Advances and Other Receivables

3 Months Ended

Mar. 31, 2023

4. Advances and Other Receivables

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


Advances and Other Receivables, Net	March 31, 2023		December 31, 2022
Servicing advances, net of $9 and $12 purchase discount, respectively	$	970	$	1,053
Receivables from agencies, investors and prior servicers, net of $7 purchase discount	111		103
Reserves	(148)		(137)
Total advances and other receivables, net	$	933	$	1,019

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


	Three Months Ended March 31,
Reserves for Advances and Other Receivables	2023		2022
Balance - beginning of period	$	137	$	167
Provision and other additions(1)	16		16
Write-offs	(5)		(31)
Balance - end of period	$	148	$	152

(1)The Company recorded a provision of $9 and $6 through the MTM adjustments in “revenues - service related, net”, in the condensed consolidated statements of operations during the three months ended March 31, 2023 and 2022, 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 March 31,
	2023				2022
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	$	12	$	7	$	19	$	12
Utilization of purchase discounts	(3)		—		(3)		(4)

Balance - end of period	$	9	$	7	$	16	$	8

Credit Loss for Advances and Other Receivables

During the three months ended March 31, 2023 and 2022, the Company increased the current expected credit loss (“CECL”) reserve by $2 and $4, respectively. In addition, the Company wrote off $5 of the CECL reserve during the three months ended March 31, 2022. As of March 31, 2023, the total CECL reserve was $38, of which $31 and $7 were recorded in reserves and purchase discount for advances and other receivables, respectively. As of March 31, 2022, the total CECL reserve was $30, of which $22 and $8 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 increases 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.