Advances and Other Receivables

9 Months Ended

Sep. 30, 2021

4. Advances and Other Receivables

Advances and other receivables, net, consists of the following:


Advances and Other Receivables, Net	September 30, 2021		December 31, 2020
Servicing advances, net of $30 and $72 purchase discount, respectively	$	893	$	975
Receivables from agencies, investors and prior servicers, net of $13 and $21 purchase discount, respectively	188		173
Reserves	(172)		(208)
Total advances and other receivables, net	$	909	$	940

The following table sets forth the activities of the servicing reserves for advances and other receivables:


	Three Months Ended September 30,				Nine Months Ended September 30,
Reserves for Advances and Other Receivables	2021		2020		2021		2020
Balance - beginning of period	$	191	$	216	$	208	$	168
Provision and other additions(1)	18		13		59		72
Write-offs	(37)		(38)		(95)		(49)
Balance - end of period	$	172	$	191	$	172	$	191

(1)The Company recorded a provision of $8 and $7 through the MTM adjustments in revenues - service related, net, in the condensed consolidated statements of operations during the three months ended September 30, 2021 and 2020, and $28 and $20 during the nine months ended September 30, 2021 and 2020, respectively, for inactive and liquidated loans that are no longer part of the MSR portfolio. Other additions represent reclassifications of required reserves provisioned within other balance sheet accounts as associated serviced loans become inactive or liquidate.

Purchase Discount for Advances and Other Receivables

The following tables set forth the activities of the purchase discounts for advances and other receivables:


	Three Months Ended September 30,
	2021				2020
Purchase Discount for Advances and Other Receivables	Servicing Advances		Receivables from Agencies, Investors and Prior Servicers		Servicing Advances		Receivables from Agencies, Investors and Prior Servicers
Balance - beginning of period	$	31	$	20	$	117	$	21
Utilization of purchase discounts	(1)		(7)		(25)		—
Balance - end of period	$	30	$	13	$	92	$	21


	Nine Months Ended September 30,
	2021				2020
Purchase Discount for Advances and Other Receivables	Servicing Advances		Receivables from Agencies, Investors and Prior Servicers		Servicing Advances		Receivables from Agencies, Investors and Prior Servicers
Balance - beginning of period	$	72	$	21	$	131	$	21
Utilization of purchase discounts	(42)		(8)		(39)		—
Balance - end of period	$	30	$	13	$	92	$	21

Credit Loss for Advances and Other Receivables

During the three and nine months ended September 30, 2021, the Company increased the current expected credit loss (“CECL”) reserve by $3 and $7, respectively. In addition, the Company wrote off $16 of the CECL reserve during the three months and nine months ended September 30, 2021. During the three and nine months ended September 30, 2020, the Company increased the CECL reserve by $13 and $27, respectively. As of September 30, 2021, the total CECL reserve was $29, of which $19 and $10 were recorded in reserves and purchase discount for advances and other receivables, respectively. As of September 30, 2020, the total CECL reserve was $44, of which $27 and $17 were recorded in reserves and purchase discount for advances and other receivables, respectively.

The Company determined that the credit-related risk associated with applicable financial instruments typically increase with the passage of time. The CECL reserve methodology considers these financial instruments collectible to a point in time of 39 months. Any projected remaining balance at the end of the collection period is considered a loss and factors into the overall CECL loss rate required.