt	—			—			(90,666		)	—			(90,666		)
Capital contributions	—			33,431			4,127			(37,558		)	—
Capital distributions	—			(5,971		)	(22,403		)	28,374			—
Change in due to affiliates	(4,497		)	88,380			31,240			(115,123		)	—
Other	6,833			(1,950		)	(1		)	—			4,882
Cash flows provided by (used in) financing activities	(5,164		)	771,905			(44,285		)	(124,307		)	598,149

Net increase (decrease) in cash and cash equivalents	(88,794		)	(101,711		)	1,961			—			(188,544		)
Cash and cash equivalents at the beginning of the period	100,009			388,644			3,232			—			491,885
Cash and cash equivalents at the end of the period	$	11,215		$	286,933		$	5,193		$	—		$	303,341