(Former name, former address, and former fiscal year if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

As of November 5, 2013 there were 34,878,568 total shares of common stock outstanding.

	September 30,		December 31,
	2013		2012
	(unaudited)
Assets
Cash and cash equivalents	$	60,968	$	65,027
Restricted cash		7,035		7,130
Pledged securities, at fair value		45,449		33,481
Loans held for sale, at fair value		365,210		1,101,561
Loans held for investment		118,864		9,468
Servicing fees and other receivables, net		26,638		40,933
Derivative assets		13,357		21,258
Mortgage servicing rights		344,899		315,524
Goodwill		60,212		59,735
Intangible assets		1,828		4,644
Other assets		23,256		29,872
Total assets	$	1,067,716	$	1,688,633

Liabilities and Stockholders’ Equity

Liabilities
Accounts payable and other liabilities	$	124,940	$	122,798
Performance deposits from borrowers		7,995		9,503
Derivative liabilities		8,444		867
Guaranty obligation, net of accumulated amortization		22,762		21,155
Allowance for risk-sharing obligations		8,461		15,670
Warehouse notes payable		429,944		1,084,539
Notes payable		74,700		80,925
Total liabilities	$	677,246	$	1,335,457

Stockholders’ Equity
Stockholders’ equity:
Preferred shares, Authorized 50,000,000, none issued.	$	—	$	—
Common stock, $0.01 par value. Authorized 200,000,000; issued and outstanding 33,905,552 shares in 2013 and 33,567,730 shares in 2012.		339		336
Additional paid-in capital		243,790		236,823
Retained earnings		146,341		116,017
Total stockholders’ equity	$	390,470	$	353,176
Commitments and contingencies		—		—
Total liabilities and stockholders’ equity	$	1,067,716	$	1,688,633

	For the three months ended September 30,						For the nine months ended September 30,
	2013			2012			2013		2012
Revenues
Gains from mortgage banking activities	$	45,278		$	53,400		$	151,285	$	107,136
Servicing fees		22,954			13,307			66,465		32,513
Net warehouse interest income		1,783			1,248			5,166		3,259
Escrow earnings and other interest income		1,037			708			2,895		1,772
Other		2,598			1,463			7,758		6,568
Total revenues	$	73,650		$	70,126		$	233,569	$	151,248

Expenses
Personnel	$	31,091		$	32,173		$	96,682	$	61,177
Amortization and depreciation		19,441			9,629			54,425		23,596
Amortization of intangible assets		1,072			7,371			2,816		7,406
Provision for risk-sharing obligations		(155	)		(848	)		997		1,126
Interest expense on corporate debt		854			388			2,692		719
Other operating expenses		8,643			9,635			27,121		20,843
Total expenses	$	60,946		$	58,348		$	184,733	$	114,867
Income from operations	$	12,704		$	11,778		$	48,836	$	36,381
Income tax expense		4,649			4,680			18,512		14,152
Net income	$	8,055		$	7,098		$	30,324	$	22,229

Basic earnings per share	$	0.24		$	0.28		$	0.90	$	0.97
Diluted earnings per share	$	0.23		$	0.28		$	0.88	$	0.96

Basic weighted average shares outstanding		33,859,453			25,091,153			33,710,837		22,881,795
Diluted weighted average shares outstanding		34,382,975			25,443,601			34,315,514		23,101,832

	Nine Months Ended September 30,
	2013			2012
Cash flows from operating activities:
Net income	$	30,324		$	22,229
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Gains attributable to fair value of future servicing rights, net of guaranty obligation		(70,616	)		(52,091	)
Gains attributable to fair value of premium and origination fees		11,535			(10,000	)
Provision for risk-sharing obligations		997			1,126
Amortization and depreciation		57,241			31,002
Originations of loans held for sale		(4,342,343	)		(2,594,190	)
Sales of loans to third parties		5,072,536			1,691,226
Amortization of deferred loan fees and costs		(67	)		(58	)
Origination fees received from loans held for investment		591			—
Stock compensation		6,846			3,384
Tax (benefit) expense from vesting of equity awards		(1,253	)		7
Cash paid to settle risk-sharing obligations		(4,935	)		(2,030	)
Cash allowance received from landlord		—			1,301
Cash received from sale of assets acquired		—			2,244
Changes in:
Restricted cash and pledged securities		(11,873	)		(3,291	)
Servicing fees and other receivables		11,109			498
Derivative fair value adjustments		—			299
Other assets		9,394			(5,545	)
Accounts payable and other liabilities		(16,927	)		9,850
Performance deposits from borrowers		(1,508	)		1,763
Net cash provided by (used in) operating activities	$	751,051		$	(902,276	)
Cash flows from investing activities:
Capital expenditures	$	(4,339	)	$	(4,668	)
Acquisition of CWCapital LLC, net of cash acquired and other assets		—			(208,109	)
Originations of loans held for investment		(131,620	)		(16,368	)
Principal collected on loans held for investment		21,700			—
Net cash used in investing activities	$	(114,259	)	$	(229,145	)
Cash flows from financing activities:
(Repayments) borrowings of short-term warehouse notes payable, net	$	(729,964	)	$	939,295
Borrowings of interim warehouse notes payable		92,281			12,375
Repayments of interim warehouse notes payable		(16,912	)		—
Borrowings of notes payable		—			83,000
Repayments of notes payable		(6,225	)		(23,869	)
Secured borrowings		19,845			—
Debt issuance costs		—			(1,108	)
Proceeds from issuance of common stock		1,189			150,698
Repurchase of common stock		(2,318	)		(167	)
Tax benefit (expense) from vesting of equity awards		1,253			(7	)
Net cash (used in) provided by financing activities	$	(640,851	)	$	1,160,217
Net (decrease) increase in cash and cash equivalents	$	(4,059	)	$	28,796
Cash and cash equivalents at beginning of period		65,027			53,817
Cash and cash equivalents at end of period	$	60,968		$	82,613
Supplemental Disclosure of Cash Flow Information:
Cash paid to third parties for interest	$	11,317		$	4,296
Cash paid for taxes	$	647		$	8,256

These financial statements represent the condensed consolidated financial position and results of operations of Walker & Dunlop, Inc. and its subsidiaries. Unless the context otherwise requires, references to “we,” “us,” “our,” “Walker & Dunlop” and the “Company” mean the Walker & Dunlop consolidated companies. The statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. Because the accompanying condensed consolidated financial statements do not include all of the information and footnotes required by GAAP, they should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012 (“2012 Form 10-K”). In the opinion of management, all adjustments (consisting only of normal recurring accruals except as otherwise noted herein) considered necessary for a fair presentation of the results for the Company in the interim periods presented have been included. Results of operations for the three and nine months ended September 30, 2013 are not necessarily indicative of the results that may be expected for the year ending December 31, 2013, or thereafter.

Walker & Dunlop is one of the leading commercial real estate finance companies in the United States, with a primary focus on multifamily lending. The Company originates, sells and services a range of multifamily and other commercial real estate financing products. The Company’s clients are owners and developers of commercial real estate across the country. The Company originates and sells loans pursuant to the programs of the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac,” and together with Fannie Mae, the government-sponsored enterprises, or the “GSEs”), the Government National Mortgage Association (“Ginnie Mae”) and the Federal Housing Administration, a division of the U.S. Department of Housing and Urban Development (together with Ginnie Mae, “HUD”), with which Walker & Dunlop has long-established relationships. The Company retains servicing rights and asset management responsibilities on nearly all loans that it sells to the GSEs and HUD. Walker & Dunlop is approved as a Fannie Mae Delegated Underwriting and Servicing (“DUS”^TM) lender nationally, a Freddie Mac Program Plus lender in 22 states and the District of Columbia, a HUD Multifamily Accelerated Processing (“MAP”) lender nationally, a HUD Section 232 LEAN lender nationally, and a Ginnie Mae issuer. The Company also brokers and services loans for a number of life insurance companies and other institutional investors, in which cases it does not fund the loan but rather acts as a loan broker. Additionally, through our subsidiary entities, we provide institutional advisory, asset management, and investment management services specializing in debt, structured debt, and equity financing for commercial real estate.

The Company has an interim loan program offering floating-rate loans with original principal balances of generally up to $30.0 million, for terms of up to two years, to experienced borrowers seeking to acquire or reposition multifamily properties that do not currently qualify for permanent financing (the “Program”). The Company underwrites all loans originated through the Program using similar underwriting standards used to underwrite loans it originates and sells. During the time they are outstanding, the Company assumes the full risk of loss on the loans. In addition, the Company services and asset-manages loans originated through the Program, with the ultimate goal of providing permanent financing on the properties. These loans are classified as held for investment on the Company’s balance sheet during such time that they are outstanding. $109.9 million of the loans outstanding as of September 30, 2013 were originated in 2013, and all of the loans outstanding as of September 30, 2013 were originated within the past 18 months. As of September 30, 2013, none of the loans under the Program is delinquent. Additionally, we have not incurred a loss on any loans originated under the Program.

On September 4, 2012, the Company closed its acquisition of CWCapital, LLC (“CWCapital”), at which time the total consideration transferred was valued at approximately $231.1 million, consisting of $80.0 million in cash and the Company’s issuance in a private placement to CW Financial Services, LLC (“CW Financial”) of approximately 11.6 million shares of common stock valued at approximately $151.1 million (the “Acquisition”). Upon closing of the Acquisition, CWCapital became an indirect wholly owned subsidiary of the Company and was renamed Walker & Dunlop Capital, LLC. By virtue of the Company’s ownership of CWCapital, the Company also acquired a 50% ownership in ARA Finance LLC, a joint venture with ARA Finco LLC, one of the largest investment sales brokers in the United States, in which ARA Finco LLC owns the remaining 50% of ARA Finance LLC. The Company does not have the ability to direct the activities of ARA Finance LLC; therefore, the Company accounts for its investment in ARA Finance LLC under the equity method of accounting.

The results of operations for the three and nine months ended September 30, 2013 reflect the impact of the Acquisition, which materially affects the comparability to the prior year.

During the third quarter of 2013, the Company launched a large loan bridge program (the “Bridge Program”). Similar to the Program, the Bridge Program offers floating-rate loans to experienced borrowers seeking to acquire or reposition multifamily properties that do not currently qualify for permanent financing but are good candidates for future permanent financing. The Bridge Program is offered for loans of $30.0 million or more and for terms of up to three years. As of September 30, 2013, there have been no loans originated under the Bridge Program.

The Bridge Program was established through a partnership with third-party investors. The loans in the Bridge Program are approved for funding by unanimous consent of the limited partners, funded by the partnership, and underwritten by the Company pursuant to service agreements. The Company accounts for its five-percent ownership interest as an equity-method investment. The operations of the Bridge Program were immaterial for the three and nine months ended September 30, 2013.

In the third quarter of 2013, the Company transferred a participating interest in a financial asset to a third party. The Company accounted for the transfer as a secured borrowing. The entire financial asset is presented as loans held for investment, and the secured borrowing of $19.8 million is included within the Accounts payable and other liabilities line item in the Condensed Consolidated Balance Sheets.

Principles of Consolidation—The condensed consolidated financial statements include the accounts of the Company and all of its consolidated entities. All material intercompany transactions have been eliminated. The Company has evaluated all subsequent events.

Use of Estimates—The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, including guaranty obligations, capitalized mortgage servicing rights, derivative instruments and hedging relationships, and the disclosure of contingent assets and liabilities. Actual results may vary from these estimates.

Comprehensive Income—For the three and nine months ended September 30, 2013 and 2012, comprehensive income equaled net income; therefore, a separate statement of comprehensive income is not included in the accompanying condensed consolidated financial statements.

Loans Held for Investment—Loans held for investment are interim loans originated by the Company through the Program. The loans are carried at their unpaid principal balances adjusted for net unamortized loan fees and costs, and net of any allowance for loan losses. Interest income is accrued based on the actual coupon rate and is recognized as revenue when earned and deemed collectible.

The Company uses the interest method to determine an effective yield to amortize the loan fees and costs on real estate loans held for investment. All loans held for investment are floating-rate loans; therefore, the Company uses the initial coupon interest rate of the loans (without regard to future changes in the underlying indices) and anticipated principal payments, if any, to determine periodic amortization.

The Company will reclassify loans held-for-investment as loans held-for-sale if it determines that the loans will be sold or transferred to third parties.

The Company monitors the financial condition of the borrower and the financial trends of the underlying property for each of its loans held for investment to assess the credit quality of the loan. None of the loans held for investment was delinquent as of September 30, 2013 or December 31, 2012. Additionally, we have not experienced any losses or delinquencies of 15 days or more related to these loans since the inception of the Program. No allowance for loan losses related to these loans was recorded as of September 30, 2013 or December 31, 2012.

Net Warehouse Interest Income—The Company presents warehouse interest income net of warehouse interest expense. Warehouse interest income is the interest earned from loans that are held for sale and those held for investment. Substantially all loans that are held for sale are financed with matched borrowings under our warehouse facilities incurred to fund a specific loan held for sale. Additionally, a substantial portion of loans held for investment is match funded. Warehouse interest expense is incurred on borrowings used to fund loans solely while they are held for sale or for investment. Warehouse interest income and expense are earned

or incurred on loans held for sale after a loan is closed and before a loan is sold. Warehouse interest income and expense are earned or incurred on loans held for investment after a loan is closed and before a loan is repaid.

Included in net warehouse interest income for the three and nine months ended September 30, 2013 and 2012 are the following components (in thousands):

Recently Issued Accounting Pronouncements—There were no accounting pronouncements issued during the third quarter of 2013 that have the potential to impact the Company. All other recently issued accounting pronouncements and their expected impact to the Company have been disclosed previously.

There have been no material changes to the accounting policies discussed in Note 2 of the Company’s 2012 Form 10-K.

The Company has made certain immaterial reclassifications to prior-year balances to conform to current-year presentation.

On September 4, 2012 (“the Acquisition Date”), the Company closed its acquisition of CWCapital, at which time the total consideration transferred was valued at approximately $231.1 million, consisting of $80.0 million in cash and the Company’s issuance in a private placement to CW Financial of approximately 11.6 million shares of common stock valued at approximately $151.1 million. Upon closing of the Acquisition, CWCapital became an indirect wholly owned subsidiary of the Company and was renamed Walker & Dunlop Capital, LLC.

The Company recorded the fair value of the assets acquired and liabilities assumed as of the Acquisition Date. The Company also included CWCapital’s results of operations and cash flows in its financial statements from the Acquisition Date forward.

The fair value of consideration transferred was allocated to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values at the Acquisition Date, with the remaining unallocated amount recognized as goodwill.

The recognized goodwill of $60.2 million, all of which is tax deductible over 15 years, is attributed to the value of the assembled workforce, the broader scale of operations of the combined company’s national platform, and the long-term expected synergies associated with the combination.

The following summarizes the changes in the carrying amount of the Company’s goodwill for the nine months ended September 30, 2013 (in thousands):

The Company provisionally allocated the purchase price to the assets acquired, separately identifiable intangible assets, and liabilities assumed related to the Acquisition based on their estimated Acquisition Date fair values. A change to the provisional amounts recorded for assets acquired, identifiable intangible assets, and liabilities assumed during the measurement period affects the

amount of the purchase price allocated to goodwill. Such changes to the purchase price allocation during the measurement period are recorded as retrospective adjustments to the consolidated financial statements. During the nine months ended September 30, 2013, the Company identified immaterial adjustments to certain of the provisional amounts recorded as shown in the table above. The adjustments were recorded based on information obtained subsequent to the Acquisition Date that related to information that existed as of the Acquisition Date. The Company recorded no retrospective adjustments or impairment during the three months ended September 30, 2013.

The Company completed the accounting for the Acquisition as the Company obtained all of the information it was seeking about facts and circumstances that existed as of the Acquisition Date.

The following summarizes the Company’s other intangible assets, including those related to the Acquisition (in thousands):


	As of September 30, 2013							As of December 31, 2012
	Gross carrying value		Accumulated amortization			Net carrying value		Gross carrying value		Accumulated amortization			Net carrying value
Mortgage pipeline intangible asset	$	18,700	$	(17,945	)	$	755	$	18,700	$	(15,182	)	$	3,518
Acquired mortgage servicing rights		124,629		(28,716	)		95,913		124,629		(8,503	)		116,126
Originated mortgage servicing rights		344,556		(95,570	)		248,986		277,328		(77,930	)		199,398
Total	$	487,885	$	(142,231	)	$	345,654	$	420,657	$	(101,615	)	$	319,042

The Company expects to amortize the remaining net carrying value of the mortgage pipeline intangible asset within the next nine months. However, the timing of the actual amortization may vary from this estimate. The expected amortization of Mortgage Servicing Rights (MSRs), which includes the MSRs acquired from CWCapital shown above, is disclosed in Note 6.

The gains from mortgage banking activities consisted of the following activity for the three and nine months ended September 30, 2013 and 2012 (in thousands):

	For the three months ended September 30,						For the nine months ended September 30,
	2013			2012			2013			2012
Contractual loan origination related fees, net	$	23,816		$	27,674		$	80,669		$	55,045
Fair value of expected future cash flows from servicing recognized at commitment		22,671			27,237			74,488			55,404
Fair value of expected guaranty obligation		(1,209	)		(1,511	)		(3,872	)		(3,313	)
Total gains from mortgage banking activities	$	45,278		$	53,400		$	151,285		$	107,136

The origination fees shown in the table above are net of co-broker fees of $4.9 million and $5.2 million for the three months ended September 30, 2013 and 2012, respectively, and $16.8 million and $13.6 million for the nine months ended September 30, 2013 and 2012, respectively.

MSRs represent the fair value of the servicing rights retained by the Company for mortgage loans originated and sold. The capitalized amount is equal to the estimated fair value of the expected net cash flows associated with the servicing rights. The following describes the key assumptions used in calculating each loan’s MSR:

Discount rate—Depending upon loan type, the discount rate used is management’s best estimate of market discount rates. The rates used for loans originated were 10% to 15% for each of the periods presented.

Estimated Life—The estimated life of the MSRs is derived based upon the stated yield maintenance and/or prepayment protection term of the underlying loan and may be reduced by 6 to 12 months based upon the expiration of various types of prepayment penalty and/or lockout provisions prior to that stated maturity date.

Servicing Cost—The estimated future cost to service the loan for the estimated life of the MSR is subtracted from the estimated future cash flows.

The fair value of the MSRs was $400.0 million and $350.5 million at September 30, 2013 and December 31, 2012, respectively. The Company uses a discounted static cash flow valuation approach and the key economic assumption is the discount rate. For example, see the following sensitivities:

The impact of a 100 basis point increase in the discount rate at September 30, 2013, is a decrease in the fair value of $13.2 million.

The impact of a 200 basis point increase in the discount rate at September 30, 2013, is a decrease in the fair value of $25.4 million.

Activity related to capitalized MSRs for the three and nine months ended September 30, 2013 and 2012 was as follows (in thousands):

	For the three months ended September 30,						For the nine months ended September 30,
	2013			2012			2013			2012
Beginning balance	$	341,770		$	149,533		$	315,524		$	137,079
Additions, following the sale of loan		22,991			24,585			85,286			51,449
Additions, CWCapital acquisition		—			130,543			—			130,543
Amortization		(16,201	)		(9,228	)		(47,144	)		(22,279	)
Pre-payments and write-offs		(3,661	)		(729	)		(8,767	)		(2,088	)
Ending balance	$	344,899		$	294,704		$	344,899		$	294,704

The expected amortization of MSR balances recorded as of September 30, 2013 is shown in the table below (in thousands). Actual amortization may vary from these estimates.

Three Months Ending December 31,	Originated MSRs Amortization		Acquired MSRs Amortization		Total MSRs Amortization
2013	$	11,266	$	4,872	$	16,138
Year Ending December 31,
2014		42,958		18,726		61,684
2015		37,721		17,316		55,037
2016		34,556		16,026		50,582
2017		31,443		14,117		45,560
2018		27,122		10,226		37,348
Thereafter		63,920		14,630		78,550
Total	$	248,986	$	95,913	$	344,899

When a loan is sold under the Fannie Mae DUS program, the Company typically agrees to guarantee a portion of the ultimate loss incurred on the loan should the borrower fail to perform. The compensation for this risk is a component of the servicing fee on the loan. No guaranty is provided for loans sold under the Freddie Mac or HUD loan programs.

A summary of our guaranty obligation for the three and nine months ended September 30, 2013 and 2012 is as follows (in thousands):

	For the three months ended September 30,						For the nine months ended September 30,
	2013			2012			2013			2012
Beginning balance	$	22,735		$	10,746		$	21,155		$	9,921
Guaranty obligation recognized, following the sale of loan		1,010			1,778			4,436			3,565
Guaranty obligation recognized, CWCapital acquisition		—			8,254			—			8,254
Amortization of guaranty obligation		(983	)		(664	)		(2,829	)		(1,626	)
Ending balance	$	22,762		$	20,114		$	22,762		$	20,114

The Company evaluates the allowance for risk-sharing obligations by monitoring the performance of each loan for triggering events or conditions that may signal a potential default. In situations where payment under the guaranty is probable and estimable on a specific loan, the Company records an additional liability for the estimated allowance for risk-sharing through a charge to the provision for risk-sharing obligations in the income statement, along with a write-off of the loan-specific MSR. The amount of the provision reflects our assessment of the likelihood of payment by the borrower, the estimated disposition value of the underlying collateral and the level of risk-sharing. Historically, the loss recognition occurs at or before the loan becoming 60 days delinquent.

A summary of our allowance for risk-sharing obligations for the three and nine months ended September 30, 2013 and 2012 is as follows (in thousands):

	For the three months ended September 30,						For the nine months ended September 30,
	2013			2012			2013			2012
Beginning balance	$	12,322		$	13,629		$	15,670		$	14,917
Provision for risk sharing obligations		(155	)		(848	)		997			1,126
Allowance for risk-sharing obligations, CWCapital acquisition		—			4,063			—			4,063
Write-offs (1)		(3,706	)		—			(8,206	)		(3,262	)
Ending balance	$	8,461		$	16,844		$	8,461		$	16,844

(1) Represents the write-off of the allowance for risk-sharing obligations upon final settlement of the loss sharing amount with Fannie Mae.

As of September 30, 2013, the maximum quantifiable contingent liability associated with the Company’s guarantees under the Fannie Mae DUS agreement was $3.6 billion. The maximum quantifiable contingent liability is not representative of the actual loss the Company would incur. The Company would be liable for this amount only if all of the loans it services for Fannie Mae, for which the Company retains some risk of loss, were to default and all of the collateral underlying these loans was determined to be without value at the time of settlement.

The total unpaid principal balance of loans the Company was servicing for various institutional investors was $38.7 billion as of September 30, 2013 compared to $33.9 billion as of September 30, 2012.

The maximum borrowing amounts and outstanding balances under the warehouse notes payable as of September 30, 2013 were as follows (in thousands):

On April 12, 2013, the Company executed an amendment to the warehousing agreement related to warehouse facility #1, reducing the interest rate under the line to 30-day LIBOR plus 165 basis points. On June 13, 2013, the Company executed an amendment to the warehousing agreement related to warehouse facility #1, reducing the interest rate under the line to 30-day LIBOR plus 150 basis points effective June 1, 2013. On August 30, 2013, the Company executed an amendment to the warehousing agreement related to warehouse facility #1, extending the maturity date of the warehouse line from September 3, 2013 to September 2, 2014. No other material modifications were made to the agreement.

On April 2, 2013, the Company executed an amendment to the warehouse agreement related to warehouse facility #2, reducing the interest rate under the line to 30-day LIBOR plus 150 basis points. No other material modifications were made to the agreement. On June 25, 2013 the Company executed an amendment to and restatement of the warehouse agreement related to warehouse facility #2. The amendment and restatement, among other things, increased the borrowing capacity to $650.0 million from $450.0 million and extended the maturity date from September 3, 2013 to June 24, 2014.

On July 19, 2013, the Company executed an amendment to the warehouse agreement related to warehouse facility #3, extending the maturity date from July 21, 2013 to September 19, 2013. On August 19, 2013, the Company executed an amendment to the warehouse agreement related to warehouse facility #3, extending the maturity date from September 19, 2013 to September 21, 2014. Additionally, the committed amount was increased from $35.0 million to $57.4 million. The interest rate for advances made on or after July 21, 2013 was reduced from 30-day LIBOR plus 250 basis points to 30-day LIBOR plus 200 basis points. No other material modifications were made to the agreement.

On September 24, 2013, the Company executed an amendment to the warehousing agreement related to warehouse facility #4. Among other things, the amendment extended the maturity date of the warehouse line from October 4, 2013 to December 4, 2013 and increased the commitment amount from $50.0 million to $60.0 million.

The Company uses valuation techniques that are consistent with the market approach, the income approach and/or the cost approach to measure assets and liabilities that are measured at fair value. Inputs to valuation techniques refer to the assumptions that market participants would use in pricing the asset or liability. Inputs may be observable, meaning those that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from independent sources, or unobservable, meaning those that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. In that regard, accounting standards establish a fair value hierarchy for valuation inputs that gives the highest priority to quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The fair value hierarchy is as follows:

The Company’s MSRs are measured at fair value on a nonrecurring basis. That is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment). The Company’s MSRs do not trade in an active, open market with readily observable prices. While sales of MSRs do occur, precise terms and conditions vary with each transaction and are not readily available. Accordingly, the estimated fair value of MSRs was developed using discounted cash flow models that calculate the present value of estimated future net servicing income. The model considers contractually specified servicing fees, prepayment assumptions, delinquency rates, late charges, other ancillary revenue, costs to service and other economic factors. The Company reassesses and periodically adjusts the underlying inputs and assumptions used in the model to reflect observable market conditions and assumptions that a market participant would consider in valuing an MSR asset. MSRs are carried at the lower of amortized cost or estimated fair value.

A description of the valuation methodologies used for assets and liabilities measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy, is set forth below. These valuation methodologies were applied to all of the Company’s assets and liabilities carried at fair value:

The following table summarizes financial assets and financial liabilities measured at fair value on a recurring basis as of September 30, 2013, and December 31, 2012, segregated by the level of the valuation inputs within the fair value hierarchy used to measure fair value (in thousands):

	Quoted Prices in Active Markets For Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)		Balance as of Period End
September 30, 2013
Assets
Loans held for sale	$	—	$	365,210	$	—	$	365,210
Pledged securities		45,449		—		—		45,449
Derivative assets		—		—		13,357		13,357
Total	$	45,449	$	365,210	$	13,357	$	424,016

Liabilities
Derivative liabilities	$	—	$	—	$	8,444	$	8,444
Total	$	—	$	—	$	8,444	$	8,444

December 31, 2012
Assets
Loans held for sale	$	—	$	1,101,561	$	—	$	1,101,561
Pledged securities		33,481		—		—		33,481
Derivative assets		—		—		21,258		21,258
Total	$	33,481	$	1,101,561	$	21,258	$	1,156,300

Liabilities
Derivative liabilities	$	—	$	—	$	867	$	867
Total	$	—	$	—	$	867	$	867

There were no transfers between any of the levels within the fair value hierarchy during the nine months ended September 30, 2013 and 2012.

Derivative instruments (Level 3) are outstanding for short periods of time (generally less than 60 days) and are not outstanding for more than one period.

A roll forward of derivative instruments which require valuations based upon significant unobservable inputs, is presented below for the three and nine months ended September 30, 2013 and 2012 (in thousands):

	Fair Value Measurements Using Significant Unobservable Inputs:
	Derivative Instruments
	Three Months Ended						Nine Months Ended
	September 30, 2013			September 30, 2012			September 30, 2013			September 30, 2012
Derivative assets and liabilities, net
Beginning balance	$	34,336		$	7,602		$	20,391		$	5,415
Settlements		(74,701	)		(40,897	)		(166,763	)		(92,446	)
Realized gains recorded in earnings (1)		40,365			33,295			146,372			87,031
Unrealized gains recorded in earnings (1)		4,913			20,105			4,913			20,105
Ending balance	$	4,913		$	20,105		$	4,913		$	20,105

(1) Realized and unrealized gains from derivatives are recognized in the Gains from mortgage banking activities line item in the Condensed Consolidated Statements of Income.

The following table presents information about significant unobservable inputs used in the measurement of the fair value of the Company’s Level 3 assets and liabilities (in thousands):

(1) Significant increases (decreases) in this input may lead to significantly lower (higher) fair value measurements.

The carrying amounts and the fair values of the Company’s financial instruments as of September 30, 2013, and December 31, 2012, are presented below (in thousands):

	Maryland		80-0629925
(State or other jurisdiction of		(I.R.S. Employer Identification No.)
incorporation or organization)

Large accelerated filer ¨	Accelerated filer x	Non-accelerated filer ¨	Smaller reporting company ¨

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		Page
PART I	FINANCIAL INFORMATION

Item 1.	Financial Statements	2

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	39

Item 4.	Controls and Procedures	39

PART II	OTHER INFORMATION

Item 1.	Legal Proceedings	40

Item 1A.	Risk Factors	40

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	41

Item 3.	Defaults Upon Senior Securities	41

Item 4.	Mine Safety Disclosures	41

Item 5.	Other Information	41

Item 6.	Exhibits	42

	Signature	44

	Exhibit Index	45

Facility	Maximum Amount		Outstanding Balance		Interest rate
Committed warehouse facility #1	$	575,000	$	170,301	Average 30-day LIBOR plus 1.50%
Committed warehouse facility #2		650,000		101,932	Average 30-day LIBOR plus 1.50%
Committed warehouse facility #3		57,400		40,945	Average 30-day LIBOR plus 2.00%
Committed warehouse facility #4		60,000		41,549	Average 30-day LIBOR plus 2.50%
Fannie Mae Repurchase agreement, uncommitted line and open maturity		500,000		75,217	Average 30-day LIBOR plus 1.15%
Total	$	1,842,400	$	429,944

	For the three months ended September 30,						For the nine months ended September 30,
	2013			2012			2013			2012
Warehouse interest income	$	4,877		$	4,169		$	15,083		$	9,722
Warehouse interest expense		(3,094	)		(2,921	)		(9,917	)		(6,463	)
Net warehouse interest income	$	1,783		$	1,248		$	5,166		$	3,259

	For the nine months ended, September 30, 2013
Beginning balance	$	59,735
Goodwill related to the Acquisition		—
Retrospective adjustments		477
Impairment		—
Ending balance	$	60,212