Receivables (Tables)

12 Months Ended

Dec. 31, 2014

Receivables consisted of the following:



	December 31, 2014			December 31, 2013
	(in millions)
Real estate secured:
First lien	$	20,153		$	23,568
Second lien	2,517			3,016
Total real estate secured receivables	22,670			26,584
Accrued interest income and other	789			862
Credit loss reserve for receivables	(2,217		)	(3,273		)
Total receivables, net	$	21,242		$	24,173

Aging Analysis of Past Due Loans

The following tables summarize the past due status of our receivables at December 31, 2014 and December 31, 2013. The aging of past due amounts is determined based on the contractual delinquency status of payments made under the terms of the receivable. An account is generally considered to be contractually delinquent when payments have not been made in accordance with the loan terms. Delinquency status is affected by customer account management policies and practices such as re-aging.



	Past Due				Total Past Due				Total Receivables⁽²⁾
December 31, 2014	30 – 89 days		90+ days		Total Past Due		Current⁽¹⁾		Total Receivables⁽²⁾
	(in millions)
Real estate secured:
First lien	$	1,572	$	902	$	2,474	$	17,679	$	20,153
Second lien	165		100		265		2,252		2,517
Total real estate secured receivables	$	1,737	$	1,002	$	2,739	$	19,931	$	22,670



	Past Due				Total Past Due				Total Receivables⁽²⁾
December 31, 2013	30 – 89 days		90+ days		Total Past Due		Current⁽¹⁾		Total Receivables⁽²⁾
	(in millions)
Real estate secured:
First lien	$	2,462	$	1,538	$	4,000	$	19,568	$	23,568
Second lien	249		192		441		2,575		3,016
Total real estate secured receivables	$	2,711	$	1,730	$	4,441	$	22,143	$	26,584


⁽¹⁾	Receivables less than 30 days past due are presented as current.

⁽²⁾

The receivable balances included in this table reflects the principal amount outstanding on the loan and certain basis adjustments to the loan such as deferred fees and costs on originated loans, purchase accounting fair value adjustments and premiums or discounts on purchased loans. However, these basis adjustments on the loans are excluded in other presentations of dollars of two-months-and-over contractual delinquency and nonperforming receivable account balances.

Receivables Classified by Contractual Maturity Date

Contractual maturities of our receivables (based upon final contractual maturities) are as follows:



	2015		2016		2017		2018		2019		Thereafter		Total
	(in millions)
Real estate secured:
First lien	$	61	$	51	$	74	$	87	$	116	$	19,764	$	20,153
Second lien	14		19		22		22		45		2,395		2,517
Total real estate secured receivables	$	75	$	70	$	96	$	109	$	161	$	22,159	$	22,670

Receivables Due After One Year Classified by Contractual Maturity and Repricing Characteristic

The following table summarizes contractual maturities of receivables due after one year by repricing characteristic (based upon final contractual maturities):



At December 31, 2014	Over 1 But Within 5 Years		Over 5 Years
	(in millions)
Receivables at predetermined interest rates	$	399	$	19,893
Receivables at floating or adjustable rates	37		2,266
Total	$	436	$	22,159

Nonaccrual Receivables

Nonaccrual receivables and nonaccrual receivables held for sale consisted of the following:



	December 31, 2014		December 31, 2013
	(in millions)
Nonaccrual receivable portfolios:
Real estate secured⁽¹⁾	$	1,024	$	1,769
Receivables held for sale⁽²⁾	509		1,422
Total nonaccrual receivables⁽³⁾	$	1,533	$	3,191


⁽¹⁾	At December 31, 2014 and December 31, 2013, nonaccrual real estate secured receivables held for investment include $417 million and $639 million, respectively, of receivables that are carried at the lower of amortized cost or fair value of the collateral less cost to sell.

⁽²⁾

For a discussion of the movements between the components of nonaccrual receivables, see Note 7, "Receivables Held for Sale," which includes discussion of the formal program introduced in the second quarter of 2013 to transfer receivables (meeting pre-determined criteria) to held for sale when the receivable is written down to the lower of amortized cost or fair value of the collateral less cost to sell in accordance with our existing charge-off policies.


⁽³⁾	Nonaccrual receivables do not include receivables totaling $627 million and $953 million at December 31, 2014 and December 31, 2013, respectively, which have been written down to the lower of amortized cost or fair value of the collateral less cost to sell which are less than 90 days contractually delinquent and not accruing interest.

Additional Information on Nonaccrual Receivables

The following table provides additional information on our total nonaccrual receivables:



Year Ended December 31,	2014		2013		2012
	(in millions)
Interest income that would have been recorded if the nonaccrual receivable had been current in accordance with contractual terms during the period	$	354	$	819	$	1,100
Interest income that was recorded on nonaccrual receivables included in interest income on nonaccrual loans during the period	114		216		331

Receivables Classified as Trouble Debt Restructuring Loans

The following table presents information about receivables and receivables held for sale which as a result of any account management action taken during the years ended December 31, 2014, 2013 and 2012 and became classified as TDR Loans.



Year Ended December 31,	2014		2013		2012
	(in millions)
Real estate secured:
First lien	$	659	$	1,358	$	2,871
Second lien	86		166		329
Real estate secured receivables held for sale	70		298		364
Total real estate secured	815		1,822		3,564
Personal non-credit card receivables held for sale⁽¹⁾	—		28		294
Total⁽²⁾	$	815	$	1,850	$	3,858


⁽¹⁾	As discussed more fully in Note 7, "Receivables Held for Sale," we sold our personal non-credit card receivable portfolio on April 1, 2013.


⁽²⁾	The following table summarizes the actions taken during the years ended December 31, 2014, 2013 and 2012 which resulted in the above receivables being classified as a TDR Loan.



Year Ended December 31,	2014		2013		2012
	(in millions)
Modifications, primarily interest rate modifications	$	436	$	692	$	1,814
Re-age of past due account	379		1,158		2,044
Total	$	815	$	1,850	$	3,858

TDR Loans

Receivables and receivables held for sale reported as TDR Loans consisted of the following:



	December 31, 2014		December 31, 2013
	(in millions)
TDR Loans:⁽¹⁾⁽²⁾
Real estate secured:
First lien⁽⁴⁾	$	9,630	$	10,633
Second lien⁽⁴⁾	915		1,047
Real estate secured receivables held for sale⁽³⁾	650		1,392
Total real estate secured TDR Loans	$	11,195	$	13,072

Credit loss reserves for TDR Loans:⁽⁵⁾
Real estate secured:
First lien	$	1,738	$	2,294
Second lien	244		360
Total credit loss reserves for real estate secured TDR Loans⁽³⁾	$	1,982	$	2,654


⁽¹⁾	TDR Loans are considered to be impaired loans regardless of accrual status.

⁽²⁾

The TDR Loan balances included in the table above reflect the current carrying amount of TDR Loans and includes all basis adjustments on the loan, such as unearned income, unamortized deferred fees and costs on originated loans and premiums or discounts on purchased loans as well as any charge-off recorded in accordance with our existing charge-off policies. Additionally, the carrying amount of TDR Loans classified as held for sale has been reduced by both the lower of amortized cost or fair value adjustment as well as the credit loss reserves associated with these receivables prior to the transfer. The following table reflects the unpaid principal balance of TDR Loans:



	December 31, 2014		December 31, 2013
	(in millions)
Real estate secured:
First lien	$	9,931	$	10,983
Second lien	1,050		1,188
Real estate secured receivables held for sale	1,004		2,587
Total real estate secured TDR Loans	$	11,985	$	14,758

At December 31, 2014 and December 31, 2013, the unpaid principal balances reflected above include $549 million and $92 million, respectively, which has received a reduction in the unpaid principal balance as part of an account management action.


⁽³⁾	There are no credit loss reserves associated with receivables classified as held for sale as they are carried at the lower of amortized cost or fair value.


⁽⁴⁾	At December 31, 2014 and December 31, 2013, TDR Loans held for investment totaling $517 million and $604 million, respectively, are recorded at the lower of amortized cost or fair value of the collateral less cost to sell.


⁽⁵⁾	Included in credit loss reserves.

Receivables Classified as Trouble Debt Restructuring Loan

The following table discloses receivables and receivables held for sale which were classified as TDR Loans during the previous 12 months which subsequently became sixty days or greater contractually delinquent during the years ended December 31, 2014, 2013 and 2012.



Year Ended December 31,	2014		2013		2012
	(in millions)
Real estate secured:
First lien	$	367	$	765	$	1,837
Second lien	53		116		259
Real estate secured receivables held for sale	33		342		365
Total real estate secured	453		1,223		2,461
Personal non-credit card receivables held for sale⁽¹⁾	—		21		262
Total	$	453	$	1,244	$	2,723


⁽¹⁾	As discussed more fully in Note 7, "Receivables Held for Sale," we sold our personal non-credit card receivable portfolio on April 1, 2013.

Additional Information Relating to Trouble Debt Restructuring Loan

The following table provides additional information relating to TDR Loans, including TDR Loans held for sale:



Year Ended December 31,	2014		2013		2012
	(in millions)
Average balance of TDR Loans:
Real estate secured:
First lien	$	11,342	$	14,430	$	14,657
Second lien	975		1,136		1,219
Total real estate secured	12,317		15,566		15,876
Personal non-credit card	—		144		925
Total average balance of TDR Loans	$	12,317	$	15,710	$	16,801
Interest income recognized on TDR Loans:
Real estate secured:
First lien	$	782	$	927	$	871
Second lien	95		108		104
Total real estate secured	877		1,035		975
Personal non-credit card	—		40		174
Total interest income recognized on TDR Loans	$	877	$	1,075	$	1,149

Summary of Contractual Delinquency and Delinquency Ratio

The following table summarizes dollars of two-months-and-over contractual delinquency and as a percent of total receivables and receivables held for sale (“delinquency ratio”) for our loan portfolio:



	December 31, 2014				December 31, 2013
	Dollars of Delinquency		Delinquency Ratio		Dollars of Delinquency		Delinquency Ratio
	(dollars are in millions)
Real estate secured:
First lien	$	1,388	6.89	%	$	2,387	10.13	%
Second lien	154		6.12		275		9.12
Real estate secured receivables held for sale	530		61.63		1,473		71.96
Total real estate secured	$	2,072	8.81	%	$	4,135	14.44	%

Nonperforming Consumer Receivable Portfolio

The following table summarizes the status of receivables and receivables held for sale:



	Accruing Loans		Nonaccrual Loans⁽³⁾		Total
	(in millions)
At December 31, 2014
Real estate secured⁽¹⁾⁽²⁾	$	21,646	$	1,024	$	22,670
Real estate secured receivables held for sale	351		509		860
Total	$	21,997	$	1,533	$	23,530
At December 31, 2013
Real estate secured⁽¹⁾⁽²⁾	$	24,815	$	1,769	$	26,584
Real estate secured receivables held for sale	625		1,422		2,047
Total	$	25,440	$	3,191	$	28,631


⁽¹⁾	At December 31, 2014 and December 31, 2013, nonaccrual real estate secured receivables held for investment include $417 million and $639 million, respectively, of receivables that are carried at the lower of amortized cost or fair value of the collateral less cost to sell.


⁽²⁾	At December 31, 2014 and December 31, 2013, nonaccrual real estate secured receivables held for investment include $739 million and $1,245 million, respectively, of TDR Loans, some of which may also be carried at fair value of the collateral less cost to sell.


⁽³⁾	Nonaccrual loans do not include receivables totaling $627 million and $953 million at December 31, 2014 and December 31, 2013, respectively, which have been written down to the lower of amortized cost or fair value of the collateral less cost to sell which are less than 90 days contractually delinquent and not accruing interest.