DEBT

9 Months Ended

Sep. 30, 2024

DEBT

DEBT

NOTE 6—DEBT

Warehouse Facilities

As of September 30, 2024, to provide financing to borrowers under the Agencies’ programs, the Company had committed and uncommitted warehouse lines of credit in the amount of $3.8 billion with certain national banks and a $1.5 billion uncommitted facility with Fannie Mae (collectively, the “Agency Warehouse Facilities”). In support of these Agency Warehouse Facilities, the Company has pledged

substantially all of its loans held for sale under the Company’s approved programs. The Company’s ability to originate mortgage loans for sale depends upon its ability to secure and maintain these types of short-term financings on acceptable terms.

Additionally, the Company has arranged for warehouse lines of credit with certain national banks to assist in funding loans held for investment under the Interim Loan Program (“Interim Warehouse Facilities”). The Company has pledged the majority of its loans held for investment against these Interim Warehouse Facilities. The Company’s ability to originate and hold loans held for investment depends upon market conditions and its ability to secure and maintain these types of short-term financings on acceptable terms. As of September 30, 2024, the Interim Warehouse Facilities had $119.8 million of total facility capacity with an outstanding balance of $11.7 million. The interest rate on the Interim Warehouse Facilities ranged from SOFR (defined below) plus 250 to 311 basis points.

The interest rate for all the Company’s warehouse facilities and debt is based on an Adjusted Term Secured Overnight Financing Rate (“SOFR”).  The maximum amount and outstanding borrowings under Agency Warehouse Facilities as of September 30, 2024 follows:

	September 30, 2024
(in thousands)	Committed		Uncommitted		Total Facility		Outstanding
Facility	Amount		Amount		Capacity		Balance		Interest rate(1)
Agency Warehouse Facility #1	$	325,000		250,000		575,000	$	161,956	SOFR plus 1.30%
Agency Warehouse Facility #2		700,000		300,000		1,000,000		215,752	SOFR plus 1.30%
Agency Warehouse Facility #3		425,000		425,000		850,000		214,877	SOFR plus 1.30%
Agency Warehouse Facility #4		150,000		225,000		375,000		89,593	SOFR plus 1.30% to 1.35%
Agency Warehouse Facility #5		50,000		950,000		1,000,000		269,375	SOFR plus 1.45%
Total National Bank Agency Warehouse Facilities	$	1,650,000		2,150,000		3,800,000	$	951,553
Fannie Mae repurchase agreement, uncommitted line and open maturity		—		1,500,000		1,500,000		56,981
Total Agency Warehouse Facilities	$	1,650,000		3,650,000		5,300,000	$	1,008,534

(1) Interest rate presented does not include the effect of any applicable interest rate floors.

During 2024, the following amendments to the Company’s Agency Warehouse Facilities were executed in the normal course of business to support the Company’s business. No other material modifications have been made to the Agency Warehouse Facilities during the year.

The maturity date of Agency Warehouse Facility #1 was extended to August 27, 2025.

The maturity date of Agency Warehouse Facility #2 was extended to April 11, 2025.

The committed borrowing capacity of Agency Warehouse Facility #3 was decreased from $600.0 million to $425.0 million, and the uncommitted borrowing capacity was increased from $265.0 million to $425.0 million. The maturity date was also extended to May 15, 2025, and the interest rate was decreased from SOFR plus 135 basis points to SOFR plus 130 basis points.

The committed borrowing capacity of Agency Warehouse Facility #4 was decreased from $200.0 million to $150.0 million. The maturity date was also extended to June 22, 2025.

The committed borrowing capacity of Agency Warehouse Facility #5 was increased to $50.0 million, and the uncommitted borrowing capacity was decreased from $1.0 billion to $950.0 million. The maturity date was also extended to September 11, 2025.

Note Payable

The Company has a senior secured credit agreement (the “Credit Agreement”) that provides for a $600.0 million initial term loan. Additionally, in January 2023 the Company entered into a lender joinder agreement and amendment to the Credit Agreement that provided for additional borrowing with a principal amount of $200.0 million, modified the ratio thresholds related to mandatory prepayments, and included a provision that allows additional types of indebtedness.

During the second quarter of 2024, the Company entered into a second amendment, that, among other things, decreased the interest rate of the additional borrowing from Adjusted Term SOFR plus 3.00% to Adjusted Term SOFR plus 2.25%, combined the additional term loan

with the initial term loan to create a single fungible senior secured borrowing (the “Term Debt”), and incorporated other immaterial changes, such as a de minimis update to the quarterly principal payment.

As of September 30, 2024, the Term Debt had an outstanding principal balance of $780.5 million that matures on December 16, 2028.

The warehouse notes payable and notes payable are subject to various financial covenants. The Company is in compliance with all of these financial covenants as of September 30, 2024.