Fair Value (Tables)

12 Months Ended

Dec. 31, 2025

Schedule of Fair Value Measurement Inputs and Valuation Techniques

Following are descriptions of the valuation methodologies used to measure material assets and liabilities at fair value and the details of the valuation models, key inputs to those models, and significant assumptions utilized. Within the assumption tables presented, not meaningful (“NM”) refers to a range of inputs that is too broad to provide meaningful information to the user or to an input that has no range and consists of a single data point. Weighted averages are calculated by weighting each input by the relative outstanding balance of the related financial instrument.


Instrument		Valuation Techniques	Classification of Fair Value Hierarchy
Assets
Loans held for investment, subject to HMBS related obligations(1)
	HECM loans - securitized into Ginnie Mae HMBS	These loans are valued utilizing a present value methodology that discounts estimated future cash flows over the life of the loan portfolio using weighted average remaining life (“WAL”), conditional prepayment rate (“CPR”), loss frequency, loss severity, borrower draw rate, and discount rate assumptions.	Level 3
Loans held for investment, subject to nonrecourse debt(1)
	Non-agency reverse mortgage loans - securitized	These loans are valued utilizing a present value methodology that discounts estimated future cash flows over the life of the loan portfolio using WAL, loan-to-value (“LTV”), CPR, loss severity, home price appreciation (“HPA”), and discount rate assumptions, inclusive of the credit spread component.	Level 3
	HECM buyouts - securitized (performing)	These loans are valued utilizing a present value methodology that discounts estimated future cash flows over the life of the loan portfolio using WAL, CPR, loss severity, and discount rate assumptions.	Level 3
	HECM buyouts - securitized (nonperforming)	These loans are valued utilizing a present value methodology that discounts estimated future cash flows over the life of the loan portfolio using WAL, CPR, loss frequency, loss severity, and discount rate assumptions.	Level 3
(1) The Company aggregates loan portfolios based on the underlying securitization trust and values these loans using these aggregated pools. The range of inputs provided is based on the range of inputs utilized for each securitization trust.
Loans held for investment
	Non-agency reverse mortgage loans	These loans are valued utilizing a present value methodology that discounts estimated future cash flows over the life of the loan portfolio using WAL, LTV, CPR, loss severity, HPA, and discount rate assumptions, inclusive of the credit spread component.	Level 3


	HECM buyouts (nonperforming)	The fair value of nonperforming repurchased loans is based on expected cash proceeds from the liquidation of the underlying properties and expected claim proceeds from HUD. These loans are valued utilizing a present value methodology that discounts estimated future cash flows over the life of the loan portfolio using WAL, CPR, loss frequency, loss severity, and discount rate. Termination proceeds are adjusted for expected loss frequencies and severities to arrive at net proceeds that will be provided upon final resolution, including assignments to the FHA. Historical experience is utilized to estimate the loss rates resulting from scenarios where FHA insurance proceeds are not expected to cover all principal and interest outstanding and, as servicer, the Company is exposed to losses upon resolution of the loan.	Level 3
Other assets
	Loans held for sale	The reverse mortgage loans are valued based on an expected margin on sale.	Level 3
	Retained bonds	Management obtains third-party valuations to assess the reasonableness of the fair value calculations provided by the internal valuation model. The primary assumptions utilized include WAL and discount rate.	Level 3
Liabilities
HMBS related obligations
	HMBS related obligations	The fair value is based on the net present value of projected cash flows over the estimated life of the liability. The fair value of the HMBS related obligations also includes the consideration required by a market participant to transfer the HECM and HMBS servicing obligations, including exposure resulting from shortfalls in FHA insurance proceeds as well as assumptions that it believes a market participant would consider in valuing the liability, including, but not limited to, assumptions for repayment, costs to transfer servicing obligations, shortfalls in FHA insurance proceeds, and discount rates. The significant unobservable inputs used in the measurement include WAL, CPR, and discount rates.	Level 3
Nonrecourse debt
	Non-agency reverse mortgage loan securitizations and performing/nonperforming HECM securitizations	The fair value is based on the net present value of projected cash flows over the estimated life of the liability. The significant unobservable inputs used in the measurement include WAL, CPR, and discount rates, inclusive of the credit spread component.	Level 3
Convertible Notes
	Convertible Notes	The Convertible Notes are measured based on the closing market price of the Company’s publicly-traded stock on the applicable date of the Consolidated Statements of Financial Condition. Refer to Note 13 - Notes Payable for additional information. There were no Convertible Notes as of December 31, 2024.	Level 2
Repurchase Agreement obligation
	Repurchase Agreement obligation	The Repurchase Agreement obligation is measured based on the total consideration to be paid upon the second closing of the Repurchase. Refer to Note 23 - Related Party Transactions for additional information. There was no obligation as of December 31, 2024.	Level 2


Deferred purchase price liabilities
	AAG/Bloom	These liabilities are measured based on the estimated amount of indemnified claims associated with the acquisition of certain assets and liabilities from AAG/Bloom, and the closing market price of the Company’s publicly-traded stock on the applicable date of the Consolidated Statements of Financial Condition.	Level 3
	TRA obligation	The fair value is derived through the use of a DCF model. The significant unobservable assumptions used in the DCF include the ability to utilize tax attributes based on current tax forecasts, a constant U.S. federal income tax rate, and a discount rate.	Level 3


		December 31, 2025			December 31, 2024
Instrument / Unobservable Inputs		Range	Weighted Average		Range	Weighted Average
Assets
Loans held for investment, subject to HMBS related obligations
	WAL (in years)	NM	3.1		NM	3.0
	CPR	NM	20.9	%	NM	21.6	%
	Loss frequency	NM	4.5	%	NM	4.4	%
	Loss severity	5.8% - 15.8%	6.0	%	3.4% - 15.9%	3.5	%
	Average draw rate	NM	1.1	%	NM	1.1	%
	Discount rate	NM	4.7	%	NM	5.3	%
Loans held for investment, subject to nonrecourse debt:
	Non-agency reverse mortgage loans - securitized
	WAL (in years)	NM	9.8		NM	10.1
	LTV	NM	49.9	%	0.0% - 98.0%	47.2	%
	CPR	NM	15.0	%	NM	14.8	%
	Loss severity	NM	10.0	%	NM	10.0	%
	HPA	(6.8)% - 5.3%	3.7	%	(5.6)% - 8.3%	3.6	%
	Discount rate	NM	6.3	%	NM	7.0	%
	HECM buyouts - securitized (performing)
	WAL (in years)	NM	6.9		NM	7.1
	CPR	NM	16.3	%	NM	15.1	%
	Loss severity	6.0% - 13.3%	8.4	%	3.4% - 15.9%	4.7	%
	Discount rate	NM	7.3	%	NM	8.0	%
	HECM buyouts - securitized (nonperforming)
	WAL (in years)	NM	1.5		NM	1.5
	CPR	NM	41.5	%	NM	40.0	%
	Loss frequency	NM	45.5	%	23.1% - 100.0%	45.6	%
	Loss severity	6.0% - 13.3%	6.8	%	3.4% - 15.9%	5.2	%
	Discount rate	NM	6.8	%	NM	8.0	%
Loans held for investment:
	Non-agency reverse mortgage loans
	WAL (in years)	NM	11.1		NM	10.5
	LTV	NM	43.2	%	5.9% - 70.6%	35.1	%
	CPR	NM	14.9	%	NM	16.2	%
	Loss severity	NM	10.0	%	NM	10.0	%
	HPA	(6.8)% - 5.3%	3.6	%	(5.6)% - 8.3%	3.5	%


		December 31, 2025			December 31, 2024
Instrument / Unobservable Inputs		Range	Weighted Average		Range	Weighted Average
	Discount rate	NM	6.3	%	NM	7.1	%
	HECM buyouts (nonperforming)
	WAL (in years)	NM	1.3		NM	1.5
	CPR	NM	45.4	%	NM	43.8	%
	Loss frequency	NM	42.3	%	NM	47.9	%
	Loss severity	6.0% - 13.3%	11.2	%	3.4% - 15.9%	10.5	%
	Discount rate	NM	6.8	%	NM	8.0	%
Other assets:
	Retained bonds
	WAL (in years)	NM	3.0		NM	3.5
	Discount rate	(1.7)% - 15.3%	7.1	%	(1.3)% - 15.3%	7.3	%
Liabilities
HMBS related obligations
	WAL (in years)	NM	3.9		NM	3.8
	CPR	NM	24.8	%	NM	24.8	%
	Discount rate	NM	4.6	%	NM	5.2	%
Nonrecourse debt:
	Non-agency reverse mortgage loan securitizations
	WAL (in years)	0.1 - 10.5	6.4		0.1 - 10.9	3.7
	CPR	NM	21.8	%	NM	17.3	%
	Discount rate	NM	6.0	%	NM	6.7	%
	Performing/nonperforming HECM securitizations
	WAL (in years)	NM	1.2		NM	1.0
	CPR	NM	57.4	%	NM	18.6	%
	Discount rate	NM	5.4	%	NM	7.5	%
Deferred purchase price liabilities:
	TRA obligation
	Discount rate	NM	26.6	%	NM	28.1	%

Schedule of Recognized Assets and Liabilities that are Measured at Fair Value on a Recurring Basis

The following tables present assets and liabilities that are measured at fair value on a recurring basis (in thousands):


	December 31, 2025
	Total Fair Value		Level 1		Level 2		Level 3
Assets
Loans held for investment, subject to HMBS related obligations	$	19,135,403	$	—	$	—	$	19,135,403
Loans held for investment, subject to nonrecourse debt	10,026,177		—		—		10,026,177
Loans held for investment	870,081		—		—		870,081
Other assets:
Loans held for sale	37,461		—		1,338		36,123
Retained bonds	38,685		—		—		38,685
Total assets	$	30,107,807	$	—	$	1,338	$	30,106,469

Liabilities
HMBS related obligations	$	18,912,226	$	—	$	—	$	18,912,226
Nonrecourse debt	9,736,493		—		—		9,736,493
Convertible Notes	53,800		—		53,800		—
Repurchase Agreement obligation	40,595		—		40,595		—
Deferred purchase price liabilities:
AAG/Bloom	8,646		—		—		8,646
TRA obligation	3,901		—		—		3,901
Total liabilities	$	28,755,661	$	—	$	94,395	$	28,661,266


	December 31, 2024
	Total Fair Value		Level 1		Level 2		Level 3
Assets
Loans held for investment, subject to HMBS related obligations	$	18,669,962	$	—	$	—	$	18,669,962
Loans held for investment, subject to nonrecourse debt	9,288,403		—		—		9,288,403
Loans held for investment	520,103		—		—		520,103
Other assets:
Loans held for sale	3,454		—		3,454		—
Retained bonds	40,407		—		—		40,407
Total assets	$	28,522,329	$	—	$	3,454	$	28,518,875

Liabilities
HMBS related obligations	$	18,444,370	$	—	$	—	$	18,444,370
Nonrecourse debt	8,954,068		—		—		8,954,068
Deferred purchase price liabilities:
AAG/Bloom	13,370		—		—		13,370
TRA obligation	3,314		—		—		3,314
Total liabilities	$	27,415,122	$	—	$	—	$	27,415,122

Schedule of Fair Value Assets Measured on Recurring Basis Unobservable Input Reconciliation

The following tables present Level 3 assets and liabilities that are measured at fair value on a recurring basis (in thousands):


	Assets
Year ended December 31, 2025	Loans held for investment		Loans held for investment, subject to nonrecourse debt		Loans held for sale		Retained bonds
Beginning balance	$	19,190,065	$	9,288,403	$	—	$	40,407
Total gain (loss) included in earnings	1,473,731		966,349		(1,305)		1,903
Purchases, settlements, and transfers:
Purchases and additions	3,322,290		24,735		71,971		—
Sales and settlements	(2,949,938)		(1,085,448)		(220,520)		(3,625)
Transfers in (out) between categories	(1,030,664)		832,138		185,977		—
Ending balance	$	20,005,484	$	10,026,177	$	36,123	$	38,685


	Assets
Year ended December 31, 2024	Loans held for investment		Loans held for investment, subject to nonrecourse debt		MSR		Retained bonds
Beginning balance	$	18,123,991	$	8,272,393	$	6,436	$	44,297
Total gain (loss) included in earnings	1,753,126		639,122		(920)		(684)
Purchases, settlements, and transfers:
Purchases and additions	2,870,747		41,134		—		—
Sales and settlements	(2,256,238)		(988,337)		(5,516)		(3,206)
Transfers in (out) between categories	(1,301,561)		1,324,091		—		—
Ending balance	$	19,190,065	$	9,288,403	$	—	$	40,407

Schedule of Fair Value Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation

The following tables present Level 3 assets and liabilities that are measured at fair value on a recurring basis (in thousands):


	Liabilities
Year ended December 31, 2025	HMBS related obligations		Nonrecourse debt		Deferred purchase price liabilities
Beginning balance	$	(18,444,370)	$	(8,954,068)	$	(16,684)
Total gain (loss) included in earnings	(1,116,201)		(733,504)		1,931
Purchases, settlements, and transfers:
Purchases and additions	(2,006,384)		(4,991,431)		—
Settlements	2,654,729		4,942,510		2,206
Ending balance	$	(18,912,226)	$	(9,736,493)	$	(12,547)


	Liabilities
Year ended December 31, 2024	HMBS related obligations		Nonrecourse debt		Deferred purchase price liabilities
Beginning balance	$	(17,353,720)	$	(7,904,200)	$	(8,855)
Total loss included in earnings	(1,340,956)		(644,705)		(7,966)
Purchases, settlements, and transfers:
Purchases and additions	(2,003,170)		(3,177,025)		—
Settlements	2,253,476		2,771,862		137
Ending balance	$	(18,444,370)	$	(8,954,068)	$	(16,684)

Fair Value Option, Disclosures

The following table presents the total amount of loans held for investment that were greater than 90 days past due and on non-accrual status (in thousands):


	December 31, 2025						December 31, 2024
	UPB		Fair Value		Difference		UPB		Fair Value		Difference
Loans held for investment, subject to nonrecourse debt	$	—	$	—	$	—	$	32,067	$	19,362	$	(12,705)
Loans held for investment	7,019		6,142		(877)		222		155		(67)
Total	$	7,019	$	6,142	$	(877)	$	32,289	$	19,517	$	(12,772)

The following table presents the fair value and the UPB of these financial assets and liabilities (in thousands):


	December 31, 2025				December 31, 2024
	Fair Value		UPB		Fair Value		UPB
Assets
Loans held for investment, subject to HMBS related obligations	$	19,135,403	$	17,983,144	$	18,669,962	$	17,652,495
Loans held for investment, subject to nonrecourse debt	10,026,177		9,567,732		9,288,403		9,218,697
Loans held for investment	870,081		790,342		520,103		503,949
Other assets:
Loans held for sale	37,461		34,515		3,454		4,331
Liabilities
HMBS related obligations	18,912,226		17,983,144		18,444,370		17,652,495
Nonrecourse debt	9,736,493		9,960,524		8,954,068		9,363,919
Convertible Notes	53,800		40,000		—		—

The following table presents the composition and the outstanding UPB of the reverse mortgage loan portfolio serviced by the Company (in thousands):


	December 31, 2025		December 31, 2024
Loans held for investment, subject to HMBS related obligations	$	17,983,144	$	17,652,495

Loans held for investment, subject to nonrecourse debt:
Non-agency reverse mortgages	8,887,778		8,567,792
Performing HECM buyouts	251,051		210,041
Nonperforming HECM buyouts	428,903		408,614
Total loans held for investment, subject to nonrecourse debt	9,567,732		9,186,447

Loans held for investment:
Non-agency reverse mortgages	614,515		270,956
HECM loans not securitized(1)	103,825		101,100
Unpoolable HECM loans(2)	64,983		131,671
Total loans held for investment(3)	783,323		503,727

Other assets:
Loans held for sale(3)	32,761		—

Total owned loan portfolio	28,366,960		27,342,669
Loans reclassified as government guaranteed receivable	50,922		45,773
Loans serviced for others	590,192		88,125
Total serviced loan portfolio	$	29,008,074	$	27,476,567

(1) HECM loans not securitized primarily represent newly originated loans and poolable tails.

(2) Unpoolable HECM loans primarily represent loans that have reached 98% of their MCA.

(3) As of December 31, 2025 and 2024, there was $753.2 million and $451.3 million, respectively, in UPB in loans pledged as collateral for financing lines of credit.

The following table presents our owned loan portfolio by mortgage rate type (in thousands):


	December 31, 2025		December 31, 2024
Adjustable rate loans	$	20,662,839	$	19,966,185
Fixed rate loans	7,704,121		7,376,484
Total owned loan portfolio	$	28,366,960	$	27,342,669

Schedule of Carrying Value and Fair Value of Notes Payable

The following table presents the amortized cost and fair value of notes payable (in thousands):


	December 31, 2025				December 31, 2024
	Carrying Value		Fair Value		Carrying Value		Fair Value
Senior Secured Notes	$	126,089	$	149,620	$	156,074	$	185,632
Exchangeable Secured Notes	130,040		178,428		126,059		191,110
LFH Promissory Note	20,000		20,000		—		—
2025 Unsecured Notes	—		—		7,378		6,187
Working Capital Promissory Notes	—		—		85,000		85,000
Total notes recorded at amortized cost	276,129		$	348,048	374,511		$	467,929
Convertible Notes, recorded at fair value	53,800				—
Total notes payable	$	329,929			$	374,511

- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

+ References + Details