EXCESS MORTGAGE SERVICING RIGHTS (Tables)

12 Months Ended

Dec. 31, 2024

Transfers and Servicing [Abstract]

Schedule of Activity Related to the Carrying Value of Investments in Excess MSRs

The following table summarizes activity related to MSRs and MSR financing receivables:

Balance as of December 31, 2022	$	8,889,403
Originations(A)	786,655
Proceeds from sales(B)	(704,436)
Change in Fair Value Due To:
Realization of cash flows(C)	(518,978)
Change in valuation inputs and assumptions	(46,706)
Balance as of December 31, 2023	8,405,938
Acquisition	700,207
Originations(A)	1,396,154
Sales	11,026
Change in Fair Value Due To:
Realization of cash flows(C)	(607,169)
Change in valuation inputs and assumptions	415,515
Balance as of December 31, 2024	$	10,321,671

(A)Represents MSRs retained on the sale of originated residential mortgage loans. Includes $54.4 million and $0.0 million of MSRs capitalized through co-issue with third-parties for the years ended December 31, 2024 and 2023, respectively.

(B)Relates primarily to excess servicing cash flows sold on certain agency loans with a total UPB of approximately $91.4 billion during the year ended December 31, 2023. In connection with these sales, the Company recorded a gain of approximately $5.2 million during the period, which is included within change in fair value of MSRs and MSR financing receivables in the consolidated statements of operations.

(C)Based on the paydown of the underlying residential mortgage loans.

The following table summarizes MSRs and MSR financing receivables by type as of December 31, 2024 and 2023:

	UPB of Underlying Mortgages		Weighted Average Life (Years)(A)	Carrying Value(B)
2024
GSE	$	383,014,320	6.5	$	6,413,199
non-Agency	70,022,636		5.4	836,408
Ginnie Mae(C)	137,177,395		6.4	3,072,064
Total / Weighted Average	$	590,214,351	6.4	$	10,321,671
2023
GSE	$	351,642,337	7.7	$	5,333,013
non-Agency	48,928,545		6.8	678,913
Ginnie Mae(C)	127,863,627		7.1	2,394,012
Total / Weighted Average	$	528,434,509	7.5	$	8,405,938

(A)Represents the weighted average expected timing of the receipt of expected cash flows for this investment.

(B)Represents the fair value for this investment. As of December 31, 2024 and 2023, weighted average discount rates of 8.9% (range of 8.7% – 10.3%) and 8.5% (range of 7.9% – 10.8%), respectively, were used to value Rithm Capital’s MSRs and MSR financing receivables, respectively.

(C)As of December 31, 2024 and 2023, Rithm Capital has approximately $2.7 billion and $1.8 billion in residential mortgage loans subject to repurchase and the related residential mortgage loans repurchase liability on its consolidated balance sheets.

The following table presents activity related to the consolidated investments in Excess MSRs measured at fair value:

	Total
Balance as of December 31, 2022(A)	$	321,803
Interest income	18,310
Other income	267
Proceeds from repayments	(41,552)
Proceeds from sales	(2,779)
Change in fair value	(15,227)
Activity of Investments in Equity Method Investees:
Distributions of earnings from equity method investees	(2,219)
Distributions of capital from equity method investees	(9,968)
Change in fair value of investments in equity method investees	2,515
Balance as of December 31, 2023(A)	271,150
Purchases	122,887
Interest income	29,815
Other income	(656)
Proceeds from repayments	(55,750)
Proceeds from sales	(499)
Change in fair value	10,820
Acquisition of Assets from Fortress Excess MSR JV:
Distributions of earnings from equity method investees	(344)
Distributions of capital from equity method investees	(8,846)
Change in fair value of investments in equity method investees	1,617
Reclassification of SLS serviced Excess MSRs to full MSRs	(1,032)
Balance as of December 31, 2024	$	369,162

(A)Rithm Capital’s total investment in Excess MSRs as of December 31, 2023 and 2022 includes $62.8 million and $72.4 million of indirect investments in Excess MSRs, respectively. As a result of Rithm Capital’s investment in the Fortress Excess MSR JV during the second quarter of 2024, all of the Company’s investments in Excess MSRs are direct investments as of December 31, 2024, as shown in the table above.

Summary of Direct Investments in Excess MSRs

The following summarizes Rithm Capital’s direct investments in Excess MSRs:

	December 31, 2024
	UPB of Underlying Mortgages		Interest in Excess MSR		Weighted Average Life Years(A)	Amortized Cost Basis		Carrying Value(B)
			Rithm Capital(C)(D)	Mr. Cooper
Total	$	53,494,378	65.0% – 80.0% (69.9%)	20.0% – 35.0% (30.9%)	5.9	$	321,962	$	369,162

	December 31, 2023
	UPB of Underlying Mortgages		Interest in Excess MSR			Weighted Average Life Years(A)	Amortized Cost Basis		Carrying Value(B)
			Rithm Capital(C)(D)	Former Manager-managed funds	Mr. Cooper
Total	$	42,957,347	32.5% – 100.0% (56.5%)	—% – 50.0%	—% – 35.0%	6.3	$	181,721	$	208,385

(A)Represents the weighted average expected timing of the receipt of expected cash flows for this investment.

(B)Carrying value represents the fair value of the pools and recapture agreements, as applicable.

(C)Amounts in parentheses represent weighted averages.

(D)Rithm Capital also invested in related servicer advance investments, including the base fee component of the related MSR as of December 31, 2024 and 2023 (Note 14) on $13.3 billion and $15.5 billion UPB, respectively, underlying these Excess MSRs.

Changes in fair value of Excess MSRs investments consist of the following:

	Year Ended December 31,
	2024		2023		2022
Original and Recaptured Pools	$	10,820	$	(12,712)	$	(1,436)