Quarterly report [Sections 13 or 15(d)]

SEGMENTS

v3.25.2
SEGMENTS
 6 Months Ended
Jun. 30, 2025
Segment Reporting [Abstract]  
SEGMENTS SEGMENTS
ASC 280, Segment Reporting, establishes the standards for reporting information about segments in financial statements. In applying the criteria set forth in that guidance, the Company has determined that it has two reportable segments — Origination and Servicing, based on the Company’s business lines that offer different products and services, as described below.
Origination — The Company operates its loan origination business throughout the United States. Its licensed sales professionals and support staff cultivate deep relationships with referral partners and clients and provide a customized approach to the loan transaction whether it is a purchase or refinance. The origination segment is primarily responsible for loan origination, acquisition and sale activities.
Servicing — The Company services loans primarily out of its corporate office in San Diego, California. Properties of the loans serviced by the Company are disbursed throughout the United States and as of June 30, 2025 the Company serviced at least one loan in 49 different states and the District of Columbia. The servicing segment provides a steady stream of cash flow to support the origination segment, and more importantly, it allows for the Company to build long-standing client relationships that drive repeat and referral business back to the origination segment to recapture the client’s next mortgage transaction. The servicing segment is primarily responsible for the servicing activities of all loans in the Company’s servicing portfolio, which includes, but is not limited to, collection and remittance of loan payments, managing borrower’s impound accounts for taxes and insurance, loan payoffs, loss mitigation and foreclosure activities.
The Company’s chief operating decision maker (“CODM”) is the executive management team consisting of the Chief Executive Officer and the President and Chief Operating Officer. The CODM uses net income for both reportable segments as its primary measure in assessing segment performance and how to allocate resources. The Company does not allocate assets to its reportable segments as they are not included in the review performed by the CODM for purposes of assessing segment performance and allocating resources. The balance sheet is managed on a consolidated basis and is not used in the context of segment reporting. The Company also does not allocate certain corporate expenses, which are represented by All Other in the tables below.
The following table presents the financial performance and results by segment for the three months ended June 30, 2025:
(in thousands)
 Origination Servicing Total
Segments		 All Other Total
Revenue
Loan origination fees and gain on sale of loans, net $ 235,132  $ 869  $ 236,001  $ —  $ 236,001 
Gain on reverse mortgage loans held for investment and HMBS-related borrowings, net 2,591  —  2,591  —  2,591 
Loan servicing and other fees —  72,745  72,745  —  72,745 
Valuation adjustment of mortgage servicing rights —  (41,313) (41,313) —  (41,313)
Interest income
 26,124  12,589  38,713  1  38,714 
Interest expense
 (21,035) (1,559) (22,594) (6,369) (28,963)
Other (expense) income, net (268) 1  (267) (63) (330)
Net revenue 242,544  43,332  285,876  (6,431) 279,445 
Expenses
Salaries, incentive compensation and benefits 178,482  10,304  188,786  14,052  202,838 
General and administrative 20,729  3,228  23,957  7,469  31,426 
Occupancy, equipment and communication 16,652  1,133  17,785  2,128  19,913 
Depreciation and amortization 3,291  207  3,498  113  3,611 
Provision for foreclosure losses —  1,115  1,115  —  1,115 
Total expenses
 219,154  15,987  235,141  23,762  258,903 
Income tax expense —  —  —  1,879  1,879 
Net income (loss) $ 23,390  $ 27,345  $ 50,735  $ (32,072) $ 18,663 
The following table presents the financial performance and results by segment for the six months ended June 30, 2025:
(in thousands)
 Origination Servicing Total
Segments		 All Other Total
Revenue
Loan origination fees and gain on sale of loans, net $ 419,293  $ 1,921  $ 421,214  $ —  $ 421,214 
Gain on reverse mortgage loans held for investment and HMBS-related borrowings, net 5,506  —  5,506  —  5,506 
Loan servicing and other fees —  145,496  145,496  —  145,496 
Valuation adjustment of mortgage servicing rights —  (111,249) (111,249) —  (111,249)
Interest income
 44,602  22,556  67,158  650  67,808 
Interest expense
 (36,510) (2,414) (38,924) (12,118) (51,042)
Other income (expense), net 254  2  256  (58) 198 
Net revenue 433,145  56,312  489,457  (11,526) 477,931 
Expenses
Salaries, incentive compensation and benefits 328,403  20,476  348,879  27,171  376,050 
General and administrative 42,302  6,948  49,250  11,329  60,579 
Occupancy, equipment and communication 35,194  2,275  37,469  4,164  41,633 
Depreciation and amortization 6,712  340  7,052  206  7,258 
Provision for foreclosure losses —  3,493  3,493  —  3,493 
Total expenses
 412,611  33,532  446,143  42,870  489,013 
Income tax benefit —  —  —  (5,786) (5,786)
Net income (loss) $ 20,534  $ 22,780  $ 43,314  $ (48,610) $ (5,296)
The following table presents the financial performance and results by segment for the three months ended June 30, 2024:
(in thousands)
 Origination Servicing Total
Segments		 All Other Total
Revenue
Loan origination fees and gain on sale of loans, net $ 206,218  $ (370) $ 205,848  $ —  $ 205,848 
Gain on reverse mortgage loans held for investment and HMBS-related borrowings, net 2,134  —  2,134  —  2,134 
Loan servicing and other fees —  67,709  67,709  —  67,709 
Valuation adjustment of mortgage servicing rights —  2,134  2,134  —  2,134 
Interest income
 22,817  12,873  35,690  529  36,219 
Interest expense
 (22,936) (963) (23,899) (4,748) (28,647)
Other income (expense), net 535  45  580  (292) 288 
Net revenue 208,768  81,428  290,196  (4,511) 285,685 
Expenses
Salaries, incentive compensation and benefits 169,037  8,518  177,555  11,383  188,938 
General and administrative 21,798  2,855  24,653  3,745  28,398 
Occupancy, equipment and communication 17,876  735  18,611  1,737  20,348 
Depreciation and amortization 3,162  270  3,432  538  3,970 
Reversal of foreclosure losses —  (496) (496) —  (496)
Total expenses
 211,873  11,882  223,755  17,403  241,158 
Income tax expense —  —  —  6,936  6,936 
Net (loss) income $ (3,105) $ 69,546  $ 66,441  $ (28,850) $ 37,591 
The following table presents the financial performance and results by segment for the six months ended June 30, 2024:
(in thousands)
 Origination Servicing Total
Segments		 All Other Total
Revenue
Loan origination fees and gain on sale of loans, net $ 339,882  $ 26  $ 339,908  $ —  $ 339,908 
Gain on reverse mortgage loans held for investment and HMBS-related borrowings, net 5,364  —  5,364  —  5,364 
Loan servicing and other fees —  133,497  133,497  —  133,497 
Valuation adjustment of mortgage servicing rights —  22,912  22,912  —  22,912 
Interest income
 36,048  24,021  60,069  878  60,947 
Interest expense
 (35,503) (1,655) (37,158) (8,030) (45,188)
Other income (expense), net 899  67  966  (939) 27 
Net revenue 346,690  178,868  525,558  (8,091) 517,467 
Expenses
Salaries, incentive compensation and benefits 290,142  16,663  306,805  22,200  329,005 
General and administrative 42,346  6,717  49,063  8,546  57,609 
Occupancy, equipment and communication 34,811  1,701  36,512  3,651  40,163 
Depreciation and amortization 6,653  411  7,064  660  7,724 
Reversal of foreclosure losses —  (104) (104) —  (104)
Total expenses
 373,952  25,388  399,340  35,057  434,397 
Income tax expense —  —  —  17,079  17,079 
Net (loss) income $ (27,262) $ 153,480  $ 126,218  $ (60,227) $ 65,991