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Long-Term Debt

12 Months Ended

Dec. 31, 2024

Note 16—Long-Term Debt

Notes Payable Secured by Mortgage Servicing Assets

Term Notes and Term Loans

The Company, through its wholly-owned subsidiaries PNMAC, PLS and the PNMAC GMSR ISSUER TRUST (“Issuer Trust”), has entered into a structured finance transaction, in which PLS pledges and/or sells to the Issuer Trust participation certificates representing beneficial interests in Ginnie Mae mortgage servicing assets pursuant to a repurchase agreement. The Issuer Trust has issued VFNs to PLS, has issued secured term notes (the “Term Notes”) to qualified institutional buyers under Rule 144A of the Securities Act of 1933, as amended (the “Securities Act”), and has entered into a series of syndicated term loans with various lenders (the “Term Loans”). The Term Notes and Term Loans are secured by the participation certificates relating to Ginnie Mae mortgage servicing assets financed pursuant to the servicing asset repurchase facilities, and rank pari passu with the mortgage servicing asset VFNs which are sold by PLS under agreements to repurchase as shown in Note 15—Short-Term Debt.

Following is a summary of the issued and outstanding Term Notes and Term Loans:


				Maturity date
Issuance date	Principal balance		Annual interest rate spread (1)	Stated	Optional extension (2)
	(in thousands)
Term Notes:
June 3, 2022	$	500,000	4.25%	5/25/2027	5/25/2029
February 29, 2024		425,000	3.20%	3/26/2029	3/25/2031
Term Loans:
February 28, 2023		680,000	3.00%	2/25/2028	2/25/2029
October 25, 2023		125,000	3.00%	10/25/2028
	$	1,730,000

(1)	Interest is charged at a rate based on SOFR plus a spread.

(2)	The Term Notes and Term Loans’ indentures provide the Company with the option to extend the maturity of the Term Notes or Term Loans as specified in the respective agreements.

Freddie Mac MSR Notes Payable

The Company has notes payable to two lenders that are secured by Freddie Mac MSRs. Interest is charged at a rate of SOFR plus a spread as defined in the agreements. The facilities expire on March 6, 2026 and June 11, 2026. The maximum amount that the Company may borrow under the notes payable is $900 million, $850 million of which is committed, and may be reduced by other debt outstanding with the counterparties.

Notes payable secured by mortgage servicing assets are summarized below:


	Year ended December 31,
	2024		2023		2022

	(dollars in thousands)
Average balance	$	1,848,374	$	2,421,124	$	1,584,383
Weighted average interest rate (1)		8.73%		8.59%		4.88%
Total interest expense	$	164,161	$	211,085	$	79,813

(1)	Excludes the effect of amortization of debt issuance costs totaling $2.9 million, $3.2 million and $2.5 million for the years ended December 31, 2024, 2023 and 2022, respectively.


	December 31,
	2024		2023

	(dollars in thousands)
Carrying value:
Unpaid principal balance:
Term Notes and Term Loans	$	1,730,000	$	1,730,000
Freddie Mac MSR Notes Payable		325,000		150,000
		2,055,000		1,880,000
Unamortized debt issuance costs		(6,028)		(6,585)
	$	2,048,972	$	1,873,415
Weighted average interest rate		7.81%		8.82%
Assets pledged to secure notes payable (1):
Servicing advances	$	357,939	$	354,831
Mortgage servicing rights	$	8,609,388	$	7,033,892
Deposits	$	16,697	$	15,653

(1)

Beneficial interests in the Ginnie Mae MSRs, servicing advances and deposits together serve as the collateral backing servicing asset facilities that are included in Assets sold under agreements to repurchase and the Term Notes and Term Loans are included in Notes payable secured by mortgage servicing assets.

Unsecured Senior Notes

The Company issued unsecured senior notes (the “Unsecured Notes”) to qualified institutional buyers under Rule 144A of the Securities Act. The Unsecured Notes are senior unsecured obligations of the Company and will rank senior in right of payment to any future subordinate indebtedness of the Company, equally in right of payment with all existing and future senior indebtedness of the Company and effectively subordinate to any existing and future secured indebtedness of the Company to the extent of the fair value of collateral securing such indebtedness.

The Unsecured Notes are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by PFSI’s existing and future wholly-owned domestic subsidiaries (other than certain excluded subsidiaries defined in the indenture under which the Unsecured Notes were issued). The guarantees are senior unsecured obligations of the guarantors and will rank senior in right of payment to any future subordinate indebtedness of the guarantors, equally in right of payment with all existing and future senior indebtedness of the guarantors and effectively subordinate to any existing and future secured indebtedness of the guarantors to the extent of the fair value of collateral securing such indebtedness. The Unsecured Notes and the guarantees are structurally subordinate to the indebtedness and liabilities of the Company’s subsidiaries that do not guarantee the Unsecured Notes.

Following is a summary of the Company’s issued and outstanding Unsecured Notes:


Issuance date	Principal balance		Note interest rate	Maturity date	Optional redemption date (1)
	(in thousands)		(annual)
September 29, 2020	$	500,000	5.375%	October 15, 2025	October 15, 2022
October 19, 2020		150,000	5.375%	October 15, 2025	October 15, 2022
February 11, 2021		650,000	4.25%	February 15, 2029	February 15, 2024
September 16, 2021		500,000	5.75%	September 15, 2031	September 15, 2026
December 11, 2023		750,000	7.875%	December 15, 2029	December 15, 2026
May 23, 2024		650,000	7.125%	November 15, 2030	November 15, 2026
	$	3,200,000

(1)

Before the optional redemption date, the Company may redeem some or all of the Unsecured Notes for that issuance at a price equal to 100% of the principal amount, plus accrued and unpaid interest and a make-whole premium or the Company may redeem up to 40% of the Unsecured Notes for that issuance with an amount equal to or less than the net proceeds from certain equity offerings at the redemption price set forth in the indenture, plus accrued and unpaid interest. On or after the optional redemption date, the Company may redeem some or all of the Unsecured Notes for that issuance at the redemption prices set forth in the indenture, plus accrued and unpaid interest.


	Year ended December 31,
	2024		2023		2022

	(dollars in thousands)
Average balance	$	2,946,039	$	1,843,151	$	1,800,000
Weighted average interest rate (1)		6.04%		5.13%		5.07%
Total interest expense	$	184,304	$	98,396	$	95,014

(1)	Excludes the effect of amortization of debt issuance costs of $6.5 million, $3.8 million and $3.7 million on for the years ended December 31, 2024, 2023 and 2022, respectively.


	December 31,
	2024		2023

	(dollars in thousands)
Carrying value:
Unpaid principal balance	$	3,200,000	$	2,550,000
Unamortized debt issuance costs and premiums, net		(35,968)		(30,349)
	$	3,164,032	$	2,519,651
Weighted average interest rate		6.15%		5.90%

Maturities of Long-Term Debt

Maturities of long-term debt obligations (based on stated maturity dates) are as follows:


	Year ended December 31,
	2025		2026		2027		2028		2029		Thereafter		Total

	(in thousands)
Notes payable secured by mortgage servicing assets (1)	$	—	$	325,000	$	500,000	$	805,000	$	425,000	$	—	$	2,055,000
Unsecured senior notes		650,000		—		—		—		1,400,000		1,150,000		3,200,000
Total	$	650,000	$	325,000	$	500,000	$	805,000	$	1,825,000	$	1,150,000	$	5,255,000

(1)	The Term Notes and Term Loans’ indentures provide the Company with the option to extend the maturity of the Term Notes by two years after their stated maturities.