Debt Obligations, Net

12 Months Ended

Dec. 31, 2025

We enter into loan warehouse facilities, repurchase agreements ("repo"), recourse subordinate securities financings, and other forms of collateralized (and generally uncommitted) borrowings with several banks and major investment banking firms. We use debt to finance the acquisition and/or origination of residential consumer and residential investor mortgage loans (including those we acquire or originate in anticipation of sale or securitization), and to finance investments in securities and other investments. Additionally, we use corporate debt obligations to fund other aspects of our business and operations, including the repurchase of shares of our capital stock.

At December 31, 2025, we had outstanding agreements on debt obligations with several counterparties and we were in compliance with all of the related covenants.

The following tables summarize our debt obligations at December 31, 2025 and 2024.

Table 18.1 – Debt Obligations, Net


	December 31, 2025
(Dollars in Thousands)	Number of Facilities or Issuances	Principal Amount		Carrying Value (1)		Facility Capacity		Weighted Average Interest Rate (2)		Final Stated Maturity	Carrying Value of Collateral

Short-Term Facilities:
Residential consumer loan warehouse facilities	8	$	2,798,725	$	2,798,725	$	3,554,960	5.52	%	1/2026-8/2026	$	3,066,067
Residential investor loan warehouse facilities	4	157,999		157,571		825,000		7.22	%	5/2026-12/2026	159,074
Real estate securities repurchase facilities	4	30,867		30,867		—		5.20	%	1/2026-3/2026	40,568
Real estate securities repurchase facilities IO	1	—		—		75,000		6.87	%	6/2026	—
Residential MSR warehouse facility	1	95,862		95,862		125,000		7.12	%	1/2026	194,228
HEI warehouse facility	1	43,496		43,496		150,000		8.29	%	12/2026	98,308
Servicer advance financing	1	152,660		152,293		200,000		5.68	%	12/2026	223,677

Recourse Subordinate Securities Financing:
CAFL securities (3)	1	263,063		262,374		(a)		7.54	%	9/2028	330,212
Sequoia and other third-party securities (3)	1	87,477		87,477		(a)		7.27	%	6/2027	109,686

Long-Term Facilities:
Residential investor loan warehouse facilities	2	131,138		131,069		1,300,000		6.68	%	1/2027-8/2027	205,833
Secured revolving financing facility (4)	1	282,883		276,580		400,000		8.66	%	3/2027	451,262

Corporate Debt:
Promissory notes (3) (5)	3	9,264		9,264		(a)		7.01	%	N/A	(b)
7.75% convertible senior notes (3)	1	297,170		292,993		(a)		7.75	%	6/2027	(b)
Trust preferred securities and subordinated notes	2	139,500		138,906		(a)		6.35	%	1/2037, 7/2037	(b)
9.125% Senior Notes (3)	1	59,127		57,444		(a)		9.13	%	3/2029	(b)
9.0% Senior Notes (3)	1	84,015		81,647		(a)		9.00	%	9/2029	(b)
9.125% Senior Notes (3)	1	89,232		86,270		(a)		9.13	%	3/2030	(b)
9.5% Senior Notes (3)	1	100,000		96,544		(a)		9.50	%	12/2030	(b)
Total Debt Obligations		$	4,822,478	$	4,799,382						$4,878,915


	December 31, 2024
(Dollars in Thousands)	Number of Facilities or Issuances	Principal Amount		Carrying Value (1)		Facility Capacity		Weighted Average Interest Rate (2)		Final Stated Maturity	Carrying Value of Collateral
Short-Term Facilities:
Residential consumer loan warehouse facilities	7	$	956,010	$	956,010	$	2,175,000	6.24	%	3/2025-10/2025	$	1,005,926
Residential investor loan warehouse facilities	2	223,975		223,876		800,000		7.31	%	6/2025-7/2025	300,843
Real estate securities repurchase facilities	6	210,352		210,352		—		5.81	%	1/2025-3/2025	281,997
Residential MSR warehouse facility	1	58,164		58,164		75,000		7.65	%	10/2025	91,506
HEI warehouse facility	1	97,497		97,497		150,000		9.00	%	12/2025	207,097

Recourse Subordinate Securities Financings:
CAFL securities (3)	1	268,240		267,140		(a)		7.54	%	9/2028	318,106

Long Term Facilities:
Residential investor loan warehouse facilities	5	615,036		613,129		1,530,000		7.83	%	5/2026-4/2027	889,901
Servicer advance financing	1	159,798		159,031		200,000		6.32	%	12/2026	233,820
Secured revolving financing facility (4)	1	225,000		220,234		250,000		9.50	%	3/2026	372,396

Corporate Debt:
Promissory notes (3) (5)	3	12,859		12,859		(a)		7.06	%	N/A	(b)
5.75% exchangeable senior notes (3)	1	123,574		123,087		(a)		5.75	%	10/2025	(b)
7.75% convertible senior notes (3)	1	247,170		242,652		(a)		7.75	%	6/2027	(b)
Trust preferred securities and subordinated notes	2	139,500		138,860		(a)		7.10	%	1/2037, 7/2037	(b)
9.125% Senior Notes (3)	1	60,000		57,877		(a)		9.13	%	3/2029	(b)
9.0% Senior Notes (3)	1	85,000		82,112		(a)		9.00	%	9/2029	(b)
Total Debt Obligations		$	3,482,175	$	3,462,880						$	3,701,592

(1)Carrying value presented net of total deferred issuance costs of $23 million and $20 million at December 31, 2025 and 2024, respectively.

(2)Variable rate borrowings are based on 1- or 3-month SOFR, plus an applicable spread.

(3)Borrowing has a fixed interest rate at period end.

(4)Facility may be extended for one year at our option.

(5)Promissory notes payable on demand to lender with 90-day notice.

(a) Outstanding principal balance represents facility capacity at period end.

(b) Unsecured corporate debt; no related collateral at period end.

Recourse Subordinate Securities Financing

In June 2025, we entered into a recourse subordinate securities financing facility providing non-marginable debt financing of certain securities retained from our consolidated Sequoia securitizations and other third-party issued interest-only securities. This financing is guaranteed by Redwood, with an interest rate of approximately 7.27% through June 2027, increasing to 10.27% from June 2027 through July 2028. This financing facility may be terminated at our option, beginning in June 2026, and has a final stated maturity in June 2027.

Corporate Debt

Corporate Secured Revolving Financing Facility

In March 2024, we entered into a corporate secured revolving financing facility to provide non-marginable recourse debt financing secured by previously unencumbered assets, such as retained residential consumer and residential investor subordinate

securities and other investments, as well as equity in certain operating subsidiaries. In October 2025, we increased our borrowing capacity on this facility from $250 million to $400 million and extended the maturity date to March 2027.

Senior Notes

In January 2025, Redwood issued $90 million of 9.125% Senior Notes due in 2030. The Senior Notes are senior unsecured obligations of Redwood and bear interest at a rate equal to 9.125% per year, payable quarterly in arrears on March 1, June 1, September 1 and December 1 of each year, beginning on June 1, 2025. The Senior Notes mature on March 1, 2030. We may redeem the Senior Notes, in whole or in part, at any time on or after March 1, 2027 at a redemption price equal to 100% of the principal amount redeemed plus accrued and unpaid interest.

In November 2025, Redwood issued $100 million of 9.5% Senior Notes due in 2030. The Senior Notes are senior unsecured obligations of Redwood and bear interest at a rate equal to 9.5% per year, payable quarterly in arrears on March 1, June 1, September 1 and December 1 of each year, beginning on March 1, 2026. The Senior Notes mature on December 1, 2030. We may redeem the Senior Notes, in whole or in part, at any time on or after December 1, 2027 at a redemption price equal to 100% of the principal amount redeemed plus accrued and unpaid interest.

Convertible Notes

During the year ended December 31, 2025, we repaid in full $124 million of exchangeable senior notes upon maturity in October 2025.

In June 2022, we issued $215 million principal amount of 7.75% convertible senior notes due 2027. These notes require semi-annual interest payments at a fixed annual coupon rate of 7.75% until maturity or conversion, which will be no later than June 15, 2027. After deducting the underwriting discount and offering costs, we received $208 million of net proceeds. In October 2024, we issued an additional $40 million of these 7.75% senior notes due 2027 in a private offering, resulting in net proceeds of approximately $39 million. In August 2025, we issued an additional $50 million of these 7.75% senior notes due 2027, resulting in net proceeds of approximately $49 million. We may elect to settle conversions either entirely in cash or in a combination of cash and shares of common stock. Upon conversion, the conversion value will be paid in cash up to at least the principal amount of the notes being converted. At December 31, 2025, the conversion rate of the notes was 95.6823 common shares per $1,000 principal amount of notes (equivalent to a conversion price of $10.45 per common share). During 2025 and 2024, we repurchased zero and $4 million par value of these notes, respectively.