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INVESTMENTS IN CONSUMER LOANS (Tables)
 12 Months Ended
Dec. 31, 2018
Investments, Debt and Equity Securities [Abstract]  
Schedule of Investments in Consumer Loan Equity Method Investees
The following table summarizes the investment in consumer loans, held-for-investment held by New Residential:
 
Unpaid Principal Balance
 
Interest in Consumer Loans
 
Carrying Value
 
Weighted Average Coupon
 
Weighted Average Expected Life (Years)(A)
 
Weighted Average Delinquency(B)
December 31, 2018
 
 
 
 
 
 
 
 
 
 
 
Consumer Loan Companies
 
 
 
 
 
 
 
 
 
 
 
Performing Loans
$
815,341

 
53.5
%
 
$
856,563

 
18.8
%
 
3.6
 
5.4
%
Purchased Credit Deteriorated Loans(C)
221,910

 
53.5
%
 
182,917

 
16.0
%
 
3.4
 
11.6
%
Other - Performing Loans
35,326

 
100.0
%
 
32,722

 
14.2
%
 
0.8
 
5.6
%
Total Consumer Loans, held-for-investment
$
1,072,577

 
 
 
$
1,072,202

 
18.1
%
 
3.5
 
6.7
%
December 31, 2017
 
 
 
 
 
 
 
 
 
 
 
Consumer Loan Companies
 
 
 
 
 
 
 
 
 
 
 
Performing Loans
$
1,005,570

 
53.5
%
 
$
1,052,561

 
18.7
%
 
3.7
 
6.0
%
Purchased Credit Deteriorated Loans(C)
282,540

 
53.5
%
 
236,449

 
16.2
%
 
3.3
 
12.5
%
Other - Performing Loans
89,682

 
100.0
%
 
85,253

 
14.1
%
 
1.0
 
4.5
%
Total Consumer Loans, held-for-investment
$
1,377,792

 
 
 
$
1,374,263

 
17.9
%
 
3.5
 
7.3
%

(A)
Represents the weighted average expected timing of the receipt of expected cash flows for this investment.
(B)
Represents the percentage of the total unpaid principal balance that is 30+ days delinquent. Delinquency status is the primary credit quality indicator as it provides early warning of borrowers who may be experiencing financial difficulties.
(C)
Includes loans with evidence of credit deterioration since origination where it is probable that New Residential will not collect all contractually required principal and interest payments, which are accounted for as PCD loans.
Past Due Financing Receivables
The following table provides past due information regarding New Residential’s Performing Loans, which is an important indicator of credit quality and the establishment of the allowance for loan losses:
December 31, 2018
Days Past Due
 
Delinquency Status(A)
Current
 
83.3
%
30-59
 
7.4
%
60-89
 
2.2
%
90-119(B)
 
0.8
%
120+(C)
 
6.3
%
 
 
100.0
%

(A)
Represents the percentage of the total principal balance that corresponds to loans that are in each delinquency status.
(B)
Includes loans 90-119 days past due and still accruing interest because they are generally placed on nonaccrual status at 120 days or more past due.
(C)
Represents nonaccrual loans.
The following table provides past due information regarding New Residential’s performing consumer loans, held-for-investment, which is an important indicator of credit quality and the establishment of the allowance for loan losses:
December 31, 2018
Days Past Due
 
Delinquency Status(A)
Current
 
94.7
%
30-59
 
2.0
%
60-89
 
1.3
%
90-119(B)
 
0.8
%
120+(B) (C)
 
1.2
%
 
 
100.0
%

(A)
Represents the percentage of the total unpaid principal balance that corresponds to loans that are in each delinquency status.
(B)
Includes loans more than 90 days past due and still accruing interest.
(C)
Interest is accrued up to the date of charge-off at 180 days past due.
Schedule of Carrying Value of Performing Consumer Loans
Activities related to the carrying value of performing consumer loans, held-for-investment were as follows:
 
 
Performing Loans
Balance at December 31, 2016
 
$
1,482,954

Purchases
 
—

Additional fundings(A)
 
56,321

Proceeds from repayments
 
(329,843
)
Accretion of loan discount and premium amortization, net
 
4,891

Gross charge-offs
 
(73,842
)
Additions to the allowance for loan losses, net
 
(2,667
)
Balance at December 31, 2017
 
$
1,137,814

Purchases
 


Additional fundings(A)
 
63,971

Proceeds from repayments
 
(257,182
)
Accretion of loan discount and premium amortization, net
 
1,940

Gross charge-offs
 
(56,870
)
Additions to the allowance for loan losses, net
 
(388
)
Balance at December 31, 2018
 
$
889,285


(A)
Represents draws on consumer loans with revolving privileges.
Allowance for Credit Losses on Financing Receivables
Activities related to the valuation and loss provision on reverse mortgage loans and allowance for loan losses on performing loans held-for-investment were as follows:
 
 
Performing Loans
Balance at December 31, 2016
 
$
—

Provision for loan losses(A)
 
646

Charge-offs(B)
 
(450
)
Balance at December 31, 2017
 
$
196

Provision for loan losses(A)
 
1,028

Charge-offs(B)
 
(1,224
)
Balance at December 31, 2018
 
$
—


(A)
Based on an analysis of collective borrower performance, credit ratings of borrowers, loan-to-value ratios, estimated value of the underlying collateral, key terms of the loans and historical and anticipated trends in defaults and loss severities at a pool level.
(B)
Loans, other than PCD loans, are generally charged off or charged down to the net realizable value of the collateral (i.e., fair value less costs to sell), with an offset to the allowance for loan losses, when available information confirms that loans are uncollectible.

Activities related to the allowance for loan losses on performing consumer loans, held-for-investment were as follows:
 
 
Collectively Evaluated(A)
 
Individually Impaired(B)
 
Total
Balance at December 31, 2016
 
$
2,441

 
$
997

 
$
3,438

Provision for loan losses
 
65,059

 
679

 
65,738

Net charge-offs(C)
 
(63,071
)
 
—

 
(63,071
)
Balance at December 31, 2017
 
$
4,429

 
$
1,676

 
$
6,105

Provision (reversal) for loan losses
 
47,839

 
388

 
48,227

Net charge-offs(C)
 
(49,664
)
 
—

 
(49,664
)
Balance at December 31, 2018
 
$
2,604

 
$
2,064

 
$
4,668


(A)
Represents smaller-balance homogeneous loans that are not individually considered impaired and are evaluated based on an analysis of collective borrower performance, key terms of the loans and historical and anticipated trends in defaults and loss severities, and consideration of the unamortized acquisition discount.
(B)
Represents consumer loan modifications considered to be troubled debt restructurings (“TDRs”) as they provide concessions to borrowers, primarily in the form of interest rate reductions, who are experiencing financial difficulty. As of December 31, 2018, there are $14.2 million in UPB and $12.6 million in carrying value of consumer loans classified as TDRs.
(C)
Consumer loans, other than PCD loans, are charged off when available information confirms that loans are uncollectible, which is generally when they become 180 days past due. Charge-offs are presented net of $9.0 million and $10.8 million in recoveries of previously charged-off UPB in 2018 and 2017, respectively.
Schedule of Carrying Value of Purchased Credit Deteriorated Loans
A portion of the consumer loans are considered PCD loans. Activities related to the carrying value of PCD consumer loans, held-for-investment were as follows:
Balance at December 31, 2016
 
$
316,532

(Allowance) reversal for loan losses(A)
 
3,013

Proceeds from repayments
 
(123,932
)
Accretion of loan discount and other amortization
 
40,836

Balance at December 31, 2017
 
$
236,449

(Allowance) reversal for loan losses(A)
 
(31
)
Proceeds from repayments
 
(90,700
)
Accretion of loan discount and other amortization
 
37,199

Balance at December 31, 2018
 
$
182,917


(A)
An allowance represents the present value of cash flows expected at acquisition that are no longer expected to be collected. A reversal results from an increase to expected cash flows that reverses a prior allowance.
Impaired Financing Receivables
The following is the unpaid principal balance and carrying value for consumer loans, for which, as of the acquisition date, it was probable that New Residential would be unable to collect all contractually required payments:
 
Unpaid Principal Balance
 
Carrying Value
December 31, 2018
$
221,910

 
$
182,917

December 31, 2017
282,540

 
236,449
Schedule of Changes in Accretable Yield
The following is a summary of the changes in accretable yield for these loans:
Balance at December 31, 2016
 
$
167,928

Accretion
 
(40,836
)
Reclassifications from (to) non-accretable difference(A)
 
5,199

Balance at December 31, 2017
 
$
132,291

Accretion
 
(37,199
)
Reclassifications from (to) non-accretable difference(A)
 
31,426

Balance at December 31, 2018
 
$
126,518


(A)
Represents a probable and significant increase in cash flows previously expected to be uncollectible.
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net
Others’ interests in the equity of the Consumer Loan Companies is computed as follows:
 
 
December 31,
 
 
2018
 
2017
Total Consumer Loan Companies equity
 
$
66,105

 
$
74,071

Others’ ownership interest
 
46.5
%
 
46.5
%
Others’ interests in equity of consolidated subsidiary
 
$
30,561

 
$
34,466


Others’ interests in the Consumer Loan Companies’ net income (loss) is computed as follows:
 
Year Ended December 31,
 
2018
 
2017
Net Consumer Loan Companies income (loss)
$
79,539

 
$
98,692

Others’ ownership interest as a percent of total
46.5
%
 
46.5
%
Others’ interest in net income (loss) of consolidated subsidiaries
$
36,987

 
$
45,892
Schedule of Variable Interest Entities
The following table presents information on the assets and liabilities of the Shelter JVs:
 
 
As of
 
 
December 31, 2018
Assets
 
 
Cash and cash equivalents
 
$
17,346

Property and equipment, net
 
137

Intangible assets, net
 
70

Prepaid expenses and other assets
 
411

Total assets
 
$
17,964

Liabilities
 
 
Accounts payable and accrued expenses
 
$
1,315

Reserve for sales recourse
 
967

Total liabilities
 
$
2,282


Noncontrolling Interests
Noncontrolling interests in the equity of the Shelter JVs is computed as follows:
 
 
December 31, 2018
Total consolidated equity of JVs
 
$
15,682

Noncontrolling ownership interest
 
51.0
%
Noncontrolling equity interest in consolidated JVs
 
$
7,998

 
 
 
Total consolidated net income of JVs
 
$
3,135

Noncontrolling ownership interest in net income
 
51.0
%
Noncontrolling interest in net income of consolidated JVs
 
$
1,599


As described in “Call Rights” above, New Residential has issued securitizations which were treated as sales under GAAP. New Residential has no obligation to repurchase any loans from these securitizations and its exposure to loss is limited to the carrying amount of its retained interests in the securitization entities. These securitizations are conducted through variable interest entities, of which New Residential is not the primary beneficiary. Additionally, New Penn, a wholly owned subsidiary of New Residential, was deemed to be the primary beneficiary of the SAFT 2013-1 securitization entity as a result of its ability to direct activities that most significantly impact the economic performance of the entity in its role as servicer and its ownership of subordinate retained interests. The following table summarizes certain characteristics of the underlying residential mortgage loans, and related financing, in these securitizations as of December 31, 2018:
Residential mortgage loan UPB
 
$
7,818,221

Weighted average delinquency(A)
 
1.97
%
Net credit losses for the year ended December 31, 2018
 
$
9,101

Face amount of debt held by third parties(B)
 
$
6,783,187

 
 
 
Carrying value of bonds retained by New Residential(C)
 
$
1,206,402

Cash flows received by New Residential on these bonds for the year ended December 31, 2018
 
$
178,301


(A)
Represents the percentage of the UPB that is 60+ days delinquent.
(B)
Excludes bonds retained by New Residential.
(C)
Includes bonds retained pursuant to required risk retention regulations.
 
 
As of December 31,
 
 
2018
 
2017
Assets
 
 
 
 
Consumer loans, held-for-investment
 
$
1,039,480

 
$
1,289,010

Restricted cash
 
10,186

 
11,563

Accrued interest receivable
 
15,627

 
19,360

Total assets(A)
 
$
1,065,293

 
$
1,319,933

Liabilities
 
 
 
 
Notes and bonds payable(B)
 
$
1,030,096

 
$
1,284,436

Accounts payable and accrued expenses
 
3,814

 
4,007

Total liabilities(A)
 
$
1,033,910

 
$
1,288,443


(A)
The creditors of the Consumer Loan SPVs do not have recourse to the general credit of New Residential, and the assets of the Consumer Loan SPVs are not directly available to satisfy New Residential’s obligations.
(B)
Includes $121.0 million face amount of bonds retained by New Residential issued by these VIEs.
Summary of the Investment in the Consumer Loan Companies
The following tables summarize the investment in LoanCo and WarrantCo held by New Residential:
 
December 31, 2018(A)
 
December 31, 2017
Consumer loans, at fair value
$
231,560

 
$
178,422

Warrants, at fair value
103,067

 
80,746

Other assets
25,971

 
46,342

Warehouse financing
(182,065
)
 
(117,944
)
Other liabilities
(1,142
)
 
(13,059
)
Equity
$
177,391

 
$
174,507

Undistributed retained earnings
$
—

 
$
—

New Residential’s investment
$
42,875

 
$
42,473

New Residential’s ownership
24.2
%
 
24.3
%


 
Year Ended
 
December 31, 2018(A)
Interest income
$
42,920

Interest expense
(12,258
)
Change in fair value of consumer loans and warrants
17,491

Gain on sale of consumer loans(B)
2,697

Other expenses
(7,257
)
Net income
$
43,593

New Residential’s equity in net income
$
10,803

New Residential’s ownership
24.8
%


(A)
Data as of, and for the periods ended, November 30, 2018, as a result of the one month reporting lag.
(B)
During the year ended December 31, 2018, LoanCo sold, through securitizations which were treated as sales for accounting purposes, $1.2 billion in UPB of consumer loans. LoanCo retained $103.0 million of residual interests in the securitizations and distributed them to the LoanCo co-investors, including New Residential.

The following is a summary of LoanCo’s consumer loan investments:
 
Unpaid Principal Balance
 
Interest in Consumer Loans
 
Carrying Value
 
Weighted Average Coupon
 
Weighted Average Expected Life (Years)(A)
 
Weighted Average Delinquency(B)
December 31, 2018(C)
$
231,560

 
25.0
%
 
$
231,560

 
14.2
%
 
1.3
 
0.4
%

(A)
Represents the weighted average expected timing of the receipt of expected cash flows for this investment.
(B)
Represents the percentage of the total unpaid principal balance that is 30+ days delinquent. Delinquency status is the primary credit quality indicator as it provides early warning of borrowers who may be experiencing financial difficulties.
(C)
Data as of November 30, 2018 as a result of the one month reporting lag.

New Residential’s investment in LoanCo and WarrantCo changed as follows:
Balance at December 31, 2017
$
51,412

Contributions to equity method investees
308,050

Distributions of earnings from equity method investees
(6,176
)
Distributions of capital from equity method investees
(325,795
)
Earnings from investments in consumer loans, equity method investees
10,803

Balance at December 31, 2018
$
38,294