Ready Capital (RC) 10-Q 10 May 18 2018 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information	3 Months Ended
	Mar. 31, 2018shares
Document and Entity Information
Entity Registrant Name	Sutherland Asset Management Corp
Entity Central Index Key	1,527,590
Document Type	10-Q
Document Period End Date	Mar. 31, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2,018
Entity Common Stock, Shares Outstanding	31,996,440
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Assets
Cash and cash equivalents	$ 86,773	$ 63,425
Restricted cash	13,964	11,666
Loans, net (including $40,430 and $188,150 held at fair value)	1,057,034	1,017,920
Loans, held for sale, at fair value	160,999	216,022
Mortgage backed securities, at fair value	47,181	39,922
Loans eligible for repurchase from Ginnie Mae	81,484	95,158
Investment in unconsolidated joint venture	50,229	55,369
Derivative instruments,at fair value	5,022	4,725
Servicing rights (including $81,591 and $72,295 held at fair value)	104,613	94,038
Receivable from third parties	11,064	6,756
Other assets	53,592	56,840
Assets of consolidated VIEs	968,999	861,662
Total Assets	2,640,954	2,523,503
Liabilities
Secured borrowings	657,233	631,286
Promissory note	5,883	6,107
Securitized debt obligations of consolidated VIEs, net	679,871	598,148
Convertible note, net	109,226	108,991
Senior secured notes, net	178,688	138,078
Guaranteed loan financing	278,500	293,045
Contingent consideration	10,732	10,016
Liabilities for loans eligible for repurchase from Ginnie Mae	81,484	95,158
Derivative instruments, at fair value	756	282
Dividends payable	12,335	12,289
Accounts payable and other accrued liabilities	64,490	74,636
Total Liabilities	2,079,198	1,968,036
Stockholders’ Equity
Common stock, $0.0001 par value, 500,000,000 shares authorized, 31,996,440 and 31,996,440 shares issued and outstanding, respectively	3	3
Additional paid-in capital	539,457	539,455
Retained earnings (deficit)	2,559	(3,385)
Total Sutherland Asset Management Corporation equity	542,019	536,073
Non-controlling interests	19,737	19,394
Total Stockholders’ Equity	561,756	555,467
Total Liabilities and Stockholders’ Equity	$ 2,640,954	$ 2,523,503

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Parenthetical information
Loan receivable allowance	$ 40,430	$ 188,150
Servicing rights held at fair value	$ 81,591	$ 72,295
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, authorized capital	500,000,000	500,000,000
Common stock, issued	31,996,440	31,996,440
Common stock, outstanding	31,996,440	31,996,440

CONSOLIDATED STATEMENTS OF INCO

CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands	Mar. 14, 2018	Dec. 13, 2017	Sep. 12, 2017	Jun. 15, 2017	Mar. 14, 2017	Dec. 21, 2016	Mar. 31, 2018	Mar. 31, 2017
CONSOLIDATED STATEMENTS OF INCOME
Interest income							$ 37,150	$ 33,884
Interest expense							(22,666)	(16,441)
Net interest income before provision for loan losses							14,484	17,443
Provision for loan losses							(167)	(1,232)
Net interest income after provision for loan losses							14,317	16,211
Non-interest income
Gains on residential mortgage banking activities, net of variable loan expenses							11,734	10,509
Other income							1,334	840
Income on unconsolidated joint venture							5,739
Servicing income, net of amortization and impairment of $1,350 and $2,765							6,410	4,442
Total non-interest income							25,217	15,791
Non-interest expense
Employee compensation and benefits							(15,320)	(13,464)
Allocated employee compensation and benefits from related party							(1,200)	(1,012)
Professional fees							(2,648)	(2,159)
Management fees – related party							(2,013)	(1,977)
Incentive fees – related party							(408)
Loan servicing expense							(4,093)	(1,513)
Other operating expenses							(8,011)	(5,534)
Total non-interest expense							(33,693)	(25,659)
Net realized gain on financial instruments							12,232	2,966
Net unrealized gain on financial instruments							3,008	1,282
Income before provision for income taxes							21,081	10,591
Provision for income taxes							(2,563)	(1,034)
Net income							18,518	9,557
Less: Net income attributable to non-controlling interest							664	701
Net income attributable to Sutherland Asset Management Corporation							$ 17,854	$ 8,856
Earnings per basic common share							$ 0.56	$ 0.29
Earnings per diluted common share							$ 0.56	$ 0.29
Weighted-average shares outstanding
Basic							32,036,504	30,549,806
Diluted							32,045,844	30,549,806
Dividends declared per share of common stock	$ 0.37	$ 0.37	$ 0.37	$ 0.37	$ 0.37	$ 0.35	$ 0.37	$ 0.37

CONSOLIDATED STATEMENTS OF INC5

CONSOLIDATED STATEMENTS OF INCOME (Parenthetical) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
CONSOLIDATED STATEMENTS OF INCOME
Amortization and impairment of servicing rights	$ 1,350	$ 2,765

CONSOLIDATED STATEMENTS OF CHAN

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Thousands	Total Sutherland Asset Management Corporation Equity	Common Stock	Additional Paid-in-Capital	Retained Earnings (Deficit)	Noncontrolling Interests	Total
Balance at beginning of period at Dec. 31, 2016	$ 513,097	$ 3	$ 513,295	$ (201)	$ 39,005	$ 552,102
Balance at beginning of period (in shares) at Dec. 31, 2016		30,549,084
Increase (Decrease) in Stockholders' Equity
Dividend declared on common stock ($0.37 per share March 31, 2018 and 2017, respectively)	(11,303)			(11,303)		(11,303)
Dividend declared on OP units					(859)	(859)
Stock-based compensation	363		363			363
Net Income	8,856			8,856	701	9,557
Balance at end of period at Mar. 31, 2017	511,013	$ 3	513,658	(2,648)	38,847	549,860
Balance at end of period (in shares) at Mar. 31, 2017		30,549,084
Balance at beginning of period at Dec. 31, 2017	536,073	$ 3	539,455	(3,385)	19,394	555,467
Balance at beginning of period (in shares) at Dec. 31, 2017		31,996,440
Increase (Decrease) in Stockholders' Equity
Dividend declared on common stock ($0.37 per share March 31, 2018 and 2017, respectively)	(11,910)			(11,910)		(11,910)
Dividend declared on OP units					(425)	(425)
Equity component of 2017 convertible note issuance	(78)		(78)		(3)	(81)
Contributions, net					107	107
Stock-based compensation	80		80			80
Net Income	17,854			17,854	664	18,518
Balance at end of period at Mar. 31, 2018	$ 542,019	$ 3	$ 539,457	$ 2,559	$ 19,737	$ 561,756
Balance at end of period (in shares) at Mar. 31, 2018		31,996,440

CONSOLIDATED STATEMENTS OF CHA7

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Parenthetical) - $ / shares	Mar. 14, 2018	Dec. 13, 2017	Sep. 12, 2017	Jun. 15, 2017	Mar. 14, 2017	Dec. 21, 2016	Mar. 31, 2018	Mar. 31, 2017
Statement of Stockholders' Equity
Dividends declared per share of common stock	$ 0.37	$ 0.37	$ 0.37	$ 0.37	$ 0.37	$ 0.35	$ 0.37	$ 0.37

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Cash Flows From Operating Activities:
Net income	$ 18,518	$ 9,557
Adjustments to reconcile net income to net cash provided (used in) operating activities:
Discount accretion and premium amortization of financial instruments, net	(2,038)	(2,476)
Amortization of guaranteed loan financing, deferred financing costs, and intangible assets	3,492	4,948
Provision for loan losses	167	1,232
Charge off of real estate acquired in settlement of loans	19	103
Increase (decrease) in repair and denial reserve	110	(263)
Purchase of short-term investments		(639,481)
Proceeds from sale or maturity of short-term investments		719,948
Net settlement of derivative instruments	4,556	(225)
Purchase of loans, held for sale, at fair value		(5,909)
Origination of loans, held for sale, at fair value	(610,502)	(550,084)
Proceeds from disposition and principal payments of loans, held for sale, at fair value	677,401	594,875
Income on unconsolidated joint venture	1,048
Gain on sale of mortgages held for sale included in gains on residential mortgage banking activities, net of variable loan expenses	(6,279)	(13,394)
Gain (loss) on derivatives included in Gains on residential mortgage banking activities, net of variable loan expenses	(1,162)	1,576
Creation of servicing rights, net of payoffs	(4,408)	(3,803)
Net realized gains on financial instruments	(12,232)	(2,966)
Net unrealized gains on financial instruments	(3,008)	(1,282)
Net changes in operating assets and liabilities
Assets of consolidated VIEs (excluding loans, net), accrued interest and due from servicers	(8,261)	24,675
Receivable from third parties	(4,308)	(104,001)
Other assets	5,122	(11,576)
Accounts payable and other accrued liabilities	(10,013)	(5,998)
Net cash provided by operating activities	48,222	15,456
Cash Flow From Investing Activities:
Origination of loans	(118,945)	(79,349)
Purchase of loans	(142,000)	(5,577)
Purchase of mortgage backed securities, at fair value	(10,419)
Purchase of real estate	(191)
Proceeds on unconsolidated joint venture in excess of earnings recognized	4,092
Payment of liability under participation agreements, net of proceeds received	(81)	(487)
Proceeds from disposition and principal payment of loans	116,836	106,989
Proceeds from sale and principal payment of mortgage backed securities, at fair value	3,662	1,224
Proceeds from sale of real estate	614	577
Net cash (used in) provided by investing activities	(146,432)	23,377
Cash Flows From Financing Activities:
Proceeds from secured borrowings	938,671	1,733,946
Proceeds from issuance of securitized debt obligations of consolidated VIEs	155,951
Proceeds from senior secured note offering	41,328	75,000
Payment of secured borrowings	(912,724)	(1,762,134)
Payment of securitized debt obligations of consolidated VIEs	(65,161)	(59,512)
Payment of guaranteed loan financing	(17,360)	(31,903)
Payment of promissory note	(224)	(332)
Payment of deferred financing costs	(4,443)	(2,377)
Contributions, net	107
Dividend payments	(12,289)	(11,505)
Net cash (used in) provided by financing activities	123,856	(58,817)
Net increase (decrease) in cash, cash equivalents, and restricted cash	25,646	(19,984)
Cash, cash equivalents, and restricted cash at beginning of period	75,091	79,756
Cash, cash equivalents, and restricted cash at end of period	100,737	59,772
Supplemental disclosure of operating cash flow
Cash paid for interest	23,135	14,632
Cash paid for income taxes	796	480
Stock-based compensation	151	363
Supplemental disclosure of non-cash investing activities
Loans transferred from Loans, held for sale, at fair value to Loans, net	$ 333
Loans transferred from Loans, net to Loans, held for sale, at fair value		$ 5,606

Organization

Organization	3 Months Ended
	Mar. 31, 2018
Organization
Organization	Note 1 – Organization Sutherland Asset Management Corporation (the “Company” or “Sutherland” and together with its subsidiaries “we,” “us” and “our”) is a Maryland corporation. On October 31, 2016, we completed our path to becoming a publicly traded company through our merger with and into a subsidiary of ZAIS Financial Corp. (“ZAIS Financial”), with ZAIS Financial legally surviving the merger and changing its name to Sutherland Asset Management Corporation. On November 1, 2016, our common stock began trading on the New York Stock Exchange (“NYSE”) under ticker symbol “SLD”. The Company is externally managed and advised by Waterfall Asset Management, LLC (“Waterfall” or the “Manager”), an investment advisor registered with the United States Securities and Exchange Commission under the Investment Advisors Act of 1940, as amended. Sutherland Partners, LP (the “Operating Partnership”) holds substantially all of our assets and conducts substantially all of our business. As of March 31, 2018 and December 31, 2017, the Company owned approximately 96.5%, of the operating partnership units (“OP units”) of the Operating Partnership. The Company, as sole general partner of the Operating Partnership, has responsibility and discretion in the management and control of the Operating Partnership, and the limited partners of the Operating Partnership, in such capacity, have no authority to transact business for, or participate in the management activities of the Operating Partnership. Therefore, the Company consolidates the Operating Partnership. The Company, together with its consolidated subsidiaries and variable interest entities (“VIEs”), is a specialty-finance company which acquires, originates, manages, services and finances small balance commercial (“SBC”) loans, Small Business Administration (“SBA”) loans, residential mortgage loans, and to a lesser extent, mortgage backed securities (“MBS”) collateralized primarily by SBC loans, or other real estate-related investments. SBC loans represent a special category of commercial loans, sharing both commercial and residential loan characteristics. SBC loans are generally secured by first mortgages on commercial properties, but because SBC loans are also often accompanied by collateralization of personal assets and subordinate lien positions, aspects of residential mortgage credit analysis are utilized in the underwriting process. The Company reports its results of operations through the following four business segments: i) Loan Acquisitions , ii) SBC Originations , iii) SBA Originations, Acquisitions and Servicing , and iv) Residential Mortgage Banking, with the remaining amounts recorded in Corporate- Other . Our acquisition and origination platforms consist of the following four operating segments: · Loan Acquisitions . We acquire performing and non-performing SBC loans and intend to continue to acquire these loans as part of our business strategy. We hold performing SBC loans to term, and we seek to maximize the value of the non-performing SBC loans acquired by us through proprietary loan modification programs. We typically acquire non-performing loans at a discount to their unpaid principal balance (“UPB”) when we believe that resolution of the loans will provide attractive risk-adjusted returns. · SBC Originations . We originate SBC loans secured by stabilized or transitional investor properties using multiple loan origination channels through our wholly-owned subsidiary, ReadyCap Commercial, LLC (“RCC”), a wholly-owned subsidiary of ReadyCap Holdings, LLC (collectively, “ReadyCap”). Additionally, as part of this segment, we originate and service multi-family loan products under the newly launched small balance loan program of the Federal Home Loan Mortgage Corporation (“Freddie Mac” and the “Freddie Mac program”). These originated loans are generally held-for-investment or placed into securitization structures. · SBA Originations, Acquisitions, and Servicing . We acquire, originate and service owner-occupied loans guaranteed by the SBA under its Section 7(a) loan program (the “SBA Section 7(a) Program”) through our wholly-owned subsidiary, ReadyCap Lending (“RCL”). We hold an SBA license as one of only 14 non-bank Small Business Lending Companies (“SBLCs”) and have been granted preferred lender status by the SBA. In the future, we may originate SBC loans for real estate under the SBA 504 loan program, under which the SBA guarantees subordinated, long-term financing. These originated loans are either held-for-investment, placed into securitization structures, or sold. · Residential Mortgage Banking . In connection with our merger with ZAIS Financial on October 31, 2016, as described in greater detail below, we added a residential mortgage loan origination segment through our wholly-owned subsidiary, GMFS, LLC ("GMFS"). GMFS originates residential mortgage loans eligible to be purchased, guaranteed or insured by the Federal National Mortgage Association (“Fannie Mae”), Freddie Mac, Federal Housing Administration (“FHA”), U.S. Department of Agriculture (“USDA”) and U.S. Department of Veterans Affairs (“VA”) through retail, correspondent and broker channels. These originated loans are then sold to third parties. The Company qualifies as a REIT under the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), commencing with its first taxable year ended December 31, 2011. To maintain its tax status as a REIT, the Company distributes at least 90% of its taxable income in the form of distributions to shareholders.

Basis of Presentation

Basis of Presentation	3 Months Ended
	Mar. 31, 2018
Basis of Presentation
Basis of Presentation	Note 2 – Basis of Presentation The unaudited interim consolidated financial statements presented herein are as of March 31, 2018 and December 31, 2017 and for the three months ended March 31, 2018 and 2017. These unaudited consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”)—as prescribed by the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) and the rules and regulations of the U.S. Securities and Exchange Commission. The accompanying unaudited interim consolidated financial statements do not include all information and footnotes required by generally accepted accounting principles in the United States of America ("GAAP") for complete consolidated financial statements. These interim unaudited interim consolidated financial statements and related notes should be read in conjunction with the Company's audited financial statements for the years ended December 31, 2017 and 2016, and for each of the three years in the period ended December 31, 2017, disclosed within the most recently filed 2017 annual report on Form 10-K. In the opinion of management, the accompanying unaudited interim consolidated financial statements contain all adjustments, consisting of normal recurring adjustments necessary for a fair statement of the results for the interim periods presented. Such operating results may not be indicative of the expected results for any other interim periods or the entire year.

Summary of Significant Accounti

Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2018
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	Note 3 – Summary of Significant Accounting Policies Use of Estimates The preparation of the Company’s unaudited interim consolidated financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the unaudited interim consolidated financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates. Basis of Consolidation The accompanying unaudited interim consolidated financial statements of the Company include the accounts and results of operations of the Operating Partnership and other consolidated subsidiaries and VIEs in which we are the primary beneficiary. The unaudited interim consolidated financial statements are prepared in accordance with ASC 810, Consolidations. Intercompany accounts and transactions have been eliminated. Reclassifications Certain amounts reported for the prior periods in the accompanying unaudited interim consolidated financial statements have been reclassified in order to conform to the current period’s presentation. As described in Note 4, the impact of the retrospective adoption of Accounting Standards Update (“ASU”) 2016-18, Statement of Cash Flows: Restricted Cash , resulted in revisions to prior period numbers to conform with the updated accounting standard and our current period’s presentation. As described in Note 9, the historical results of our Residential mortgage banking segment has been reclassified in the unaudited interim consolidated statements of income to conform to our current period’s presentation of Gains on residential mortgage banking activities, net of variable loan expenses. As described in Note 25, effective at the beginning of the third quarter of 2017, the Company implemented organizational changes to align its segment financial reporting more closely with its current business practices. These organizational changes resulted in securitization activities on originated SBC and SBA loans being transferred out of the Loan Acquisitions segment and into either the SBC originations or SBA originations, acquisitions, and servicing segment, based on the loan type. These organizational changes also resulted in the Company presenting Corporate- Other amounts separately and no longer reflecting these amounts as part of the four business segments. Prior period numbers were revised to conform to the new segment alignment and to be consistent with our current period’s presentation. Cash and Cash Equivalents The Company has accounted for cash and cash equivalents in accordance with ASC 305, Cash and Cash Equivalents. The Company defines cash and cash equivalents as cash, demand deposits, and short-term, highly liquid investments with original maturities of 90 days or less when purchased. Cash and cash equivalents are exposed to concentrations of credit risk. We deposit our cash with institutions that we believe to have highly valuable and defensible business franchises, strong financial fundamentals, and predictable and stable operating environments. As of March 31, 2018 and December 31, 2017, the Company had $0.6 million in money market mutual funds, and substantially all of the Company’s cash and cash equivalents not held in money market funds were comprised of cash balances with banks that are in excess of the Federal Deposit Insurance Corporation insurance limits. Restricted Cash Restricted cash represents cash held by the Company as collateral against its derivatives, borrowings under repurchase agreements, borrowings under credit facilities with counterparties, construction and mortgage escrows, as well as cash held for remittance on loans serviced for third parties. Restricted cash is not available for general corporate purposes, but may be applied against amounts due to counterparties under existing swaps and repurchase agreement borrowings, or returned to the Company when the restriction requirements no longer exist or at the maturity of the swap or repurchase agreement. Short term investments The Company accounts for short-term investments as trading securities under ASC 320, Investments-Debt and Equity Securities . Short-term investments consist of U.S. Treasury Bills with original maturities of less than a year but greater than three months. The Company holds short-term investments at fair value. Interest received and accrued as well as the accretion of purchase discount in connection with short-term investments is recorded as interest income on the unaudited interim consolidated statements of income. Changes in the fair value of short-term investments are recorded as net unrealized gain (loss) on the unaudited interim consolidated statements of income. Loans, net Loans, net consists of loans, held-for-investment, net of allowance for loan losses and loans, held at fair value. Loans, held-for-investment Loans, held-for-investment are loans acquired from third parties (“acquired loans”), loans originated by ReadyCap that we do not intend to securitize or sell, or securitized loans that were previously originated by ReadyCap. Securitized loans remain on the Company’s balance sheet because the securitization vehicles are consolidated under ASC 810. Acquired loans are recorded at cost at the time they are acquired. Acquired loans are accounted for in accordance with ASC 310-30, Receivables - Loans and Debt Securities Acquired with Deteriorated Credit Quality (“ASC 310-30”) and referred to as “purchased credit impaired loans” (PCI loans) if both of the following conditions are met as of the acquisition date: (i) there is evidence of deterioration in credit quality of the loan since its origination and (ii) it is probable that we will not collect all contractual cash flows on the loan. Acquired loans without evidence of these conditions, securitized loans, and loans originated by ReadyCap that we do not intend to securitize are accounted for under ASC 310-10, Receivables- Overall , (“ASC 310-10”) and are referred to as “Non-purchased credit impaired loans” (non-PCI loans). Purchased Credit Impaired (PCI) Loans The estimated cash flow expected for each loan is estimated at the time the loan is acquired. The excess of the cash flows expected to be collected on PCI loans, measured as of the acquisition date, over the initial investment is referred to as the accretable yield and is recognized in interest income over the remaining life of the loan using the interest method of accretion. The difference between contractually required payments as of the acquisition date and the cash flows expected to be collected is referred to as the non-accretable difference and is not accreted over time. The Company estimates expected cash flows to be collected over the life of individual PCI loans on a quarterly basis. If the Company determines that discounted expected cash flows have decreased, the PCI loans would be considered impaired, which would result in a provision for loan loss and a corresponding increase in the allowance for loan losses. If discounted expected cash flows have increased, or improved, in subsequent evaluations, the increase in cash flows is first used to reverse the amount of any related allowance for loan losses before the yield is adjusted. Additionally, the Company will increase the accretable yield to account for the increase in expected cash flows. The estimate of the amount and timing of cash flows for our PCI loans is based on historical information available and expected future performance of the loans, and may include the timing of expected future cash flows, prepayment speed, default rates, loss severities, delinquency rates, percentage of non-performing loans, extent of credit support available, Fair Isaac Corporation (“FICO”) scores at loan origination, year of origination, loan-to-value ratios, geographic concentrations, as well as reports by credit rating agencies, such as Moody’s, Standard & Poor’s Corporation (“S&P”), or Fitch, general market assessments and dialogue with market participants. As a result, substantial judgment is used in the analysis to determine the expected cash flows. Non-PCI Loans The Company uses the interest method to recognize, as a constant effective yield adjustment, the difference between the initial recorded investment in the loan and the principal amount of the loan. The calculation of the constant effective yield necessary to apply the interest method uses the payment terms required by the loan contract, and prepayments of principal are not anticipated to shorten the loan term. For non-PCI loans, recognition of interest income is suspended when any loans are placed on non-accrual status. Generally, all classes of loans are placed on non-accrual status when principal or interest has been delinquent for 90 days or when full collection is determined not to be probable. Interest income accrued, but not collected, at the date loans are placed on non-accrual status is reversed and subsequently recognized only to the extent it is received in cash or until it qualifies for return to accrual status. However, where there is doubt regarding the ultimate collectability of loan principal, all cash received is applied to reduce the carrying value of such loans. Loans are restored to accrual status only when contractually current and the collection of future payments is reasonably assured. Loans, held at fair value Loans, held at fair value are loans originated by ReadyCap. The Company has elected the fair value option because of the intent to transfer to securitizations in the near term. Interest is recognized as interest income on the unaudited interim consolidated statements of income when earned and deemed collectible. Changes in fair value are recurring and are reported as net unrealized gain (loss) on the unaudited interim consolidated statements of income. The Company transfers loans held at fair value to loans, held-for-investment upon the completion of securitization. Allowance for loan losses The allowance for loan losses is intended to provide for credit losses inherent in the loans, held-for-investment portfolio and is reviewed quarterly for adequacy considering credit quality indicators, including probable and historical losses, collateral values, loan-to-value ratio and economic conditions. The allowance for loan losses is increased through provisions for loan losses charged to earnings and reduced by charge-offs, net of recoveries. We determine the allowance for loan losses by measuring credit impairment on (1) an individual basis for non-accrual status loans, and (2) on a collective basis for all other loans with similar risk characteristics. The allowance for loan losses on an individual basis is assessed when a loan is on non-accrual and the recoverability of the loan is less than its carrying value. The Company considers the loans to be collateral dependent and relies on the current fair value of the collateral as the basis for determining impairment. Loans that are not assessed individually for impairment are assessed on a collective basis. For the acquired loans we perform a historical analysis on both cumulative defaults and severity upon default for all loans that were current as of November 4, 2013 when the Company was formed or acquired thereafter. We calculated the cumulative default and loss severity on the acquired loans with delinquency statuses of 90+ days and applied those factors to the current acquired loan population. For the originated loans, our historical data shows a minimal number of defaults, therefore we used an analysis performed on the latest ReadyCap securitization to determine the likelihood of default and to determine loss severity we stressed collateral value to the current principal balance based on the total valuation decline of SBC properties from the peak valuation in 2007 through their post-crisis low in 2010. The determination of allowances for SBA loans is based upon the assignment of a probability of default on a rating scale. Each loan rating is re-evaluated at least annually for loan performance, underlying borrower financial performance or data from third party credit bureaus. The probability of default is compared to the underlying collateral value securing each loan and compared to each loan carrying value to calculate a loss estimate. Collectively the estimated probability of default and recovery value is compared to actual portfolio default and recovery rates as well as economic factors and adjusted when needed. The determination of whether an allowance for loan loss is necessary is based on whether or not there is a decrease in cash flows based on consideration of factual information available at the time of assessment as well as management’s estimates of the future performance and projected amount and timing of cash flows expected to be collected on the loan. While we have a formal methodology to determine the adequate and appropriate level of the allowance for loan losses, estimates of inherent loan losses involve judgment and assumptions as to various factors, including current economic conditions. Our determination of adequacy of the allowance for loan losses is based on quarterly evaluations of the above factors. Accordingly, the provision for loan losses will vary from period to period based on management's ongoing assessment of the adequacy of the allowance for loan losses. Non-accrual loans Non-accrual loans are the loans for which we are not accruing or accreting interest income. Non-accrual loans include non-PCI loans when principal or interest has been delinquent for 90 days or more or when it is determined that full collection of contractual cash flows is not probable. Additionally, PCI loans for which the Company is unable to reasonably estimate the timing and amount of expected cash flows are considered to be non-accrual loans. Troubled Debt Restructurings In situations where, for economic or legal reasons related to the borrower’s financial difficulties, we grant concessions for a period of time to the borrower that we would not otherwise consider, the related loans are classified as troubled debt restructurings (“TDR”). These modified terms may include interest rate reductions, principal forgiveness, term extensions, payment forbearance and other actions intended to minimize our economic loss and to avoid foreclosure or repossession of collateral. For modifications where we forgive principal, the entire amount of such principal forgiveness is immediately charged off. Loans classified as TDRs, are considered impaired loans. Other than resolutions such as foreclosures and sales, we may remove loans held-for-investment from TDR classification, but only if they have been refinanced or restructured at market terms and qualify as a new loan. Generally, all loans modified in a TDR are placed or remain on non-accrual status at the time of the restructuring. However, certain accruing loans modified in a TDR that are current at the time of restructuring may remain on accrual status if payment in full under the restructured terms is expected. Impaired loans The Company considers a loan to be impaired when the Company does not expect to collect all of the contractual interest and principal payments as scheduled in the loan agreements. This includes certain non-PCI loans where we do not expect to collect all of the contractual interest and principal payments, as well as PCI loans, which experienced credit deterioration prior to acquisition. Loans, held for sale, at fair value Loans, held for sale, at fair value are loans that are expected to be sold to third parties in the near term. Interest is recognized as interest income on the unaudited interim consolidated statements of income when earned and deemed collectible. For loans originated by our SBC originations and SBA originations segments, changes in fair value are recurring and are reported as net unrealized gain (loss) on the unaudited interim consolidated statements of income. For originated SBA loans, the guaranteed portion is held for sale, at fair value. For loans originated by GMFS, changes in fair value are reported as gains on residential mortgage banking activities, net of variable loan expenses, on the unaudited interim consolidated statements of income. The Company transfers loans held for sale, at fair value to loans, held-for-investment when the Company no longer intends to sell the loans. Mortgage backed securities, at fair value The Company accounts for MBS as trading securities and are carried at fair value under ASC 320, Investments-Debt and Equity Securities. Our MBS portfolio is comprised of asset-backed securities collateralized by interest in or obligations backed by pools of SBC loans. Purchases and sales of MBS are recorded on the trade date. Our MBS securities pledged as collateral against borrowings under repurchase agreements are included in mortgage backed securities, at fair value on our unaudited interim consolidated balance sheets. MBS are recorded at fair value as determined by market prices provided by independent broker dealers or other independent valuation service providers. The fair values assigned to these investments are based upon available information and may not reflect amounts that may be realized. We generally intend to hold our investment in MBS to generate interest income; however, we have and may continue to sell certain of our investment securities as part of the overall management of our assets and liabilities and operating our business. Loans eligible for repurchase from Ginnie Mae When the Company has the unilateral right to repurchase Ginnie Mae pool loans it has previously sold (generally loans that are more than 90 days past due), the Company then records the right to repurchase the loan as an asset and liability in its unaudited interim consolidated balance sheets. Such amounts reflect the unpaid principal balance of the loans. Derivative instruments, at fair value Subject to maintaining our qualification as a REIT for U.S. federal income tax purposes, we utilize derivative financial instruments, currently comprised of credit default swaps (“CDSs”), interest rate swaps, and interest rate lock commitments (“IRLCs”) as part of our risk management. The Company accounts for derivative instruments under ASC 815, Derivatives and Hedges . All derivatives are reported as either assets or liabilities on the unaudited interim consolidated balance sheets at the estimated fair value with the changes in the fair value recorded in earnings. Although permitted under certain circumstances, generally the Company does not offset cash collateral receivable or payables against our gross derivative positions. As of March 31, 2018 there was no cash collateral receivable held for derivatives. As of December 31, 2017, the cash collateral receivable held for derivative instruments is $0.8 million and is included in restricted cash on the unaudited interim consolidated balance sheets. Interest Rate Swap Agreements An interest rate swap is an agreement between two counterparties to exchange periodic interest payments where one party to the contract makes a fixed-rate payment in exchange for a floating-rate payment from the other party. The dollar amount each party pays is an agreed-upon periodic interest rate multiplied by some pre-determined dollar principal (notional amount). No principal (notional amount) is exchanged between the two parties at trade initiation date. Only interest payments are exchanged. Interest rate swaps are classified as Level 2 in the fair value hierarchy. The fair value adjustments, along with the related interest income or interest expense, are reported as net gain/(loss) on financial instruments. Interest Rate Lock Commitments (“IRLCs”) IRLCs are agreements under which GMFS agrees to extend credit to a borrower under certain specified terms and conditions in which the interest rate and the maximum amount of the loan are set prior to funding. Unrealized gains and losses on the IRLCs, reflected as derivative assets and derivative liabilities, respectively, are measured based on the value of the underlying mortgage loan, quoted government-sponsored enterprise Fannie Mae, Freddie Mac, and the Government National Mortgage Association ((“Ginnie Mae”), collectively, “GSEs”) or MBS prices, estimates of the fair value of the mortgage servicing rights (“MSRs”) and the probability that the mortgage loan will fund within the terms of the IRLC, net of commission expense and broker fees. The realized and unrealized gains or losses are reported on the unaudited interim consolidated statements of income as gains on residential mortgage banking activities, net of variable loan expenses. IRLCs are classified as Level 3 in the fair value hierarchy. CDS CDS are contracts between two parties, a protection buyer who makes fixed periodic payments, and a protection seller, who collects the premium in exchange for making the protection buyer whole in the case of default. The fair value adjustments, along with the related interest income or interest expense, are reported as gain/(loss) on financial instruments. CDS are classified as Level 2 in the fair value hierarchy. Servicing rights Servicing rights initially represent the fair value of expected future cash flows for performing servicing activities for others. The fair value considers estimated future servicing fees and ancillary revenue, offset by estimated costs to service the loans, and generally declines over time as net servicing cash flows are received, effectively amortizing the servicing right asset against contractual servicing and ancillary fee income. Servicing rights are recognized upon sale or securitization of loans if servicing is retained. For servicing rights, gains related to servicing rights retained is included in net realized gain/(loss) on the unaudited interim consolidated statements of income. For residential mortgage servicing rights, gains on servicing rights retained upon sale of a loan are included in gains on residential mortgage banking activities, net of variable loan expenses, on the unaudited interim consolidated statements of income. The Company treats its servicing rights and residential mortgage servicing rights as two separate classes of servicing assets based on the class of the underlying mortgages and it treats these assets as two separate pools for risk management purposes. Servicing rights relating to the Company’s servicing of loans guaranteed by the SBA under its Section 7(a) loan program and servicing rights related to the Freddie Mac program are accounted for under ASC 860, Transfers and Servicing, while the Company’s residential mortgage servicing rights are accounted for under the fair value option under ASC 825, Financial Instruments. Servicing rights – SBA and Freddie Mac SBA and Freddie Mac servicing rights are initially recorded at fair value and subsequently carried at amortized cost. We capitalize the value expected to be realized from performing specified servicing activities for others. Servicing rights are amortized in proportion to and over the period of estimated servicing income, and are evaluated for potential impairment quarterly. For purposes of testing our servicing rights for impairment, we first determine whether facts and circumstances exist that would suggest the carrying value of the servicing asset is not recoverable. If so, we then compare the net present value of servicing cash flow with its carrying value. The estimated net present value of servicing cash flows is determined using discounted cash flow modeling techniques, which require management to make estimates regarding future net servicing cash flows, taking into consideration historical and forecasted loan prepayment rates, delinquency rates and anticipated maturity defaults. If the carrying value of the servicing rights exceeds the net present value of servicing cash flows, the servicing rights are considered impaired and an impairment loss is recognized in earnings for the amount by which carrying value exceeds the net present value of servicing cash flows. We leverage all available relevant market data to determine the fair value of our recognized servicing assets. Since quoted market prices for servicing rights are not readily available, we estimate the fair value of servicing rights by determining the present value of future expected servicing cash flows using modeling techniques that incorporate management's best estimates of key variables including estimates regarding future net servicing cash flows, forecasted loan prepayment rates, delinquency rates, and return requirements commensurate with the risks involved. Cash flow assumptions are modeled using our internally forecasted revenue and expenses, and where possible, the reasonableness of assumptions is periodically validated through comparisons to market data. Prepayment speed estimates are determined from historical prepayment rates or obtained from third-party industry data. Return requirement assumptions are determined using data obtained from market participants, where available, or based on current relevant interest rates plus a risk-adjusted spread. We also consider other factors that can impact the value of the servicing rights, such as surety provider termination clauses and servicer terminations that could result if we failed to materially comply with the covenants or conditions of our servicing agreements and did not remedy the failure. Since many factors can affect the estimate of the fair value of servicing rights, we regularly evaluate the major assumptions and modeling techniques used in our estimate and review these assumptions against market comparables, if available. We monitor the actual performance of our servicing rights by regularly comparing actual cash flow, credit, and prepayment experience to modeled estimates. Servicing rights - Residential (carried at fair value) The Company’s residential mortgage servicing rights consist of conforming conventional residential loans sold to Fannie Mae and Freddie Mac or loans securitized in Ginnie Mae securities. Government insured loans serviced by the Company are securitized through Ginnie Mae, whereby the Company is insured against loss by the Federal Housing Administration or partially guaranteed against loss by the Department of Veterans Affairs. The Company has elected to account for its portfolio of residential mortgage servicing rights (“MSRs”) at fair value. For these assets, the Company uses a third-party vendor to assist management in estimating the fair value. The third-party vendor uses a discounted cash flow approach which consists of projecting servicing cash flows discounted at a rate that management believes market participants would use in their determinations of fair value. The key assumptions used in the estimation of the fair value of MSRs include prepayment rates, discount rates, default rates, and cost of servicing rates. Residential MSRs are classified as Level 3 in the fair value hierarchy. Intangible assets Intangible assets are accounted for under ASC 350, Intangibles-Goodwill and Other . As of March 31, 2018 and December 31, 2017, the Company’s identifiable intangible assets include SBA license for our lending operations as well as a trade name, a favorable lease, and other licenses relating to our residential mortgage banking segement, obtained as part of the ZAIS Financial merger transaction. The Company determined that its SBA license has an indefinite life, while the other intangibles acquired as part of the ZAIS Financial merger transaction are finite-lived. The Company amortizes intangible assets with identified estimated useful lives on a straight-line basis over their estimated useful lives. The Company initially records its intangible assets at cost and subsequently tests for impairment on an annual basis. Intangible assets are included within other assets on the unaudited interim consolidated balance sheets. Investment in unconsolidated joint venture In November of 2017, the Company acquired an interest in an SBC loan pool through a joint venture, WFLLA, LLC, which the Company has a 50% interest. According to ASC 323, Equity Method and Joint Ventures , investors in unincorporated entities such as partnerships and unincorporated joint ventures generally shall account for their investments using the equity method of accounting if the investor has the ability to exercise significant influence over the investee. Under the equity method, we recognize our share of the earnings or losses of the investment monthly in earnings and adjust the carrying amount for our share of the earnings or losses based on our equity ownership. Pursuant to the consolidation guidance, we determined our interest in the entity is a VIE, however, we do not consolidate the entity as we determined that we are not the primary beneficiary. The Company is determined to be the primary beneficiary only when it has a controlling financial interest in the VIE, which is defined as possessing both (i) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. Deferred financing costs Costs incurred in connection with our secured borrowings are accounted for under ASC 340, Other Assets and Deferred Costs . Deferred costs are capitalized and amortized using the effective interest method over the respective financing term with such amortization reflected on our unaudited interim consolidated statements of income as a component of interest expense. Our deferred financing costs may include legal, accounting and other related fees. Unamortized deferred financing costs are expensed when the associated debt is refinanced or repaid before maturity. Pursuant to the adoption of ASU 2015-03, unamortized deferred financing costs related to securitizations and note issuances are presented on the unaudited interim consolidated balance sheets as a direct deduction from the associated liability. Due from Servicers The loan servicing activities of the Company’s SBC Loan Acquisitions and SBC Originations reportable segments are performed primarily by third-party servicers. SBA loans originated by and held at RCL are internally serviced. Residential mortgage loans originated by and held at GMFS are both serviced by third-party servicers and internally serviced. The Company’s servicers hold substantially all of the cash owned by the Company related to loan servicing activities. These amounts include principal and interest payments made by borrowers, net of advances and servicing fees. Cash is generally received within thirty days of recording the receivable. The Company is subject to credit risk to the extent any servicer with whom the Company conducts business is unable to deliver cash balances or process loan-related transactions on the Company’s behalf. The Company monitors the financial condition of the servicers with whom the Company conducts business and believes the likelihood of loss under the aforementioned circumstances is remote. Secured borrowings Secured borrowings include borrowings under credit facilities and borrowings under repurchase agreements. Borrowings under credit facilities The Company accounts for borrowings under credit facilities under ASC 470, Debt. The Company partially finances its loans, net through credit agreements with various counterparties. These borrowings are collateralized by loans, held-for-investment, and loans, held for sale, at fair value and have maturity dates within two years from the unaudited interim consolidated balance sheet date. If the fair value (as determined by the applicable counterparty) of the collateral securing these borrowings decreases, we may be subject to margin calls during the period the borrowings are outstanding. In instances where we do not satisfy the margin calls within the required time frame, the counterparty may retain the collateral and pursue collection of any outstanding debt amount from us. Interest paid and accrued in connection with credit facilities is recorded as interest expense on the unaudited interim consolidated statements of income. Borrowing under repurchase agreements Borrowings under repurchase agreements are accounted for under ASC 860, Transfers and Servicing . Investment securities financed under repurchase agreements are treated as collateralized borrowings, unless they meet sale treatment or are deemed to be li

Recently Issued Accounting Pron

Recently Issued Accounting Pronouncements	3 Months Ended
	Mar. 31, 2018
Recently Issued Accounting Pronouncements
Recently Issued Accounting Pronouncements	Note 4 – Recently Issued Accounting Pronouncements Financial Accounting Standards Board ("FASB") Standards adopted during 2018 Standard Summary of guidance Effects on financial statements ASU 2014-09, Revenue from Contracts with Customers (Topic 606)  Outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance.  Since the guidance does not apply to revenue associated with financial instruments, including loans and securities, and other contractual rights or obligations within the scope of ASC 860, Transfers and Servicing, the adoption of this standard on a modified retrospective basis on January 1, 2018 did not have a material impact on our consolidated financial statements. Issued May 2014 ASU 2017-09, Compensation—Stock Compensation (Topic 718) Scope of Modification Accounting  Provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718.  The adoption of this standard had no impact on our consolidated financial statements since there were no modifications. This ASU required prospective adoption, therefore, any future award changes will be evaluated under the amended guidance. Issued May 2017 ASU 2016-15, Statement of Cash Flows (Topic 230) – Classification of Certain Cash Receipts and Cash Payments  Provides guidance on the disclosure and classification of certain items within the statement of cash flows, including beneficial interests obtained in a securitization of financial assets, debt prepayment or extinguishment costs, and distributions received from equity-method investees.  The retrospective adoption of this standard did not have a material impact on our consolidated financial statements. We chose the cumulative earnings approach for distributions received from equity method investees, which did not result in any changes in the way we account for such distributions. Issued August 2016 ASU 2016-16, Income Taxes (Topic 740) – Intra-Entity Transfers of Assets Other Than Inventory  Requires that an entity recognize the income tax consequences of intra-entity transfers of assets other than inventory at the time of the transfer instead of deferring the tax consequences until the asset has been sold to an outside party, as current GAAP requires.  The modified retrospective adoption of this standard did not have a material impact on our consolidated financial statements. Issued October 2016 ASU 2017-01, Business Combinations (Topic 805) – Clarifying the Definition of a Business  This ASU results in most real estate acquisitions no longer being considered business combinations and instead being accounted for as asset acquisitions.  The adoption of this standard did not have a material impact on our consolidated financial statements. This ASU required prospective adoption, therefore, any future acquisitions will be evaluated under the amended guidance. Issued January 2017 ASU 2017-05, Other Income – Gains and Losses from the De-recognition of Nonfinancial Assets  Requires that all entities account for the de-recognition of a business in accordance with ASC 810, including instances in which the business is considered in substance real estate.  The retrospective adoption of this standard did not have a material impact on our consolidated financial statements. Issued February 2017 ASU 2016-18, Statement of Cash Flows (Topic 230) - Restricted Cash  Requires that restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows.  The adoption of this standard on a retrospective basis resulted in reclassifying restricted cash out of investing activities and now is included within cash and cash equivalents on the consolidated statement of cash flows. The following table shows the impact of the adoption of this guidance. Issued November 2016 (In Thousands) Three months ended As previously reported under GAAP applicable at the time Cash and cash equivalents at beginning of the period $ 59,566 Net decrease in cash and cash equivalents (19,566) Cash and cash equivalents at end of the period $ 40,000 As currently reported under ASU 2016-18 Cash and cash equivalents and restricted cash at beginning of the period $ 79,756 Net decrease in cash and cash equivalents and restricted cash (19,984) Cash and cash equivalents and restricted cash at end of the period $ 59,772 FASB Standards issued, but not yet adopted Standard Summary of guidance Effects on financial statements ASU 2016-13, Financial Instruments—Credit Losses (Topic 326) – Measurement of Credit Losses on Financial Instruments  Requires the use of an “expected loss” credit model for estimating future credit losses of certain financial instruments instead of the “incurred loss” credit model that existing GAAP currently requires.  Required effective date: Annual reporting periods, and interim periods therein, beginning after December 15, 2019. Early adoption is permitted for periods beginning after December 15, 2018. Issued June 2016  The “expected loss” model requires the consideration of possible credit losses over the life of an instrument compared to only estimating credit losses upon the occurrence of a discrete loss event in accordance with the current “incurred loss” methodology.  The Company is evaluating the impact ASU 2016-13 will have on our consolidated financial statements. ASU 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815)—Accounting for Certain Financial Instruments with Down Round Features  Provides guidance which changes the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features.  Required effective date: Annual reporting periods, and interim periods therein, beginning after December 15, 2018. Early adoption is permitted. Issued July 2017  When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity's own stock.  This standard currently would not have an impact on our consolidated financial statements. None of our issued equity or debt (in particular our convertible notes), contain down round features. ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities  Provides guidance on simplifying the accounting and presentation for hedging activities.  This standard currently would not have an impact on our consolidated financial statements. We do not apply hedge accounting to any of our derivative instruments. Issued August 2017

Loans and Allowance for Loan Lo

Loans and Allowance for Loan Losses	3 Months Ended
	Mar. 31, 2018
Loans and Allowance for Loan Losses
Loans and Allowance for Loan Losses	Note 5 – Loans and Allowance for Loan Losses The accounting for a loan depends on management’s strategy for the loan, and on whether the loan was credit-impaired at the date of acquisition. The Company accounts for loans based on the following loan program categories: · Originated or purchased loans held-for-investment, other than PCI loans – originated transitional loans, originated conventional SBC and SBA loans that have been securitized, or acquired loans with no signs of credit deterioration at time of purchase. · Loans at fair value – originated conventional SBC and SBA loans that we intend to securitize · Loans held-for-sale, at fair value – originated or acquired that we intend to sell in the near term · PCI loans held-for-investment – acquired loans with signs of credit deterioration at time of purchase Loan Portfolio The following table summarizes the classification, unpaid principal balance (“UPB”), and carrying value of loans held by the Company including loans of consolidated VIEs: March 31, 2018 December 31, 2017 Loans (In Thousands) Carrying Value UPB Carrying Value UPB Loans Acquired SBA 7(a) loans $ 313,382 $ 334,501 $ 331,083 $ 353,556 Acquired loans 316,938 334,143 191,327 209,694 Originated Transitional loans 297,863 300,123 246,076 248,190 Originated SBC loans, at fair value 40,430 39,833 188,150 182,045 Originated SBC loans 42,926 42,232 27,610 27,349 Originated SBA 7(a) loans 51,970 54,679 41,208 43,439 Originated Residential Agency loans 2,246 2,246 2,013 2,014 Total Loans, before allowance for loan losses $ 1,065,755 $ 1,107,757 $ 1,027,467 $ 1,066,287 Allowance for loan losses $ (8,721) — $ (9,547) — Total Loans, net $ 1,057,034 $ 1,107,757 $ 1,017,920 $ 1,066,287 Loans in consolidated VIEs Loans Originated SBC loans $ 509,575 $ 497,091 $ 382,873 $ 373,996 Acquired loans 176,366 190,021 189,545 204,497 Acquired SBA 7(a) loans 66,142 90,467 69,523 95,605 Originated Transitional loans 192,623 192,432 196,438 196,070 Total Loans, in consolidated VIEs, before allowance for loan losses $ 944,706 $ 970,011 $ 838,379 $ 870,168 Allowance for loan losses on loans in consolidated VIEs $ (1,812) — $ (2,199) — Total Loans, net, in consolidated VIEs $ 942,894 $ 970,011 $ 836,180 $ 870,168 Total Loans, net, and Loans, net in consolidated VIEs $ 1,999,928 $ 2,077,768 $ 1,854,100 $ 1,936,455 Loans, held for sale, at fair value Originated Residential Agency loans $ 86,741 $ 83,880 $ 129,096 $ 124,758 Originated Freddie Mac loans 49,270 48,519 67,591 66,642 Originated SBA 7(a) loans 23,776 21,927 16,791 15,472 Acquired loans 1,212 1,296 2,544 2,662 Total Loans, held for sale, at fair value $ 160,999 $ 155,622 $ 216,022 $ 209,534 Total Loan portfolio $ 2,160,927 $ 2,233,390 $ 2,070,122 $ 2,145,989 Credit Quality Indicators The Company monitors credit quality of our loan portfolio based on primary credit quality indicators. Delinquency rates are a primary credit quality indicator for our types of loans. Loans that are more than 30 days past due provide an early warning of borrowers who may be experiencing financial difficulties and/or who may be unable or unwilling to repay the loan. As the loan continues to age, it becomes more clear that the borrower is likely either unable or unwilling to pay. The following tables display delinquency information on loans, net as of March 31, 2018 and December 31, 2017: March 31, 2018 Loans (In Thousands) Current and 30-89 Days 90+ Days Total Loans Carrying Value Non-Accrual 90+ Days Past Due but Accruing Loans (1)(2) Acquired SBA 7(a) loans $ 358,760 $ 16,039 $ 2,245 $ 377,044 $ 17,497 $ — Acquired loans 464,476 5,185 17,534 487,195 10,257 8,743 Originated Transitional loans 490,486 — — 490,486 — — Originated SBC loans, at fair value 35,704 4,726 — 40,430 — — Originated SBC loans 542,307 2,550 7,702 552,559 7,702 — Originated SBA 7(a) loans 51,558 379 — 51,937 903 — Originated Residential Agency loans 1,223 — 1,023 2,246 — 1,023 Total Loans, before general allowance for loans losses $ 1,944,514 $ 28,879 $ 28,504 $ 2,001,897 $ 36,359 $ 9,766 General allowance for loan losses $ (1,969) Total Loans, net $ 1,999,928 Percentage of outstanding (1) Loan balances include specific allowance for loan losses. (2) Includes Loans, net in consolidated VIEs December 31, 2017 Loans (In Thousands) Current and 30-89 Days 90+ Days Total Loans Carrying Value Non-Accrual 90+ Days Past Due but Accruing Loans (1)(2) Acquired SBA 7(a) loans $ 376,102 $ 15,953 $ 5,542 $ 397,597 $ 16,782 $ 176 Acquired loans 348,271 6,891 19,263 374,425 16,405 4,090 Originated Transitional loans 435,252 7,263 — 442,515 — — Originated SBC loans, at fair value 188,150 — — 188,150 — — Originated SBC loans 402,004 7,702 608 410,314 608 — Originated SBA 7(a) loans 40,871 311 — 41,182 671 — Originated Residential Agency loans 1,226 — 787 2,013 289 498 Total Loans, before allowance for loans losses $ 1,791,876 $ 38,120 $ 26,200 $ 1,856,196 $ 34,755 $ 4,764 General allowance for loan losses $ (2,096) Total Loans, net $ 1,854,100 Percentage of outstanding (1) Loan balances include specific allowance for loan losses. (2) Includes Loans, net in consolidated VIEs In addition to delinquency rates, the current estimated LTV ratio is another indicator that can provide insight into a borrower’s continued willingness to pay, as the delinquency rate of high LTV loans tends to be greater than that for loans where the borrower has equity in the collateral. The geographic distribution of the loan collateral also provides insight as to the credit quality of the portfolio, as factors such as the regional economy, property price changes and specific events such as natural disasters, will affect credit quality. The Company monitors the loan-to-value ratio and associated risks on a monthly basis. The following tables presents quantitative information on the credit quality of loans, net as of March 31, 2018 and December 31, 2017: Loan-to-Value (a) (In Thousands) 0.0 – 20.0% 20.1 – 40.0% 40.1 – 60.0% 60.1 – 80.0% 80.1 – 100.0% Greater than 100.0% Total March 31, 2018 Loans (1) (2) Acquired SBA 7(a) loans $ 8,855 $ 38,782 $ 123,609 $ 98,577 $ 49,327 $ 57,894 $ 377,044 Acquired loans 71,577 139,433 137,111 85,562 26,761 26,751 487,195 Originated Transitional loans — 21,695 150,593 278,117 26,893 13,188 490,486 Originated SBC loans, at fair value — 11,938 6,881 6,123 15,488 — 40,430 Originated SBC loans 2,648 53,157 200,928 291,468 4,358 — 552,559 Originated SBA 7(a) loans 33 1,539 5,694 19,849 7,389 17,433 51,937 Originated Residential Agency loans — 60 166 731 820 469 2,246 Total Loans, before general allowance for loans losses $ 83,113 $ 266,604 $ 624,982 $ 780,427 $ 131,036 $ 115,735 $ 2,001,897 General allowance for loan losses $ (1,969) Total Loans, net $ 1,999,928 December 31, 2017 Loans (1) (2) Acquired SBA 7(a) loans $ 8,978 $ 37,880 $ 125,234 $ 106,199 $ 56,676 $ 62,630 $ 397,597 Acquired loans 54,463 102,498 114,010 67,037 18,745 17,672 374,425 Originated Transitional loans — 26,735 171,227 212,830 21,639 10,084 442,515 Originated SBC loans, at fair value — 17,294 31,245 115,653 21,245 2,713 188,150 Originated SBC loans 2,661 49,281 192,796 158,047 7,529 — 410,314 Originated SBA 7(a) loans 52 954 5,227 15,583 5,766 13,600 41,182 Originated Residential Agency loans — 60 166 609 823 355 2,013 Total Loans, before allowance for loans losses $ 66,154 $ 234,702 $ 639,905 $ 675,958 $ 132,423 $ 107,054 $ 1,856,196 General allowance for loan losses $ (2,096) Total Loans, net $ 1,854,100 (a) Loan-to-value is calculated as carrying amount as a percentage of current collateral value (1) Loan balances include specific allowance for loan loss reserves. (2) Includes Loans, net in consolidated VIEs As of March 31, 2018 and December 31, 2017, the Company’s total carrying amount of loans in the foreclosure process was $0.2 million and $0.4 million, respectively. The following table displays the geographic concentration of the Company’s loans, net, secured by real estate recorded on our unaudited interim consolidated balance sheets. Geographic Concentration (Unpaid Principal Balance) March 31, 2018 December 31, 2017 California 13.8 % 13.5 % Texas 11.9 12.4 Florida 11.6 11.7 New York 6.9 6.8 Georgia 6.0 6.2 Arizona 4.0 5.1 Illinois 3.6 3.9 North Carolina 3.5 3.7 Pennsylvania 3.0 2.1 Ohio 2.6 2.7 Other 33.1 31.9 Total 100.0 % 100.0 % The following table displays the collateral type concentration of the Company’s loans, net, on our unaudited interim consolidated balance sheets. Collateral Concentration (Unpaid Principal Balance) March 31, 2018 December 31, 2017 SBA (1) 23.1 % 25.4 % Multi-family 21.4 21.1 Retail 17.7 17.6 Office 14.9 15.6 Industrial 7.9 6.9 Mixed Use 7.3 6.3 Lodging/Residential 2.7 2.9 Other 5.0 4.2 Total 100.0 % 100.0 % (1) Further detail provided on SBA collateral concentration is included in table below. The following table displays the collateral type concentration of the Company’s SBA loans within loans, net, on our unaudited interim consolidated balance sheets. Collateral Concentration (Unpaid Principal Balance) March 31, 2018 December 31, 2017 Offices of Physicians 16.2 % 16.0 % Child Day Care Services 11.7 12.3 Lodging 10.7 10.5 Veterinarians 7.0 7.0 Eating Places 5.5 5.5 Grocery Stores 4.7 4.7 Auto 3.0 3.2 Funeral Service & Crematories 2.3 2.2 Accounting Auditing & Bookkeeping 2.1 2.1 Gasoline Service Stations 2.1 1.9 Other 34.7 34.6 Total 100.0 % 100.0 % Allowance for Loan Losses The allowance for loan losses represents the Company’s estimate of probable credit losses inherent in the Company’s held-for-investment loan portfolio. This is assessed by considering credit quality indicators, including probable and historical losses, collateral values, loan-to-value (“LTV”) ratios, and economic conditions. The allowance for loan losses includes an asset-specific component, a general formula-based component, and a component related to PCI loans. The following tables detail the allowance for loan losses by loan product and impairment methodology as of the unaudited interim consolidated balance sheet dates: March 31, 2018 (In Thousands) Originated Originated Transitional loans Acquired Acquired Originated Total Allowance for General $ 227 $ 338 $ 493 $ 510 $ 401 $ 1,969 Specific - - 416 1,062 33 1,511 PCI - - 5,635 1,418 - 7,053 Ending balance $ 227 $ 338 $ 6,544 $ 2,990 $ 434 $ 10,533 December 31, 2017 (In Thousands) Originated Originated Transitional loans Acquired Acquired Originated Total Allowance for General $ 468 $ - $ 819 $ 518 $ 291 $ 2,096 Specific 169 - 586 1,564 27 2,346 PCI - - 5,859 1,445 - 7,304 Ending balance $ 637 $ - $ 7,264 $ 3,527 $ 318 $ 11,746 The following tables detail the activity of the allowance for loan losses for loans: Three months ended March 31, 2018 (In Thousands) Originated Originated Transitional loans Acquired Acquired Originated Total Allowance for Beginning balance $ 637 $ - $ 7,264 $ 3,527 $ 318 $ 11,746 Provision for (Recoveries of) loan losses (241) 338 139 (185) 116 167 Charge-offs and sales (169) - (224) (449) - (842) Recoveries - - (635) 97 - (538) Ending balance $ 227 $ 338 $ 6,544 $ 2,990 $ 434 $ 10,533 Three months ended March 31, 2017 (In Thousands) Originated Originated Transitional loans Acquired Acquired Originated Total Allowance for Beginning balance $ 804 $ - $ 10,150 $ 5,004 $ 172 $ 16,130 Provision for (Recoveries of) loan losses 38 - 680 356 158 1,232 Charge-offs and sales - - (659) (260) - (919) Recoveries - - (1,759) - - (1,759) Ending balance $ 842 $ - $ 8,412 $ 5,100 $ 330 $ 14,684 Impaired Loans- Non-PCI loans The Company considers a loan to be impaired when the Company does not expect to collect all the contractual and principal payments as scheduled in the loan agreements. Impaired loans include loans that have been modified in a TDR or loans that are placed on non-accrual status. All impaired loans are evaluated for an asset-specific allowance as described in Note 3. (In Thousands) March 31, 2018 December 31, 2017 Impaired loans With an allowance $ 8,933 $ 9,222 Without an allowance 21,929 12,659 Total recorded carrying value of impaired loans $ 30,862 $ 21,881 Allowance for loan losses related to impaired loans $ (1,511) $ (2,346) Unpaid principal balance of impaired loans $ 36,484 $ 29,853 Impaired loans on non-accrual status $ 29,010 $ 21,881 Average carrying value of impaired loans $ 26,372 $ 28,693 March 31, 2018 March 31, 2017 Interest income on impaired loans for the three months ended $ 2 $ 3 Troubled Debt Restructurings If the borrower is determined to be in financial difficulty, then the Company will determine whether a financial concession has been granted to the borrower by analyzing the value of the loan as compared to the recorded investment, modifications of the interest rate as compared to market rates, modification of the stated maturity date, modification of the timing of principal and interest payments and the partial forgiveness of the loan. Modified loans that are classified as TDRs are individually evaluated and measured for impairment. The following table summarizes the recorded investment of TDRs on the unaudited interim consolidated balance sheet dates by loan type. March 31, 2018 December 31, 2017 (In Thousands) SBC SBA Total SBC SBA Total Recorded carrying value modified loans classified as TDRs $ 3,677 $ 12,820 $ 16,497 $ 3,727 $ 12,398 $ 16,125 Allowance for loan losses on loans classified as TDRs $ 846 $ 505 $ 1,351 $ 883 $ 695 $ 1,578 Carrying value of modified loans classified as TDRs Carrying value of modified loans classified as TDRs on accrual status $ 2,296 $ 4,879 $ 7,175 $ 1,804 $ 4,791 $ 6,595 Carrying value of modified loans classified as TDRs on non-accrual status 1,381 7,941 9,322 1,923 7,607 9,530 Total carrying value of modified loans classified as TDRs $ 3,677 $ 12,820 $ 16,497 $ 3,727 $ 12,398 $ 16,125 The following table summarizes the TDR activity that occurred during the three months ended March 31, 2018 and 2017 and the financial effects of these modifications. Three Months Ended March 31, 2018 Three Months Ended March 31, 2017 (In Thousands, except number of loans) SBC SBA Total SBC SBA Total Number of loans permanently modified - 11 11 9 4 13 Pre-modification recorded balance (a) $ - $ 1,120 $ 1,120 $ 2,234 $ 522 $ 2,756 Post-modification recorded balance (a) - 1,223 1,223 2,034 456 2,490 Number of loans that remain in default as of March 31, 2018 (b) - 4 4 6 - 6 Balance of loans that remain in default as of March 31, 2018 (b) $ - $ 239 $ 239 $ 1,179 $ - $ 1,179 Concession granted (a) : Term extension $ - $ 1,135 $ 1,135 $ 13 $ 390 $ 403 Interest rate reduction - - - 116 - 116 Principal reduction - - - 656 - 656 Foreclosure - 64 64 1,249 66 1,315 Total $ - $ 1,199 $ 1,199 $ 2,034 $ 456 $ 2,490 (a) Represents carrying value. (b) Represents the March 31, 2018 carrying values of the TDRs that occurred during the three months ended March 31, 2018 and 2017 that remained in default as of March 31, 2018. Generally, all loans modified in a TDR are placed or remain on non-accrual status at the time of the restructuring. However, certain accruing loans modified in a TDR that are current at the time of restructuring may remain on accrual status if payment in full under the restructured terms is expected. For purposes of this schedule, a loan is considered in default if it is 30 or more days past due. The Company does not believe the financial impact of the presented TDRs to be material. The other elements of the Company’s modification programs do not have a significant impact on financial results given their relative size, or do not have a direct financial impact as in the case of covenant changes. Loans, held-for-investment are accounted for under ASC 310-10 or ASC 310-30 depending on whether there is evidence of credit deterioration at the time of acquisition. The outstanding carrying amount of our held-for-investment loan portfolio broken down by ASC 310-10 (non-PCI loans) and ASC 310-30 (PCI loans) is as follows: March 31, 2018 December 31, 2017 Non-PCI PCI Non-PCI PCI (In Thousands) Loans Loans Loans Loans Unpaid principal balance $ 1,915,622 $ 122,313 $ 1,624,395 $ 130,015 Non-accretable discount — (8,810) — (8,336) Accretable discount (38,100) (20,994) (44,629) (23,749) Loans, held-for-investment 1,877,522 92,509 1,579,766 97,930 Allowance for loan losses (3,480) (7,053) (4,442) (7,304) Loans, held-for-investment $ 1,874,042 $ 85,456 $ 1,575,324 $ 90,626 In the three months ended March 31, 2018 and 2017, the Company did not acquire any PCI loans. PCI Loans The following table details the activity of the accretable yield on PCI loans, held-for investment. The amount of accretable yield is affected by changes in credit outlooks, including metrics such as default and loss severities, prepayment speeds, which can change the amount and period of time over which interest payments are expected to be received, and the interest rates on variable loans. Three Months Ended March 31, (In Thousands) 2018 2017 Beginning accretable discount- PCI loans $ 23,749 $ 26,978 Purchases/Originations — — Sales (656) (1,195) Accretion (1,709) (1,198) Other 411 471 Transfers (801) (835) Ending accretable discount- PCI loans $ 20,994 $ 24,221

Fair Value Measurements

Fair Value Measurements	3 Months Ended
	Mar. 31, 2018
Fair Value Measurements
Fair Value Measurements	Note 6 – Fair Value Measurements The Company adopted the provisions of ASC 820 Fair Value Measurement , which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. ASC 820 established a fair value hierarchy that prioritizes and ranks the level of market price observability used in measuring investments at fair value. Market price observability is impacted by a number of factors, including the type of investment, the characteristics specific to the investment, and the state of the marketplace (including the existence and transparency of transactions between market participants). Investments with readily available, actively quoted prices, or for which fair value can be measured from actively quoted prices in an orderly market, will generally have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Investments measured and reported at fair value are classified and disclosed into one of the following categories based on the inputs as follows: Level 1 — Quoted prices (unadjusted) in active markets for identical assets and liabilities that the Company has the ability to access. Level 2 — Pricing inputs are other than quoted prices in active markets, including, but not limited to, quoted prices for similar assets and liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market corroborated inputs. Level 3 — Significant unobservable inputs are based on the best information available in the circumstances, to the extent observable inputs are not available, including the Company’s own assumptions used in determining the fair value of investments. Fair value for these investments are determined using valuation methodologies that consider a range of factors, including but not limited to the price at which the investment was acquired, the nature of the investment, local market conditions, trading values on public exchanges for comparable securities, current and projected operating performance, and financing transactions subsequent to the acquisition of the investment. The inputs into the determination of fair value require significant management judgment. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an investment’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the investment. The following table presents the Company’s financial instruments carried at fair value on a recurring basis as of March 31, 2018: (In Thousands) Level 1 Level 2 Level 3 Total Assets: Cash held in money market funds $ 633 $ — $ — $ 633 Loans, held for sale, at fair value — 160,999 — 160,999 Loans, net, at fair value — — 40,430 40,430 Mortgage backed securities, at fair value — 24,445 22,736 47,181 Derivative instruments, at fair value — 1,552 3,470 5,022 Residential mortgage servicing rights, at fair value — — 81,591 81,591 Total assets $ 633 $ 186,996 $ 148,227 $ 335,856 Liabilities: Derivative instruments, at fair value $ — $ 756 $ — $ 756 Contingent consideration — — 10,732 10,732 Total liabilities $ — $ 756 $ 10,732 $ 11,488 The following table presents the Company’s financial instruments carried at fair value on a recurring basis as of December 31, 2017: (In Thousands) Level 1 Level 2 Level 3 Total Assets: Cash held in money market funds $ 632 $ — $ — $ 632 Loans, held for sale, at fair value — 216,022 — 216,022 Loans, net, at fair value — — 188,150 188,150 Mortgage backed securities, at fair value — 31,859 8,063 39,922 Derivative instruments, at fair value — 2,898 1,827 4,725 Residential mortgage servicing rights, at fair value — — 72,295 72,295 Total assets $ 632 $ 250,779 $ 270,335 $ 521,746 Liabilities: Derivative instruments, at fair value $ — $ 282 $ — $ 282 Contingent consideration — — 10,016 10,016 Total liabilities $ — $ 282 $ 10,016 $ 10,298 The following table presents a summary of changes in the fair value of loans, held at fair value, classified as Level 3: Three Months Ended March 31, (In Thousands) 2018 2017 Beginning Balance $ 188,150 $ 81,592 Realized gains (losses), net (3) 27 Unrealized gains (losses), net (762) 630 Originations 150 27,499 Sales — (2,017) Principal payments (4,666) (40) Transfer to loans, held-for-investment (142,439) — Ending Balance $ 40,430 $ 107,691 Unrealized gains on loans, held at fair value held on March 31, 2018 and December 31, 2017 and classified as Level 3 were $0.6 million and $6.0 million, respectively. The following table presents a summary of changes in the fair value of loans, held for sale, at fair value classified as Level 3: Three Months Ended March 31, (In Thousands) 2018 2017 Beginning Balance $ — $ 17,312 Realized gains, net — 917 Unrealized gains, net — 526 Originations — 69,665 Sales — (54,116) Principal payments — 3,021 Ending Balance $ — $ 37,325 The following table presents a summary of changes in the fair value of MBS, at fair value classified as Level 3: Three Months Ended March 31, (In Thousands) 2018 2017 Beginning Balance $ 8,063 $ 32,391 Accreted discount, net 21 54 Realized gains, net 123 189 Unrealized gains (losses), net 230 (45) Sales / Principal payments (517) (1,224) Transfer to (from) Level 3 14,816 — Ending Balance $ 22,736 $ 31,365 Unrealized gains (losses) on MBS at fair value held on March 31, 2018 and December 31, 2017 and classified as Level 3 were $0.4 million and $(0.6) million, respectively. Refer to “Note 8 – Servicing rights” for activity relating to the changes in the fair value of the Company’s residential mortgage servicing rights. Unrealized losses on residential mortgage servicing rights, at fair value held on March 31, 2018 and December 31, 2017 and classified as Level 3 were $3.6 million and $8.5 million, respectively. The following table presents a summary of changes in the fair value of derivatives instruments, at fair value classified as Level 3, or interest rate lock commitments: Three Months Ended March 31, (In Thousands) 2018 2017 Beginning Balance $ 1,827 $ 2,690 Unrealized gains (losses) 1,643 (1,312) Ending Balance $ 3,470 $ 1,378 Unrealized losses on derivatives held on March 31, 2018 and December 31, 2017 and classified as Level 3 were $0.1 million and $1.7 million, respectively. The following table presents a summary of changes in the fair value of contingent consideration classified as Level 3: Three Months Ended March 31, (In Thousands) 2018 2017 Beginning Balance $ 10,016 $ 14,487 Adjustment for legal settlement 634 (5,744) Amortization 82 98 Ending Balance $ 10,732 $ 8,841 As of March 31, 2018 and December 31, 2017, there was no unrealized gain (loss) on contingent consideration. The Company’s policy is to recognize transfers in and transfers out as of the beginning of the period of the event or the change in circumstances that caused the transfer. Transfers between Level 2 and Level 3 generally relate to whether there were changes in the significant relevant observable and unobservable inputs that are available for the fair value measurements of such financial instruments. Transfers into or out of Level 3 of the fair value hierarchy are recorded at the end of the reporting period. Valuation Process for Fair Value Measurements The Company establishes valuation processes and procedures designed so that fair value measurements are appropriate and reliable, that they are based on observable inputs where possible, and that valuation approaches are consistently applied and the assumptions and inputs are reasonable. The Company has also established processes to provide that the valuation methodologies, techniques and approaches for investments that are categorized within Level 3 of the fair value hierarchy are fair, consistent and verifiable. The Company’s processes provide a framework that ensures the oversight of the Company’s fair value methodologies, techniques, validation procedures, and results. The Company designates a valuation committee (the “Committee”) to oversee the entire valuation process of the Company’s Level 3 investments. The Committee is comprised of various personnel who are responsible for developing the Company’s written valuation policies, processes and procedures, conducting periodic reviews of the valuation policies, and performing validation procedures on the overall fairness and consistent application of the valuation policies and processes and that the assumptions and inputs used in valuation are reasonable. The validation procedures overseen by the Committee are also intended to provide that the values received from external third-party pricing sources are consistent with the Company’s Valuation Policy and are carried at fair value. To the extent that there are no exchange pricing, vendor marks or broker quotes readily available, the Company may use an internal valuation model or other valuation methodology that may be based on unobservable market inputs to fair value the investment. The values provided by a third-party pricing service are calculated based on key inputs provided by the Company including collateral values, unpaid principal balances, cash flow velocity, contractual status and anticipated disposition timelines. In addition, the Company performs an internal valuation used to assess and review the reasonableness and validity of the fair values provided by a third party. The Company also performs analytical procedures, which include automated checks consisting of prior-period variance analysis, comparisons of actual prices to internally calculate expected prices based on observable market changes, analysis of changes in pricing ranges, and relative value and yield comparisons using the Company’s proprietary valuation models. Upon completion of the review process described above, the Company may provide additional quantitative and qualitative data to the third-party pricing service to consider in valuing certain financial assets and liabilities, as applicable. Such data may include deal specific information not included in the data tape provided to the third party, outliers when compared to the unpaid principal balance and collateral value and knowledge of any impending liquidation of an investment. If deemed necessary by the third party and management, the investments are re-valued by the third party to account for the updated information. The following table summarizes the valuation techniques and significant unobservable inputs used for the Company’s financial instruments that are categorized within Level 3 of the fair value hierarchy as of March 31, 2018 using third party information without adjustment: Predominant Weighted Valuation Average Price (In Thousands, except price) Fair Value Technique Type Price Range (a) Loans, held at fair value $ 40,430 Single External Source Third Party Mark $ 101.50 – 101.50 $ 101.50 Mortgage backed securities, at fair value(b) 22,610 Broker Quotes Third Party Mark 67.52 – 73.01 69.36 Mortgage backed securities, at fair value 126 Transaction Price Transaction Price 99.00 – 99.00 99.00 Residential mortgage servicing rights, at fair value 81,591 Single external source Discounted cash flow N/A N/A Contingent consideration 10,732 Single external source Discounted cash flow N/A N/A (a) Prices are weighted based on the unpaid principal balance of the loans and securities included in the range for each class (b) Price ranges and weighted averages exclude interest-only strips with a fair value of $0.5 million as of March 31, 2018. The following table summarizes the valuation techniques and significant unobservable inputs used for the Company’s financial instruments that are categorized within Level 3 of the fair value hierarchy as of December 31, 2017 using third-party information without adjustment: Predominant Weighted Valuation Average Price (In Thousands, except price) Fair Value Technique Type Price Range (a) Loans, held at fair value $ 188,150 Single External Source Third Party Mark $ 101.05 – 104.00 $ 103.35 Mortgage backed securities, at fair value (b) 7,937 Broker Quotes Third Party Mark 70.92 – 70.92 70.92 Mortgage backed securities, at fair value 126 Transaction Price Transaction Price 99.00 – 99.00 99.00 Residential mortgage servicing rights, at fair value 72,295 Single external source Discounted cash flow N/A N/A Contingent consideration 10,016 Single external source Discounted cash flow N/A N/A (a) Prices are weighted based on the unpaid principal balance of the loans and securities included in the range for each class (b) Price ranges and weighted averages exclude interest-only strips with a fair value of $0.5 million as of December 31, 2017. The fair value measurements of these assets are sensitive to changes in assumptions regarding prepayment, probability of default, loss severity in the event of default, forecasts of home prices, and significant activity or developments in the real estate market. Significant changes in any of those inputs in isolation may result in significantly higher or lower fair value measurements. Generally, an increase in the probability of default and loss severity in the event of default would result in a lower fair value measurement. A decrease in these assumptions would have the opposite effect. Conversely, an assumption that the home prices will increase would result in a higher fair value measurement. A decrease in the assumption for home prices would have the opposite effect. Financial instruments not carried at fair value The following table presents the carrying value and estimated fair value of our financial instruments that are not carried at fair value on the unaudited interim consolidated balance sheets and are classified as Level 3: March 31, 2018 December 31, 2017 (In Thousands) Carrying Value Fair Value Carrying Value Fair Value Assets: Loans, net $ 1,959,498 $ 2,009,116 $ 1,665,950 $ 1,737,361 Investment in unconsolidated joint venture 50,229 50,229 55,369 55,369 Servicing rights 23,022 24,763 21,743 23,432 Total assets $ 2,032,749 $ 2,084,108 $ 1,743,062 $ 1,816,162 Liabilities: Secured borrowings $ 657,233 $ 657,233 $ 631,286 $ 631,286 Promissory note 5,883 5,883 6,107 6,107 Securitized debt obligations of consolidated VIEs, net 679,871 695,610 598,148 613,676 Senior secured note, net 178,688 182,737 138,078 144,376 Guaranteed loan financing 278,500 291,340 293,045 306,964 Convertible note, net 109,226 98,721 108,991 108,301 Total liabilities $ 1,909,401 $ 1,931,524 $ 1,775,655 $ 1,810,710 Other assets totaling $12.9 million at March 31, 2018 and $16. 5 million at December 31, 2017 are not carried at fair value and include Due from servicers and Accrued interest, which are reflected in Note 17. Receivable from third parties totaling $11.1 million at March 31, 2018 and $6.8 million at December 31, 2017 are not carried at fair value. For these instruments, carrying value approximates fair value and are classified as Level 3. Accounts payable and other accrued liabilities totaling $10.6 million at March 31, 2018 and $12.4 million at December 31, 2017 are not carried at fair value and include Payable to related parties and Accrued interest payable which are included in Note 17. For these instruments, carrying value approximates fair value and are classified as Level 3.

Mortgage Backed Securities

Mortgage Backed Securities	3 Months Ended
	Mar. 31, 2018
Mortgage Backed Securities
Mortgage Backed Securities	Note 7 – Mortgage Backed Securities The following table presents certain information about the Company’s MBS portfolio, which are classified as trading securities and carried at fair value, as of March 31, 2018. March 31, 2018 Weighted Weighted Average Gross Gross Average Interest Principal Amortized Unrealized Unrealized (In Thousands) Maturity (a) Rate (a) Balance Cost Fair Value Gains Losses MBS Freddie Mac Loans 01/2036 5.1 % $ 61,509 $ 44,672 $ 45,856 $ 2,149 $ (965) Commercial Loans 06/2043 5.6 4,611 1,078 1,199 121 — Tax Liens 09/2026 6.0 127 127 126 — (1) Total 07/2036 5.1 % $ 66,247 $ 45,877 $ 47,181 $ 2,270 $ (966) (a) Weighted based on current principal balance The following table presents certain information about the Company’s MBS portfolio, which are classified as trading securities and carried at fair value, as of December 31, 2017. December 31, 2017 Weighted Weighted Average Gross Gross Average Interest Principal Amortized Unrealized Unrealized (In Thousands) Maturity (a) Rate (a) Balance Cost Fair Value Gains Losses MBS Freddie Mac Loans 12/2034 5.3 % $ 49,767 $ 37,287 $ 38,568 $ 2,529 $ (1,248) Commercial Loans 06/2043 5.5 4,513 1,054 1,228 174 — Tax Liens 09/2026 6.0 127 127 126 — (1) Total 08/2035 5.3 % $ 54,407 $ 38,468 $ 39,922 $ 2,703 $ (1,249) (a) Weighted based on current principal balance The following table presents certain information about the maturity of the Company’s MBS portfolio as of March 31, 2 018 . March 31, 2018 Weighted Average Interest Principal Amortized (In Thousands) Rate (a) Balance Cost Fair Value After five years through ten years 10.3 % $ 6,434 $ 5,810 $ 6,483 After ten years 4.6 59,813 40,067 40,698 Total 5.1 % $ 66,247 $ 45,877 $ 47,181 (a) Weighted based on current principal balance The following table presents certain information about the maturity of the Company’s MBS portfolio as of December 31, 2017. December 31, 2017 Weighted Average Interest Principal Amortized (In Thousands) Rate (a) Balance Cost Fair Value After five years through ten years 8.9 % $ 8,919 $ 8,205 $ 8,904 After ten years 4.6 45,488 30,263 31,018 Total 5.3 % $ 54,407 $ 38,468 $ 39,922 (a) Weighted based on current principal balance

Servicing rights

Servicing rights	3 Months Ended
	Mar. 31, 2018
Servicing rights
Servicing Rights	Note 8 - Servicing rights The Company performs servicing activities for third parties, which primarily include collecting principal, interest and other payments from borrowers, remitting the corresponding payments to investors and monitoring delinquencies. The Company’s servicing fees are specified by pooling and servicing Agreements. The following table presents information about the Company’s portfolios of servicing rights: Three Months Ended March 31, (In Thousands) 2018 2017 SBA servicing rights, at amortized cost Beginning net carrying amount $ 16,684 $ 20,275 Additions due to loans sold, servicing retained 692 218 Amortization (886) (1,108) Impairment (172) (888) Ending net carrying value of SBA servicing rights $ 16,318 $ 18,497 Freddie Mac servicing rights, at amortized cost Beginning net carrying amount $ 5,059 $ 2,203 Additions due to loans sold, servicing retained 1,938 441 Amortization (293) (96) Recovery (Impairment) — (673) Ending net carrying value of Freddie Mac servicing rights $ 6,704 $ 1,875 Ending net carrying value of SBA and Freddie Mac servicing rights, at amortized cost $ 23,022 $ 20,372 Residential mortgage servicing rights, at fair value Beginning Balance $ 72,295 $ 61,376 Additions due to loans sold, servicing retained 5,706 5,052 Loan pay-offs (1,298) (1,250) Unrealized gains (losses) 4,888 (553) Ending fair value of residential mortgage servicing rights $ 81,591 $ 64,625 Total servicing rights $ 104,613 $ 84,997 Servicing rights – SBA and Freddie Mac The Company’s SBA and Freddie Mac servicing rights are carried at the lower of cost or amortized cost. The Company estimates the fair value of the SBA and Freddie Mac servicing rights carried at amortized cost using a combination of internal models and data provided by third-party valuation experts. The assumptions used in our internal models include forward prepayment rates, forward default rates, discount rates, and servicing expenses. The Company’s models calculate the present value of expected future cash flows utilizing assumptions that we believe are used by market participants. We derive forward prepayment rates, forward default rates and discount rates from historical experience adjusted for prevailing market conditions. Components of the estimated future cash flows include servicing fees, late fees, other ancillary fees and cost of servicing. The following table presents additional information about the Company’s SBA and Freddie Mac servicing rights: As of March 31, 2018 As of December 31, 2017 Unpaid Principal Unpaid Principal (In Thousands) Amount Carrying Value Amount Carrying Value SBA $ 437,177 $ 16,318 $ 427,623 $ 16,684 Freddie Mac 676,928 6,704 559,823 5,059 Total $ 1,114,105 $ 23,022 $ 987,446 $ 21,743 The significant assumptions used in the March 31, 2018 and December 31, 2017 estimated valuation of the Company’s SBA and Freddie Mac commercial servicing rights carried at amortized cost include: March 31, 2018 December 31, 2017 Range of input Weighted Range of input Weighted SBA servicing rights (at amortized cost) • Forward prepayment rate - % % - % % • Forward default rate - % % - % % • Discount rate - % % - % % • Servicing expense - % % - % % Freddie Mac commercial servicing rights (at amortized cost) • Forward prepayment rate - % % - % % • Forward default rate - % % - % % • Discount rate - % % - % % • Servicing expense - % % - % % These assumptions can change between and at each reporting period as market conditions and projected interest rates change. The following table reflects the possible impact of 10% and 20% adverse changes to key assumptions on the carrying amount of the Company’s SBA and Freddie Mac servicing rights. (In Thousands) March 31, 2018 December 31, 2017 SBA servicing rights (at amortized cost) • Forward prepayment rate 10% adverse change $ (492) $ (514) 20% adverse change (957) (998) • Default rate 10% adverse change $ (28) $ (24) 20% adverse change (57) (48) • Discount rate 10% adverse change $ (520) $ (520) 20% adverse change (1,007) (1,008) Freddie Mac commercial servicing rights (at amortized cost) • Forward prepayment rate 10% adverse change $ (56) $ (43) 20% adverse change (110) (84) • Default rate 10% adverse change $ (8) $ (6) 20% adverse change (15) (12) • Discount rate 10% adverse change $ (344) $ (270) 20% adverse change (661) (518) The estimated future amortization expense for the servicing rights is expected to be as follows: (In Thousands) March 31, 2018 2018 $ 3,441 2019 3,978 2020 3,360 2021 2,831 2022 2,368 Thereafter 7,044 Total $ 23,022 Residential mortgage servicing rights The Company’s residential mortgage servicing rights consist of conforming conventional loans sold to Fannie Mae and Freddie Mac or loans securitized in Ginnie Mae securities. Similarly, the government loans serviced by the Company are securitized through Ginnie Mae, whereby the Company is insured against loss by the Federal Housing Administration or partially guaranteed against loss by the Department of Veteran Affairs. The following table presents additional information about the Company’s residential mortgage servicing rights carried at fair value: As of March 31, 2018 As of December 31, 2017 Unpaid Principal Unpaid Principal (In Thousands) Amount Fair Value Amount Fair Value Fannie Mae $ 2,608,840 $ 30,347 $ 2,524,897 $ 26,929 Ginnie Mae 2,023,846 24,610 2,134,772 24,135 Freddie Mac 2,184,960 26,634 1,898,786 21,231 Total $ 6,817,646 $ 81,591 $ 6,558,455 $ 72,295 The significant assumptions used in the March 31, 2018 and December 31, 2017 valuation of the Company’s residential mortgage servicing rights carried at fair include: March 31, 2018 December 31, 2017 Range of input Weighted Range of input Weighted Residential mortgage servicing rights (at fair value) • Forward prepayment rate - % % - % % • Discount rate - % % - % % • Servicing expense - % % - % % The following table reflects the possible impact of 10% and 20% adverse changes to key assumptions on the fair value of the Company’s residential mortgage servicing rights. (In Thousands) March 31, 2018 December 31, 2017 Prepayment rate 10% adverse change $ (2,711) $ (2,721) 20% adverse change (5,231) (4,928) Discount rate 10% adverse change $ (3,493) $ (3,029) 20% adverse change (6,708) (5,823) Cost of servicing 10% adverse change $ (1,448) $ (1,230) 20% adverse change (2,895) (2,460)

Gains on residential mortgage b

Gains on residential mortgage banking activities, net of variable loan expenses	3 Months Ended
	Mar. 31, 2018
Gains on residential mortgage banking activities, net of variable loan expenses
Gains on residential mortgage banking activities, net of variable loan expenses	Note 9 – Gains on residential mortgage banking activities, net of variable loan expenses Gains on residential mortgage banking activities, net of variable loan expenses, reflects revenue and expense within our residential mortgage banking business directly related to loan origination and sale activity. This primarily consists of the realized gains on sales of residential loans held for sale and loan origination fee income, offset by direct costs, such as correspondent fee expenses and other direct expenses relating to these loans, which vary based on loan origination volumes. Gains on residential mortgage banking activities, net of direct variable loan expenses, also consists of unrealized gains and losses associated with the changes in fair value of the loans held for sale, the fair value of retained MSR additions, and the realized and unrealized gains and losses from derivative instruments. The following table presents the components of gains on residential mortgage banking activities, net of variable loan expenses, recorded in the Company’s unaudited interim consolidated statements of income. Three Months Ended March 31, (In Thousands) 2018 2017 Realized and unrealized gains and losses of residential mortgage loans held for sale, at fair value $ 6,279 $ 13,394 Creation of new mortgage servicing rights, net of payoffs 4,408 3,803 Loan origination fee income on residential mortgage loans 2,175 1,863 Correspondent fees and other direct loan expenses, including provision for loan indemnification (2,290) (6,975) Unrealized gains (loss) on IRLCs and other derivatives 1,162 (1,576) Total gains on residential mortgage banking activities, net of variable loan expenses $ 11,734 $ 10,509

Secured Borrowings and Promisso

Secured Borrowings and Promissory Note	3 Months Ended
	Mar. 31, 2018
Secured Borrowings and Promissory Note
Secured Borrowings and Promissory Note	Note 10 – Secured Borrowings and Promissory Note The following tables present certain characteristics of our secured borrowings and promissory note: Pledged Assets Carrying Value (In Thousands) Maturity Pricing Facility March 31, December 31, March 31, December 31, Borrowings under credit facilities JPMorgan - Commercial (1) June 2018 L + 3.25 to 3.50% $ 250,000 $ 94,660 $ 107,697 $ 70,846 $ 60,459 Keybank - Commercial (2) February 2019 L + 1.75% 125,000 49,271 67,589 48,519 66,642 Comerica - Residential (3) March 2019 L + 2.125% 150,000 52,294 71,035 59,737 67,336 Associated Bank - Residential loans (3) August 2018 L + 2.125% 40,000 9,006 29,242 8,549 27,699 Origin Bank - Residential loans (3) May 2018 L + 2.25% 40,000 24,334 27,891 22,919 26,538 Total borrowings under credit facilities (8) $ 605,000 $ 229,565 $ 303,454 $ 210,570 $ 248,674 Borrowings under repurchase agreements Deutsche Bank- Commercial (4) February 2020 L + 2.30 to 2.80% $ 275,000 $ 220,303 $ 252,499 $ 137,804 $ 173,811 JPMorgan - Commercial (5) December 2020 L + 2.50 to 4.50% 200,000 82,827 90,829 47,857 55,355 Citibank - Commercial (6) June 2018 L + 2.50% 200,000 208,014 150,707 180,534 88,095 JPMorgan - MBS (7) June 2018 2.91 to 5.39% 48,218 71,966 80,690 48,218 53,325 Citibank - MBS (7) May 2018 3.89% 5,957 11,496 11,496 5,957 5,957 RBC - MBS (7) April 2018 3.34% 4,906 6,357 8,778 4,906 6,069 Mizuho - MBS (7) April 2018 2.79% 21,387 27,857 — 21,387 — Total borrowings under repurchase agreements (9) $ 755,468 $ 628,820 $ 594,999 $ 446,663 $ 382,612 Total secured borrowings $ 1,360,468 $ 858,385 $ 898,453 $ 657,233 $ 631,286 Promissory note payable FCB - Commercial June 2021 2.75% $ 6,554 $ 7,279 $ 7,752 $ 5,883 $ 6,107 Total promissory note payable $ 6,554 $ 7,279 $ 7,752 $ 5,883 $ 6,107 (1) Borrowings are used to finance SBC and SBA loan acquisitions, and SBA loan originations. (2) Borrowings are used to finance Freddie Mac SBC loan originations. (3) Borrowings are used to finance Residential Agency loan originations. (4) Borrowings are used to finance SBC loan originations and Transitional loan originations. (5) Borrowings are used to finance SBC loan originations, Transitional loan originations, and SBC loan acquisitions. (6) Borrowings are used to finance SBC loan originations and SBC loan acquisitions. (7) Borrowings are used to finance Mortgage backed securities and Retained interests in consolidated VIE's. (8) The weighted average interest rate of borrowings under credit facilities was 4.1% and 3.9% as of March 31, 2018 and December 31, 2017, respectively. (9) The weighted average interest rate of borrowings under repurchase agreements was 4.3% and 3.1% as of March 31, 2018 and December 31, 2017, respectively. The following table presents the carrying value of the Company’s collateral pledged with respect to secured borrowings and promissory note payable outstanding with our lenders: Pledged Assets (In Thousands) March 31, December 31, Collateral pledged - borrowings under credit facilities Loans, net $ 229,468 $ 303,133 Real estate acquired in settlement of loans 97 321 Total collateral pledged on borrowings under credit facilities $ 229,565 $ 303,454 Collateral pledged - borrowings under repurchase agreements Loans, net $ 511,145 $ 494,035 Mortgage backed securities 44,718 37,397 Retained interest in assets of consolidated VIEs 72,957 63,567 Total collateral pledged on borrowings under repurchase agreements $ 628,820 $ 594,999 Total collateral pledged on secured borrowings $ 858,385 $ 898,453 Collateral pledged - promissory note payable Loans, net $ 7,279 $ 7,752 Total collateral pledged on promissory note payable $ 7,279 $ 7,752 The agreements governing the Company’s secured borrowings and promissory note require the Company to maintain certain financial and debt covenants. The Company was in compliance with all debt and financial covenants as of March 31, 2018 and December 31, 2017.

Senior secured notes, net and C

Senior secured notes, net and Convertible notes, net	3 Months Ended
	Mar. 31, 2018
Senior secured notes, net and Convertible notes, net
Senior secured notes, net and Convertible notes, net	Note 11 – Senior secured notes, net and Convertible notes, net Senior secured notes, net During 2017, ReadyCap Holdings LLC, a subsidiary of the Company, issued $140.0 million in 7.50% Senior Secured Notes due 2022. On January 30, 2018 ReadyCap Holdings LLC, issued an additional $40.0 million in aggregate principal amount of 7.50% Senior Secured Notes due 2022, which have identical terms (other than issue date and issue price) to the notes issued during 2017 (collectively “the Senior Secured Notes”). The additional $40.0 million in Senior Secured Notes were priced with a yield to par call date of 6.5%. Payments of the amounts due on the Senior Secured Notes are fully and unconditionally guaranteed by the Company and its subsidiaries: Sutherland Partners LP, Sutherland Asset I, LLC, and ReadyCap Commercial, LLC. The funds were used to fund new SBC and SBA loan originations and new SBC loan acquisitions. As of March 31, 2018, we were in compliance with all covenants with respect to the Senior Secured Notes. Convertible notes, net On August 9, 2017, the Company closed an underwritten public sale of $115.0 million aggregate principal amount of its 7.00% convertible senior notes due 2023 (“Convertible Notes”). The Convertible Notes will mature on August 15, 2023, unless earlier repurchased, redeemed or converted. During certain periods and subject to certain conditions, the notes will be convertible by holders into shares of the Company's common stock at an initial conversion rate of 1.4997 shares of common stock per $25 principal amount of the notes, which is equivalent to an initial conversion price of approximately $16.67 per share of common stock. Upon conversion, holders will receive, at the Company's discretion, cash, shares of the Company's common stock or a combination thereof. The Company may redeem all or any portion of the Convertible Notes, at its option, on or after August 15, 2021, at a redemption price payable in cash equal to 100% of the principal amount of the Convertible Notes to be redeemed, plus accrued and unpaid interest. Additionally, upon the occurrence of certain corporate transactions, holders may require the Company to purchase the Convertible Notes for cash at a purchase price equal to 100% of the principal amount of the Convertible Notes to be purchased, plus accrued and unpaid interest. The Convertible Notes will be convertible only upon satisfaction of one or more of the following conditions: (1) the closing market price of the Company’s common stock is greater than or equal to 120% of the conversion price of the respective Convertible Notes for at least 20 out of 30 days prior to the end of the preceding fiscal quarter, (2) the trading price of the Convertible Notes is less than 98% of the product of (i) the conversion rate and (ii) the closing price of the Company’s common stock during any five consecutive trading day period, (3) the Company issues certain equity instruments at less than the 10-day average closing market price of its common stock or the per-share value of certain distributions exceeds the market price of the Company’s common stock by more than 10%, or (4) certain other specified corporate events (significant consolidation, sale, merger share exchange, etc.) occur. At issuance, we allocated $112.7 million and $2.3 million of the carrying value of the Convertible Notes to its debt and equity components, respectively, before the allocation of deferred financing costs. As of March 31, 2018, we were in compliance with all covenants with respect to the Convertible Notes. The following table presents the components of the Senior Secured Notes and Convertible Notes, including the carrying value for the aggregate contractual maturities, on the unaudited interim consolidated balance sheet: (in thousands, except rates) Coupon Rate Maturity Date March 31, 2018 Senior secured notes principal amount (1) 7.50 % 2/15/2022 $ 180,000 Unamortized premium - Senior secured notes 2,899 Unamortized deferred financing costs - Senior secured notes (4,211) Total Senior secured notes, net $ 178,688 2017 Convertible notes - principal amount (2) 7.00 % 8/15/2023 115,000 Unamortized discount - Convertible notes (3) (2,058) Unamortized deferred financing costs - Convertible notes (3,716) Total Convertible notes, net $ 109,226 Total carrying amount of debt components $ 287,914 Total carrying amount of conversion option of equity components recorded in equity $ 2,058 (1) Interest on the Senior Secured Notes is payable semiannually on each February 15 and August 15, beginning on August 15, 2017. (2) Interest on the Convertible Notes is payable quarterly on February 15, May 15, August 15, and November 15 of each year, beginning on November 15, 2017. (3) Represents the discount created by separating the conversion option from the debt host instrument.

Guaranteed loan financing

Guaranteed loan financing	3 Months Ended
	Mar. 31, 2018
Guaranteed loan financing.
Guaranteed loan financing	Note 12 – Guaranteed loan financing Participations or other partial loan sales which do not meet the definition of a participating interest remain as an investment on the unaudited interim consolidated balance sheets and the portion sold is recorded as guaranteed loan financing in the liabilities section of the unaudited interim consolidated balance sheets. For these partial loan sales, the interest earned on the entire loan balance is recorded as interest income and the interest earned by the buyer in the partial loan sale is recorded within interest expense in the accompanying unaudited interim consolidated statements of income. The following table presents guaranteed loan financing and the related interest rates and maturity dates: Weighted Range of Average Interest Range of (In Thousands) Interest Rate Rates Maturities (Years) Ending Balance March 31, 2018 3.75 % 1.70 – 7.25 % 2018 - 2038 $ 278,500 December 31, 2017 3.51 % 1.62 – 7.00 % 2018 - 2038 $ 293,045 The following table summarizes contractual maturities of total guaranteed loan financing outstanding: (In Thousands) March 31, 2018 2018 $ 1,159 2019 2,158 2020 2,846 2021 3,985 2022 4,332 Thereafter 264,020 Total $ 278,500 Our guaranteed loan financings are secured by loans, net of $282.1 million and $296.9 million as of March 31, 2018 and December 31, 201 7 , respectively.

Variable Interest Entities and

Variable Interest Entities and Securitization Activities	3 Months Ended
	Mar. 31, 2018
Variable Interest Entities and Securitization Activities
Variable Interest Entities and Securitization Activities	Note 13 – Variable Interest Entities and Securitization Activities In the normal course of business, we enter into certain types of transactions with entities that are considered to be VIEs. Our primary involvement with VIEs has been related to our securitization transactions in which we transfer assets to securitization trusts. We primarily securitize acquired SBC loans, originated transitional loans, and acquired SBA loans, which provides a source of funding for us and has enabled us to transfer a certain portion of the economic risk of the loans or related debt securities to third parties. We also transfer originated loans to securitization trusts sponsored by third parties, most notably Freddie Mac. Third-party securitizations are securitization entities in which we maintain an economic interest, but do not sponsor. The entity that has a controlling financial interest in a VIE is referred to as the primary beneficiary and is required to consolidate the VIE. The majority of the VIEs in which we have been involved in are consolidated in our financial statements. See Note 3 for a discussion of our accounting policies applied to the consolidation of the VIE and transfer of the loans in connection with the securitization. Securitization-Related VIEs Company sponsored securitizations In a securitization transaction, assets are transferred to a trust, which generally meets the definition of a VIE. Our primary securitization activity is in the form of SBC and SBA loan securitizations, conducted through securitization trusts which we consolidate, as we determined that we are the primary beneficiary. For financial statement reporting purposes, since the underlying trust is consolidated, the securitization is effectively viewed as a financing of the loans that were securitized to enable the senior security to be created and sold to a third-party investor. As such, the senior security is presented on the consolidated balance sheets as securitized debt obligations of consolidated VIEs. The third-party beneficial interest holders in the VIE have no recourse against the Company, except that the Company has an obligation to repurchase assets from the VIE in the event that certain representations and warranties in relation to the loans sold to the VIE are breached. In the absence of such a breach, the Company has no obligation to provide any other explicit or implicit support to any VIE. The securitization trust receives principal and interest on the underlying loans and distributes those payments to the certificate holders. The assets and other instruments held by the securitization trust are restricted in that they can only be used to fulfill the obligations of the securitization trust. The risks associated with the Company’s involvement with the VIE is limited to the risks and rights as a certificate holder of the securities retained by the Company. The consolidation of the securitization transactions includes the senior securities issued to third parties which are shown as securitized debt obligations of consolidated VIEs on the consolidated balance sheets. The following table presents additional information on the Company’s securitized debt obligations: March 31, 2018 December 31, 2017 Current Weighted Current Weighted Principal Carrying Average Principal Carrying Average (In Thousands) Balance value Interest Rate Balance value Interest Rate Waterfall Victoria Mortgage Trust 2011-SBC2 $ 15,295 $ 15,295 5.4 % $ 16,010 $ 16,010 5.3 % Sutherland Commercial Mortgage Loans 2015-SBC4 7,636 7,418 4.0 10,049 9,687 4.0 Sutherland Commercial Mortgage Trust 2017-SBC6 108,357 106,624 3.3 119,784 117,868 3.3 ReadyCap Commercial Mortgage Trust 2014-1 30,565 30,563 4.0 33,953 33,951 3.6 ReadyCap Commercial Mortgage Trust 2015-2 147,311 142,836 4.1 151,993 147,271 4.1 ReadyCap Commercial Mortgage Trust 2016-3 87,415 84,855 3.6 98,733 95,907 3.5 ReadyCap Commercial Mortgage Trust 2018-4 150,344 145,108 4.1 — — — Ready Capital Mortgage Financing 2017-FL1 133,652 130,101 3.1 158,978 154,721 2.8 ReadyCap Lending Small Business Trust 2015-1 19,371 17,071 3.0 25,057 22,733 2.5 Total $ 699,946 $ 679,871 3.7 % $ 614,557 $ 598,148 3.4 % Repayment of our securitized debt will be dependent upon the cash flows generated by the loans in the securitization trust that collateralize such debt. The actual cash flows from the securitized loans are comprised of coupon interest, scheduled principal payments, prepayments and liquidations of the underlying loans. The actual term of the securitized debt may differ significantly from our estimate given that actual interest collections, mortgage prepayments and/or losses on liquidation of mortgages may differ significantly from those expected. Third-party sponsored securitizations For Freddie Mac sponsored securitizations, we determined that we are not the primary beneficiary because we do not have the power to direct the activities that most significantly impact the economic performance of these entities. Specifically, we do not service or manage these entities or otherwise solely hold decision making powers that are significant, which include special servicing decisions. As a result of this assessment, we do not consolidate any of the underlying assets and liabilities of these trusts, we only account for our specific interests in them. Other VIEs Other VIEs include a variable interest that we hold in an acquired joint venture investment that we account for as an equity method investment. We do not consolidate these entities because we do not have the power to direct the activities that most significantly impact their economic performance, we only account for our specific interest in them. Assets and Liabilities of Consolidated VIEs The following table reflects the securitized assets and liabilities for VIEs that we consolidate on our consolidated balance sheets: (In Thousands) March 31, 2018 December 31, 2017 Assets: Cash and cash equivalents $ 75 $ 25 Restricted cash 8,384 15,838 Loans, net 942,894 836,180 Real estate acquired in settlement of loans 3,209 3,443 Accrued interest 4,671 4,261 Due from servicers 9,766 1,915 Total assets 968,999 861,662 Liabilities: Securitized debt obligations of consolidated VIEs, net 679,871 598,148 Total liabilities 679,871 598,148 Assets of Unconsolidated VIEs The following table reflects our variable interests in identified VIEs, of which we are not the primary beneficiary, as of March 31, 2018 and December 31, 2017: Carrying Maximum (1) (In Thousands) March 31, 2018 December 31, 2017 March 31, 2018 December 31, 2017 Assets: Mortgage backed securities, at fair value (2) $ 45,856 $ 38,568 $ 45,856 $ 38,568 Investment in unconsolidated joint venture 50,229 55,369 50,229 55,369 Total assets in unconsolidated VIEs $ 96,085 $ 93,937 $ 96,085 $ 93,937 (1) Maximum exposure to loss is limited to the greater of the fair value or carrying value of the assets as of the consolidated balance sheet date. (2) Retained interest in Freddie Mac sponsored securitizations.

Interest Income and Interest Ex

Interest Income and Interest Expense	3 Months Ended
	Mar. 31, 2018
Interest Income and Interest Expense
Interest Income and Interest Expense	Note 14 – Interest Income and Interest Expense Interest income and interest expense are recorded in the unaudited interim consolidated statements of income and classified based on the nature of the underlying asset or liability. The following table presents the components of interest income and expense: Three Months Ended March 31, (In Thousands) 2018 2017 Interest income Loans Acquired SBA 7(a) loans $ 7,872 $ 9,872 Acquired loans 9,461 10,044 Originated Transitional loans 8,910 4,103 Originated SBC loans, at fair value 2,028 1,626 Originated SBC loans 5,740 5,611 Originated SBA 7(a) loans 843 271 Originated Residential Agency loans 12 200 Total loans (1) $ 34,866 $ 31,727 Held for sale, at fair value, loans Originated Residential Agency loans $ 877 $ 830 Originated Freddie loans 512 183 Acquired loans 13 421 Total loans, held for sale, at fair value $ 1,402 $ 1,434 Mortgage backed securities, at fair value 882 723 Total interest income $ 37,150 $ 33,884 Interest expense Secured borrowings $ (7,182) $ (7,197) Securitized debt obligations of consolidated VIEs (7,202) (5,122) Guaranteed loan financing (2,815) (3,264) Senior secured note (3,239) (790) Convertible note (2,187) — Promissory note (41) (68) Total interest expense $ (22,666) $ (16,441) Net interest income before provision for loan losses $ 14,484 $ 17,443 (1) Includes interest income on loans in consolidated VIEs.

Derivative Instruments

Derivative Instruments	3 Months Ended
	Mar. 31, 2018
Derivative Instruments
Derivative Instruments	Note 15 – Derivative Instruments The Company is exposed to changing interest rates and market conditions, which affects cash flows associated with borrowings. The Company uses derivative instruments to manage interest rate risk and conditions in the commercial mortgage market and, as such, views them as economic hedges. Interest rate swaps are used to mitigate the exposure to changes in interest rates and involve the receipt of variable-rate interest amounts from a counterparty in exchange for making payments based on a fixed interest rate over the life of the swap contract. CDS are executed in order to mitigate the risk of deterioration in the current credit health of the commercial mortgage market. IRLCs are entered into with customers who have applied for residential mortgage loans and meet certain underwriting criteria. These commitments expose GMFS to market risk if interest rates change, and if the loan is not economically hedged or committed to an investor. The Company has not elected hedge accounting for these derivative instruments and, as a result, the fair value adjustments on such instruments are recorded in earnings. The fair value adjustments for interest rate swaps and CDS, along with the related interest income, interest expense and gains/(losses) on termination of such instruments, are reported as a net realized gain/ (loss) on financial instruments on the unaudited interim consolidated statements of income. The fair value adjustments for IRLCs, along with the related interest income, interest expense and gains/(losses) on termination of such instruments, are reported in gains on residential mortgage banking activities, net of variable loan expenses on the unaudited interim consolidated statements of income. The following tables summarize the Company’s use of derivatives and their effect on the unaudited interim consolidated financial statements. Notional amounts included in the table are the average notional amounts on the unaudited interim consolidated balance sheet dates. We believe these are the most relevant measure of volume or derivative activity as they best represent the Company’s exposure to underlying instruments. As of March 31, 2018 the Company had one open credit default swap contract and 44 open interest rate swap contracts with counterparties. As of December 31, 2017 the Company had one open credit default swap contract and 52 open interest rate swap contracts with counterparties. The following table summarizes the Company’s derivatives as of the unaudited interim consolidated balance sheet dates: As of March 31, 2018 As of December 31, 2017 Asset Liability Asset Liability Notional Derivatives Derivatives Notional Derivatives Derivatives (In Thousands) Primary Underlying Risk Amount Fair Value Fair Value Amount Fair Value Fair Value Credit Default Swaps Credit Risk $ 15,000 $ — $ (58) $ 15,000 $ — $ (66) Interest Rate Swaps Interest rate risk 267,771 1,552 (698) 391,381 2,898 (216) Interest rate lock commitments Interest rate risk 236,003 3,470 — 167,533 1,827 — Total $ 518,774 $ 5,022 $ (756) $ 573,914 $ 4,725 $ (282) The following tables summarize the gains and losses on the Company’s derivatives: Three Months Ended March 31, 2018 Net Change in Net Realized Unrealized (In Thousands) Gain (Loss) Gain (Loss) Credit default swaps (1) $ — $ 8 Interest rate swaps (1) 4,555 (1,346) Residential mortgage banking activities interest rate swaps (2) — (482) Interest rate lock commitments (2) — 1,643 Total $ 4,555 $ (177) (1) Gains/ (losses) are recorded in net unrealized gain (loss) on financial instruments or net realized gain (loss) on financial instruments in the consolidated statements of income. Three Months Ended March 31, 2017 Net Change in Net Realized Unrealized (In Thousands) Gain (Loss) Gain (Loss) Credit default swaps (1) $ — $ 30 Interest rate swaps (1) (224) 135 Residential mortgage banking activities interest rate swaps (2) — (264) Interest rate lock commitments (2) — (1,312) Total $ (224) $ (1,411) (1) Gains/ (losses) are recorded in net unrealized gain (loss) on financial instruments or net realized gain (loss) on financial instruments in the consolidated statements of income.

Related Party Transactions

Related Party Transactions	3 Months Ended
	Mar. 31, 2018
Related-Party Transactions
Related Party Transactions	Note 16 – Related Party Transactions Management Agreement The Company has entered into a management agreement with the Manager (the “Management Agreement”), which describes the services to be provided to us by the Manager and compensation for such services. The Manager is responsible for managing the Company’s day-to-day operations, subject to the direction and oversight of the Company’s board of directors. Management Fee Pursuant to the terms of the Management Agreement, our Manager is paid a management fee calculated and payable quarterly in arrears equal to 1.5% per annum of the Company’s stockholders’ equity (as defined in the Management Agreement) up to $500 million and 1.00% per annum of stockholders’ equity in excess of $500 million. The following table presents certain information on the management fee payable to our Manager: For the Three Months Ended March 31, 2018 2017 Management fee - total $ 2.0 million $ 2.0 million Management fee - amount unpaid $ 2.6 million $ 2.4 million Incentive Distribution The Manager is entitled to an incentive distribution in an amount equal to the product of (i) 15% and (ii) the excess of (a) core earnings (as defined in the partnership agreement or our operating partnership) on a rolling four-quarter basis over (b) an amount equal to 8.00% per annum multiplied by the weighted average of the issue price per share of the common stock or OP units multiplied by the weighted average number of shares of common stock outstanding, provided that core earnings over the prior twelve calendar quarters (or the period since the closing of the ZAIS merger, whichever is shorter) is greater than zero. For purposes of determining the incentive distribution payable to our Manager, core earnings is defined under the partnership agreement of our operating partnership in a manner that is similar to the definition of Core Earnings described below under Item 2. “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Non-GAAP Financial Measures” included in this quarterly report on Form 10-Q but with the following additional adjustments which (i) further exclude: (a) the incentive distribution, (b) non-cash equity compensation expense, if any, (c) unrealized gains or losses on SBC loans (not just MBS and MSRs), (d) depreciation and amortization (to the extent we foreclose on any property), and (e) one-time events pursuant to changes in U.S. GAAP and certain other non-cash charges after discussions between our Manager and our independent directors and after approval by a majority of the independent directors and (ii) add back any realized gains or losses on the sales of MBS and on discontinued operations which were excluded from the definition of Core Earnings described under "Non-GAAP Financial Measures". The following table presents certain information on the incentive fee payable to our Manager: For the Three Months Ended March 31, 2018 2017 Incentive fee distribution - total $ 0.4 million $ — Incentive fee distribution - amount unpaid $ 0.4 million $ — The initial term of the Management Agreement extends for three years from the closing of the ZAIS merger and is automatically renewed for one-year terms on each anniversary thereafter. Following the initial term, the Management Agreement may be terminated upon the affirmative vote of at least two-thirds of our independent directors or the holders of a majority of the outstanding common stock (excluding shares held by employees and affiliates of the Manager), based upon (1) unsatisfactory performance by our Manager that is materially detrimental to the Company or (2) a determination that the management fee payable to the Manager is not fair, subject to the Manager’s right to prevent such a termination based on unfair fees by accepting a mutually acceptable reduction of management fees agreed to by at least two-thirds of our independent directors. The Manager must be provided with written notice of any such termination at least 180 days prior to the expiration of the then existing term and will be paid a termination fee equal to three times the sum of the average annual management fee during the 24-month period immediately preceding the date of termination, calculated as of the end of the most recently completed fiscal quarter prior to the date of termination. Expense Reimbursement In addition to the management fees and profit allocation described above, the Company is also responsible for reimbursing the Manager for certain expenses paid by our Manager on behalf of the Company and for certain services provided by the Manager to the Company. Expenses incurred by the Manager and reimbursed by us are typically included in salaries and benefits or general and administrative expense on the unaudited interim consolidated statements of income. The following table presents certain information on reimbursable expenses payable to our Manager: For the Three Months Ended March 31, 2018 2017 Reimbursable expenses payable to our Manager - total $ 0.9 million $ 0.9 million Reimbursable expenses payable to our Manager - amount unpaid $ 0.8 million $ 0.7 million Other In March of 2018, the Company acquired 75 loans, net, from Waterfall Olympic Master Fund Grantor Trust, Series I, II, and III, which are also managed by our Manager for $51.6 million, including interest. The total unpaid principal balance of the loans was $51.8 million.

Other Asset and Other Liabiliti

Other Asset and Other Liabilities	3 Months Ended
	Mar. 31, 2018
Other Asset and Other Liabilities
Other Asset and Other Liabilities	Note 17 – Other Asset and Other Liabilities The following table details the Company’s other assets and other liabilities as of the unaudited interim consolidated balance sheet dates. (In Thousands) March 31, 2018 December 31, 2017 Other assets: Due from servicers $ 6,040 $ 9,964 Intangible assets 3,177 3,264 Accrued interest 6,836 6,494 Real estate acquired in settlement of loans 1,652 1,644 Deferred financing costs 1,765 446 Deferred tax asset 17,155 17,155 Prepaid taxes 3,682 6,014 Other 13,285 11,859 Total other assets $ 53,592 $ 56,840 Accounts payable and other accrued liabilities: Accrued salaries, wages and commissions $ 9,969 $ 16,508 Servicing principal and interest payable 7,168 5,659 Repair and denial reserve 5,797 5,687 Liability under subservicing agreements 1,507 1,496 Unapplied cash 1,786 2,445 Accrued interest payable 7,677 10,317 Payable to related parties 2,961 2,042 Deferred tax liability 18,506 18,506 Other accounts payable and accrued liabilities 9,119 11,976 Total accounts payable and other accrued liabilities $ 64,490 $ 74,636 Real Estate Acquired in Settlement of Loans The Company acquires real estate through the foreclosure of its loans and the occasional purchase of real estate. The Company’s real estate properties are held in the Company’s consolidated TRSs. The following tables summarize the carrying amount of the Company’s real estate holdings as of the unaudited interim consolidated balance sheet dates: (In Thousands) March 31, 2018 December 31, 2017 Illinois 863 863 Florida 324 303 Ohio 172 51 Other 293 427 Total $ 1,652 $ 1,644 Loan indemnification reserve A liability has been established for potential losses related to representations and warranties made by GMFS for loans sold with a corresponding provision recorded for loan indemnification losses. The liability is included in accounts payable and other accrued liabilities in the Company's unaudited interim consolidated balance sheets and the provision for loan indemnification losses is included in gains on residential mortgage banking activities, net of variable loan expenses, in the Company's unaudited interim consolidated statements of income. In assessing the adequacy of the liability, management evaluates various factors including historical repurchases and indemnifications, historical loss experience, known delinquent and other problem loans, outstanding repurchase demand, historical rescission rates and economic trends and conditions in the industry. Actual losses incurred are reflected as a reduction of the reserve liability. At March 31, 2018 and December 31, 2017, the loan indemnification reserve was $1.7 million and $3.0 million, respectively. Because of the uncertainty in the various estimates underlying the loan indemnification reserve, there is a range of losses in excess of the recorded loan indemnification reserve that is reasonably possible. The estimate of the range of possible losses for representations and warranties does not represent a probable loss, and is based on current available information, significant judgment, and a number of assumptions that are subject to change. At March 31, 2018 and December 31, 2017, the reasonably possible loss above the recorded loan indemnification reserve was not considered material.

Other Income and Other Operatin

Other Income and Other Operating Expenses	3 Months Ended
	Mar. 31, 2018
Other Income and Other Operating Expenses
Other Income and Other Operating Expenses	Note 18 – Other Income and Other Operating Expenses The following table details the Company’s other income and operating expenses for the unaudited interim consolidated statements of income. Three Months Ended March 31, (In Thousands) 2018 2017 Other income Origination income 1,153 691 Release/(Increase) of repair and denial reserve (110) 166 Other 291 (17) Total other income $ 1,334 $ 840 Other operating expenses Origination costs 1,856 959 Technology expense 783 911 Charge off of real estate acquired in settlement of loans 19 103 Rent expense 522 559 Recruiting, training and travel expenses 703 467 Other 4,128 2,535 Total other operating expenses $ 8,011 $ 5,534

Stockholders_ Equity

Stockholders’ Equity	3 Months Ended
	Mar. 31, 2018
Stockholders’ Equity
Stockholders’ Equity	Note 19 – Stockholders’ Equity Common stock dividends The following table presents cash dividends declared by our board of directors on our common stock from December 21, 2016 through March 31, 2018: Dividend per Declaration Date Record Date Payment Date Share December 21, 2016 December 30, 2016 January 27, 2017 $ 0.35 March 14, 2017 March 31, 2017 April 13, 2017 $ 0.37 June 15, 2017 June 30, 2017 July 31, 2017 $ 0.37 September 12, 2017 September 29, 2017 October 20, 2017 $ 0.37 December 13, 2017 December 29, 2017 January 31, 2018 $ 0.37 March 14, 2018 March 30, 2018 April 30, 2018 $ 0.37 Stock incentive plan The Company currently maintains the 2012 equity incentive plan (“the 2012 plan”). The 2012 Plan authorizes the Compensation Committee to approve grants of equity-based awards to our officers, directors, and employees of the Manager and its affiliates. The equity incentive plan provides for grants of equity-based awards up to an aggregate of 5% of the shares of the Company’s common stock issued and outstanding from time to time on a fully diluted basis. Refer to Note 23 to the consolidated financial statements included in our Form 10-K for further information regarding this plan. The Company’s current policy for issuing shares upon settlement of stock-based incentive awards is to issue new shares.The fair value of the RSUs and RSAs granted, which is determined based upon the stock price on the grant date, is recorded as compensation expense on a straight - line basis over the vesting periods for the awards, with an offsetting increase in stockholders’ equity. The following table summarizes the Company’s RSU and RSA activity for the three months ended March 31, 2018: Independent Director RSUs Employee RSAs (In Thousands, except share data) Number of Grant date fair value Weighted-average grant date fair value (per share) Number of Grant date fair value Weighted-average grant date fair value (per share) Outstanding, January 1 — $ — $ — 25,851 $ 380 $ 14.70 Granted 23,104 320 13.85 101,670 1,408 13.85 Vested (5,776) (80) 13.85 — — — Forfeited — — — — — — Canceled — — — — — — Outstanding, March 31, 2018 17,328 $ 240 $ 13.85 127,521 $ 1,788 $ 14.02 During the three months ended March 31, 2018 and 2017, the Company recognized $0.2 million and $0.4 million of noncash compensation expense, respectively, related to its stock-based incentive plan in its unaudited interim consolidated statements of income. At March 31 2018 and 2017, approximately $1.5 million and $0.2 million of noncash compensation expense related to unvested awards had not yet been charged to net income. These costs are expected to be amortized into compensation expense ratably over the course of the remainder of the respective vesting periods.

Earnings per Share of Common St

Earnings per Share of Common Stock	3 Months Ended
	Mar. 31, 2018
Earnings per Share of Common Stock
Earnings per Share of Common Stock	Note 20 – Earnings per Share of Common Stock The following table provides information on the basic and diluted earnings per share computations, including the number of shares of common stock used for purposes of these computations: Three Months Ended March 31, (In Thousands, except for share and per share amounts) 2018 2017 Basic Earnings Net income $ 18,518 $ 9,557 Less: Income attributable to non-controlling interest 664 701 Less: Income attributable to participating shares 61 3 Basic earnings $ 17,793 $ 8,853 Diluted Earnings Net income $ 18,518 $ 9,557 Less: Income attributable to non-controlling interest 664 701 Less: Income attributable to participating shares 61 - Diluted earnings $ 17,793 $ 8,856 Number of Shares Basic — Average shares outstanding 32,036,504 30,549,806 Effect of dilutive securities — Unvested participating shares 9,340 - Diluted — Average shares outstanding 32,045,844 30,549,806 Earnings Per Share Attributable to SLD Common Stockholders: Basic $ 0.56 $ 0.29 Diluted $ 0.56 $ 0.29 Participating unvested RSUs were excluded from the computation of diluted shares as their effect was already considered under the more dilutive two-class method used above. Additionally, as of March 31, 2018, there are potential shares of common stock contingently issuable upon the conversion of the Convertible Notes in the future. The Company has asserted its intent and ability to settle the principal amount of the Convertible Notes in cash. Based on this assessment, the Company determined that it would be appropriate to apply a method similar to the treasury stock method, such that contingently issuable common stock is assessed quarterly along with our other potentially dilutive instruments. In order to compute the dilutive effect, the number of shares included in the denominator of diluted EPS is determined by dividing the “conversion spread value” of the share-settled portion (value above accreted value of face value and interest component) of the instrument by the share price. The “conversion spread value” is the value that would be delivered to investors in shares based on the terms of the bond upon an assumed conversion. As of March 31, 2018, the conversion spread value is currently zero, since the closing price of our common stock does not exceed the conversion rate (strike price) and is “out-of-the-money”, resulting in no impact on diluted EPS. Certain investors own OP units in our operating partnership. An OP unit and a share of common stock of the Company have substantially the same economic characteristics in as much as they effectively share equally in the net income or loss of the operating partnership. OP unit holders have the right to redeem their OP units, subject to certain restrictions. The redemption is required to be satisfied in shares of common stock or cash at the Company's option, calculated as follows: one share of the Company's common stock, or cash equal to the fair value of a share of the Company's common stock at the time of redemption, for each OP unit. When an OP unit holder redeems an OP unit, non-controlling interests in the operating partnership is reduced and the Company's equity is increased. At March 31, 2018 and December 31, 2017, the non-controlling interest OP unit holders owned 1,150,827 OP units, respectively.

Offsetting Assets and Liabiliti

Offsetting Assets and Liabilities	3 Months Ended
	Mar. 31, 2018
Offsetting Assets and Liabilities
Offsetting Assets and Liabilities	Note 21 – Offsetting Assets and Liabilities In order to better define its contractual rights and to secure rights that will help the Company mitigate its counterparty risk, the Company may enter into an International Swaps and Derivatives Association (“ISDA”) Master Agreement with multiple derivative counterparties. An ISDA Master Agreement, published by ISDA, is a bilateral trading agreement between two parties that allow both parties to enter into over-the-counter (“OTC”), derivative contracts. The ISDA Master Agreement contains a Schedule to the Master Agreement and a Credit Support Annex, which governs the maintenance, reporting, collateral management and default process (netting provisions in the event of a default and/or a termination event). Under an ISDA Master Agreement, the Company may, under certain circumstances, offset with the counterparty certain derivative financial instruments’ payables and/or receivables with collateral held and/or posted and create one single net payment. The provisions of the ISDA Master Agreement typically permit a single net payment in the event of default including the bankruptcy or insolvency of the counterparty. However, bankruptcy or insolvency laws of a particular jurisdiction may impose restrictions on or prohibitions against the right of offset in bankruptcy, insolvency or other events. In addition, certain ISDA Master Agreements allow counterparties to terminate derivative contracts prior to maturity in the event the Company’s stockholders’ equity decline by a stated percentage or the Company fails to meet the terms of its ISDA Master Agreements, which would cause the Company to accelerate payment of any net liability owed to the counterparty. As of March 31, 2018 and December 31, 201 7 and for the periods then ended, the Company was in good standing on all of its ISDA Master Agreements or similar arrangements with its counterparties. For derivatives traded under an ISDA Master Agreement, the collateral requirements are listed under the Credit Support Annex, which is the sum of the mark to market for each derivative contract, the independent amount due to the derivative counterparty and any thresholds, if any. Collateral may be in the form of cash or any eligible securities, as defined in the respective ISDA agreements. Cash collateral pledged to and by the Company with the counterparty, if any, is reported separately on the unaudited interim consolidated balance sheets as restricted cash. All margin call amounts must be made before the notification time and must exceed a minimum transfer amount threshold before a transfer is required. All margin calls must be responded to and completed by the close of business on the same day of the margin call, unless otherwise specified. Any margin calls after the notification time must be completed by the next business day. Typically, the Company and its counterparties are not permitted to sell, rehypothecate or use the collateral posted. To the extent amounts due to the Company from its counterparties are not fully collateralized, the Company bears exposure and the risk of loss from a defaulting counterparty. The Company attempts to mitigate counterparty risk by establishing ISDA Agreements with only high grade counterparties that have the financial health to honor their obligations and diversification, entering into agreements with multiple counterparties. In accordance with ASU 2013-01, Balance Sheet (Topic 210): Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities , the Company is required to disclose the impact of offsetting of assets and liabilities represented in the unaudited interim consolidated balance sheets to enable users of the unaudited interim consolidated financial statements to evaluate the effect or potential effect of netting arrangements on its financial position for recognized assets and liabilities. These recognized assets and liabilities are financial instruments and derivative instruments that are either subject to enforceable master netting arrangements or ISDA Master Agreements or meet the following right of setoff criteria: (a) the amounts owed by the Company to another party are determinable, (b) the Company has the right to set off the amounts owed with the amounts owed by the counterparty, (c) the Company intends to set off, and (d) the Company’s right of setoff is enforceable by law. As of March 31, 2018 and December 31, 2017, the Company has elected to offset assets and liabilities associated with its OTC derivative contracts in the unaudited interim consolidated balances sheets. The following table provides disclosure regarding the effect of offsetting the Company’s recognized assets and liabilities presented in the unaudited interim consolidated balance sheet as of March 31, 201 8 : Gross Assets Amounts Presented in Gross Amounts Not Offset in the Consolidated Gross Offset in the the Balance Sheets (1) Amounts of Consolidated Consolidated Cash Recognized Balance Balance Financial Collateral (In Thousands) Assets Sheets Sheets Instruments Received Net Amount Interest rate swaps $ 1,552 $ — $ 1,552 $ — $ 1,552 $ — Total $ 1,552 $ — $ 1,552 $ — $ 1,552 $ — Gross Liabilities Amounts Presented in Gross Amounts Not Offset in the Consolidated Gross Offset in the the Balance Sheets (1) Amounts of Consolidated Consolidated Cash Recognized Balance Balance Financial Collateral (In Thousands) Liabilities Sheets Sheets Instruments Paid Net Amount Interest rate swaps $ 698 $ — $ 698 $ — $ 698 $ — Credit default swaps 58 — 58 — 58 — Secured borrowings 657,233 — 657,233 657,233 — — Promissory note 5,883 — 5,883 5,883 — — Total $ 663,872 $ — $ 663,872 $ 663,116 $ 756 $ — (1) Amounts presented in these columns are limited in total to the net amount of assets or liabilities presented in the prior column by instrument. In certain cases, there is excess cash collateral or financial assets we have pledged to a counterparty that exceed the financial liabilities subject to a master netting repurchase arrangement or similar agreement. Additionally, in certain cases, counterparties may have pledged excess cash collateral to us that exceeds our corresponding financial assets. In each case, any of these excess amounts are excluded from the table although they are separately reported in our unaudited interim consolidated balance sheets as assets or liabilities, respectively. The following table provides disclosure regarding the effect of offsetting the Company’s recognized assets and liabilities presented in the unaudited interim consolidated balance sheet as of December 31, 2017: Gross Assets Amounts Presented in Gross Amounts Not Offset in the Consolidated Gross Offset in the the Balance Sheets (1) Amounts of Consolidated Consolidated Cash Recognized Balance Balance Financial Collateral (In Thousands) Assets Sheets Sheets Instruments Received Net Amount Interest rate swaps $ 2,898 $ — $ 2,898 $ — $ 2,898 $ — Total $ 2,898 $ — $ 2,898 $ — $ 2,898 $ — Liabilities Gross Presented in Gross Amounts Not Offset in the Consolidated Gross Amounts the Balance Sheets (1) Amounts of Offset in the Consolidated Cash Recognized Consolidated Balance Financial Collateral (In Thousands) Liabilities Balance Sheets Sheets Instruments Paid Net Amount Interest rate swaps $ 216 $ — $ 216 $ — $ 216 $ — Credit default swaps 66 — 66 — 66 — Secured borrowings 631,286 — 631,286 631,286 — — Promissory note 6,107 — 6,107 6,107 — — Total $ 637,675 $ — $ 637,675 $ 637,393 $ 282 $ — (1) Amounts presented in these columns are limited in total to the net amount of assets or liabilities presented in the prior column by instrument. In certain cases, there is excess cash collateral or financial assets we have pledged to a counterparty that exceed the financial liabilities subject to a master netting repurchase arrangement or similar agreement. Additionally, in certain cases, counterparties may have pledged excess cash collateral to us that exceeds our corresponding financial assets. In each case, any of these excess amounts are excluded from the table although they are separately reported in our unaudited interim consolidated balance sheets as assets or liabilities, respectively .

Financial Instruments with Off-

Financial Instruments with Off-balance Sheet Risk, Credit Risk, and Certain Other Risks	3 Months Ended
	Mar. 31, 2018
Financial Instruments with Off-balance Sheet Risk, Credit Risk, and Certain Other Risks
Financial Instruments with Off-balance Sheet Risk, Credit Risk, and Certain Other Risks	Note 22 – Financial Instruments with Off-balance Sheet Risk, Credit Risk, and Certain Other Risks In the normal course of business, the Company enters into transactions in various financial instruments that expose us to various types of risk, both on and off balance sheet. Such risks are associated with financial instruments and markets in which the Company invests. These financial instruments expose us to varying degrees of market risk, credit risk, interest rate risk, liquidity risk, off balance sheet risk and prepayment risk. Market Risk — Market risk is the potential adverse changes in the values of the financial instrument due to unfavorable changes in the level or volatility of interest rates, foreign currency exchange rates, or market values of the underlying financial instruments. We attempt to mitigate our exposure to market risk by entering into offsetting transactions, which may include purchase or sale of interest-bearing securities and equity securities. Credit Risk — The Company is subject to credit risk in connection with our investments in SBC loans and SBC MBS and other target assets we may acquire in the future. The credit risk related to these investments pertains to the ability and willingness of the borrowers to pay, which is assessed before credit is granted or renewed and periodically reviewed throughout the loan or security term. We believe that loan credit quality is primarily determined by the borrowers' credit profiles and loan characteristics. We seek to mitigate this risk by seeking to acquire assets at appropriate prices given anticipated and unanticipated losses and by deploying a value−driven approach to underwriting and diligence, consistent with our historical investment strategy, with a focus on projected cash flows and potential risks to cash flow. We further mitigate our risk of potential losses while managing and servicing our loans by performing various workout and loss mitigation strategies with delinquent borrowers. Nevertheless, unanticipated credit losses could occur which could adversely impact operating results. The Company is also subject to credit risk with respect to the counterparties to derivative contracts. If a counterparty becomes bankrupt or otherwise fails to perform its obligation under a derivative contract due to financial difficulties, we may experience significant delays in obtaining any recovery under the derivative contract in a dissolution, assignment for the benefit of creditors, liquidation, winding-up, bankruptcy, or other analogous proceeding. In the event of the insolvency of a counterparty to a derivative transaction, the derivative transaction would typically be terminated at its fair market value. If we are owed this fair market value in the termination of the derivative transaction and its claim is unsecured, we will be treated as a general creditor of such counterparty, and will not have any claim with respect to the underlying security. We may obtain only a limited recovery or may obtain no recovery in such circumstances. In addition, the business failure of a counterparty with whom we enter a hedging transaction will most likely result in its default, which may result in the loss of potential future value and the loss of our hedge and force us to cover our commitments, if any, at the then current market price. Counterparty credit risk is the risk that counterparties may fail to fulfill their obligations, including their inability to post additional collateral in circumstances where their pledged collateral value becomes inadequate. The Company attempts to manage its exposure to counterparty risk through diversification, use of financial instruments and monitoring the creditworthiness of counterparties. The Company finances the acquisition of a significant portion of its loans and investments with repurchase agreements and borrowings under credit facilities. In connection with these financing arrangements, the Company pledges its loans, securities and cash as collateral to secure the borrowings. The amount of collateral pledged will typically exceed the amount of the borrowings (i.e., the haircut) such that the borrowings will be over-collateralized. As a result, the Company is exposed to the counterparty if, during the term of the repurchase agreement financing, a lender should default on its obligation and the Company is not able to recover its pledged assets. The amount of this exposure is the difference between the amount loaned to the Company plus interest due to the counterparty and the fair value of the collateral pledged by the Company to the lender including accrued interest receivable on such collateral. GMFS sells loans to investors without recourse. As such, the investors have assumed the risk of loss or default by the borrower. However, GMFS is usually required by these investors to make certain standard representations and warranties relating to credit information, loan documentation and collateral. To the extent that GMFS does not comply with such representations, or there are early payment defaults, GMFS may be required to repurchase the loans or indemnify these investors for any losses from borrower defaults. In addition, if loans pay-off within a specified time frame, GMFS may be required to refund a portion of the sales proceeds to the investors. Liquidity Risk — Liquidity risk arises in our investments and the general financing of our investing activities. It includes the risk of not being able to fund acquisition and origination activities at settlement dates and/or liquidate positions in a timely manner at reasonable prices, in addition to potential increase in collateral requirements during times of heightened market volatility. If we were forced to dispose of an illiquid investment at an inopportune time, we might be forced to do so at a substantial discount to the market value, resulting in a realized loss. We attempt to mitigate our liquidity risk by regularly monitoring the liquidity of our investments in SBC loans, MBS and other financial instruments. Factors such as our expected exit strategy for, the bid to offer spread of, and the number of broker dealers making an active market in a particular strategy and the availability of long-term funding, are considered in analyzing liquidity risk. To reduce any perceived disparity between the liquidity and the terms of the debt instruments in which we invest, we attempt to minimize our reliance on short-term financing arrangements. While we may finance certain investment in security positions using traditional margin arrangements and borrowings under repurchase agreements, other financial instruments such as collateralized debt obligations, and other longer term financing vehicles may be utilized to attempt to provide us with sources of long-term financing. Off‑Balance Sheet Risk —The Company has undrawn commitments on outstanding loans which are disclosed in Note 23. Interest Rate — Interest rate risk is highly sensitive to many factors, including governmental monetary and tax policies, domestic and international economic and political considerations and other factors beyond our control. Our operating results will depend, in part, on differences between the income from our investments and our financing costs. Generally, our debt financing is based on a floating rate of interest calculated on a fixed spread over the relevant index, subject to a floor, as determined by the particular financing arrangement. In the event of a significant rising interest rate environment and/or economic downturn, defaults could increase and result in credit losses to us, which could materially and adversely affect our business, financial condition, liquidity, results of operations and prospects. Furthermore, such defaults could have an adverse effect on the spread between our interest-earning assets and interest-bearing liabilities. Additionally, non-performing SBC loans are not as interest rate sensitive as performing loans, as earnings on non-performing loans are often generated from restructuring the assets through loss mitigation strategies and opportunistically disposing of them. Because non-performing SBC loans are short-term assets, the discount rates used for valuation are based on short-term market interest rates, which may not move in tandem with long-term market interest rates. A rising rate environment often means an improving economy, which might have a positive impact on commercial property values, resulting in increased gains on the disposition of these assets. While rising rates could make it more costly to refinance these assets, we expect that the impact of this would be mitigated by higher property values. Moreover, small business owners are generally less interest rate sensitive than large commercial property owners, and interest cost is a relatively small component of their operating expenses. An improving economy will likely spur increased property values and sales, thereby increasing the need for SBC financing. Prepayment Risk — As we receive prepayments of principal on our investments, premiums paid on such investments will be amortized against interest income. In general, an increase in prepayment rates will accelerate the amortization of purchase premiums, thereby reducing the interest income earned on the investments and this is also affected by interest rate movements. Conversely, discounts on such investments are accreted into interest income. In general, an increase in prepayment rates will accelerate the accretion of purchase discounts, thereby increasing the interest income earned on the investments. An increase in prepayment rates will also adversely affect the fair value of our MSRs.

Commitments, Contingencies and

Commitments, Contingencies and Indemnifications	3 Months Ended
	Mar. 31, 2018
Commitments, Contingencies and Indemnifications
Commitments, Contingencies and Indemnifications	Note 23 – Commitments, Contingencies and Indemnifications Litigation The Company may be subject to litigation and administrative proceedings arising in the ordinary course of its business. The Company has entered into agreements, which provide for indemnifications against losses, costs, claims, and liabilities arising from the performance of individual obligations under such agreements. The Company has had no prior claims or payments pursuant to these agreements. The Company’s individual maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Company that have not yet occurred. However, based on history and experience, the Company expects the risk of loss to be remote. Management is not aware of any other contingencies that would require accrual or disclosure in the unaudited interim consolidated financial statements. Unfunded Loan Commitments As of March 31, 2018, the Company had $2.9 million of unfunded loan commitments related to loans, held for sale, at fair value. As of December 31, 2017, the Company had $ $9.6 million of unfunded loan commitments related to loans, held at fair value. As of March 31, 2018 and December 31, 2017, the Company had $39.3 million and $84.7 million of unfunded loan commitments related to loans, held-for-investment, respectively. Commitments to Originate Loans GMFS enters into IRLCs with customers who have applied for residential mortgage loans and meet certain credit and underwriting criteria. These commitments expose GMFS to market risk if interest rates change, and the loan is not economically hedged or committed to an investor. GMFS is also exposed to credit loss if the loan is originated and not sold to an investor and the borrower does not perform. GMFS enters into IRLCs with customers who have applied for residential mortgage loans and meet certain credit and underwriting criteria. These commitments expose GMFS to market risk if interest rates change, and the loan is not hedged or committed to an investor. GMFS is also exposed to credit loss if the loan is originated and not sold to an investor and the mortgagor does not perform. Commitments to originate loans do not necessarily reflect future cash requirements as some commitments are expected to expire without being drawn upon. As of March 31, 2018 and December 31, 2017, total commitments to originate loans were $224. 1 million and $147.6 million, respectively.

Income Taxes

Income Taxes	3 Months Ended
	Mar. 31, 2018
Income Taxes
Income Taxes	Note 24 – Income Taxes The Company is a REIT pursuant to IRC Section 856. Our qualification as a REIT depends on our ability to meet various requirements imposed by the Internal Revenue Code, which relate to our organizational structure, diversity of stock ownership and certain requirements with regard to the nature of our assets and the sources of our income. As a REIT, we generally must distribute annually at least 90% of our net taxable income, subject to certain adjustments and excluding any net capital gain, in order for U.S. federal income tax not to apply to our earnings that we distribute. To the extent that we satisfy this distribution requirement, but distribute less than 100% of our net taxable income, we will be subject to U.S. federal income tax on our undistributed taxable income. In addition, we will be subject to a 4% nondeductible excise tax if the actual amount that we pay out to our stockholders in a calendar year is less than a minimum amount specified under U.S. federal tax laws. Even if we qualify as a REIT, we may be subject to certain U.S. federal income and excise taxes and state and local taxes on our income and assets. If we fail to maintain our qualification as a REIT for any taxable year, we may be subject to material penalties as well as federal, state and local income tax on our taxable income at regular corporate rates and we would not be able to qualify as a REIT for the subsequent four taxable years. As of March 31, 2018 and December 31, 2017, we are in compliance with all REIT requirements. Certain of our subsidiaries have elected to be treated as taxable REIT subsidiaries (“TRSs”). TRSs permit us to participate in certain activities from which REITs are generally precluded, as long as these activities meet specific criteria, are conducted within the parameters of certain limitations established by the Code, and are conducted in entities which elect to be treated as taxable subsidiaries under the Code. To the extent these criteria are met, we will continue to maintain our qualification as a REIT. The accompanying unaudited interim consolidated financial statements include an interim tax provision for our TRS’ for the three months ended March 31, 2018 and 2017, respectively. Our TRSs engage in various real estate related operations, including originating and securitizing commercial and residential mortgage loans, and investments in real property. The majority of our TRSs are held within the SBC Originations, SBA Originations, Acquisitions and Servicing, and Residential Mortgage Banking segments. Our TRSs are not consolidated for federal income tax purposes, but are instead taxed as corporations. For financial reporting purposes, a provision for current and deferred income taxes is established for the portion of earnings recognized by us with respect to our interest in TRSs. During the three months ended March 31, 2018 and 2017, we recorded an income tax expense of $2.6 million and an income tax expense $1.0 million, respectively. The income tax expense for the above periods primarily related to activities of our taxable REIT subsidiaries and various state and local taxes. There were no material changes to uncertain tax positions or valuation allowance assessments during the quarter.

Segment Reporting

Segment Reporting	3 Months Ended
	Mar. 31, 2018
Segment Reporting
Segment Reporting	Note 25 – Segment Reporting The Company reports its results of operations through the following four business segments: i) Loan Acquisitions , ii) SBC Originations , iii) SBA Originations, Acquisitions and Servicing , and iv) Residential Mortgage Banking . The Company’s organizational structure is based on a number of factors that the Chief Operating Decision Maker (“CODM”), the Chief Executive Officer (“CEO”), uses to evaluate, view, and run its business operations, which includes customer base and nature of loan program types. The segments are based on this organizational structure and the information reviewed by the CODM and management to evaluate segment results. Loan Acquisitions Through the Loan Acquisitions segment, the Company acquires performing and non-performing SBC loans and intends to continue to acquire these loans as part of the Company’s business strategy. SBC Originations Through the SBC Originations segment, the Company originates SBC loans secured by stabilized or transitional investor properties using multiple loan origination channels. Additionally, as part of this segment, we originate and service multi-family loan products under the Freddie Mac program. This segment also reflects the impact of our SBC securitization activities. SBA Originations, Acquisitions, and Servicing Through the SBA Originations, Acquisitions, and Servicing segment, the Company acquires, originates and services loans guaranteed by the SBA under the SBA Section 7(a) Program. This segment also reflects the impact of our SBA securitization activities. Residential Mortgage Banking Through the Residential Mortgage Banking segment, the Company originates residential mortgage loans eligible to be purchased, guaranteed or insured by Fannie Mae, Freddie Mac, FHA, USDA and VA through retail, correspondent and broker channels. Corporate- Other Corporate- Other consists primarily of unallocated corporate financing, including interest expense relating to our senior secured and convertible notes on funds yet to be deployed, allocated employee compensation from our Manager, management and incentive fees paid to our Manager and other general corporate overhead expenses. Segment Realignment Effective at the beginning of the third quarter of 2017, the Company implemented organizational changes to align its segment financial reporting more closely with its current business practices. Securitization activities on originated SBC and SBA loans were transferred out of the Loan Acquisitions segment and into either the SBC originations or SBA originations, acquisitions, and servicing segment, based on loan type. The other change presents Corporate- Other amounts separately and no longer reflecting these amounts as part of the four business segments. Prior period numbers were revised to conform to the new segment alignment and to be consistent with our current period’s presentation. Results of Business Segments and All Other Reportable business segments, along with remaining unallocated amounts recorded within Corporate- Other, for the three months ended March 31, 2018 are summarized in the below table. SBA Originations, Residential Loan SBC Acquisitions, Mortgage Corporate- (In Thousands) Acquisitions Originations and Servicing Banking Other Consolidated Interest income $ 9,688 $ 17,858 $ 8,715 $ 889 $ — $ 37,150 Interest expense (5,831) (12,470) (3,620) (745) — (22,666) Net interest income before provision for loan losses $ 3,857 $ 5,388 $ 5,095 $ 144 $ — $ 14,484 Provision for loan losses (272) 36 69 — — (167) Net interest income after provision for loan losses $ 3,585 $ 5,424 $ 5,164 $ 144 $ — $ 14,317 Non-interest income Gains on residential mortgage banking activities, net of variable loan expenses $ — $ — $ — $ 11,734 $ — $ 11,734 Other income 156 1,259 (123) 42 — 1,334 Income from unconsolidated joint venture 5,739 — — — — 5,739 Servicing income 5 252 1,252 4,901 — 6,410 Total non-interest income $ 5,900 $ 1,511 $ 1,129 $ 16,677 $ — $ 25,217 Non-interest expense Employee compensation and benefits (173) (2,637) (3,255) (9,114) (141) (15,320) Allocated employee compensation and benefits from related party (120) — — — (1,080) (1,200) Professional fees (317) (389) (479) (109) (1,354) (2,648) Management fees – related party — — — — (2,013) (2,013) Incentive fees – related party — — — — (408) (408) Loan servicing expense (808) (631) 76 (2,730) — (4,093) Other operating expenses (818) (2,679) (1,110) (2,700) (704) (8,011) Total non-interest expense $ (2,236) $ (6,336) $ (4,768) $ (14,653) $ (5,700) $ (33,693) Net realized gain on financial instruments 148 8,699 3,385 — — 12,232 Net unrealized gain (loss) on financial instruments (46) (2,367) 533 4,888 — 3,008 Income before provision for income taxes $ 7,351 $ 6,931 $ 5,443 $ 7,056 $ (5,700) $ 21,081 Total Assets $ 609,997 $ 1,223,608 $ 503,512 $ 283,000 $ 20,837 $ 2,640,954 Reportable business segments, along with remaining unallocated amounts recorded within Corporate- Other, for the three months ended March 31, 2017 are summarized in the below table. SBA Originations, Residential Loan SBC Acquisitions, Mortgage Corporate- (In Thousands) Acquisitions Originations and Servicing Banking Other Consolidated Interest income $ 11,188 $ 11,523 $ 10,143 $ 1,030 $ — $ 33,884 Interest expense (7,933) (2,825) (4,008) (686) (989) (16,441) Net interest income before provision for loan losses $ 3,255 $ 8,698 $ 6,135 $ 344 $ (989) $ 17,443 Provision for loan losses (622) (96) (514) — — (1,232) Net interest income after provision for loan losses $ 2,633 $ 8,602 $ 5,621 $ 344 $ (989) $ 16,211 Non-interest income Gains on residential mortgage banking activities, net of variable loan expenses $ — $ — $ — $ 10,509 $ — $ 10,509 Other income (110) 630 302 18 — 840 Servicing income 6 (503) 797 4,142 — 4,442 Total non-interest income $ (104) $ 127 $ 1,099 $ 14,669 $ — $ 15,791 Non-interest expense Employee compensation and benefits (173) (2,026) (2,199) (8,618) (448) (13,464) Allocated employee compensation and benefits from related party (102) — — — (910) (1,012) Professional fees (197) (328) (487) (300) (847) (2,159) Management fees – related party — — — — (1,977) (1,977) Loan servicing expense (666) (481) 1,108 (1,474) — (1,513) Other operating expenses (1,051) (1,547) (839) (1,617) (480) (5,534) Total non-interest expense $ (2,189) $ (4,382) $ (2,417) $ (12,009) $ (4,662) $ (25,659) Net realized gain on financial instruments 306 1,336 1,055 — 269 2,966 Net unrealized gain (loss) on financial instruments 473 1,292 — (553) 70 1,282 Income before provision for income taxes $ 1,119 $ 6,975 $ 5,358 $ 2,451 $ (5,312) $ 10,591 Total Assets $ 566,038 $ 832,057 $ 572,561 $ 314,480 $ 242,386 $ 2,527,522

Subsequent Events

Subsequent Events	3 Months Ended
	Mar. 31, 2018
Subsequent Events
Subsequent Events	Note 27 – Subsequent Events In April 2018, the Company completed the issuance of a public offering of $50.0 million in 6.5% senior notes due April 2021. Interest on the notes will be paid at a rate of 6.5% per annum, payable quarterly in arrears on January 30, April 30, July 30 and October 30 of each year, beginning on July 30, 2018. The Notes will mature on April 30, 2021, unless earlier repurchased or redeemed.

Summary of Significant Accoun35

Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2018
Summary of Significant Accounting Policies
Use of Estimates	Use of Estimates The preparation of the Company’s unaudited interim consolidated financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the unaudited interim consolidated financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates.
Basis of Consolidation	Basis of Consolidation The accompanying unaudited interim consolidated financial statements of the Company include the accounts and results of operations of the Operating Partnership and other consolidated subsidiaries and VIEs in which we are the primary beneficiary. The unaudited interim consolidated financial statements are prepared in accordance with ASC 810, Consolidations. Intercompany accounts and transactions have been eliminated.
Reclassifications	Reclassifications Certain amounts reported for the prior periods in the accompanying unaudited interim consolidated financial statements have been reclassified in order to conform to the current period’s presentation. As described in Note 4, the impact of the retrospective adoption of Accounting Standards Update (“ASU”) 2016-18, Statement of Cash Flows: Restricted Cash , resulted in revisions to prior period numbers to conform with the updated accounting standard and our current period’s presentation. As described in Note 9, the historical results of our Residential mortgage banking segment has been reclassified in the unaudited interim consolidated statements of income to conform to our current period’s presentation of Gains on residential mortgage banking activities, net of variable loan expenses. As described in Note 25, effective at the beginning of the third quarter of 2017, the Company implemented organizational changes to align its segment financial reporting more closely with its current business practices. These organizational changes resulted in securitization activities on originated SBC and SBA loans being transferred out of the Loan Acquisitions segment and into either the SBC originations or SBA originations, acquisitions, and servicing segment, based on the loan type. These organizational changes also resulted in the Company presenting Corporate- Other amounts separately and no longer reflecting these amounts as part of the four business segments. Prior period numbers were revised to conform to the new segment alignment and to be consistent with our current period’s presentation.
Cash and Cash Equivalents	Cash and Cash Equivalents The Company has accounted for cash and cash equivalents in accordance with ASC 305, Cash and Cash Equivalents. The Company defines cash and cash equivalents as cash, demand deposits, and short-term, highly liquid investments with original maturities of 90 days or less when purchased. Cash and cash equivalents are exposed to concentrations of credit risk. We deposit our cash with institutions that we believe to have highly valuable and defensible business franchises, strong financial fundamentals, and predictable and stable operating environments. As of March 31, 2018 and December 31, 2017, the Company had $0.6 million in money market mutual funds, and substantially all of the Company’s cash and cash equivalents not held in money market funds were comprised of cash balances with banks that are in excess of the Federal Deposit Insurance Corporation insurance limits.
Restricted Cash	Restricted Cash Restricted cash represents cash held by the Company as collateral against its derivatives, borrowings under repurchase agreements, borrowings under credit facilities with counterparties, construction and mortgage escrows, as well as cash held for remittance on loans serviced for third parties. Restricted cash is not available for general corporate purposes, but may be applied against amounts due to counterparties under existing swaps and repurchase agreement borrowings, or returned to the Company when the restriction requirements no longer exist or at the maturity of the swap or repurchase agreement.
Short term investments	Short term investments The Company accounts for short-term investments as trading securities under ASC 320, Investments-Debt and Equity Securities . Short-term investments consist of U.S. Treasury Bills with original maturities of less than a year but greater than three months. The Company holds short-term investments at fair value. Interest received and accrued as well as the accretion of purchase discount in connection with short-term investments is recorded as interest income on the unaudited interim consolidated statements of income. Changes in the fair value of short-term investments are recorded as net unrealized gain (loss) on the unaudited interim consolidated statements of income.
Loans, net	Loans, net Loans, net consists of loans, held-for-investment, net of allowance for loan losses and loans, held at fair value. Loans, held-for-investment Loans, held-for-investment are loans acquired from third parties (“acquired loans”), loans originated by ReadyCap that we do not intend to securitize or sell, or securitized loans that were previously originated by ReadyCap. Securitized loans remain on the Company’s balance sheet because the securitization vehicles are consolidated under ASC 810. Acquired loans are recorded at cost at the time they are acquired. Acquired loans are accounted for in accordance with ASC 310-30, Receivables - Loans and Debt Securities Acquired with Deteriorated Credit Quality (“ASC 310-30”) and referred to as “purchased credit impaired loans” (PCI loans) if both of the following conditions are met as of the acquisition date: (i) there is evidence of deterioration in credit quality of the loan since its origination and (ii) it is probable that we will not collect all contractual cash flows on the loan. Acquired loans without evidence of these conditions, securitized loans, and loans originated by ReadyCap that we do not intend to securitize are accounted for under ASC 310-10, Receivables- Overall , (“ASC 310-10”) and are referred to as “Non-purchased credit impaired loans” (non-PCI loans). Purchased Credit Impaired (PCI) Loans The estimated cash flow expected for each loan is estimated at the time the loan is acquired. The excess of the cash flows expected to be collected on PCI loans, measured as of the acquisition date, over the initial investment is referred to as the accretable yield and is recognized in interest income over the remaining life of the loan using the interest method of accretion. The difference between contractually required payments as of the acquisition date and the cash flows expected to be collected is referred to as the non-accretable difference and is not accreted over time. The Company estimates expected cash flows to be collected over the life of individual PCI loans on a quarterly basis. If the Company determines that discounted expected cash flows have decreased, the PCI loans would be considered impaired, which would result in a provision for loan loss and a corresponding increase in the allowance for loan losses. If discounted expected cash flows have increased, or improved, in subsequent evaluations, the increase in cash flows is first used to reverse the amount of any related allowance for loan losses before the yield is adjusted. Additionally, the Company will increase the accretable yield to account for the increase in expected cash flows. The estimate of the amount and timing of cash flows for our PCI loans is based on historical information available and expected future performance of the loans, and may include the timing of expected future cash flows, prepayment speed, default rates, loss severities, delinquency rates, percentage of non-performing loans, extent of credit support available, Fair Isaac Corporation (“FICO”) scores at loan origination, year of origination, loan-to-value ratios, geographic concentrations, as well as reports by credit rating agencies, such as Moody’s, Standard & Poor’s Corporation (“S&P”), or Fitch, general market assessments and dialogue with market participants. As a result, substantial judgment is used in the analysis to determine the expected cash flows. Non-PCI Loans The Company uses the interest method to recognize, as a constant effective yield adjustment, the difference between the initial recorded investment in the loan and the principal amount of the loan. The calculation of the constant effective yield necessary to apply the interest method uses the payment terms required by the loan contract, and prepayments of principal are not anticipated to shorten the loan term. For non-PCI loans, recognition of interest income is suspended when any loans are placed on non-accrual status. Generally, all classes of loans are placed on non-accrual status when principal or interest has been delinquent for 90 days or when full collection is determined not to be probable. Interest income accrued, but not collected, at the date loans are placed on non-accrual status is reversed and subsequently recognized only to the extent it is received in cash or until it qualifies for return to accrual status. However, where there is doubt regarding the ultimate collectability of loan principal, all cash received is applied to reduce the carrying value of such loans. Loans are restored to accrual status only when contractually current and the collection of future payments is reasonably assured. Loans, held at fair value Loans, held at fair value are loans originated by ReadyCap. The Company has elected the fair value option because of the intent to transfer to securitizations in the near term. Interest is recognized as interest income on the unaudited interim consolidated statements of income when earned and deemed collectible. Changes in fair value are recurring and are reported as net unrealized gain (loss) on the unaudited interim consolidated statements of income. The Company transfers loans held at fair value to loans, held-for-investment upon the completion of securitization.
Allowance for loan losses	Allowance for loan losses The allowance for loan losses is intended to provide for credit losses inherent in the loans, held-for-investment portfolio and is reviewed quarterly for adequacy considering credit quality indicators, including probable and historical losses, collateral values, loan-to-value ratio and economic conditions. The allowance for loan losses is increased through provisions for loan losses charged to earnings and reduced by charge-offs, net of recoveries. We determine the allowance for loan losses by measuring credit impairment on (1) an individual basis for non-accrual status loans, and (2) on a collective basis for all other loans with similar risk characteristics. The allowance for loan losses on an individual basis is assessed when a loan is on non-accrual and the recoverability of the loan is less than its carrying value. The Company considers the loans to be collateral dependent and relies on the current fair value of the collateral as the basis for determining impairment. Loans that are not assessed individually for impairment are assessed on a collective basis. For the acquired loans we perform a historical analysis on both cumulative defaults and severity upon default for all loans that were current as of November 4, 2013 when the Company was formed or acquired thereafter. We calculated the cumulative default and loss severity on the acquired loans with delinquency statuses of 90+ days and applied those factors to the current acquired loan population. For the originated loans, our historical data shows a minimal number of defaults, therefore we used an analysis performed on the latest ReadyCap securitization to determine the likelihood of default and to determine loss severity we stressed collateral value to the current principal balance based on the total valuation decline of SBC properties from the peak valuation in 2007 through their post-crisis low in 2010. The determination of allowances for SBA loans is based upon the assignment of a probability of default on a rating scale. Each loan rating is re-evaluated at least annually for loan performance, underlying borrower financial performance or data from third party credit bureaus. The probability of default is compared to the underlying collateral value securing each loan and compared to each loan carrying value to calculate a loss estimate. Collectively the estimated probability of default and recovery value is compared to actual portfolio default and recovery rates as well as economic factors and adjusted when needed. The determination of whether an allowance for loan loss is necessary is based on whether or not there is a decrease in cash flows based on consideration of factual information available at the time of assessment as well as management’s estimates of the future performance and projected amount and timing of cash flows expected to be collected on the loan. While we have a formal methodology to determine the adequate and appropriate level of the allowance for loan losses, estimates of inherent loan losses involve judgment and assumptions as to various factors, including current economic conditions. Our determination of adequacy of the allowance for loan losses is based on quarterly evaluations of the above factors. Accordingly, the provision for loan losses will vary from period to period based on management's ongoing assessment of the adequacy of the allowance for loan losses.
Non-accrual loans	Non-accrual loans Non-accrual loans are the loans for which we are not accruing or accreting interest income. Non-accrual loans include non-PCI loans when principal or interest has been delinquent for 90 days or more or when it is determined that full collection of contractual cash flows is not probable. Additionally, PCI loans for which the Company is unable to reasonably estimate the timing and amount of expected cash flows are considered to be non-accrual loans.
Troubled Debt Restructurings	Troubled Debt Restructurings In situations where, for economic or legal reasons related to the borrower’s financial difficulties, we grant concessions for a period of time to the borrower that we would not otherwise consider, the related loans are classified as troubled debt restructurings (“TDR”). These modified terms may include interest rate reductions, principal forgiveness, term extensions, payment forbearance and other actions intended to minimize our economic loss and to avoid foreclosure or repossession of collateral. For modifications where we forgive principal, the entire amount of such principal forgiveness is immediately charged off. Loans classified as TDRs, are considered impaired loans. Other than resolutions such as foreclosures and sales, we may remove loans held-for-investment from TDR classification, but only if they have been refinanced or restructured at market terms and qualify as a new loan. Generally, all loans modified in a TDR are placed or remain on non-accrual status at the time of the restructuring. However, certain accruing loans modified in a TDR that are current at the time of restructuring may remain on accrual status if payment in full under the restructured terms is expected.
Impaired loans	Impaired loans The Company considers a loan to be impaired when the Company does not expect to collect all of the contractual interest and principal payments as scheduled in the loan agreements. This includes certain non-PCI loans where we do not expect to collect all of the contractual interest and principal payments, as well as PCI loans, which experienced credit deterioration prior to acquisition.
Loans, held for sale, at fair value	Loans, held for sale, at fair value Loans, held for sale, at fair value are loans that are expected to be sold to third parties in the near term. Interest is recognized as interest income on the unaudited interim consolidated statements of income when earned and deemed collectible. For loans originated by our SBC originations and SBA originations segments, changes in fair value are recurring and are reported as net unrealized gain (loss) on the unaudited interim consolidated statements of income. For originated SBA loans, the guaranteed portion is held for sale, at fair value. For loans originated by GMFS, changes in fair value are reported as gains on residential mortgage banking activities, net of variable loan expenses, on the unaudited interim consolidated statements of income. The Company transfers loans held for sale, at fair value to loans, held-for-investment when the Company no longer intends to sell the loans.
Mortgage backed securities, at fair value	Mortgage backed securities, at fair value The Company accounts for MBS as trading securities and are carried at fair value under ASC 320, Investments-Debt and Equity Securities. Our MBS portfolio is comprised of asset-backed securities collateralized by interest in or obligations backed by pools of SBC loans. Purchases and sales of MBS are recorded on the trade date. Our MBS securities pledged as collateral against borrowings under repurchase agreements are included in mortgage backed securities, at fair value on our unaudited interim consolidated balance sheets. MBS are recorded at fair value as determined by market prices provided by independent broker dealers or other independent valuation service providers. The fair values assigned to these investments are based upon available information and may not reflect amounts that may be realized. We generally intend to hold our investment in MBS to generate interest income; however, we have and may continue to sell certain of our investment securities as part of the overall management of our assets and liabilities and operating our business.
Loans eligible for repurchase from Ginnie Mae	Loans eligible for repurchase from Ginnie Mae When the Company has the unilateral right to repurchase Ginnie Mae pool loans it has previously sold (generally loans that are more than 90 days past due), the Company then records the right to repurchase the loan as an asset and liability in its unaudited interim consolidated balance sheets. Such amounts reflect the unpaid principal balance of the loans.
Derivative instruments, at fair value	Derivative instruments, at fair value Subject to maintaining our qualification as a REIT for U.S. federal income tax purposes, we utilize derivative financial instruments, currently comprised of credit default swaps (“CDSs”), interest rate swaps, and interest rate lock commitments (“IRLCs”) as part of our risk management. The Company accounts for derivative instruments under ASC 815, Derivatives and Hedges . All derivatives are reported as either assets or liabilities on the unaudited interim consolidated balance sheets at the estimated fair value with the changes in the fair value recorded in earnings. Although permitted under certain circumstances, generally the Company does not offset cash collateral receivable or payables against our gross derivative positions. As of March 31, 2018 there was no cash collateral receivable held for derivatives. As of December 31, 2017, the cash collateral receivable held for derivative instruments is $0.8 million and is included in restricted cash on the unaudited interim consolidated balance sheets. Interest Rate Swap Agreements An interest rate swap is an agreement between two counterparties to exchange periodic interest payments where one party to the contract makes a fixed-rate payment in exchange for a floating-rate payment from the other party. The dollar amount each party pays is an agreed-upon periodic interest rate multiplied by some pre-determined dollar principal (notional amount). No principal (notional amount) is exchanged between the two parties at trade initiation date. Only interest payments are exchanged. Interest rate swaps are classified as Level 2 in the fair value hierarchy. The fair value adjustments, along with the related interest income or interest expense, are reported as net gain/(loss) on financial instruments. Interest Rate Lock Commitments (“IRLCs”) IRLCs are agreements under which GMFS agrees to extend credit to a borrower under certain specified terms and conditions in which the interest rate and the maximum amount of the loan are set prior to funding. Unrealized gains and losses on the IRLCs, reflected as derivative assets and derivative liabilities, respectively, are measured based on the value of the underlying mortgage loan, quoted government-sponsored enterprise Fannie Mae, Freddie Mac, and the Government National Mortgage Association ((“Ginnie Mae”), collectively, “GSEs”) or MBS prices, estimates of the fair value of the mortgage servicing rights (“MSRs”) and the probability that the mortgage loan will fund within the terms of the IRLC, net of commission expense and broker fees. The realized and unrealized gains or losses are reported on the unaudited interim consolidated statements of income as gains on residential mortgage banking activities, net of variable loan expenses. IRLCs are classified as Level 3 in the fair value hierarchy. CDS CDS are contracts between two parties, a protection buyer who makes fixed periodic payments, and a protection seller, who collects the premium in exchange for making the protection buyer whole in the case of default. The fair value adjustments, along with the related interest income or interest expense, are reported as gain/(loss) on financial instruments. CDS are classified as Level 2 in the fair value hierarchy.
Servicing rights	Servicing rights Servicing rights initially represent the fair value of expected future cash flows for performing servicing activities for others. The fair value considers estimated future servicing fees and ancillary revenue, offset by estimated costs to service the loans, and generally declines over time as net servicing cash flows are received, effectively amortizing the servicing right asset against contractual servicing and ancillary fee income. Servicing rights are recognized upon sale or securitization of loans if servicing is retained. For servicing rights, gains related to servicing rights retained is included in net realized gain/(loss) on the unaudited interim consolidated statements of income. For residential mortgage servicing rights, gains on servicing rights retained upon sale of a loan are included in gains on residential mortgage banking activities, net of variable loan expenses, on the unaudited interim consolidated statements of income. The Company treats its servicing rights and residential mortgage servicing rights as two separate classes of servicing assets based on the class of the underlying mortgages and it treats these assets as two separate pools for risk management purposes. Servicing rights relating to the Company’s servicing of loans guaranteed by the SBA under its Section 7(a) loan program and servicing rights related to the Freddie Mac program are accounted for under ASC 860, Transfers and Servicing, while the Company’s residential mortgage servicing rights are accounted for under the fair value option under ASC 825, Financial Instruments. Servicing rights – SBA and Freddie Mac SBA and Freddie Mac servicing rights are initially recorded at fair value and subsequently carried at amortized cost. We capitalize the value expected to be realized from performing specified servicing activities for others. Servicing rights are amortized in proportion to and over the period of estimated servicing income, and are evaluated for potential impairment quarterly. For purposes of testing our servicing rights for impairment, we first determine whether facts and circumstances exist that would suggest the carrying value of the servicing asset is not recoverable. If so, we then compare the net present value of servicing cash flow with its carrying value. The estimated net present value of servicing cash flows is determined using discounted cash flow modeling techniques, which require management to make estimates regarding future net servicing cash flows, taking into consideration historical and forecasted loan prepayment rates, delinquency rates and anticipated maturity defaults. If the carrying value of the servicing rights exceeds the net present value of servicing cash flows, the servicing rights are considered impaired and an impairment loss is recognized in earnings for the amount by which carrying value exceeds the net present value of servicing cash flows. We leverage all available relevant market data to determine the fair value of our recognized servicing assets. Since quoted market prices for servicing rights are not readily available, we estimate the fair value of servicing rights by determining the present value of future expected servicing cash flows using modeling techniques that incorporate management's best estimates of key variables including estimates regarding future net servicing cash flows, forecasted loan prepayment rates, delinquency rates, and return requirements commensurate with the risks involved. Cash flow assumptions are modeled using our internally forecasted revenue and expenses, and where possible, the reasonableness of assumptions is periodically validated through comparisons to market data. Prepayment speed estimates are determined from historical prepayment rates or obtained from third-party industry data. Return requirement assumptions are determined using data obtained from market participants, where available, or based on current relevant interest rates plus a risk-adjusted spread. We also consider other factors that can impact the value of the servicing rights, such as surety provider termination clauses and servicer terminations that could result if we failed to materially comply with the covenants or conditions of our servicing agreements and did not remedy the failure. Since many factors can affect the estimate of the fair value of servicing rights, we regularly evaluate the major assumptions and modeling techniques used in our estimate and review these assumptions against market comparables, if available. We monitor the actual performance of our servicing rights by regularly comparing actual cash flow, credit, and prepayment experience to modeled estimates. Servicing rights - Residential (carried at fair value) The Company’s residential mortgage servicing rights consist of conforming conventional residential loans sold to Fannie Mae and Freddie Mac or loans securitized in Ginnie Mae securities. Government insured loans serviced by the Company are securitized through Ginnie Mae, whereby the Company is insured against loss by the Federal Housing Administration or partially guaranteed against loss by the Department of Veterans Affairs. The Company has elected to account for its portfolio of residential mortgage servicing rights (“MSRs”) at fair value. For these assets, the Company uses a third-party vendor to assist management in estimating the fair value. The third-party vendor uses a discounted cash flow approach which consists of projecting servicing cash flows discounted at a rate that management believes market participants would use in their determinations of fair value. The key assumptions used in the estimation of the fair value of MSRs include prepayment rates, discount rates, default rates, and cost of servicing rates. Residential MSRs are classified as Level 3 in the fair value hierarchy.
Intangible assets	Intangible assets Intangible assets are accounted for under ASC 350, Intangibles-Goodwill and Other . As of March 31, 2018 and December 31, 2017, the Company’s identifiable intangible assets include SBA license for our lending operations as well as a trade name, a favorable lease, and other licenses relating to our residential mortgage banking segement, obtained as part of the ZAIS Financial merger transaction. The Company determined that its SBA license has an indefinite life, while the other intangibles acquired as part of the ZAIS Financial merger transaction are finite-lived. The Company amortizes intangible assets with identified estimated useful lives on a straight-line basis over their estimated useful lives. The Company initially records its intangible assets at cost and subsequently tests for impairment on an annual basis. Intangible assets are included within other assets on the unaudited interim consolidated balance sheets.
Investment in unconsolidated joint venture	Investment in unconsolidated joint venture In November of 2017, the Company acquired an interest in an SBC loan pool through a joint venture, WFLLA, LLC, which the Company has a 50% interest. According to ASC 323, Equity Method and Joint Ventures , investors in unincorporated entities such as partnerships and unincorporated joint ventures generally shall account for their investments using the equity method of accounting if the investor has the ability to exercise significant influence over the investee. Under the equity method, we recognize our share of the earnings or losses of the investment monthly in earnings and adjust the carrying amount for our share of the earnings or losses based on our equity ownership. Pursuant to the consolidation guidance, we determined our interest in the entity is a VIE, however, we do not consolidate the entity as we determined that we are not the primary beneficiary. The Company is determined to be the primary beneficiary only when it has a controlling financial interest in the VIE, which is defined as possessing both (i) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE.
Deferred financing costs	Deferred financing costs Costs incurred in connection with our secured borrowings are accounted for under ASC 340, Other Assets and Deferred Costs . Deferred costs are capitalized and amortized using the effective interest method over the respective financing term with such amortization reflected on our unaudited interim consolidated statements of income as a component of interest expense. Our deferred financing costs may include legal, accounting and other related fees. Unamortized deferred financing costs are expensed when the associated debt is refinanced or repaid before maturity. Pursuant to the adoption of ASU 2015-03, unamortized deferred financing costs related to securitizations and note issuances are presented on the unaudited interim consolidated balance sheets as a direct deduction from the associated liability.
Due from Servicers	Due from Servicers The loan servicing activities of the Company’s SBC Loan Acquisitions and SBC Originations reportable segments are performed primarily by third-party servicers. SBA loans originated by and held at RCL are internally serviced. Residential mortgage loans originated by and held at GMFS are both serviced by third-party servicers and internally serviced. The Company’s servicers hold substantially all of the cash owned by the Company related to loan servicing activities. These amounts include principal and interest payments made by borrowers, net of advances and servicing fees. Cash is generally received within thirty days of recording the receivable. The Company is subject to credit risk to the extent any servicer with whom the Company conducts business is unable to deliver cash balances or process loan-related transactions on the Company’s behalf. The Company monitors the financial condition of the servicers with whom the Company conducts business and believes the likelihood of loss under the aforementioned circumstances is remote.
Secured borrowings	Secured borrowings Secured borrowings include borrowings under credit facilities and borrowings under repurchase agreements. Borrowings under credit facilities The Company accounts for borrowings under credit facilities under ASC 470, Debt. The Company partially finances its loans, net through credit agreements with various counterparties. These borrowings are collateralized by loans, held-for-investment, and loans, held for sale, at fair value and have maturity dates within two years from the unaudited interim consolidated balance sheet date. If the fair value (as determined by the applicable counterparty) of the collateral securing these borrowings decreases, we may be subject to margin calls during the period the borrowings are outstanding. In instances where we do not satisfy the margin calls within the required time frame, the counterparty may retain the collateral and pursue collection of any outstanding debt amount from us. Interest paid and accrued in connection with credit facilities is recorded as interest expense on the unaudited interim consolidated statements of income. Borrowing under repurchase agreements Borrowings under repurchase agreements are accounted for under ASC 860, Transfers and Servicing . Investment securities financed under repurchase agreements are treated as collateralized borrowings, unless they meet sale treatment or are deemed to be linked transactions. Through March 31, 2018, none of our repurchase agreements have been accounted for as components of linked transactions. All securities financed through a repurchase agreement have remained on our unaudited interim consolidated balance sheets as an asset and cash received from the lender was recorded on our unaudited interim consolidated balance sheets as a liability. Interest paid and accrued in connection with our repurchase agreements is recorded as interest expense on the unaudited interim consolidated statements of income.
Promissory note	Promissory note The Company accounts for promissory notes under ASC 470, Debt. There are no debt issuance costs associated with the outstanding note. The note is collateralized by loans, held-for-investment and have maturity dates within five years from the unaudited interim consolidated balance sheet date. Interest paid and accrued in connection with the promissory note is recorded as interest expense on the unaudited interim consolidated statements of income.
Securitized debt obligations of consolidated VIEs, net	Securitized debt obligations of consolidated VIEs, net Since 2011, we have engaged in several securitization transactions, which the Company accounts for under ASC 810. Securitization involves transferring assets to an SPE, or securitization trust, to convert all or a portion of those assets into cash before they would have been realized in the normal course of business, through the SPE’s issuance of debt instruments. The entity that has a controlling financial interest in a VIE is referred to as the primary beneficiary and is required to consolidate the VIE. The consolidation of the SPE includes the issuance of senior securities to third parties, which are shown as securitized debt obligations of consolidated VIEs on the consolidated balance sheets. Debt issuance costs related to securitizations are presented as a direct deduction from the carrying value of the related debt liability. Debt issuance costs are amortized using the effective interest method and are included in interest expense from securitized debt obligations on the unaudited interim consolidated financial statements.
Convertible note, net	Convertible note, net ASC 470, Debt , requires the liability and equity components of convertible debt instruments that may be settled in cash upon conversion to be separately accounted for in a manner that reflects the issuer’s nonconvertible debt borrowing rate. ASC 470-20 requires that the initial proceeds from the sale of these notes be allocated between a liability component and an equity component in a manner that reflects interest expense at the interest rate of similar nonconvertible debt that could have been issued by the Company at such time. We measured the estimated fair value of the debt component of our convertible notes as of the issuance date based on our nonconvertible debt borrowing rate. The equity components of the convertible senior notes have been reflected within additional paid-in capital in our unaudited interim consolidated balance sheet, and the resulting debt discount is amortized over the period during which the convertible notes are expected to be outstanding (through the maturity date) as additional non-cash interest expense. Upon repurchase of convertible debt instruments, ASC 470-20 requires the issuer to allocate total settlement consideration, inclusive of transaction costs, amongst the liability and equity components of the instrument based on the fair value of the liability component immediately prior to repurchase. The difference between the settlement consideration allocated to the liability component and the net carrying value of the liability component, including unamortized debt issuance costs, would be recognized as gain (loss) on extinguishment of debt in our unaudited interim consolidated statements of operations. The remaining settlement consideration allocated to the equity component would be recognized as a reduction of additional paid-in capital in our unaudited interim consolidated balance sheets.
Senior secured note, net	Senior secured note, net The Company accounts for secured debt offerings under ASC 470, Debt. Pursuant to the adoption of ASU 2015-03, the Company’s senior secured note is presented net of debt issuance costs. These senior secured notes are collateralized by loans, MBS, and retained interests of consolidated VIE’s. Interest paid and accrued in connection with senior secured notes is recorded as interest expense on the unaudited interim consolidated statements of income.
Guaranteed loan financing	Guaranteed loan financing Certain partial loan sales do not qualify for sale accounting under ASC 860, Transfers and Servicing because these sales do not meet the definition of a “participating interest,” as defined in the guidance, in order for sale treatment to be allowed. Participations or other partial loan sales which do not meet the definition of a participating interest remain as an investment on the unaudited interim consolidated balance sheets and the proceeds from the portion sold is recorded as guaranteed loan financing in the liabilities section of the unaudited interim consolidated balance sheets. For these partial loan sales, the interest earned on the entire loan balance is recorded as interest income and the interest earned by the buyer in the partial loan sale is recorded within interest expense in the accompanying unaudited interim consolidated statements of income.
Contingent consideration	Contingent consideration Contingent consideration represents future payments of cash or equity interests to the former owners of GMFS, which was acquired on October 31, 2016. The contingent consideration was initially recorded on the date of acquisition at fair value in the unaudited interim consolidated balance sheet and is subsequently remeasured each reporting period at fair value with the change in the fair value recorded in earnings in the accompanying unaudited interim consolidated statements of income.
Repair and denial reserve	Repair and denial reserve The repair and denial reserve represents the potential liability to the SBA in the event that we are required to make whole the SBA for reimbursement of the guaranteed portion of SBA loans. We may be responsible for the guaranteed portion of SBA loans if there are lien and collateral issues, unauthorized use of proceeds, liquidation deficiencies, undocumented servicing actions or denial of SBA eligibility. This reserve is calculated using an estimated frequency of a repair and denial event upon default, as well as an estimate of the severity of the repair and denial as a percentage of the guaranteed balance.
Variable Interest Entities	Variable Interest Entities VIEs are entities that, by design, either (i) lack sufficient equity to permit the entity to finance its activities without additional subordinated financial support from other parties; or (ii) have equity investors that do not have the ability to make significant decisions relating to the entity’s operations through voting rights, or do not have the obligation to absorb the expected losses, or do not have the right to receive the residual returns of the entity. The entity that has a financial interest in a VIE is referred to as the primary beneficiary and is required to consolidate the VIE. An entity is deemed to be the primary beneficiary of a VIE if the entity has both (i) the power to direct the activities that most significantly impact the VIE’s economic performance and (ii) the right to receive benefits from the VIE or the obligation to absorb losses of the VIE that could be significant to the VIE. In determining whether we are the primary beneficiary of a VIE, we consider both qualitative and quantitative factors regarding the nature, size and form of our involvement with the VIE, such as our role establishing the VIE and our ongoing rights and responsibilities, the design of the VIE, our economic interests, servicing fees and servicing responsibilities, and other factors. We perform ongoing reassessments to evaluate whether changes in the entity’s capital structure or changes in the nature of our involvement with the entity result in a change to the VIE designation or a change to our consolidation conclusion.
Non-controlling Interests	Non-controlling Interests Non-controlling interests, which are presented on the unaudited interim consolidated balance sheets and the unaudited interim consolidated statements of income, represent direct investment in the Operating Partnership by Sutherland OP Holdings II, Ltd., which is managed by our Manager, and third parties.
Fair Value Option	Fair Value Option The guidance in ASC 825, Financial Instruments , provides a fair value option election that allows entities to make an irrevocable election of fair value as the initial and subsequent measurement attribute for certain eligible financial assets and liabilities. Unrealized gains and losses on items for which the fair value option has been elected are reported in earnings. The decision to elect the fair value option is determined on an instrument by instrument basis and must be applied to an entire instrument and is irrevocable once elected. Assets and liabilities measured at fair value pursuant to this guidance are required to be reported separately in our unaudited interim consolidated balance sheets from those instruments using another accounting method. We have elected the fair value option for certain loans held-for-sale originated by ReadyCap that the Company intends to securitize or sell in the near term. The fair value elections for loans, held at fair value originated by ReadyCap were made due to the short-term nature of these instruments. We have elected the fair value option for loans held-for-sale originated by GMFS that the Company intends to sell in the near term. We have elected the fair value option for certain residential mortgage servicing rights acquired as part of the merger transaction.
Earnings per Share	Earnings per Share We present both basic and diluted earnings per share (“EPS”) amounts in our unaudited interim statements of income. Basic EPS excludes dilution and is computed by dividing income available to common stockholders by the weighted-average number of shares of common stock outstanding for the period. Diluted EPS reflects the maximum potential dilution that could occur from our share-based compensation, consisting of unvested restricted stock units (“RSUs”), unvested restricted stock awards (“RSAs”), as well as “in-the-money” conversion options associated with our outstanding convertible senior notes. Potential dilutive shares are excluded from the calculation if they have an anti-dilutive effect in the period.. All of the Company’s unvested RSUs and unvested RSAs contain rights to receive non-forfeitable dividends and, thus, are participating securities. Due to the existence of these participating securities, the two-class method of computing EPS is required, unless another method is determined to be more dilutive. Under the two-class method, undistributed earnings are reallocated between shares of common stock and participating securities.
Income Taxes	Income Taxes GAAP establishes financial accounting and reporting standards for the effect of income taxes. The objectives of accounting for income taxes are to recognize the amount of taxes payable or refundable for the current period and deferred tax liabilities and assets for the future tax consequences of events that have been recognized in an entity’s unaudited interim consolidated financial statements or tax returns. We assess the recoverability of deferred tax assets through evaluation of carryback availability, projected taxable income and other factors as applicable. Significant judgment is required in assessing the future tax consequences of events that have been recognized in our unaudited interim consolidated financial statements or tax returns as well as the recoverability of amounts we record, including deferred tax assets. We provide for exposure in connection with uncertain tax positions, which requires significant judgment by management including determination, based on the weight of the tax law and available evidence, that it is more-likely-than-not that a tax result will be realized. Our policy is to recognize interest and/or penalties related to income tax matters in income tax expense on our unaudited interim consolidated statements of income. As of March 31, 2018 and December 31, 2017, we accrued no taxes, interest or penalties related to uncertain tax positions. In addition, we do not anticipate a change in this position in the next 12 months.
Revenue Recognition	Revenue Recognition On January 1, 2018, new accounting rules regarding revenue recognition became effective for public companies with a calendar fiscal year. Under the new accounting rules regarding revenue, revenue is recognized upon the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Revenue is recognized through the following five-step process: Step 1: Identify the contract(s) with a customer. Step 2: Identify the performance obligations in the contract. Step 3: Determine the transaction price. Step 4: Allocate the transaction price to the performance obligations in the contract. Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. Since the updated guidance does not apply to revenue associated with financial instruments, including interest income, realized or unrealized gains on financial instruments, loan servicing fees, loan origination fees, among other revenue streams, the adoption of this standard did not have a material impact on our unaudited interim consolidated financial statements. The revenue recognition guidance also included revisions to existing accounting rules regarding the determination of whether a company is acting as a principal or agent in an arrangement and accounting for sales of nonfinancial assets where the seller has continuing involvement. These additional revisions also did not materially impact the Company. Interest Income Interest income on non-PCI loans, held-for-investment, loans, held at fair value, loans, held for sale, at fair value, and MBS, at fair value is accrued based on the outstanding principal amount and contractual terms of the instrument. Discounts or premiums associated with the loans and investment securities are amortized or accreted into interest income as a yield adjustment on the effective interest method, based on contractual cash flows through the maturity date of the investment. On at least a quarterly basis, we review and, if appropriate, make adjustments to the accrual status of the asset. If the asset has been delinquent for the previous 90 days, the asset status will turn to non-accrual, and recognition of interest income will be suspended until the asset resumes contractual payments for three consecutive months. Realized Gains (Losses) Upon the sale or disposition (not including the prepayment of outstanding principal balance) of loans or securities, the excess (or deficiency) of net proceeds over the net carrying value or cost basis of such loans or securities is recognized as a realized gain/loss. Origination Income and Expense Origination income represents fees received for origination of either loans, held at fair value, loans, held for sale, at fair value, or loans, held-for-investment. For loans held, at fair value, and loans, held for sale, at fair value, pursuant to ASC 825, the Company reports origination fee income as revenue and fees charged and costs incurred as expenses. These fees and costs are excluded from the fair value. For originated loans, held-for-investment, under ASC 310-10, the Company defers these origination fees and costs at origination and amortizes them under the effective interest method over the life of the loan. Origination fees and expenses for ReadyCap loans, held at fair value and loans, held for sale, at fair value, are presented in the unaudited interim consolidated statements of income in other income and operating expenses. Origination fees and expenses for residential mortgage loans originated by GMFS are presented in the unaudited interim consolidated statements of income in gains of residential mortgage banking activities, net of variable loan expenses. The amortization of net origination fees and expenses for loans, held-for-investment are presented in the unaudited interim consolidated statements of income in interest income.
Gains on Residential Mortgage Banking Activities, net of variable loan expenses	Gains on Residential Mortgage Banking Activities, net of variable loan expenses Gains on residential mortgage banking activities, net of variable loan expenses, reflects variable revenue and expense within our residential mortgage banking business directly related to loan origination and sale activity. This primarily consists of the realized gains on sales of residential loans held for sale and loan origination fee income, offset by direct costs, such as correspondent fee expenses and other direct expenses relating to these loans, which vary based on loan origination volumes. Gains on residential mortgage banking activities, net of variable loan expenses, also consists of unrealized gains and losses associated with the changes in fair value of the loans held for sale, the fair value of retained MSR additions, and the realized and unrealized gains and losses from derivative instruments. Gains and losses from the sale of mortgage loans held for sale are recognized based upon the difference between the sales proceeds and carrying value of the related loans upon sale and is included in gains on residential mortgage banking activities, net of variable loan expenses in the unaudited interim consolidated statements of income. Sales proceeds reflect the cash received from investors from the sale of a loan plus the servicing release premium if the related MSR is sold. Gains and losses also includes the unrealized gains and losses associated with the mortgage loans held for sale and the realized and unrealized gains and losses from IRLCs. Loan origination costs directly attributable to the processing, underwriting, and closing of a loan are included in the gain on sale of mortgage loans held for sale when loans are sold. Loan expenses include indirect costs related to loan origination activities, such as correspondent fees, and are expensed as incurred and are included in gains on residential mortgage banking activities, net of variable loan expenses, in the Company’s unaudited interim consolidated statements of income. The provision for loan indemnification includes the fair value of the incurred liability for mortgage repurchases and indemnifications recognized at the time of loan sale and any other provisions recorded against the loan indemnification reserve and are included in gains on residential mortgage banking activities, net of variable loan expenses, in the Company’s unaudited interim consolidated statements of income. Loan origination fee income represents revenue earned from originating mortgage loans held for sale and are reflected in gains on residential mortgage banking activities, net of variable loan expenses, when loans are sold.
Loans, held at fair value	Loans, held at fair value Loans, held at fair value are loans originated by ReadyCap. The Company has elected the fair value option because of the intent to transfer to securitizations in the near term. Interest is recognized as interest income on the unaudited interim consolidated statements of income when earned and deemed collectible. Changes in fair value are recurring and are reported as net unrealized gain (loss) on the unaudited interim consolidated statements of income. The Company transfers loans held at fair value to loans, held-for-investment upon the completion of securitization.

Loans and Allowance for Loan 36

Loans and Allowance for Loan Losses (Tables)	3 Months Ended
	Mar. 31, 2018
Schedule of classification, unpaid principal balance, and carrying value of loans held including loans of consolidated VIEs	March 31, 2018 December 31, 2017 Loans (In Thousands) Carrying Value UPB Carrying Value UPB Loans Acquired SBA 7(a) loans $ 313,382 $ 334,501 $ 331,083 $ 353,556 Acquired loans 316,938 334,143 191,327 209,694 Originated Transitional loans 297,863 300,123 246,076 248,190 Originated SBC loans, at fair value 40,430 39,833 188,150 182,045 Originated SBC loans 42,926 42,232 27,610 27,349 Originated SBA 7(a) loans 51,970 54,679 41,208 43,439 Originated Residential Agency loans 2,246 2,246 2,013 2,014 Total Loans, before allowance for loan losses $ 1,065,755 $ 1,107,757 $ 1,027,467 $ 1,066,287 Allowance for loan losses $ (8,721) — $ (9,547) — Total Loans, net $ 1,057,034 $ 1,107,757 $ 1,017,920 $ 1,066,287 Loans in consolidated VIEs Loans Originated SBC loans $ 509,575 $ 497,091 $ 382,873 $ 373,996 Acquired loans 176,366 190,021 189,545 204,497 Acquired SBA 7(a) loans 66,142 90,467 69,523 95,605 Originated Transitional loans 192,623 192,432 196,438 196,070 Total Loans, in consolidated VIEs, before allowance for loan losses $ 944,706 $ 970,011 $ 838,379 $ 870,168 Allowance for loan losses on loans in consolidated VIEs $ (1,812) — $ (2,199) — Total Loans, net, in consolidated VIEs $ 942,894 $ 970,011 $ 836,180 $ 870,168 Total Loans, net, and Loans, net in consolidated VIEs $ 1,999,928 $ 2,077,768 $ 1,854,100 $ 1,936,455 Loans, held for sale, at fair value Originated Residential Agency loans $ 86,741 $ 83,880 $ 129,096 $ 124,758 Originated Freddie Mac loans 49,270 48,519 67,591 66,642 Originated SBA 7(a) loans 23,776 21,927 16,791 15,472 Acquired loans 1,212 1,296 2,544 2,662 Total Loans, held for sale, at fair value $ 160,999 $ 155,622 $ 216,022 $ 209,534 Total Loan portfolio $ 2,160,927 $ 2,233,390 $ 2,070,122 $ 2,145,989
Schedule of delinquency information of loans	March 31, 2018 Loans (In Thousands) Current and 30-89 Days 90+ Days Total Loans Carrying Value Non-Accrual 90+ Days Past Due but Accruing Loans (1)(2) Acquired SBA 7(a) loans $ 358,760 $ 16,039 $ 2,245 $ 377,044 $ 17,497 $ — Acquired loans 464,476 5,185 17,534 487,195 10,257 8,743 Originated Transitional loans 490,486 — — 490,486 — — Originated SBC loans, at fair value 35,704 4,726 — 40,430 — — Originated SBC loans 542,307 2,550 7,702 552,559 7,702 — Originated SBA 7(a) loans 51,558 379 — 51,937 903 — Originated Residential Agency loans 1,223 — 1,023 2,246 — 1,023 Total Loans, before general allowance for loans losses $ 1,944,514 $ 28,879 $ 28,504 $ 2,001,897 $ 36,359 $ 9,766 General allowance for loan losses $ (1,969) Total Loans, net $ 1,999,928 Percentage of outstanding (1) Loan balances include specific allowance for loan losses. (2) Includes Loans, net in consolidated VIEs December 31, 2017 Loans (In Thousands) Current and 30-89 Days 90+ Days Total Loans Carrying Value Non-Accrual 90+ Days Past Due but Accruing Loans (1)(2) Acquired SBA 7(a) loans $ 376,102 $ 15,953 $ 5,542 $ 397,597 $ 16,782 $ 176 Acquired loans 348,271 6,891 19,263 374,425 16,405 4,090 Originated Transitional loans 435,252 7,263 — 442,515 — — Originated SBC loans, at fair value 188,150 — — 188,150 — — Originated SBC loans 402,004 7,702 608 410,314 608 — Originated SBA 7(a) loans 40,871 311 — 41,182 671 — Originated Residential Agency loans 1,226 — 787 2,013 289 498 Total Loans, before allowance for loans losses $ 1,791,876 $ 38,120 $ 26,200 $ 1,856,196 $ 34,755 $ 4,764 General allowance for loan losses $ (2,096) Total Loans, net $ 1,854,100 Percentage of outstanding (1) Loan balances include specific allowance for loan losses. (2) Includes Loans, net in consolidated VIEs
Schedule of impaired loans, held for investment	March 31, 2018 (In Thousands) Originated Originated Transitional loans Acquired Acquired Originated Total Allowance for General $ 227 $ 338 $ 493 $ 510 $ 401 $ 1,969 Specific - - 416 1,062 33 1,511 PCI - - 5,635 1,418 - 7,053 Ending balance $ 227 $ 338 $ 6,544 $ 2,990 $ 434 $ 10,533 December 31, 2017 (In Thousands) Originated Originated Transitional loans Acquired Acquired Originated Total Allowance for General $ 468 $ - $ 819 $ 518 $ 291 $ 2,096 Specific 169 - 586 1,564 27 2,346 PCI - - 5,859 1,445 - 7,304 Ending balance $ 637 $ - $ 7,264 $ 3,527 $ 318 $ 11,746
Schedule of activity of the allowance for loan losses for loans, held-for investment	Three months ended March 31, 2018 (In Thousands) Originated Originated Transitional loans Acquired Acquired Originated Total Allowance for Beginning balance $ 637 $ - $ 7,264 $ 3,527 $ 318 $ 11,746 Provision for (Recoveries of) loan losses (241) 338 139 (185) 116 167 Charge-offs and sales (169) - (224) (449) - (842) Recoveries - - (635) 97 - (538) Ending balance $ 227 $ 338 $ 6,544 $ 2,990 $ 434 $ 10,533 Three months ended March 31, 2017 (In Thousands) Originated Originated Transitional loans Acquired Acquired Originated Total Allowance for Beginning balance $ 804 $ - $ 10,150 $ 5,004 $ 172 $ 16,130 Provision for (Recoveries of) loan losses 38 - 680 356 158 1,232 Charge-offs and sales - - (659) (260) - (919) Recoveries - - (1,759) - - (1,759) Ending balance $ 842 $ - $ 8,412 $ 5,100 $ 330 $ 14,684
Schedule of recorded investment of TDRs	March 31, 2018 December 31, 2017 (In Thousands) SBC SBA Total SBC SBA Total Recorded carrying value modified loans classified as TDRs $ 3,677 $ 12,820 $ 16,497 $ 3,727 $ 12,398 $ 16,125 Allowance for loan losses on loans classified as TDRs $ 846 $ 505 $ 1,351 $ 883 $ 695 $ 1,578 Carrying value of modified loans classified as TDRs Carrying value of modified loans classified as TDRs on accrual status $ 2,296 $ 4,879 $ 7,175 $ 1,804 $ 4,791 $ 6,595 Carrying value of modified loans classified as TDRs on non-accrual status 1,381 7,941 9,322 1,923 7,607 9,530 Total carrying value of modified loans classified as TDRs $ 3,677 $ 12,820 $ 16,497 $ 3,727 $ 12,398 $ 16,125
Schedule of TDR modifications by primary modification type and related financial effects	The following table summarizes the TDR activity that occurred during the three months ended March 31, 2018 and 2017 and the financial effects of these modifications. Three Months Ended March 31, 2018 Three Months Ended March 31, 2017 (In Thousands, except number of loans) SBC SBA Total SBC SBA Total Number of loans permanently modified - 11 11 9 4 13 Pre-modification recorded balance (a) $ - $ 1,120 $ 1,120 $ 2,234 $ 522 $ 2,756 Post-modification recorded balance (a) - 1,223 1,223 2,034 456 2,490 Number of loans that remain in default as of March 31, 2018 (b) - 4 4 6 - 6 Balance of loans that remain in default as of March 31, 2018 (b) $ - $ 239 $ 239 $ 1,179 $ - $ 1,179 Concession granted (a) : Term extension $ - $ 1,135 $ 1,135 $ 13 $ 390 $ 403 Interest rate reduction - - - 116 - 116 Principal reduction - - - 656 - 656 Foreclosure - 64 64 1,249 66 1,315 Total $ - $ 1,199 $ 1,199 $ 2,034 $ 456 $ 2,490 (a) Represents carrying value. (b) Represents the March 31, 2018 carrying values of the TDRs that occurred during the three months ended March 31, 2018 and 2017 that remained in default as of March 31, 2018. Generally, all loans modified in a TDR are placed or remain on non-accrual status at the time of the restructuring. However, certain accruing loans modified in a TDR that are current at the time of restructuring may remain on accrual status if payment in full under the restructured terms is expected. For purposes of this schedule, a loan is considered in default if it is 30 or more days past due.
Loans, held-for-investment
Schedule of monitoring credit quality of loans	Loan-to-Value (a) (In Thousands) 0.0 – 20.0% 20.1 – 40.0% 40.1 – 60.0% 60.1 – 80.0% 80.1 – 100.0% Greater than 100.0% Total March 31, 2018 Loans (1) (2) Acquired SBA 7(a) loans $ 8,855 $ 38,782 $ 123,609 $ 98,577 $ 49,327 $ 57,894 $ 377,044 Acquired loans 71,577 139,433 137,111 85,562 26,761 26,751 487,195 Originated Transitional loans — 21,695 150,593 278,117 26,893 13,188 490,486 Originated SBC loans, at fair value — 11,938 6,881 6,123 15,488 — 40,430 Originated SBC loans 2,648 53,157 200,928 291,468 4,358 — 552,559 Originated SBA 7(a) loans 33 1,539 5,694 19,849 7,389 17,433 51,937 Originated Residential Agency loans — 60 166 731 820 469 2,246 Total Loans, before general allowance for loans losses $ 83,113 $ 266,604 $ 624,982 $ 780,427 $ 131,036 $ 115,735 $ 2,001,897 General allowance for loan losses $ (1,969) Total Loans, net $ 1,999,928 December 31, 2017 Loans (1) (2) Acquired SBA 7(a) loans $ 8,978 $ 37,880 $ 125,234 $ 106,199 $ 56,676 $ 62,630 $ 397,597 Acquired loans 54,463 102,498 114,010 67,037 18,745 17,672 374,425 Originated Transitional loans — 26,735 171,227 212,830 21,639 10,084 442,515 Originated SBC loans, at fair value — 17,294 31,245 115,653 21,245 2,713 188,150 Originated SBC loans 2,661 49,281 192,796 158,047 7,529 — 410,314 Originated SBA 7(a) loans 52 954 5,227 15,583 5,766 13,600 41,182 Originated Residential Agency loans — 60 166 609 823 355 2,013 Total Loans, before allowance for loans losses $ 66,154 $ 234,702 $ 639,905 $ 675,958 $ 132,423 $ 107,054 $ 1,856,196 General allowance for loan losses $ (2,096) Total Loans, net $ 1,854,100 (a) Loan-to-value is calculated as carrying amount as a percentage of current collateral value (1) Loan balances include specific allowance for loan loss reserves. (2) Includes Loans, net in consolidated VIEs
Schedule of outstanding amounts and details of carrying amount of acquired loans, held for investment	March 31, 2018 December 31, 2017 Non-PCI PCI Non-PCI PCI (In Thousands) Loans Loans Loans Loans Unpaid principal balance $ 1,915,622 $ 122,313 $ 1,624,395 $ 130,015 Non-accretable discount — (8,810) — (8,336) Accretable discount (38,100) (20,994) (44,629) (23,749) Loans, held-for-investment 1,877,522 92,509 1,579,766 97,930 Allowance for loan losses (3,480) (7,053) (4,442) (7,304) Loans, held-for-investment $ 1,874,042 $ 85,456 $ 1,575,324 $ 90,626
Non - PCI Loans
Schedule of impaired loans are evaluated for an asset specific allowance	(In Thousands) March 31, 2018 December 31, 2017 Impaired loans With an allowance $ 8,933 $ 9,222 Without an allowance 21,929 12,659 Total recorded carrying value of impaired loans $ 30,862 $ 21,881 Allowance for loan losses related to impaired loans $ (1,511) $ (2,346) Unpaid principal balance of impaired loans $ 36,484 $ 29,853 Impaired loans on non-accrual status $ 29,010 $ 21,881 Average carrying value of impaired loans $ 26,372 $ 28,693 March 31, 2018 March 31, 2017 Interest income on impaired loans for the three months ended $ 2 $ 3
PCI Loans
Schedule of activity of accretable yield of loans, held for investment	Three Months Ended March 31, (In Thousands) 2018 2017 Beginning accretable discount- PCI loans $ 23,749 $ 26,978 Purchases/Originations — — Sales (656) (1,195) Accretion (1,709) (1,198) Other 411 471 Transfers (801) (835) Ending accretable discount- PCI loans $ 20,994 $ 24,221
Geographical concentration | Loans, held-for-investment
Schedule of concentration risk of loans secured by real estate	Geographic Concentration (Unpaid Principal Balance) March 31, 2018 December 31, 2017 California 13.8 % 13.5 % Texas 11.9 12.4 Florida 11.6 11.7 New York 6.9 6.8 Georgia 6.0 6.2 Arizona 4.0 5.1 Illinois 3.6 3.9 North Carolina 3.5 3.7 Pennsylvania 3.0 2.1 Ohio 2.6 2.7 Other 33.1 31.9 Total 100.0 % 100.0 %
Collateral concentration | Loans, held-for-investment
Schedule of concentration risk of loans secured by real estate	The following table displays the collateral type concentration of the Company’s loans, net, on our unaudited interim consolidated balance sheets. Collateral Concentration (Unpaid Principal Balance) March 31, 2018 December 31, 2017 SBA (1) 23.1 % 25.4 % Multi-family 21.4 21.1 Retail 17.7 17.6 Office 14.9 15.6 Industrial 7.9 6.9 Mixed Use 7.3 6.3 Lodging/Residential 2.7 2.9 Other 5.0 4.2 Total 100.0 % 100.0 % (1) Further detail provided on SBA collateral concentration is included in table below. The following table displays the collateral type concentration of the Company’s SBA loans within loans, net, on our unaudited interim consolidated balance sheets. Collateral Concentration (Unpaid Principal Balance) March 31, 2018 December 31, 2017 Offices of Physicians 16.2 % 16.0 % Child Day Care Services 11.7 12.3 Lodging 10.7 10.5 Veterinarians 7.0 7.0 Eating Places 5.5 5.5 Grocery Stores 4.7 4.7 Auto 3.0 3.2 Funeral Service & Crematories 2.3 2.2 Accounting Auditing & Bookkeeping 2.1 2.1 Gasoline Service Stations 2.1 1.9 Other 34.7 34.6 Total 100.0 % 100.0 %

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	3 Months Ended
	Mar. 31, 2018
Fair value measurements
Schedule of financial instruments carried at fair value on a recurring basis	The following table presents the Company’s financial instruments carried at fair value on a recurring basis as of March 31, 2018: (In Thousands) Level 1 Level 2 Level 3 Total Assets: Cash held in money market funds $ 633 $ — $ — $ 633 Loans, held for sale, at fair value — 160,999 — 160,999 Loans, net, at fair value — — 40,430 40,430 Mortgage backed securities, at fair value — 24,445 22,736 47,181 Derivative instruments, at fair value — 1,552 3,470 5,022 Residential mortgage servicing rights, at fair value — — 81,591 81,591 Total assets $ 633 $ 186,996 $ 148,227 $ 335,856 Liabilities: Derivative instruments, at fair value $ — $ 756 $ — $ 756 Contingent consideration — — 10,732 10,732 Total liabilities $ — $ 756 $ 10,732 $ 11,488 The following table presents the Company’s financial instruments carried at fair value on a recurring basis as of December 31, 2017: (In Thousands) Level 1 Level 2 Level 3 Total Assets: Cash held in money market funds $ 632 $ — $ — $ 632 Loans, held for sale, at fair value — 216,022 — 216,022 Loans, net, at fair value — — 188,150 188,150 Mortgage backed securities, at fair value — 31,859 8,063 39,922 Derivative instruments, at fair value — 2,898 1,827 4,725 Residential mortgage servicing rights, at fair value — — 72,295 72,295 Total assets $ 632 $ 250,779 $ 270,335 $ 521,746 Liabilities: Derivative instruments, at fair value $ — $ 282 $ — $ 282 Contingent consideration — — 10,016 10,016 Total liabilities $ — $ 282 $ 10,016 $ 10,298
Summary of the valuation techniques and significant unobservable inputs used for the Company’s financial instruments that are categorized within Level 3 of the fair value hierarchy	The following table summarizes the valuation techniques and significant unobservable inputs used for the Company’s financial instruments that are categorized within Level 3 of the fair value hierarchy as of March 31, 2018 using third party information without adjustment: Predominant Weighted Valuation Average Price (In Thousands, except price) Fair Value Technique Type Price Range (a) Loans, held at fair value $ 40,430 Single External Source Third Party Mark $ 101.50 – 101.50 $ 101.50 Mortgage backed securities, at fair value(b) 22,610 Broker Quotes Third Party Mark 67.52 – 73.01 69.36 Mortgage backed securities, at fair value 126 Transaction Price Transaction Price 99.00 – 99.00 99.00 Residential mortgage servicing rights, at fair value 81,591 Single external source Discounted cash flow N/A N/A Contingent consideration 10,732 Single external source Discounted cash flow N/A N/A (a) Prices are weighted based on the unpaid principal balance of the loans and securities included in the range for each class (b) Price ranges and weighted averages exclude interest-only strips with a fair value of $0.5 million as of March 31, 2018. The following table summarizes the valuation techniques and significant unobservable inputs used for the Company’s financial instruments that are categorized within Level 3 of the fair value hierarchy as of December 31, 2017 using third-party information without adjustment: Predominant Weighted Valuation Average Price (In Thousands, except price) Fair Value Technique Type Price Range (a) Loans, held at fair value $ 188,150 Single External Source Third Party Mark $ 101.05 – 104.00 $ 103.35 Mortgage backed securities, at fair value (b) 7,937 Broker Quotes Third Party Mark 70.92 – 70.92 70.92 Mortgage backed securities, at fair value 126 Transaction Price Transaction Price 99.00 – 99.00 99.00 Residential mortgage servicing rights, at fair value 72,295 Single external source Discounted cash flow N/A N/A Contingent consideration 10,016 Single external source Discounted cash flow N/A N/A (a) Prices are weighted based on the unpaid principal balance of the loans and securities included in the range for each class (b) Price ranges and weighted averages exclude interest-only strips with a fair value of $0.5 million as of December 31, 2017.
Summary of the carrying value and estimated fair value of financial instruments not carried at fair value on the consolidated balance sheets and are classified as Level 3	March 31, 2018 December 31, 2017 (In Thousands) Carrying Value Fair Value Carrying Value Fair Value Assets: Loans, net $ 1,959,498 $ 2,009,116 $ 1,665,950 $ 1,737,361 Investment in unconsolidated joint venture 50,229 50,229 55,369 55,369 Servicing rights 23,022 24,763 21,743 23,432 Total assets $ 2,032,749 $ 2,084,108 $ 1,743,062 $ 1,816,162 Liabilities: Secured borrowings $ 657,233 $ 657,233 $ 631,286 $ 631,286 Promissory note 5,883 5,883 6,107 6,107 Securitized debt obligations of consolidated VIEs, net 679,871 695,610 598,148 613,676 Senior secured note, net 178,688 182,737 138,078 144,376 Guaranteed loan financing 278,500 291,340 293,045 306,964 Convertible note, net 109,226 98,721 108,991 108,301 Total liabilities $ 1,909,401 $ 1,931,524 $ 1,775,655 $ 1,810,710
Loans, held at fair value
Fair value measurements
Summary of changes in the fair value of financial instruments held at fair value classified as Level 3	Three Months Ended March 31, (In Thousands) 2018 2017 Beginning Balance $ 188,150 $ 81,592 Realized gains (losses), net (3) 27 Unrealized gains (losses), net (762) 630 Originations 150 27,499 Sales — (2,017) Principal payments (4,666) (40) Transfer to loans, held-for-investment (142,439) — Ending Balance $ 40,430 $ 107,691
Loans, held for sale, at fair value
Fair value measurements
Summary of changes in the fair value of financial instruments held at fair value classified as Level 3	Three Months Ended March 31, (In Thousands) 2018 2017 Beginning Balance $ — $ 17,312 Realized gains, net — 917 Unrealized gains, net — 526 Originations — 69,665 Sales — (54,116) Principal payments — 3,021 Ending Balance $ — $ 37,325
MBS
Fair value measurements
Summary of changes in the fair value of financial instruments held at fair value classified as Level 3	Three Months Ended March 31, (In Thousands) 2018 2017 Beginning Balance $ 8,063 $ 32,391 Accreted discount, net 21 54 Realized gains, net 123 189 Unrealized gains (losses), net 230 (45) Sales / Principal payments (517) (1,224) Transfer to (from) Level 3 14,816 — Ending Balance $ 22,736 $ 31,365
Derivatives
Fair value measurements
Summary of changes in the fair value of financial instruments held at fair value classified as Level 3	Three Months Ended March 31, (In Thousands) 2018 2017 Beginning Balance $ 1,827 $ 2,690 Unrealized gains (losses) 1,643 (1,312) Ending Balance $ 3,470 $ 1,378
Contingent Consideration
Fair value measurements
Summary of changes in the fair value of liabilities at fair value classified as Level 3	Three Months Ended March 31, (In Thousands) 2018 2017 Beginning Balance $ 10,016 $ 14,487 Adjustment for legal settlement 634 (5,744) Amortization 82 98 Ending Balance $ 10,732 $ 8,841

Mortgage Backed Securities (Tab

Mortgage Backed Securities (Tables)	3 Months Ended
	Mar. 31, 2018
Mortgage Backed Securities
Schedule of information about the Company's MBS portfolio	The following table presents certain information about the Company’s MBS portfolio, which are classified as trading securities and carried at fair value, as of March 31, 2018. March 31, 2018 Weighted Weighted Average Gross Gross Average Interest Principal Amortized Unrealized Unrealized (In Thousands) Maturity (a) Rate (a) Balance Cost Fair Value Gains Losses MBS Freddie Mac Loans 01/2036 5.1 % $ 61,509 $ 44,672 $ 45,856 $ 2,149 $ (965) Commercial Loans 06/2043 5.6 4,611 1,078 1,199 121 — Tax Liens 09/2026 6.0 127 127 126 — (1) Total 07/2036 5.1 % $ 66,247 $ 45,877 $ 47,181 $ 2,270 $ (966) (a) Weighted based on current principal balance The following table presents certain information about the Company’s MBS portfolio, which are classified as trading securities and carried at fair value, as of December 31, 2017. December 31, 2017 Weighted Weighted Average Gross Gross Average Interest Principal Amortized Unrealized Unrealized (In Thousands) Maturity (a) Rate (a) Balance Cost Fair Value Gains Losses MBS Freddie Mac Loans 12/2034 5.3 % $ 49,767 $ 37,287 $ 38,568 $ 2,529 $ (1,248) Commercial Loans 06/2043 5.5 4,513 1,054 1,228 174 — Tax Liens 09/2026 6.0 127 127 126 — (1) Total 08/2035 5.3 % $ 54,407 $ 38,468 $ 39,922 $ 2,703 $ (1,249) (a) Weighted based on current principal balance
Schedule of information about the maturity of the Company's MBS portfolio	The following table presents certain information about the maturity of the Company’s MBS portfolio as of March 31, 2 018 . March 31, 2018 Weighted Average Interest Principal Amortized (In Thousands) Rate (a) Balance Cost Fair Value After five years through ten years 10.3 % $ 6,434 $ 5,810 $ 6,483 After ten years 4.6 59,813 40,067 40,698 Total 5.1 % $ 66,247 $ 45,877 $ 47,181 (a) Weighted based on current principal balance The following table presents certain information about the maturity of the Company’s MBS portfolio as of December 31, 2017. December 31, 2017 Weighted Average Interest Principal Amortized (In Thousands) Rate (a) Balance Cost Fair Value After five years through ten years 8.9 % $ 8,919 $ 8,205 $ 8,904 After ten years 4.6 45,488 30,263 31,018 Total 5.3 % $ 54,407 $ 38,468 $ 39,922

Servicing rights (Tables)

Servicing rights (Tables)	3 Months Ended
	Mar. 31, 2018
Schedule of servicing rights	Three Months Ended March 31, (In Thousands) 2018 2017 SBA servicing rights, at amortized cost Beginning net carrying amount $ 16,684 $ 20,275 Additions due to loans sold, servicing retained 692 218 Amortization (886) (1,108) Impairment (172) (888) Ending net carrying value of SBA servicing rights $ 16,318 $ 18,497 Freddie Mac servicing rights, at amortized cost Beginning net carrying amount $ 5,059 $ 2,203 Additions due to loans sold, servicing retained 1,938 441 Amortization (293) (96) Recovery (Impairment) — (673) Ending net carrying value of Freddie Mac servicing rights $ 6,704 $ 1,875 Ending net carrying value of SBA and Freddie Mac servicing rights, at amortized cost $ 23,022 $ 20,372 Residential mortgage servicing rights, at fair value Beginning Balance $ 72,295 $ 61,376 Additions due to loans sold, servicing retained 5,706 5,052 Loan pay-offs (1,298) (1,250) Unrealized gains (losses) 4,888 (553) Ending fair value of residential mortgage servicing rights $ 81,591 $ 64,625 Total servicing rights $ 104,613 $ 84,997
Schedule of future amortization expense for the servicing rights	(In Thousands) March 31, 2018 2018 $ 3,441 2019 3,978 2020 3,360 2021 2,831 2022 2,368 Thereafter 7,044 Total $ 23,022
Residential
Schedule of servicing rights	As of March 31, 2018 As of December 31, 2017 Unpaid Principal Unpaid Principal (In Thousands) Amount Fair Value Amount Fair Value Fannie Mae $ 2,608,840 $ 30,347 $ 2,524,897 $ 26,929 Ginnie Mae 2,023,846 24,610 2,134,772 24,135 Freddie Mac 2,184,960 26,634 1,898,786 21,231 Total $ 6,817,646 $ 81,591 $ 6,558,455 $ 72,295
Schedule Of Mortgage Servicing Rights Portfolio	March 31, 2018 December 31, 2017 Range of input Weighted Range of input Weighted Residential mortgage servicing rights (at fair value) • Forward prepayment rate - % % - % % • Discount rate - % % - % % • Servicing expense - % % - % %
Schedule of adverse changes to key assumptions on the carrying amount of the servicing rights	(In Thousands) March 31, 2018 December 31, 2017 Prepayment rate 10% adverse change $ (2,711) $ (2,721) 20% adverse change (5,231) (4,928) Discount rate 10% adverse change $ (3,493) $ (3,029) 20% adverse change (6,708) (5,823) Cost of servicing 10% adverse change $ (1,448) $ (1,230) 20% adverse change (2,895) (2,460)
SBA | Freddie Mac
Schedule of servicing rights	As of March 31, 2018 As of December 31, 2017 Unpaid Principal Unpaid Principal (In Thousands) Amount Carrying Value Amount Carrying Value SBA $ 437,177 $ 16,318 $ 427,623 $ 16,684 Freddie Mac 676,928 6,704 559,823 5,059 Total $ 1,114,105 $ 23,022 $ 987,446 $ 21,743
Schedule of adverse changes to key assumptions on the carrying amount of the servicing rights	(In Thousands) March 31, 2018 December 31, 2017 SBA servicing rights (at amortized cost) • Forward prepayment rate 10% adverse change $ (492) $ (514) 20% adverse change (957) (998) • Default rate 10% adverse change $ (28) $ (24) 20% adverse change (57) (48) • Discount rate 10% adverse change $ (520) $ (520) 20% adverse change (1,007) (1,008) Freddie Mac commercial servicing rights (at amortized cost) • Forward prepayment rate 10% adverse change $ (56) $ (43) 20% adverse change (110) (84) • Default rate 10% adverse change $ (8) $ (6) 20% adverse change (15) (12) • Discount rate 10% adverse change $ (344) $ (270) 20% adverse change (661) (518)
SBA | Freddie Mac | Commercial
Schedule of adverse changes to key assumptions on the carrying amount of the servicing rights	March 31, 2018 December 31, 2017 Range of input Weighted Range of input Weighted SBA servicing rights (at amortized cost) • Forward prepayment rate - % % - % % • Forward default rate - % % - % % • Discount rate - % % - % % • Servicing expense - % % - % % Freddie Mac commercial servicing rights (at amortized cost) • Forward prepayment rate - % % - % % • Forward default rate - % % - % % • Discount rate - % % - % % • Servicing expense - % % - % %

Gains on residential mortgage40

Gains on residential mortgage banking activities, net of variable loan expenses (Tables)	3 Months Ended
	Mar. 31, 2018
Gains on residential mortgage banking activities, net of variable loan expenses
Schedule of the components of gains on residential mortgage banking activities, net of variable loan expenses	Three Months Ended March 31, (In Thousands) 2018 2017 Realized and unrealized gains and losses of residential mortgage loans held for sale, at fair value $ 6,279 $ 13,394 Creation of new mortgage servicing rights, net of payoffs 4,408 3,803 Loan origination fee income on residential mortgage loans 2,175 1,863 Correspondent fees and other direct loan expenses, including provision for loan indemnification (2,290) (6,975) Unrealized gains (loss) on IRLCs and other derivatives 1,162 (1,576) Total gains on residential mortgage banking activities, net of variable loan expenses $ 11,734 $ 10,509

Secured Borrowings and Promis41

Secured Borrowings and Promissory Note (Tables)	3 Months Ended
	Mar. 31, 2018
Secured Borrowings and Promissory Note
Schedule of characteristics of our credit facilities and promissory note payable	Pledged Assets Carrying Value (In Thousands) Maturity Pricing Facility March 31, December 31, March 31, December 31, Borrowings under credit facilities JPMorgan - Commercial (1) June 2018 L + 3.25 to 3.50% $ 250,000 $ 94,660 $ 107,697 $ 70,846 $ 60,459 Keybank - Commercial (2) February 2019 L + 1.75% 125,000 49,271 67,589 48,519 66,642 Comerica - Residential (3) March 2019 L + 2.125% 150,000 52,294 71,035 59,737 67,336 Associated Bank - Residential loans (3) August 2018 L + 2.125% 40,000 9,006 29,242 8,549 27,699 Origin Bank - Residential loans (3) May 2018 L + 2.25% 40,000 24,334 27,891 22,919 26,538 Total borrowings under credit facilities (8) $ 605,000 $ 229,565 $ 303,454 $ 210,570 $ 248,674 Borrowings under repurchase agreements Deutsche Bank- Commercial (4) February 2020 L + 2.30 to 2.80% $ 275,000 $ 220,303 $ 252,499 $ 137,804 $ 173,811 JPMorgan - Commercial (5) December 2020 L + 2.50 to 4.50% 200,000 82,827 90,829 47,857 55,355 Citibank - Commercial (6) June 2018 L + 2.50% 200,000 208,014 150,707 180,534 88,095 JPMorgan - MBS (7) June 2018 2.91 to 5.39% 48,218 71,966 80,690 48,218 53,325 Citibank - MBS (7) May 2018 3.89% 5,957 11,496 11,496 5,957 5,957 RBC - MBS (7) April 2018 3.34% 4,906 6,357 8,778 4,906 6,069 Mizuho - MBS (7) April 2018 2.79% 21,387 27,857 — 21,387 — Total borrowings under repurchase agreements (9) $ 755,468 $ 628,820 $ 594,999 $ 446,663 $ 382,612 Total secured borrowings $ 1,360,468 $ 858,385 $ 898,453 $ 657,233 $ 631,286 Promissory note payable FCB - Commercial June 2021 2.75% $ 6,554 $ 7,279 $ 7,752 $ 5,883 $ 6,107 Total promissory note payable $ 6,554 $ 7,279 $ 7,752 $ 5,883 $ 6,107 (1) Borrowings are used to finance SBC and SBA loan acquisitions, and SBA loan originations. (2) Borrowings are used to finance Freddie Mac SBC loan originations. (3) Borrowings are used to finance Residential Agency loan originations. (4) Borrowings are used to finance SBC loan originations and Transitional loan originations. (5) Borrowings are used to finance SBC loan originations, Transitional loan originations, and SBC loan acquisitions. (6) Borrowings are used to finance SBC loan originations and SBC loan acquisitions. (7) Borrowings are used to finance Mortgage backed securities and Retained interests in consolidated VIE's. (8) The weighted average interest rate of borrowings under credit facilities was 4.1% and 3.9% as of March 31, 2018 and December 31, 2017, respectively. (9) The weighted average interest rate of borrowings under repurchase agreements was 4.3% and 3.1% as of March 31, 2018 and December 31, 2017, respectively.
Schedule of carrying value of collateral pledged with respect to borrowings under credit facilities and promissory note payable outstanding	Pledged Assets (In Thousands) March 31, December 31, Collateral pledged - borrowings under credit facilities Loans, net $ 229,468 $ 303,133 Real estate acquired in settlement of loans 97 321 Total collateral pledged on borrowings under credit facilities $ 229,565 $ 303,454 Collateral pledged - borrowings under repurchase agreements Loans, net $ 511,145 $ 494,035 Mortgage backed securities 44,718 37,397 Retained interest in assets of consolidated VIEs 72,957 63,567 Total collateral pledged on borrowings under repurchase agreements $ 628,820 $ 594,999 Total collateral pledged on secured borrowings $ 858,385 $ 898,453 Collateral pledged - promissory note payable Loans, net $ 7,279 $ 7,752 Total collateral pledged on promissory note payable $ 7,279 $ 7,752

Senior secured notes, net and42

Senior secured notes, net and Convertible notes, net (Tables)	3 Months Ended
	Mar. 31, 2018
Senior secured notes, net and Convertible notes, net
Schedule of components of the senior secured note and convertible notes	(in thousands, except rates) Coupon Rate Maturity Date March 31, 2018 Senior secured notes principal amount (1) 7.50 % 2/15/2022 $ 180,000 Unamortized premium - Senior secured notes 2,899 Unamortized deferred financing costs - Senior secured notes (4,211) Total Senior secured notes, net $ 178,688 2017 Convertible notes - principal amount (2) 7.00 % 8/15/2023 115,000 Unamortized discount - Convertible notes (3) (2,058) Unamortized deferred financing costs - Convertible notes (3,716) Total Convertible notes, net $ 109,226 Total carrying amount of debt components $ 287,914 Total carrying amount of conversion option of equity components recorded in equity $ 2,058 (1) Interest on the Senior Secured Notes is payable semiannually on each February 15 and August 15, beginning on August 15, 2017. (2) Interest on the Convertible Notes is payable quarterly on February 15, May 15, August 15, and November 15 of each year, beginning on November 15, 2017. (3) Represents the discount created by separating the conversion option from the debt host instrument.

Guaranteed loan financing (Tabl

Guaranteed loan financing (Tables)	3 Months Ended
	Mar. 31, 2018
Guaranteed loan financing.
Schedule of guaranteed loan financing and the related interest rates and maturity dates	Weighted Range of Average Interest Range of (In Thousands) Interest Rate Rates Maturities (Years) Ending Balance March 31, 2018 3.75 % 1.70 – 7.25 % 2018 - 2038 $ 278,500 December 31, 2017 3.51 % 1.62 – 7.00 % 2018 - 2038 $ 293,045
Summary of contractual maturities of total guaranteed loan financing outstanding	(In Thousands) March 31, 2018 2018 $ 1,159 2019 2,158 2020 2,846 2021 3,985 2022 4,332 Thereafter 264,020 Total $ 278,500

Variable Interest Entities an44

Variable Interest Entities and Securitization Activities (Tables)	3 Months Ended
	Mar. 31, 2018
Consolidated statements of income of VIEs	Statements of Income Three months ended March 31, 2018 (In Thousands) Girod HoldCo, LLC WFLLA, LLC Interest income $ 7,847 $ 3,916 Realized gains 13,903 6,938 Unrealized gains 3,263 1,628 Servicing expense and other (2,005) (1,003) Income before provision for income taxes $ 23,008 $ 11,479
VIEs
Summary of information on securitized debt obligations of consolidated VIEs	March 31, 2018 December 31, 2017 Current Weighted Current Weighted Principal Carrying Average Principal Carrying Average (In Thousands) Balance value Interest Rate Balance value Interest Rate Waterfall Victoria Mortgage Trust 2011-SBC2 $ 15,295 $ 15,295 5.4 % $ 16,010 $ 16,010 5.3 % Sutherland Commercial Mortgage Loans 2015-SBC4 7,636 7,418 4.0 10,049 9,687 4.0 Sutherland Commercial Mortgage Trust 2017-SBC6 108,357 106,624 3.3 119,784 117,868 3.3 ReadyCap Commercial Mortgage Trust 2014-1 30,565 30,563 4.0 33,953 33,951 3.6 ReadyCap Commercial Mortgage Trust 2015-2 147,311 142,836 4.1 151,993 147,271 4.1 ReadyCap Commercial Mortgage Trust 2016-3 87,415 84,855 3.6 98,733 95,907 3.5 ReadyCap Commercial Mortgage Trust 2018-4 150,344 145,108 4.1 — — — Ready Capital Mortgage Financing 2017-FL1 133,652 130,101 3.1 158,978 154,721 2.8 ReadyCap Lending Small Business Trust 2015-1 19,371 17,071 3.0 25,057 22,733 2.5 Total $ 699,946 $ 679,871 3.7 % $ 614,557 $ 598,148 3.4 %
Consolidated balance sheets of VIEs	(In Thousands) March 31, 2018 December 31, 2017 Assets: Cash and cash equivalents $ 75 $ 25 Restricted cash 8,384 15,838 Loans, net 942,894 836,180 Real estate acquired in settlement of loans 3,209 3,443 Accrued interest 4,671 4,261 Due from servicers 9,766 1,915 Total assets 968,999 861,662 Liabilities: Securitized debt obligations of consolidated VIEs, net 679,871 598,148 Total liabilities 679,871 598,148
VIE not primary beneficiary
Consolidated balance sheets of VIEs	Carrying Maximum (1) (In Thousands) March 31, 2018 December 31, 2017 March 31, 2018 December 31, 2017 Assets: Mortgage backed securities, at fair value (2) $ 45,856 $ 38,568 $ 45,856 $ 38,568 Investment in unconsolidated joint venture 50,229 55,369 50,229 55,369 Total assets in unconsolidated VIEs $ 96,085 $ 93,937 $ 96,085 $ 93,937 (1) Maximum exposure to loss is limited to the greater of the fair value or carrying value of the assets as of the consolidated balance sheet date. (2) Retained interest in Freddie Mac sponsored securitizations.

Interest Income and Interest 45

Interest Income and Interest Expense (Tables)	3 Months Ended
	Mar. 31, 2018
Interest Income and Interest Expense
Schedule of components of interest income and expense	Three Months Ended March 31, (In Thousands) 2018 2017 Interest income Loans Acquired SBA 7(a) loans $ 7,872 $ 9,872 Acquired loans 9,461 10,044 Originated Transitional loans 8,910 4,103 Originated SBC loans, at fair value 2,028 1,626 Originated SBC loans 5,740 5,611 Originated SBA 7(a) loans 843 271 Originated Residential Agency loans 12 200 Total loans (1) $ 34,866 $ 31,727 Held for sale, at fair value, loans Originated Residential Agency loans $ 877 $ 830 Originated Freddie loans 512 183 Acquired loans 13 421 Total loans, held for sale, at fair value $ 1,402 $ 1,434 Mortgage backed securities, at fair value 882 723 Total interest income $ 37,150 $ 33,884 Interest expense Secured borrowings $ (7,182) $ (7,197) Securitized debt obligations of consolidated VIEs (7,202) (5,122) Guaranteed loan financing (2,815) (3,264) Senior secured note (3,239) (790) Convertible note (2,187) — Promissory note (41) (68) Total interest expense $ (22,666) $ (16,441) Net interest income before provision for loan losses $ 14,484 $ 17,443 (1) Includes interest income on loans in consolidated VIEs.

Derivative Instruments (Tables)

Derivative Instruments (Tables)	3 Months Ended
	Mar. 31, 2018
Derivative Instruments
Schedule of the Company’s derivatives	As of March 31, 2018 As of December 31, 2017 Asset Liability Asset Liability Notional Derivatives Derivatives Notional Derivatives Derivatives (In Thousands) Primary Underlying Risk Amount Fair Value Fair Value Amount Fair Value Fair Value Credit Default Swaps Credit Risk $ 15,000 $ — $ (58) $ 15,000 $ — $ (66) Interest Rate Swaps Interest rate risk 267,771 1,552 (698) 391,381 2,898 (216) Interest rate lock commitments Interest rate risk 236,003 3,470 — 167,533 1,827 — Total $ 518,774 $ 5,022 $ (756) $ 573,914 $ 4,725 $ (282)
Schedule of gains and losses on derivatives	Three Months Ended March 31, 2018 Net Change in Net Realized Unrealized (In Thousands) Gain (Loss) Gain (Loss) Credit default swaps (1) $ — $ 8 Interest rate swaps (1) 4,555 (1,346) Residential mortgage banking activities interest rate swaps (2) — (482) Interest rate lock commitments (2) — 1,643 Total $ 4,555 $ (177) (1) Gains/ (losses) are recorded in net unrealized gain (loss) on financial instruments or net realized gain (loss) on financial instruments in the consolidated statements of income. Three Months Ended March 31, 2017 Net Change in Net Realized Unrealized (In Thousands) Gain (Loss) Gain (Loss) Credit default swaps (1) $ — $ 30 Interest rate swaps (1) (224) 135 Residential mortgage banking activities interest rate swaps (2) — (264) Interest rate lock commitments (2) — (1,312) Total $ (224) $ (1,411) (1) Gains/ (losses) are recorded in net unrealized gain (loss) on financial instruments or net realized gain (loss) on financial instruments in the consolidated statements of income.

Related Party Transactions (Tab

Related Party Transactions (Tables) - Manager	3 Months Ended
	Mar. 31, 2018
Management Fee
Related-party transactions
Schedule of related party transactions	For the Three Months Ended March 31, 2018 2017 Management fee - total $ 2.0 million $ 2.0 million Management fee - amount unpaid $ 2.6 million $ 2.4 million
Incentive Distribution
Related-party transactions
Schedule of related party transactions	For the Three Months Ended March 31, 2018 2017 Incentive fee distribution - total $ 0.4 million $ — Incentive fee distribution - amount unpaid $ 0.4 million $ —
Expense Reimbursement
Related-party transactions
Schedule of related party transactions	For the Three Months Ended March 31, 2018 2017 Reimbursable expenses payable to our Manager - total $ 0.9 million $ 0.9 million Reimbursable expenses payable to our Manager - amount unpaid $ 0.8 million $ 0.7 million

Other Asset and Other Liabili48

Other Asset and Other Liabilities (Tables)	3 Months Ended
	Mar. 31, 2018
Other Asset and Other Liabilities
Schedule of other assets and other liabilities	(In Thousands) March 31, 2018 December 31, 2017 Other assets: Due from servicers $ 6,040 $ 9,964 Intangible assets 3,177 3,264 Accrued interest 6,836 6,494 Real estate acquired in settlement of loans 1,652 1,644 Deferred financing costs 1,765 446 Deferred tax asset 17,155 17,155 Prepaid taxes 3,682 6,014 Other 13,285 11,859 Total other assets $ 53,592 $ 56,840 Accounts payable and other accrued liabilities: Accrued salaries, wages and commissions $ 9,969 $ 16,508 Servicing principal and interest payable 7,168 5,659 Repair and denial reserve 5,797 5,687 Liability under subservicing agreements 1,507 1,496 Unapplied cash 1,786 2,445 Accrued interest payable 7,677 10,317 Payable to related parties 2,961 2,042 Deferred tax liability 18,506 18,506 Other accounts payable and accrued liabilities 9,119 11,976 Total accounts payable and other accrued liabilities $ 64,490 $ 74,636
Schedule of real estate acquired in settlement of loans	(In Thousands) March 31, 2018 December 31, 2017 Illinois 863 863 Florida 324 303 Ohio 172 51 Other 293 427 Total $ 1,652 $ 1,644

Other Income and Other Operat49

Other Income and Other Operating Expenses (Tables)	3 Months Ended
	Mar. 31, 2018
Other Income and Other Operating Expenses
Schedule of other income and operating expenses	Three Months Ended March 31, (In Thousands) 2018 2017 Other income Origination income 1,153 691 Release/(Increase) of repair and denial reserve (110) 166 Other 291 (17) Total other income $ 1,334 $ 840 Other operating expenses Origination costs 1,856 959 Technology expense 783 911 Charge off of real estate acquired in settlement of loans 19 103 Rent expense 522 559 Recruiting, training and travel expenses 703 467 Other 4,128 2,535 Total other operating expenses $ 8,011 $ 5,534

Stockholders_ Equity (Tables)

Stockholders’ Equity (Tables)	3 Months Ended
	Mar. 31, 2018
Stockholders’ Equity
Schedule of cash dividends declared by the Board of Directors	Dividend per Declaration Date Record Date Payment Date Share December 21, 2016 December 30, 2016 January 27, 2017 $ 0.35 March 14, 2017 March 31, 2017 April 13, 2017 $ 0.37 June 15, 2017 June 30, 2017 July 31, 2017 $ 0.37 September 12, 2017 September 29, 2017 October 20, 2017 $ 0.37 December 13, 2017 December 29, 2017 January 31, 2018 $ 0.37 March 14, 2018 March 30, 2018 April 30, 2018 $ 0.37
Schedule of Restricted Stock Unit RSU and RSA activity	Independent Director RSUs Employee RSAs (In Thousands, except share data) Number of Grant date fair value Weighted-average grant date fair value (per share) Number of Grant date fair value Weighted-average grant date fair value (per share) Outstanding, January 1 — $ — $ — 25,851 $ 380 $ 14.70 Granted 23,104 320 13.85 101,670 1,408 13.85 Vested (5,776) (80) 13.85 — — — Forfeited — — — — — — Canceled — — — — — — Outstanding, March 31, 2018 17,328 $ 240 $ 13.85 127,521 $ 1,788 $ 14.02

Earnings per Share of Common 51

Earnings per Share of Common Stock (Tables)	3 Months Ended
	Mar. 31, 2018
Earnings per Share of Common Stock
Schedule of reconciliation of both income from continuing operations and loss from discontinued operations	Three Months Ended March 31, (In Thousands, except for share and per share amounts) 2018 2017 Basic Earnings Net income $ 18,518 $ 9,557 Less: Income attributable to non-controlling interest 664 701 Less: Income attributable to participating shares 61 3 Basic earnings $ 17,793 $ 8,853 Diluted Earnings Net income $ 18,518 $ 9,557 Less: Income attributable to non-controlling interest 664 701 Less: Income attributable to participating shares 61 - Diluted earnings $ 17,793 $ 8,856 Number of Shares Basic — Average shares outstanding 32,036,504 30,549,806 Effect of dilutive securities — Unvested participating shares 9,340 - Diluted — Average shares outstanding 32,045,844 30,549,806 Earnings Per Share Attributable to SLD Common Stockholders: Basic $ 0.56 $ 0.29 Diluted $ 0.56 $ 0.29

Offsetting Assets and Liabili52

Offsetting Assets and Liabilities (Tables)	3 Months Ended
	Mar. 31, 2018
Offsetting Assets and Liabilities
Schedule of effect of offsetting recognized assets	The following table provides disclosure regarding the effect of offsetting of the Company’s recognized assets presented in the unaudited interim consolidated balance sheet as of September 30, 2017: Gross Assets Amounts Presented in Gross Amounts Not Offset in the Consolidated Gross Offset in the the Balance Sheets (1) Amounts of Consolidated Consolidated Cash Recognized Balance Balance Financial Collateral (In Thousands) Assets Sheets Sheets Instruments Received Net Amount Interest rate swaps $ 1,562 $ — $ 1,562 $ — $ 1,562 $ — Total $ 1,562 $ — $ 1,562 $ — $ 1,562 $ — The following table provides disclosure regarding the effect of offsetting of the Company’s recognized assets presented in the unaudited interim consolidated balance sheet as of December 31, 2016: Gross Assets Amounts Presented in Gross Amounts Not Offset in the Consolidated Gross Offset in the the Balance Sheets (1) Amounts of Consolidated Consolidated Cash Recognized Balance Balance Financial Collateral (In Thousands) Assets Sheets Sheets Instruments Received Net Amount Credit default swaps $ 173 $ — $ 173 $ — $ — $ 173 Interest rate swaps 2,924 2 2,922 — — 2,922 Total $ 3,097 $ 2 $ 3,095 $ — $ — $ 3,095 (1) Amounts presented in these columns are limited in total to the net amount of assets or liabilities presented in the prior column by instrument. In certain cases, there is excess cash collateral or financial assets we have pledged to a counterparty that exceed the financial liabilities subject to a master netting repurchase arrangement or similar agreement. Additionally, in certain cases, counterparties may have pledged excess cash collateral to us that exceeds our corresponding financial assets. In each case, any of these excess amounts are excluded from the table although they are separately reported in our consolidated balance sheets as assets or liabilities, respectively.
Schedule of effect of offsetting recognized liabilities	The following table provides disclosure regarding the effect of offsetting of the Company’s recognized liabilities presented in the unaudited interim consolidated balance sheet as of September 30, 2017: Gross Liabilities Amounts Presented in Gross Amounts Not Offset in the Consolidated Gross Offset in the the Balance Sheets (1) Amounts of Consolidated Consolidated Cash Recognized Balance Balance Financial Collateral (In Thousands) Liabilities Sheets Sheets Instruments Paid Net Amount Interest rate swaps $ 303 $ — $ 303 $ — $ 303 $ — Credit default swaps 55 — 55 — 55 — Secured short-term borrowings 522,767 — 522,767 522,767 — — Promissory note, net 6,494 — 6,494 6,494 — — Total $ 529,619 $ — $ 529,619 $ 529,261 $ 358 $ — The following table provides disclosure regarding the effect of offsetting of the Company’s recognized liabilities presented in the unaudited interim consolidated balance sheet as of December 31, 2016: Liabilities Gross Presented in Gross Amounts Not Offset in the Consolidated Gross Amounts the Balance Sheets (1) Amounts of Offset in the Consolidated Cash Recognized Consolidated Balance Financial Collateral (In Thousands) Liabilities Balance Sheets Sheets Instruments Paid Net Amount Interest rate swaps $ 643 $ — $ 643 $ — $ 643 $ — Secured short-term borrowings 927,462 — 927,462 925,602 1,860 — Promissory note, net 7,378 — 7,378 7,378 — — Total $ 935,483 $ — $ 935,483 $ 932,980 $ 2,503 $ — (1) Amounts presented in these columns are limited in total to the net amount of assets or liabilities presented in the prior column by instrument. In certain cases, there is excess cash collateral or financial assets we have pledged to a counterparty that exceed the financial liabilities subject to a master netting repurchase arrangement or similar agreement. Additionally, in certain cases, counterparties may have pledged excess cash collateral to us that exceeds our corresponding financial assets. In each case, any of these excess amounts are excluded from the table although they are separately reported in our consolidated balance sheets as assets or liabilities, respectively

Segment Reporting (Tables)

Segment Reporting (Tables)	3 Months Ended
	Mar. 31, 2018
Segment Reporting
Schedule of segment reporting information	Reportable business segments, along with remaining unallocated amounts recorded within Corporate- Other, for the three months ended March 31, 2018 are summarized in the below table. SBA Originations, Residential Loan SBC Acquisitions, Mortgage Corporate- (In Thousands) Acquisitions Originations and Servicing Banking Other Consolidated Interest income $ 9,688 $ 17,858 $ 8,715 $ 889 $ — $ 37,150 Interest expense (5,831) (12,470) (3,620) (745) — (22,666) Net interest income before provision for loan losses $ 3,857 $ 5,388 $ 5,095 $ 144 $ — $ 14,484 Provision for loan losses (272) 36 69 — — (167) Net interest income after provision for loan losses $ 3,585 $ 5,424 $ 5,164 $ 144 $ — $ 14,317 Non-interest income Gains on residential mortgage banking activities, net of variable loan expenses $ — $ — $ — $ 11,734 $ — $ 11,734 Other income 156 1,259 (123) 42 — 1,334 Income from unconsolidated joint venture 5,739 — — — — 5,739 Servicing income 5 252 1,252 4,901 — 6,410 Total non-interest income $ 5,900 $ 1,511 $ 1,129 $ 16,677 $ — $ 25,217 Non-interest expense Employee compensation and benefits (173) (2,637) (3,255) (9,114) (141) (15,320) Allocated employee compensation and benefits from related party (120) — — — (1,080) (1,200) Professional fees (317) (389) (479) (109) (1,354) (2,648) Management fees – related party — — — — (2,013) (2,013) Incentive fees – related party — — — — (408) (408) Loan servicing expense (808) (631) 76 (2,730) — (4,093) Other operating expenses (818) (2,679) (1,110) (2,700) (704) (8,011) Total non-interest expense $ (2,236) $ (6,336) $ (4,768) $ (14,653) $ (5,700) $ (33,693) Net realized gain on financial instruments 148 8,699 3,385 — — 12,232 Net unrealized gain (loss) on financial instruments (46) (2,367) 533 4,888 — 3,008 Income before provision for income taxes $ 7,351 $ 6,931 $ 5,443 $ 7,056 $ (5,700) $ 21,081 Total Assets $ 609,997 $ 1,223,608 $ 503,512 $ 283,000 $ 20,837 $ 2,640,954 Reportable business segments, along with remaining unallocated amounts recorded within Corporate- Other, for the three months ended March 31, 2017 are summarized in the below table. SBA Originations, Residential Loan SBC Acquisitions, Mortgage Corporate- (In Thousands) Acquisitions Originations and Servicing Banking Other Consolidated Interest income $ 11,188 $ 11,523 $ 10,143 $ 1,030 $ — $ 33,884 Interest expense (7,933) (2,825) (4,008) (686) (989) (16,441) Net interest income before provision for loan losses $ 3,255 $ 8,698 $ 6,135 $ 344 $ (989) $ 17,443 Provision for loan losses (622) (96) (514) — — (1,232) Net interest income after provision for loan losses $ 2,633 $ 8,602 $ 5,621 $ 344 $ (989) $ 16,211 Non-interest income Gains on residential mortgage banking activities, net of variable loan expenses $ — $ — $ — $ 10,509 $ — $ 10,509 Other income (110) 630 302 18 — 840 Servicing income 6 (503) 797 4,142 — 4,442 Total non-interest income $ (104) $ 127 $ 1,099 $ 14,669 $ — $ 15,791 Non-interest expense Employee compensation and benefits (173) (2,026) (2,199) (8,618) (448) (13,464) Allocated employee compensation and benefits from related party (102) — — — (910) (1,012) Professional fees (197) (328) (487) (300) (847) (2,159) Management fees – related party — — — — (1,977) (1,977) Loan servicing expense (666) (481) 1,108 (1,474) — (1,513) Other operating expenses (1,051) (1,547) (839) (1,617) (480) (5,534) Total non-interest expense $ (2,189) $ (4,382) $ (2,417) $ (12,009) $ (4,662) $ (25,659) Net realized gain on financial instruments 306 1,336 1,055 — 269 2,966 Net unrealized gain (loss) on financial instruments 473 1,292 — (553) 70 1,282 Income before provision for income taxes $ 1,119 $ 6,975 $ 5,358 $ 2,451 $ (5,312) $ 10,591 Total Assets $ 566,038 $ 832,057 $ 572,561 $ 314,480 $ 242,386 $ 2,527,522

Supplemental Financial Data (Ta

Supplemental Financial Data (Tables)	3 Months Ended
	Mar. 31, 2018
Supplemental Financial Data
Consolidated statements of income of VIEs	Statements of Income Three months ended March 31, 2018 (In Thousands) Girod HoldCo, LLC WFLLA, LLC Interest income $ 7,847 $ 3,916 Realized gains 13,903 6,938 Unrealized gains 3,263 1,628 Servicing expense and other (2,005) (1,003) Income before provision for income taxes $ 23,008 $ 11,479

Organization (Details)

Organization (Details)	3 Months Ended
	Mar. 31, 2018segment
Ownership percentage in operating partnership	96.50%
Number of reportable segments	4
Minimum
Percentage of taxable income distributed in the form of qualifying distributions	90.00%

Summary of Significant Accoun56

Summary of Significant Accounting Policies (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2018USD ($)segmentclassitem	Dec. 31, 2017USD ($)
Number of reportable segments | segment	4
Amount in money market mutual funds	$ 600	$ 600
Number of days loans must be delinquent to be placed on nonaccrual status	90 days
Number of separate classes of servicing rights used for risk management purposes | class	2
Investment in unconsolidated joint venture ownership percentage	50.00%
Debt issuance costs	$ 1,765	446
Number of repurchase agreements accounted for as components of linked transactions | item	0
Unrecognized accrued taxes, interest and penalties	$ 0	0
The number of consecutive months contractual payments that must be received on a loan in non-accrual status before resuming recognition of interest income | item	3
Borrowings under credit facilities | Maximum
Maturity period	2 years
Promissory note
Debt issuance costs	$ 0
Promissory note | Maximum
Maturity period	5 years
Restricted cash
Cash collateral receivable	$ 0	$ 800

Recently Issued Accounting Pr57

Recently Issued Accounting Pronouncements (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Cash Flow comparison
Cash and cash equivalents at beginning of period	$ 63,425
Cash and cash equivalents at end of period	86,773
Cash, cash equivalents, and restricted cash at beginning of period	75,091	$ 79,756
Net decrease in cash in cash, cash equivalents, and restricted cash	25,646	(19,984)
Cash, cash equivalents, and restricted cash at end of period	$ 100,737	59,772
Previously Reported
Cash Flow comparison
Cash and cash equivalents at beginning of period		59,566
Net decrease in cash and cash equivalents		(19,566)
Cash and cash equivalents at end of period		$ 40,000

Loans and Allowance for Loan 58

Loans and Allowance for Loan Losses - Classification, unpaid principal balance, and carrying value (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017	Mar. 31, 2017	Dec. 31, 2016
Carrying Value
Total Loans, before allowance for loan losses	$ 1,065,755	$ 1,027,467
Allowance for loan losses	(8,721)	(9,547)
Total Loans, net	1,057,034	1,017,920
Allowance for loan losses on loans in consolidated VIEs	(10,533)	(11,746)	$ (14,684)	$ (16,130)
Total Loans, net of allowance for loan losses, including loans in consolidated VIEs	1,999,928	1,854,100
Loans, held for sale, at fair value	160,999	216,022
Loans, held-for-investment	2,160,927	2,070,122
UPB
Total Loans, before allowance for loan losses	1,107,757	1,066,287
Total Loans, net	1,107,757	1,066,287
Total Loans, net, and Loans, net in consolidated VIEs	2,077,768	1,936,455
Total Loans, held for sale, at fair value	155,622	209,534
Total Loan portfolio	2,233,390	2,145,989
VIEs
Carrying Value
Total Loans, in consolidated VIEs, before allowance for loan losses	944,706	838,379
Allowance for loan losses on loans in consolidated VIEs	(1,812)	(2,199)
Total Loans, net, in consolidated VIEs	942,894	836,180
UPB
Total Loans, in consolidated VIEs, before allowance for loan losses	970,011	870,168
Total Loans, net, in consolidated VIEs	970,011	870,168
Acquired SBA 7(a) loans
Carrying Value
Total Loans, before allowance for loan losses	313,382	331,083
Allowance for loan losses on loans in consolidated VIEs	(2,990)	(3,527)	(5,100)	(5,004)
UPB
Total Loans, before allowance for loan losses	334,501	353,556
Acquired SBA 7(a) loans | VIEs
Carrying Value
Total Loans, in consolidated VIEs, before allowance for loan losses	66,142	69,523
UPB
Total Loans, in consolidated VIEs, before allowance for loan losses	90,467	95,605
Acquired loans
Carrying Value
Total Loans, before allowance for loan losses	316,938	191,327
Allowance for loan losses on loans in consolidated VIEs	(6,544)	(7,264)	(8,412)	(10,150)
Loans, held for sale, at fair value	1,212	2,544
UPB
Total Loans, before allowance for loan losses	334,143	209,694
Total Loans, held for sale, at fair value	1,296	2,662
Acquired loans | VIEs
Carrying Value
Total Loans, in consolidated VIEs, before allowance for loan losses	176,366	189,545
UPB
Total Loans, in consolidated VIEs, before allowance for loan losses	190,021	204,497
Originated Transitional loans
Carrying Value
Total Loans, before allowance for loan losses	297,863	246,076
Allowance for loan losses on loans in consolidated VIEs	(338)
UPB
Total Loans, before allowance for loan losses	300,123	248,190
Originated Transitional loans | VIEs
Carrying Value
Total Loans, in consolidated VIEs, before allowance for loan losses	192,623	196,438
UPB
Total Loans, in consolidated VIEs, before allowance for loan losses	192,432	196,070
Originated SBC loans, at fair value
Carrying Value
Total Loans, before allowance for loan losses	40,430	188,150
UPB
Total Loans, before allowance for loan losses	39,833	182,045
Originated SBC loans
Carrying Value
Total Loans, before allowance for loan losses	42,926	27,610
Allowance for loan losses on loans in consolidated VIEs	(227)	(637)	(842)	(804)
UPB
Total Loans, before allowance for loan losses	42,232	27,349
Originated SBC loans | VIEs
Carrying Value
Total Loans, in consolidated VIEs, before allowance for loan losses	509,575	382,873
UPB
Total Loans, in consolidated VIEs, before allowance for loan losses	497,091	373,996
Originated SBA 7(a) loans
Carrying Value
Total Loans, before allowance for loan losses	51,970	41,208
Allowance for loan losses on loans in consolidated VIEs	(434)	(318)	$ (330)	$ (172)
Loans, held for sale, at fair value	23,776	16,791
UPB
Total Loans, before allowance for loan losses	54,679	43,439
Total Loans, held for sale, at fair value	21,927	15,472
Originated Residential Agency loans
Carrying Value
Total Loans, before allowance for loan losses	2,246	2,013
Loans, held for sale, at fair value	86,741	129,096
UPB
Total Loans, before allowance for loan losses	2,246	2,014
Total Loans, held for sale, at fair value	83,880	124,758
Originated Freddie Mac loans
Carrying Value
Loans, held for sale, at fair value	49,270	67,591
UPB
Total Loans, held for sale, at fair value	$ 48,519	$ 66,642

Loans and Allowance for Loan 59

Loans and Allowance for Loan Losses - Delinquency (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2018	Dec. 31, 2017
Loan delinquency information
Total Loans Carrying Value	$ 2,001,897	$ 1,856,196
Non-Accrual Loans	36,359	34,755
90+ Days Past Due but Accruing	9,766	4,764
General allowance for loan losses	(1,969)	(2,096)
Total Loans, net of allowance for loan losses, including loans in consolidated VIEs	$ 1,999,928	$ 1,854,100
Percentage of outstandings	100.00%	100.00%
Percentage of outstandings - Non accrual loans	1.80%	1.90%
Percentage of outstandings - Accruing	0.50%	0.30%
Current and less than 30 days past due
Loan delinquency information
Total Loans Carrying Value	$ 1,944,514	$ 1,791,876
Percentage of outstandings	97.20%	96.50%
30-89 Days Past Due
Loan delinquency information
Total Loans Carrying Value	$ 28,879	$ 38,120
Percentage of outstandings	1.40%	2.10%
90+ Days Past Due
Loan delinquency information
Total Loans Carrying Value	$ 28,504	$ 26,200
Percentage of outstandings	1.40%	1.40%
Acquired SBA 7(a) loans
Loan delinquency information
Total Loans Carrying Value	$ 377,044	$ 397,597
Non-Accrual Loans	17,497	16,782
90+ Days Past Due but Accruing		176
General allowance for loan losses	(510)	(518)
Acquired SBA 7(a) loans | Current and less than 30 days past due
Loan delinquency information
Total Loans Carrying Value	358,760	376,102
Acquired SBA 7(a) loans | 30-89 Days Past Due
Loan delinquency information
Total Loans Carrying Value	16,039	15,953
Acquired SBA 7(a) loans | 90+ Days Past Due
Loan delinquency information
Total Loans Carrying Value	2,245	5,542
Acquired loans
Loan delinquency information
Total Loans Carrying Value	487,195	374,425
Non-Accrual Loans	10,257	16,405
90+ Days Past Due but Accruing	8,743	4,090
General allowance for loan losses	(493)	(819)
Acquired loans | Current and less than 30 days past due
Loan delinquency information
Total Loans Carrying Value	464,476	348,271
Acquired loans | 30-89 Days Past Due
Loan delinquency information
Total Loans Carrying Value	5,185	6,891
Acquired loans | 90+ Days Past Due
Loan delinquency information
Total Loans Carrying Value	17,534	19,263
Originated Transitional loans
Loan delinquency information
Total Loans Carrying Value	490,486	442,515
General allowance for loan losses	(338)
Originated Transitional loans | Current and less than 30 days past due
Loan delinquency information
Total Loans Carrying Value	490,486	435,252
Originated Transitional loans | 30-89 Days Past Due
Loan delinquency information
Total Loans Carrying Value		7,263
Originated SBC loans, at fair value
Loan delinquency information
Total Loans Carrying Value	40,430	188,150
Originated SBC loans, at fair value | Current and less than 30 days past due
Loan delinquency information
Total Loans Carrying Value	35,704	188,150
Originated SBC loans, at fair value | 30-89 Days Past Due
Loan delinquency information
Total Loans Carrying Value	4,726
Originated SBC loans
Loan delinquency information
Total Loans Carrying Value	552,559	410,314
Non-Accrual Loans	7,702	608
General allowance for loan losses	(227)	(468)
Originated SBC loans | Current and less than 30 days past due
Loan delinquency information
Total Loans Carrying Value	542,307	402,004
Originated SBC loans | 30-89 Days Past Due
Loan delinquency information
Total Loans Carrying Value	2,550	7,702
Originated SBC loans | 90+ Days Past Due
Loan delinquency information
Total Loans Carrying Value	7,702	608
Originated SBA 7(a) loans
Loan delinquency information
Total Loans Carrying Value	51,937	41,182
Non-Accrual Loans	903	671
General allowance for loan losses	(401)	(291)
Originated SBA 7(a) loans | Current and less than 30 days past due
Loan delinquency information
Total Loans Carrying Value	51,558	40,871
Originated SBA 7(a) loans | 30-89 Days Past Due
Loan delinquency information
Total Loans Carrying Value	379	311
Originated Residential Agency loans
Loan delinquency information
Total Loans Carrying Value	2,246	2,013
Non-Accrual Loans		289
90+ Days Past Due but Accruing	1,023	498
Originated Residential Agency loans | Current and less than 30 days past due
Loan delinquency information
Total Loans Carrying Value	1,223	1,226
Originated Residential Agency loans | 90+ Days Past Due
Loan delinquency information
Total Loans Carrying Value	$ 1,023	$ 787

Loans and Allowance for Loan 60

Loans and Allowance for Loan Losses - Credit Quality (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	$ 2,001,897	$ 1,856,196
General allowance for loan losses	(1,969)	(2,096)
Total Loans, net of allowance for loan losses, including loans in consolidated VIEs	1,999,928	1,854,100
Carrying amount of loan foreclosure in process	200	400
0.0 - 20.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	83,113	66,154
20.1 - 40.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	266,604	234,702
40.1 - 60.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	624,982	639,905
60.1 - 80.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	780,427	675,958
80.1 - 100.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	131,036	132,423
Greater than 100.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	115,735	107,054
Acquired SBA 7(a) loans
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	377,044	397,597
General allowance for loan losses	(510)	(518)
Acquired SBA 7(a) loans | 0.0 - 20.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	8,855	8,978
Acquired SBA 7(a) loans | 20.1 - 40.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	38,782	37,880
Acquired SBA 7(a) loans | 40.1 - 60.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	123,609	125,234
Acquired SBA 7(a) loans | 60.1 - 80.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	98,577	106,199
Acquired SBA 7(a) loans | 80.1 - 100.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	49,327	56,676
Acquired SBA 7(a) loans | Greater than 100.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	57,894	62,630
Acquired loans
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	487,195	374,425
General allowance for loan losses	(493)	(819)
Acquired loans | 0.0 - 20.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	71,577	54,463
Acquired loans | 20.1 - 40.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	139,433	102,498
Acquired loans | 40.1 - 60.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	137,111	114,010
Acquired loans | 60.1 - 80.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	85,562	67,037
Acquired loans | 80.1 - 100.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	26,761	18,745
Acquired loans | Greater than 100.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	26,751	17,672
Originated Transitional loans
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	490,486	442,515
General allowance for loan losses	(338)
Originated Transitional loans | 20.1 - 40.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	21,695	26,735
Originated Transitional loans | 40.1 - 60.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	150,593	171,227
Originated Transitional loans | 60.1 - 80.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	278,117	212,830
Originated Transitional loans | 80.1 - 100.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	26,893	21,639
Originated Transitional loans | Greater than 100.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	13,188	10,084
Originated SBC loans, at fair value
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	40,430	188,150
Originated SBC loans, at fair value | 20.1 - 40.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	11,938	17,294
Originated SBC loans, at fair value | 40.1 - 60.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	6,881	31,245
Originated SBC loans, at fair value | 60.1 - 80.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	6,123	115,653
Originated SBC loans, at fair value | 80.1 - 100.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	15,488	21,245
Originated SBC loans, at fair value | Greater than 100.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs		2,713
Originated SBC loans
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	552,559	410,314
General allowance for loan losses	(227)	(468)
Originated SBC loans | 0.0 - 20.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	2,648	2,661
Originated SBC loans | 20.1 - 40.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	53,157	49,281
Originated SBC loans | 40.1 - 60.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	200,928	192,796
Originated SBC loans | 60.1 - 80.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	291,468	158,047
Originated SBC loans | 80.1 - 100.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	4,358	7,529
Originated SBA 7(a) loans
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	51,937	41,182
General allowance for loan losses	(401)	(291)
Originated SBA 7(a) loans | 0.0 - 20.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	33	52
Originated SBA 7(a) loans | 20.1 - 40.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	1,539	954
Originated SBA 7(a) loans | 40.1 - 60.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	5,694	5,227
Originated SBA 7(a) loans | 60.1 - 80.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	19,849	15,583
Originated SBA 7(a) loans | 80.1 - 100.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	7,389	5,766
Originated SBA 7(a) loans | Greater than 100.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	17,433	13,600
Originated Residential Agency loans
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	2,246	2,013
Originated Residential Agency loans | 20.1 - 40.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	60	60
Originated Residential Agency loans | 40.1 - 60.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	166	166
Originated Residential Agency loans | 60.1 - 80.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	731	609
Originated Residential Agency loans | 80.1 - 100.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	820	823
Originated Residential Agency loans | Greater than 100.0%
Credit quality of loans
Total Loans, before allowance for loan losses, including loans in consolidated VIEs	$ 469	$ 355

Loans and Allowance for Loan 61

Loans and Allowance for Loan Losses - Geographic and Collateral Concentration (Details) - Loans, held-for-investment	3 Months Ended	12 Months Ended
	Mar. 31, 2018	Dec. 31, 2017
Geographical concentration
Concentration risk
Percentage of loan	100.00%	100.00%
Geographical concentration | CALIFORNIA
Concentration risk
Percentage of loan	13.80%	13.50%
Geographical concentration | TEXAS
Concentration risk
Percentage of loan	11.90%	12.40%
Geographical concentration | FLORIDA
Concentration risk
Percentage of loan	11.60%	11.70%
Geographical concentration | NEW YORK
Concentration risk
Percentage of loan	6.90%	6.80%
Geographical concentration | GEORGIA
Concentration risk
Percentage of loan	6.00%	6.20%
Geographical concentration | ARIZONA
Concentration risk
Percentage of loan	4.00%	5.10%
Geographical concentration | ILLINOIS
Concentration risk
Percentage of loan	3.60%	3.90%
Geographical concentration | NORTH CAROLINA
Concentration risk
Percentage of loan	3.50%	3.70%
Geographical concentration | PENNSYLVANIA
Concentration risk
Percentage of loan	3.00%	2.10%
Geographical concentration | OHIO
Concentration risk
Percentage of loan	2.60%	2.70%
Geographical concentration | Other
Concentration risk
Percentage of loan	33.10%	31.90%
Collateral concentration
Concentration risk
Percentage of loan	100.00%	100.00%
Percentage of SBA loan	100.00%	100.00%
Collateral concentration | Offices of Physicians
Concentration risk
Percentage of SBA loan	16.20%	16.00%
Collateral concentration | Child Day Care Services
Concentration risk
Percentage of SBA loan	11.70%	12.30%
Collateral concentration | Lodging
Concentration risk
Percentage of SBA loan	10.70%	10.50%
Collateral concentration | Veterinarians
Concentration risk
Percentage of SBA loan	7.00%	7.00%
Collateral concentration | Eating Places
Concentration risk
Percentage of SBA loan	5.50%	5.50%
Collateral concentration | Grocery Stores
Concentration risk
Percentage of SBA loan	4.70%	4.70%
Collateral concentration | Auto
Concentration risk
Percentage of SBA loan	3.00%	3.20%
Collateral concentration | Funeral Service and Crematories
Concentration risk
Percentage of SBA loan	2.30%	2.20%
Collateral concentration | Accounting, Auditing and Bookkeeping
Concentration risk
Percentage of SBA loan	2.10%	2.10%
Collateral concentration | Gasoline Service Stations
Concentration risk
Percentage of SBA loan	2.10%	1.90%
Collateral concentration | Other
Concentration risk
Percentage of SBA loan	34.70%	34.60%
Collateral concentration | SBA
Concentration risk
Percentage of loan	23.10%	25.40%
Collateral concentration | Multi-family
Concentration risk
Percentage of loan	21.40%	21.10%
Collateral concentration | Retail
Concentration risk
Percentage of loan	17.70%	17.60%
Collateral concentration | Office
Concentration risk
Percentage of loan	14.90%	15.60%
Collateral concentration | Industrial
Concentration risk
Percentage of loan	7.90%	6.90%
Collateral concentration | Mixed Use
Concentration risk
Percentage of loan	7.30%	6.30%
Collateral concentration | Lodging/Residential
Concentration risk
Percentage of loan	2.70%	2.90%
Collateral concentration | Other
Concentration risk
Percentage of loan	5.00%	4.20%

Loans and Allowance for Loan 62

Loans and Allowance for Loan Losses - Allowance for loan losses by loan product and impairment methodology (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017	Mar. 31, 2017	Dec. 31, 2016
Allowance for loan losses
General	$ 1,969	$ 2,096
Specific	1,511	2,346
PCI	7,053	7,304
Ending Balance	10,533	11,746	$ 14,684	$ 16,130
Originated SBC loans
Allowance for loan losses
General	227	468
Specific		169
Ending Balance	227	637	842	804
Originated Transitional loans
Allowance for loan losses
General	338
Ending Balance	338
Acquired loans
Allowance for loan losses
General	493	819
Specific	416	586
PCI	5,635	5,859
Ending Balance	6,544	7,264	8,412	10,150
Acquired SBA 7(a) loans
Allowance for loan losses
General	510	518
Specific	1,062	1,564
PCI	1,418	1,445
Ending Balance	2,990	3,527	5,100	5,004
Originated SBA 7(a) loans
Allowance for loan losses
General	401	291
Specific	33	27
Ending Balance	$ 434	$ 318	$ 330	$ 172

Loans and Allowance for Loan 63

Loans and Allowance for Loan Losses - Investment Loans Allowance Activity (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Allowance for loan losses
Beginning Balance	$ 11,746	$ 16,130
Provision for (Recoveries of) loan losses	167	1,232
Charge-offs and sales	(842)	(919)
Recoveries	(538)	(1,759)
Ending Balance	10,533	14,684
Originated SBC loans
Allowance for loan losses
Beginning Balance	637	804
Provision for (Recoveries of) loan losses	(241)	38
Charge-offs and sales	(169)
Ending Balance	227	842
Originated Transitional loans
Allowance for loan losses
Provision for (Recoveries of) loan losses	338
Ending Balance	338
Acquired loans
Allowance for loan losses
Beginning Balance	7,264	10,150
Provision for (Recoveries of) loan losses	139	680
Charge-offs and sales	(224)	(659)
Recoveries	(635)	(1,759)
Ending Balance	6,544	8,412
Acquired SBA 7(a) loans
Allowance for loan losses
Beginning Balance	3,527	5,004
Provision for (Recoveries of) loan losses	(185)	356
Charge-offs and sales	(449)	(260)
Recoveries, adjustments	97
Ending Balance	2,990	5,100
Originated SBA 7(a) loans
Allowance for loan losses
Beginning Balance	318	172
Provision for (Recoveries of) loan losses	116	158
Ending Balance	$ 434	$ 330

Loans and Allowance for Loan 64

Loans and Allowance for Loan Losses - Investment Loans Impairment (Details) - Non - PCI Loans - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017
Impaired loans
Impaired loans with an allowance	$ 8,933		$ 9,222
Impaired loans without an allowance	21,929		12,659
Total recorded carrying value of impaired loans	30,862		21,881
Allowance for loan losses related to impaired loans	(1,511)		(2,346)
Unpaid principal balance of impaired loans	36,484		29,853
Impaired loans on non-accrual status	29,010		21,881
Average carrying amount of impaired loans	26,372		$ 28,693
Interest income recognized on impaired loans	$ 2	$ 3

Loans and Allowance for Loan 65

Loans and Allowance for Loan Losses - TDR Accrual Status (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Troubled debt restructurings (TDRs)
Recorded carrying value modified loans classified as TDR	$ 16,497	$ 16,125
Allowance for loan losses on loans classified as TDRs	1,351	1,578
Carrying value of modified loans classified as TDRs
Carrying value of modified loans classified as TDRs on accrual status	7,175	6,595
Carrying value of modified loans classified as TDRs on non-accrual status	9,322	9,530
Total carrying value of modified loans classified as TDRs	16,497	16,125
SBC
Troubled debt restructurings (TDRs)
Recorded carrying value modified loans classified as TDR	3,677	3,727
Allowance for loan losses on loans classified as TDRs	846	883
Carrying value of modified loans classified as TDRs
Carrying value of modified loans classified as TDRs on accrual status	2,296	1,804
Carrying value of modified loans classified as TDRs on non-accrual status	1,381	1,923
Total carrying value of modified loans classified as TDRs	3,677	3,727
SBA
Troubled debt restructurings (TDRs)
Recorded carrying value modified loans classified as TDR	12,820	12,398
Allowance for loan losses on loans classified as TDRs	505	695
Carrying value of modified loans classified as TDRs
Carrying value of modified loans classified as TDRs on accrual status	4,879	4,791
Carrying value of modified loans classified as TDRs on non-accrual status	7,941	7,607
Total carrying value of modified loans classified as TDRs	$ 12,820	$ 12,398

Loans and Allowance for Loan 66

Loans and Allowance for Loan Losses - TDR Activity (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2018USD ($)loan	Mar. 31, 2017USD ($)loan
Troubled debt restructurings (TDRs)
Number of loans permanently modified | loan	11	13
Pre-modification recorded balance	$ 1,120	$ 2,756
Post-modification recorded balance	$ 1,223	$ 2,490
Number of loans that remain in default as of December 31, 2017 | loan	4	6
Balance of loans that remain in default as of December 31, 2017	$ 239	$ 1,179
TDR Modifications including financial effects	$ 1,199	$ 2,490
SBC
Troubled debt restructurings (TDRs)
Number of loans permanently modified | loan		9
Pre-modification recorded balance		$ 2,234
Post-modification recorded balance		$ 2,034
Number of loans that remain in default as of December 31, 2017 | loan		6
Balance of loans that remain in default as of December 31, 2017		$ 1,179
TDR Modifications including financial effects		$ 2,034
SBA
Troubled debt restructurings (TDRs)
Number of loans permanently modified | loan	11	4
Pre-modification recorded balance	$ 1,120	$ 522
Post-modification recorded balance	$ 1,223	456
Number of loans that remain in default as of December 31, 2017 | loan	4
Balance of loans that remain in default as of December 31, 2017	$ 239
TDR Modifications including financial effects	1,199	456
Term Extension
Troubled debt restructurings (TDRs)
TDR Modifications including financial effects	1,135	403
Term Extension | SBC
Troubled debt restructurings (TDRs)
TDR Modifications including financial effects		13
Term Extension | SBA
Troubled debt restructurings (TDRs)
TDR Modifications including financial effects	1,135	390
Interest Rate Reduction
Troubled debt restructurings (TDRs)
TDR Modifications including financial effects		116
Interest Rate Reduction | SBC
Troubled debt restructurings (TDRs)
TDR Modifications including financial effects		116
Principal Reduction
Troubled debt restructurings (TDRs)
TDR Modifications including financial effects		656
Principal Reduction | SBC
Troubled debt restructurings (TDRs)
TDR Modifications including financial effects		656
Foreclosure
Troubled debt restructurings (TDRs)
TDR Modifications including financial effects	64	1,315
Foreclosure | SBC
Troubled debt restructurings (TDRs)
TDR Modifications including financial effects		1,249
Foreclosure | SBA
Troubled debt restructurings (TDRs)
TDR Modifications including financial effects	$ 64	$ 66

Loans and Allowance for Loan 67

Loans and Allowance for Loan Losses - Investment Loans (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017	Mar. 31, 2017	Dec. 31, 2016
Acquired loans
Allowance for loan losses on loans in consolidated VIEs	$ (10,533)	$ (11,746)	$ (14,684)	$ (16,130)
Non - PCI Loans
Acquired loans
Unpaid principal balance	1,915,622	1,624,395
Accretable discount	(38,100)	(44,629)
Loans, held-for-investment	1,877,522	1,579,766
Allowance for loan losses on loans in consolidated VIEs	(3,480)	(4,442)
Loans, held-for-investment	1,874,042	1,575,324
PCI Loans
Acquired loans
Unpaid principal balance	122,313	130,015
Non-accretable discount	(8,810)	(8,336)
Accretable discount	(20,994)	(23,749)	$ (24,221)	$ (26,978)
Loans, held-for-investment	92,509	97,930
Allowance for loan losses on loans in consolidated VIEs	(7,053)	(7,304)
Loans, held-for-investment	$ 85,456	$ 90,626

Loans and Allowance for Loan 68

Loans and Allowance for Loan Losses - Investment Loans Value and Yield Activity (Details) - PCI Loans - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Accretable yield
Beginning accretable yield- PCI loans	$ 23,749	$ 26,978
Sales	(656)	(1,195)
Accretion	(1,709)	(1,198)
Other	411	471
Transfers	(801)	(835)
Ending accretable yield	$ 20,994	$ 24,221

Fair Value Measurements - Finan

Fair Value Measurements - Financial Instruments Carried at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Assets:
Loans, held for sale, at fair value	$ 160,999	$ 216,022
Derivative instruments,at fair value	5,022	4,725
Residential mortgage servicing rights, at fair value	81,591	72,295
Liabilities:
Derivative instruments, at fair value	756	282
Contingent consideration	10,732	10,016
Recurring basis
Assets:
Cash held in money market funds	633	632
Loans, held for sale, at fair value	160,999	216,022
Loans, net at fair value	40,430	188,150
Mortgage backed securities, at fair value	47,181	39,922
Derivative instruments,at fair value	5,022	4,725
Residential mortgage servicing rights, at fair value	81,591	72,295
Total assets	335,856	521,746
Liabilities:
Derivative instruments, at fair value	756	282
Contingent consideration	10,732	10,016
Total liabilities	11,488	10,298
Recurring basis | Level 1
Assets:
Cash held in money market funds	633	632
Total assets	633	632
Recurring basis | Level 2
Assets:
Loans, held for sale, at fair value	160,999	216,022
Mortgage backed securities, at fair value	24,445	31,859
Derivative instruments,at fair value	1,552	2,898
Total assets	186,996	250,779
Liabilities:
Derivative instruments, at fair value	756	282
Total liabilities	756	282
Recurring basis | Level 3
Assets:
Loans, net at fair value	40,430	188,150
Mortgage backed securities, at fair value	22,736	8,063
Derivative instruments,at fair value	3,470	1,827
Residential mortgage servicing rights, at fair value	81,591	72,295
Total assets	148,227	270,335
Liabilities:
Contingent consideration	10,732	10,016
Total liabilities	$ 10,732	$ 10,016

Fair Value Measurements - Chang

Fair Value Measurements - Changes in Fair Value (Details) - Level 3 - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017
Loans, held at fair value
Changes in fair value of assets
Beginning Balance	$ 188,150	$ 81,592	$ 81,592
Realized gains (losses), net	(3)	27
Unrealized gains (losses), net	(762)	630
Originations	150	27,499
Sales		(2,017)
Principal payments	(4,666)	(40)
Transfer from loans, held-for-investment, net	(142,439)
Ending Balance	40,430	107,691	188,150
Total unrealized gain (loss)	600		6,000
Loans, held for sale, at fair value
Changes in fair value of assets
Beginning Balance		17,312	17,312
Realized gains (losses), net		917
Unrealized gains (losses), net		526
Originations		69,665
Sales		(54,116)
Principal payments		3,021
Ending Balance		37,325
MBS
Changes in fair value of assets
Beginning Balance	8,063	32,391	32,391
Accreted discount, net	21	54
Realized gains (losses), net	123	189
Unrealized gains (losses), net	230	(45)
Sales / Principal payments	(517)	(1,224)
Transfer from loans, held at fair value	14,816
Ending Balance	22,736	31,365	8,063
Total unrealized gain (loss)	400		(600)
Residential MRSs
Changes in fair value of liabilities
Total unrealized gain (loss)	(3,600)		(8,500)
Derivatives
Changes in fair value of assets
Beginning Balance	1,827	2,690	2,690
Unrealized gains (losses), net	1,643	(1,312)
Ending Balance	3,470	1,378	1,827
Total unrealized gain (loss)	(100)		(1,700)
Contingent Consideration
Changes in fair value of liabilities
Beginning Balance	10,016	14,487	14,487
Adjustment for legal settlement	634	(5,744)
Amortization	82	98
Ending Balance	10,732	$ 8,841	10,016
Total unrealized gain (loss)	$ 0		$ 0

Fair Value Measurements - Valua

Fair Value Measurements - Valuation and Inputs, at FV (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2018	Dec. 31, 2017
Recurring basis
Fair value inputs, quantitative information
Asset, fair value	$ 335,856	$ 521,746
Liabilities, fair value	11,488	10,298
Recurring basis | Level 3
Fair value inputs, quantitative information
Asset, fair value	148,227	270,335
Liabilities, fair value	10,732	10,016
Loans, held at fair value | Recurring basis | Level 3 | Third Party Mark
Fair value inputs, quantitative information
Asset, fair value	$ 40,430	$ 188,150
Loans, held at fair value | Recurring basis | Level 3 | Third Party Mark | Minimum
Fair value inputs, quantitative information
Price	$ 101.50	$ 101.05
Loans, held at fair value | Recurring basis | Level 3 | Third Party Mark | Maximum
Fair value inputs, quantitative information
Price	101.50	104
Loans, held at fair value | Recurring basis | Level 3 | Third Party Mark | Weighted Average
Fair value inputs, quantitative information
Price	$ 101.50	$ 103.35
MBS | Recurring basis | Level 3 | Third Party Mark
Fair value inputs, quantitative information
Asset, fair value	$ 22,610	$ 7,937
MBS | Recurring basis | Level 3 | Third Party Mark | Minimum
Fair value inputs, quantitative information
Price	$ 67.52	$ 70.92
MBS | Recurring basis | Level 3 | Third Party Mark | Maximum
Fair value inputs, quantitative information
Price	73.01	70.92
MBS | Recurring basis | Level 3 | Third Party Mark | Weighted Average
Fair value inputs, quantitative information
Price	$ 69.36	$ 70.92
MBS | Recurring basis | Level 3 | Transaction Price
Fair value inputs, quantitative information
Asset, fair value	$ 126	$ 126
MBS | Recurring basis | Level 3 | Transaction Price | Minimum
Fair value inputs, quantitative information
Price	$ 99	$ 99
MBS | Recurring basis | Level 3 | Transaction Price | Maximum
Fair value inputs, quantitative information
Price	99	99
MBS | Recurring basis | Level 3 | Transaction Price | Weighted Average
Fair value inputs, quantitative information
Price	$ 99	$ 99
Interest-Only-Strips | Level 3
Fair value inputs, quantitative information
Asset, fair value	$ 500	$ 500
Residential MRSs | Recurring basis | Level 3 | Discounted Cash Flow
Fair value inputs, quantitative information
Asset, fair value	81,591	72,295
Contingent Consideration | Recurring basis | Level 3 | Discounted Cash Flow
Fair value inputs, quantitative information
Liabilities, fair value	$ 10,732	$ 10,016

Fair Value Measurements - Asset

Fair Value Measurements - Assets and Liabilities, Not at FV (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Assets:
Servicing rights	$ 23,022	$ 21,743
Receivable from third parties	11,064	6,756
Liabilities:
Promissory note	5,883	6,107
Senior secured notes, net	178,688	138,078
Carrying Value
Assets:
Loans, held-for-investment	1,959,498	1,665,950
Investment in unconsolidated joint venture	50,229	55,369
Servicing rights	23,022	21,743
Total assets	2,032,749	1,743,062
Liabilities:
Borrowings under credit facilities	657,233	631,286
Promissory note	5,883	6,107
Securitized debt obligations of consolidated VIEs	679,871	598,148
Senior secured notes, net	178,688	138,078
Guaranteed loan financing	278,500	293,045
Convertible note, net	109,226	108,991
Total liabilities	1,909,401	1,775,655
Carrying Value | Level 3
Assets:
Due from servicers and accrued interest	12,900	16,500
Receivable from third parties	11,100	6,800
Liabilities:
Payable to related parties and accrued interest payable	10,600	12,400
Fair Value | Level 3
Assets:
Loans, held-for-investment	2,009,116	1,737,361
Investment in unconsolidated joint venture	50,229	55,369
Servicing rights	24,763	23,432
Total assets	2,084,108	1,816,162
Liabilities:
Borrowings under credit facilities	657,233	631,286
Promissory note	5,883	6,107
Securitized debt obligations of consolidated VIEs	695,610	613,676
Senior secured notes, net	182,737	144,376
Guaranteed loan financing	291,340	306,964
Convertible note, net	98,721	108,301
Total liabilities	$ 1,931,524	$ 1,810,710

Mortgage Backed Securities (Det

Mortgage Backed Securities (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2018	Dec. 31, 2017
Mortgage Backed Securities
Weighted Average Interest Rate	5.10%	5.30%
Principal Balance	$ 66,247	$ 54,407
Amortized Cost	45,877	38,468
Fair Value	$ 47,181	$ 39,922
Mortgage Backed Securities Weighted Average Interest Rate
After five years through ten years (as percent)	10.30%	8.90%
After ten years (as percent)	4.60%	4.60%
Mortgage Backed Securities Principal Balance
After five years through ten years	$ 6,434	$ 8,919
After ten years	59,813	45,488
Mortgage Backed Securities Amortized Cost
After five years through ten years	5,810	8,205
After ten years	40,067	30,263
Mortgage Backed Securities Estimated Fair Value
After five years through ten years	6,483	8,904
After ten years	$ 40,698	$ 31,018
MBS
Mortgage Backed Securities
Weighted Average Interest Rate	5.10%	5.30%
Principal Balance	$ 66,247	$ 54,407
Amortized Cost	45,877	38,468
Fair Value	47,181	39,922
Gross Unrealized Gains	2,270	2,703
Gross Unrealized Losses	$ (966)	$ (1,249)
Freddie Mac Loans
Mortgage Backed Securities
Weighted Average Interest Rate	5.10%	5.30%
Principal Balance	$ 61,509	$ 49,767
Amortized Cost	44,672	37,287
Fair Value	45,856	38,568
Gross Unrealized Gains	2,149	2,529
Gross Unrealized Losses	$ (965)	$ (1,248)
Commercial Loans
Mortgage Backed Securities
Weighted Average Interest Rate	5.60%	5.50%
Principal Balance	$ 4,611	$ 4,513
Amortized Cost	1,078	1,054
Fair Value	1,199	1,228
Gross Unrealized Gains	$ 121	$ 174
Tax Liens
Mortgage Backed Securities
Weighted Average Interest Rate	6.00%	6.00%
Principal Balance	$ 127	$ 127
Amortized Cost	127	127
Fair Value	126	126
Gross Unrealized Losses	$ (1)	$ (1)

Servicing rights (Details)

Servicing rights (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2018	Dec. 31, 2017	Mar. 31, 2017
Servicing rights
Unpaid Principal Amount			$ 1,114,105	$ 987,446
Carrying Value	$ 23,022		23,022
Total servicing rights			104,613	94,038	$ 84,997
Servicing rights activity at amortized cost
Ending net carrying value at amortized cost	23,022
Servicing rights activity at fair value
Beginning net carrying value at fair value	21,743
Ending net carrying value at fair value	23,022
Residential
Servicing rights
Unpaid Principal Amount			6,817,646	6,558,455
Servicing rights activity at fair value
Beginning net carrying value at fair value	72,295	$ 61,376
Additions due to loans sold, servicing retained	5,706	5,052
Loan pay-offs	(1,298)	(1,250)
Unrealized gains (losses)	4,888	(553)
Ending net carrying value at fair value	81,591	64,625
Freddie Mac
Servicing rights
Unpaid Principal Amount			676,928	559,823
Carrying Value	5,059	2,203	6,704	5,059	1,875
Servicing rights activity at amortized cost
Beginning net carrying value at amortized cost	5,059	2,203
Additions due to loans sold, servicing retained	1,938	441
Amortization	(293)	(96)
Recovery (Impairment)		(673)
Ending net carrying value at amortized cost	6,704	1,875
Servicing rights activity at fair value
Beginning net carrying value at fair value	5,059
Ending net carrying value at fair value	6,704
Freddie Mac | Residential
Servicing rights
Unpaid Principal Amount			2,184,960	1,898,786
Servicing rights activity at fair value
Beginning net carrying value at fair value	21,231
Ending net carrying value at fair value	26,634
SBA
Servicing rights
Unpaid Principal Amount			437,177	427,623
Carrying Value	16,684	20,275	16,318	$ 16,684	18,497
Servicing rights activity at amortized cost
Beginning net carrying value at amortized cost	16,684	20,275
Additions due to loans sold, servicing retained	692	218
Amortization	(886)	(1,108)
Recovery (Impairment)	(172)	(888)
Ending net carrying value at amortized cost	16,318	18,497
Servicing rights activity at fair value
Beginning net carrying value at fair value	16,684
Ending net carrying value at fair value	16,318
SBA | Freddie Mac
Servicing rights
Carrying Value	23,022	20,372	$ 23,022		$ 20,372
Servicing rights activity at amortized cost
Ending net carrying value at amortized cost	$ 23,022	$ 20,372

Servicing rights - Estimated va

Servicing rights - Estimated valuation (Details) - Commercial	3 Months Ended	12 Months Ended
	Mar. 31, 2018	Dec. 31, 2017
Minimum | Freddie Mac
Servicing rights, valuation assumptions
Forward prepayment assumptions	0.00%	0.00%
Forward default rate	0.00%	0.00%
Discount rate	12.00%	12.00%
Servicing expense (as a percent)	0.20%	0.20%
Maximum | Freddie Mac
Servicing rights, valuation assumptions
Forward prepayment assumptions	13.00%	13.00%
Forward default rate	2.00%	2.00%
Discount rate	12.00%	12.00%
Servicing expense (as a percent)	0.20%	0.20%
Weighted Average | Freddie Mac
Servicing rights, valuation assumptions
Forward prepayment assumptions	4.30%	4.20%
Forward default rate	2.00%	2.00%
Discount rate	12.00%	12.00%
Servicing expense (as a percent)	0.20%	0.20%
SBA | Minimum
Servicing rights, valuation assumptions
Forward prepayment assumptions	2.90%	2.40%
Forward default rate	0.00%	0.00%
Discount rate	12.00%	12.00%
Servicing expense (as a percent)	0.40%	0.40%
SBA | Maximum
Servicing rights, valuation assumptions
Forward prepayment assumptions	20.00%	20.50%
Forward default rate	9.40%	9.50%
Discount rate	12.00%	12.00%
Servicing expense (as a percent)	0.40%	0.40%
SBA | Weighted Average
Servicing rights, valuation assumptions
Forward prepayment assumptions	10.90%	11.50%
Forward default rate	3.10%	2.70%
Discount rate	12.00%	12.00%
Servicing expense (as a percent)	0.40%	0.40%

Servicing rights - Assumptions

Servicing rights - Assumptions (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Residential
Adverse changes to key assumptions on the carrying amount of the servicing rights
Prepayment rate (10% adverse change)	$ (2,711)	$ (2,721)
Prepayment rate (20% adverse change)	(5,231)	(4,928)
Discount rate (10% adverse change)	(3,493)	(3,029)
Discount rate (20% adverse change)	(6,708)	(5,823)
Freddie Mac
Adverse changes to key assumptions on the carrying amount of the servicing rights
Prepayment rate (10% adverse change)	(56)	(43)
Prepayment rate (20% adverse change)	(110)	(84)
Default rate (10% adverse change)	(8)	(6)
Default rate (20% adverse change)	(15)	(12)
Discount rate (10% adverse change)	(344)	(270)
Discount rate (20% adverse change)	(661)	(518)
SBA
Adverse changes to key assumptions on the carrying amount of the servicing rights
Prepayment rate (10% adverse change)	(492)	(514)
Prepayment rate (20% adverse change)	(957)	(998)
Default rate (10% adverse change)	(28)	(24)
Default rate (20% adverse change)	(57)	(48)
Discount rate (10% adverse change)	(520)	(520)
Discount rate (20% adverse change)	$ (1,007)	$ (1,008)

Servicing rights - Amortization

Servicing rights - Amortization (Details) $ in Thousands	Mar. 31, 2018USD ($)
Future amortization expense for the servicing rights
2,018	$ 3,441
2,019	3,978
2,020	3,360
2,021	2,831
2,022	2,368
Thereafter	7,044
Total	$ 23,022

Servicing rights - Residential

Servicing rights - Residential mortgage servicing rights (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2018	Dec. 31, 2017	Mar. 31, 2017	Dec. 31, 2016
Servicing rights
Unpaid Principal Amount	$ 1,114,105	$ 987,446
Fair Value	23,022	21,743
Residential
Servicing rights
Unpaid Principal Amount	6,817,646	6,558,455
Fair Value	81,591	72,295	$ 64,625	$ 61,376
Possible impact of adverse changes to key assumptions
Prepayment rate (10% adverse change)	(2,711)	(2,721)
Prepayment rate (20% adverse change)	(5,231)	(4,928)
Discount rate (10% adverse change)	(3,493)	(3,029)
Discount rate (20% adverse change)	(6,708)	(5,823)
Cost of servicing (10% adverse change)	(1,448)	(1,230)
Cost of servicing (20% adverse change)	(2,895)	(2,460)
Fannie Mae | Residential
Servicing rights
Unpaid Principal Amount	2,608,840	2,524,897
Fair Value	30,347	26,929
Ginnie Mae | Residential
Servicing rights
Unpaid Principal Amount	2,023,846	2,134,772
Fair Value	24,610	24,135
Freddie Mac
Servicing rights
Unpaid Principal Amount	676,928	559,823
Fair Value	6,704	5,059
Possible impact of adverse changes to key assumptions
Prepayment rate (10% adverse change)	(56)	(43)
Prepayment rate (20% adverse change)	(110)	(84)
Discount rate (10% adverse change)	(344)	(270)
Discount rate (20% adverse change)	(661)	(518)
Freddie Mac | Residential
Servicing rights
Unpaid Principal Amount	2,184,960	1,898,786
Fair Value	$ 26,634	$ 21,231
Minimum | Residential
Servicing rights, valuation assumptions
Forward prepayment assumptions	5.90%	7.00%
Discount rate	10.50%	10.50%
Servicing expense (as a percent)	0.70%	0.70%
Maximum | Residential
Servicing rights, valuation assumptions
Forward prepayment assumptions	14.00%	29.20%
Discount rate	12.50%	13.00%
Servicing expense (as a percent)	0.80%	0.80%
Weighted Average | Residential
Servicing rights, valuation assumptions
Forward prepayment assumptions	8.60%	8.80%
Discount rate	10.80%	10.90%
Servicing expense (as a percent)	0.80%	0.70%

Gains on residential mortgage79

Gains on residential mortgage banking activities, net of variable loan expenses(Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Gains on residential mortgage banking activities, net of variable loan expenses
Realized and unrealized gains and losses of residential mortgage loans held for sale, at fair value	$ 6,279	$ 13,394
Creation of new mortgage servicing rights, net of payoffs	4,408	3,803
Loan origination fee income on residential mortgage loans	2,175	1,863
Correspondent fees and other direct loan expenses, including provision for loan indemnification	(2,290)	(6,975)
Unrealized gains (loss) on IRLCs and other derivatives	1,162	(1,576)
Interest and Fee Income, Loans, Consumer, Total	$ 11,734	$ 10,509

Secured Borrowings and Promis80

Secured Borrowings and Promissory Note (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Dec. 31, 2017
Secured borrowings and promissory note
Maximum Facility Size	$ 1,360,468
Pledged Assets Carrying Value	858,385	$ 898,453
Carrying Value, Secured borrowings	657,233	631,286
Carrying Value, Promissory note	5,883	6,107
Borrowings under credit facilities
Secured borrowings and promissory note
Maximum Facility Size	605,000
Pledged Assets Carrying Value	229,565	303,454
Carrying Value, Secured borrowings	$ 210,570	$ 248,674
Weighted average interest rate of borrowings (as a percent)	4.10%	3.90%
Borrowings under repurchase agreements
Secured borrowings and promissory note
Maximum Facility Size	$ 755,468
Pledged Assets Carrying Value	628,820	$ 594,999
Carrying Value, Secured borrowings	$ 446,663	$ 382,612
Weighted average interest rate of borrowings (as a percent)	4.30%	3.10%
Promissory note
Secured borrowings and promissory note
Maximum Facility Size	$ 6,554
Pledged Assets Carrying Value	7,279	$ 7,752
Carrying Value, Promissory note	5,883	6,107
MBS | Borrowings under repurchase agreements
Secured borrowings and promissory note
Pledged Assets Carrying Value	44,718	37,397
MBS | JPMorgan | Borrowings under repurchase agreements
Secured borrowings and promissory note
Maximum Facility Size	48,218
Pledged Assets Carrying Value	71,966	80,690
Carrying Value, Secured borrowings	$ 48,218	53,325
MBS | JPMorgan | Borrowings under repurchase agreements | Minimum
Secured borrowings and promissory note
Pricing, stated rate (as a percent)	2.91%
MBS | JPMorgan | Borrowings under repurchase agreements | Maximum
Secured borrowings and promissory note
Pricing, stated rate (as a percent)	5.39%
MBS | Citibank | Borrowings under repurchase agreements
Secured borrowings and promissory note
Pricing, stated rate (as a percent)	3.89%
Maximum Facility Size	$ 5,957
Pledged Assets Carrying Value	11,496	11,496
Carrying Value, Secured borrowings	$ 5,957	5,957
MBS | RBC Bank | Borrowings under repurchase agreements
Secured borrowings and promissory note
Pricing, stated rate (as a percent)	3.34%
Maximum Facility Size	$ 4,906
Pledged Assets Carrying Value	6,357	8,778
Carrying Value, Secured borrowings	$ 4,906	6,069
MBS | Mizuho | Borrowings under repurchase agreements
Secured borrowings and promissory note
Pricing, stated rate (as a percent)	2.79%
Maximum Facility Size	$ 21,387
Pledged Assets Carrying Value	27,857
Carrying Value, Secured borrowings	21,387
Commercial | JPMorgan | Borrowings under credit facilities
Secured borrowings and promissory note
Maximum Facility Size	250,000
Pledged Assets Carrying Value	94,660	107,697
Carrying Value, Secured borrowings	$ 70,846	60,459
Commercial | JPMorgan | Borrowings under credit facilities | Minimum | LIBOR
Secured borrowings and promissory note
Pricing, spread on variable (as a percent)	3.25%
Commercial | JPMorgan | Borrowings under credit facilities | Maximum | LIBOR
Secured borrowings and promissory note
Pricing, spread on variable (as a percent)	3.50%
Commercial | JPMorgan | Borrowings under repurchase agreements
Secured borrowings and promissory note
Maximum Facility Size	$ 200,000
Pledged Assets Carrying Value	82,827	90,829
Carrying Value, Secured borrowings	$ 47,857	55,355
Commercial | JPMorgan | Borrowings under repurchase agreements | Minimum | LIBOR
Secured borrowings and promissory note
Pricing, spread on variable (as a percent)	2.50%
Commercial | JPMorgan | Borrowings under repurchase agreements | Maximum | LIBOR
Secured borrowings and promissory note
Pricing, spread on variable (as a percent)	4.50%
Commercial | Keybank | Borrowings under credit facilities
Secured borrowings and promissory note
Maximum Facility Size	$ 125,000
Pledged Assets Carrying Value	49,271	67,589
Carrying Value, Secured borrowings	$ 48,519	66,642
Commercial | Keybank | Borrowings under credit facilities | LIBOR
Secured borrowings and promissory note
Pricing, spread on variable (as a percent)	1.75%
Commercial | Deutsche Bank | Borrowings under repurchase agreements
Secured borrowings and promissory note
Maximum Facility Size	$ 275,000
Pledged Assets Carrying Value	220,303	252,499
Carrying Value, Secured borrowings	$ 137,804	173,811
Commercial | Deutsche Bank | Borrowings under repurchase agreements | Minimum | LIBOR
Secured borrowings and promissory note
Pricing, spread on variable (as a percent)	2.30%
Commercial | Deutsche Bank | Borrowings under repurchase agreements | Maximum | LIBOR
Secured borrowings and promissory note
Pricing, spread on variable (as a percent)	2.80%
Commercial | Citibank | Borrowings under repurchase agreements
Secured borrowings and promissory note
Maximum Facility Size	$ 200,000
Pledged Assets Carrying Value	208,014	150,707
Carrying Value, Secured borrowings	$ 180,534	88,095
Commercial | Citibank | Borrowings under repurchase agreements | Minimum | LIBOR
Secured borrowings and promissory note
Pricing, spread on variable (as a percent)	2.50%
Commercial | FCB | Promissory note
Secured borrowings and promissory note
Pricing, stated rate (as a percent)	2.75%
Maximum Facility Size	$ 6,554
Pledged Assets Carrying Value	7,279	7,752
Carrying Value, Promissory note	5,883	6,107
Residential | Comerica | Borrowings under credit facilities
Secured borrowings and promissory note
Maximum Facility Size	150,000
Pledged Assets Carrying Value	52,294	71,035
Carrying Value, Secured borrowings	$ 59,737	67,336
Residential | Comerica | Borrowings under credit facilities | LIBOR
Secured borrowings and promissory note
Pricing, spread on variable (as a percent)	2.125%
Residential | Associated Bank | Borrowings under credit facilities
Secured borrowings and promissory note
Maximum Facility Size	$ 40,000
Pledged Assets Carrying Value	9,006	29,242
Carrying Value, Secured borrowings	$ 8,549	27,699
Residential | Associated Bank | Borrowings under credit facilities | LIBOR
Secured borrowings and promissory note
Pricing, spread on variable (as a percent)	2.125%
Residential | Origin Bank | Borrowings under credit facilities
Secured borrowings and promissory note
Maximum Facility Size	$ 40,000
Pledged Assets Carrying Value	24,334	27,891
Carrying Value, Secured borrowings	$ 22,919	$ 26,538
Residential | Origin Bank | Borrowings under credit facilities | LIBOR
Secured borrowings and promissory note
Pricing, spread on variable (as a percent)	2.25%

Secured Borrowings and Promis81

Secured Borrowings and Promissory Note - Collateral Pledged (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Collateral pledged
Pledged Assets Carrying Value	$ 858,385	$ 898,453
Borrowings under credit facilities
Collateral pledged
Pledged Assets Carrying Value	229,565	303,454
Borrowings under repurchase agreements
Collateral pledged
Pledged Assets Carrying Value	628,820	594,999
Promissory note
Collateral pledged
Pledged Assets Carrying Value	7,279	7,752
Loans, net | Borrowings under credit facilities
Collateral pledged
Pledged Assets Carrying Value	229,468	303,133
Loans, net | Borrowings under repurchase agreements
Collateral pledged
Pledged Assets Carrying Value	511,145	494,035
Loans, net | Promissory note
Collateral pledged
Pledged Assets Carrying Value	7,279	7,752
Real estate | Borrowings under credit facilities
Collateral pledged
Pledged Assets Carrying Value	97	321
MBS | Borrowings under repurchase agreements
Collateral pledged
Pledged Assets Carrying Value	44,718	37,397
Retained interest in assets of consolidated VIEs | Borrowings under repurchase agreements
Collateral pledged
Pledged Assets Carrying Value	$ 72,957	$ 63,567

Senior secured notes, net and82

Senior secured notes, net and Convertible notes, net (Details)	Aug. 09, 2017USD ($)$ / shares	Mar. 31, 2018USD ($)item	Jan. 30, 2018USD ($)	Dec. 31, 2017USD ($)
Senior secured notes,net and Convertible notes, net
Unamortized deferred financing costs		$ (1,765,000)		$ (446,000)
Total Senior secured notes, net		178,688,000		138,078,000
Total Convertible notes, net		109,226,000		108,991,000
Total carrying amount of debt components		287,914,000
Total carrying amount of conversion option of equity components recorded in additional paid-in capital		2,058,000
Senior Secured Notes
Senior secured notes,net and Convertible notes, net
Face amount		$ 180,000,000
Interest rate (as a percent)		7.50%
Unamortized premium - Senior secured notes		$ 2,899,000
Unamortized deferred financing costs		(4,211,000)
Total Senior secured notes, net		178,688,000
Convertible Notes
Senior secured notes,net and Convertible notes, net
Face amount	$ 115,000,000	$ 115,000,000
Interest rate (as a percent)	7.00%	7.00%
Conversion ratio	1.4997
Principal amount of notes for conversion	$ 25
Initial conversion price | $ / shares	$ 16.67
Principal amount of the notes to be redeemed (as a percent)	100.00%
Threshold period of specified consecutive trading days within which common stock price to conversion price of convertible debt instruments must exceed threshold percentage for a specified number of trading days to trigger conversion feature		30 days
Threshold period of specified consecutive trading days within which the common stock price, used in a calculation with with the conversion rate, the result of which must exceed the threshold percentage		5 days
Specified period of time used to calculate average closing market price of common stock to be used as a factor in determining potential trigger of conversion feature		10 days
Gross carrying value of convertible notes	$ 112,700,000
Gross carrying value of the equity component	$ 2,300,000
Unamortized discount - Convertible notes		$ (2,058,000)
Unamortized deferred financing costs		(3,716,000)
Total Convertible notes, net		$ 109,226,000
Convertible Notes | Minimum
Senior secured notes,net and Convertible notes, net
Percentage of common stock price to conversion price of convertible debt instruments to determine eligibility of conversion		120.00%
Threshold number of specified trading days that common stock price to conversion price of convertible debt instruments must exceed threshold percentage within a specified consecutive trading period to trigger conversion feature | item		20
The threshold percentage that per share value of distributions exceeds the average market price which may trigger the conversion feature		10.00%
Convertible Notes | Maximum
Senior secured notes,net and Convertible notes, net
Threshold percentage of the trading price of the convertible debt instrument to the product of the conversion rate and the closing stock price during any five consecutive trading day period		98.00%
ReadyCap Holdings LLC | Senior Secured Notes
Senior secured notes,net and Convertible notes, net
Face amount			$ 40,000,000	$ 140,000,000
Interest rate (as a percent)			7.50%	7.50%
Yeld-to-maturity (as a percent)			6.50%

Guaranteed Loan Financing (Deta

Guaranteed Loan Financing (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2018	Dec. 31, 2017
Ending balance	$ 278,500	$ 293,045
Guaranteed loan financing
Ending balance	$ 278,500	$ 293,045
Guaranteed loan financing | Weighted Average
Interest Rates	3.75%	3.51%
Guaranteed loan financing | Minimum
Interest Rates	1.70%	1.62%
Guaranteed loan financing | Maximum
Interest Rates	7.25%	7.00%

Guaranteed Loan Financing - Mat

Guaranteed Loan Financing - Maturities (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Contractual maturities of total guaranteed loan financing outstanding
2,018	$ 1,159
2,019	2,158
2,020	2,846
2,021	3,985
2,022	4,332
Thereafter	264,020
Total	278,500
Guaranteed loan financing
Contractual maturities of total guaranteed loan financing outstanding
Loans held-for-investment pledged as security against guaranteed loan financing	$ 282,100	$ 296,900

Variable Interest Entities an85

Variable Interest Entities and Securitization Activities - VIE Securitized Debt Obligations (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Variable interest entities
Current Principal Balance	$ 1,114,105	$ 987,446
Carrying value	679,871	598,148
VIEs
Variable interest entities
Current Principal Balance	699,946	614,557
Carrying value	$ 679,871	$ 598,148
Weighted Average Rate	3.70%	3.40%
Waterfall Victoria Mortgage Trust 2011-SBC2
Variable interest entities
Current Principal Balance	$ 15,295	$ 16,010
Carrying value	$ 15,295	$ 16,010
Weighted Average Rate	5.40%	5.30%
Sutherland Commercial Mortgage Loans 2015-SBC4
Variable interest entities
Current Principal Balance	$ 7,636	$ 10,049
Carrying value	$ 7,418	$ 9,687
Weighted Average Rate	4.00%	4.00%
Sutherland Commercial Mortgage Loans 2017-SBC6
Variable interest entities
Current Principal Balance	$ 108,357	$ 119,784
Carrying value	$ 106,624	$ 117,868
Weighted Average Rate	3.30%	3.30%
ReadyCap Commercial Mortgage Trust 2014-1
Variable interest entities
Current Principal Balance	$ 30,565	$ 33,953
Carrying value	$ 30,563	$ 33,951
Weighted Average Rate	4.00%	3.60%
ReadyCap Commercial Mortgage Trust 2015-2
Variable interest entities
Current Principal Balance	$ 147,311	$ 151,993
Carrying value	$ 142,836	$ 147,271
Weighted Average Rate	4.10%	4.10%
ReadyCap Commercial Mortgage Trust 2016-3
Variable interest entities
Current Principal Balance	$ 87,415	$ 98,733
Carrying value	$ 84,855	$ 95,907
Weighted Average Rate	3.60%	3.50%
ReadyCap Commercial Mortgage Trust 2018-4
Variable interest entities
Current Principal Balance	$ 150,344
Carrying value	$ 145,108
Weighted Average Rate	4.10%
Readycap Capital Financing 2017-FL1
Variable interest entities
Current Principal Balance	$ 133,652	$ 158,978
Carrying value	$ 130,101	$ 154,721
Weighted Average Rate	3.10%	2.80%
ReadyCap Lending Small Business Trust 2015-1
Variable interest entities
Current Principal Balance	$ 19,371	$ 25,057
Carrying value	$ 17,071	$ 22,733
Weighted Average Rate	3.00%	2.50%

Variable Interest Entities an86

Variable Interest Entities and Securitization Activities - Consolidated VIE Assets and Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Assets
Cash and cash equivalents	$ 86,773	$ 63,425
Restricted cash	13,964	11,666
Accrued interest	6,836	6,494
Total assets	968,999	861,662
Liabilities
Securitized debt obligations of consolidated VIEs, net	679,871	598,148
VIEs
Assets
Cash and cash equivalents	75	25
Restricted cash	8,384	15,838
Loans, net	942,894	836,180
Real estate acquired in settlement of loans	3,209	3,443
Accrued interest	4,671	4,261
Due from servicers	9,766	1,915
Total assets	968,999	861,662
Liabilities
Securitized debt obligations of consolidated VIEs, net	679,871	598,148
Total liabilities	$ 679,871	$ 598,148

Variable Interest Entities an87

Variable Interest Entities and Securitization Activities - Assets of Unconsolidated VIEs (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Carrying amount
Mortgage backed securities, at fair value	$ 47,181	$ 39,922
Investment in unconsolidated joint venture	50,229	55,369
VIE not primary beneficiary
Carrying amount
Mortgage backed securities, at fair value	45,856	38,568
Investment in unconsolidated joint venture	50,229	55,369
Total assets in unconsolidated VIEs carrying amount	96,085	93,937
Maximum Exposure to Loss
Mortgage backed securities, at fair value	45,856	38,568
Investment in unconsolidated joint venture	50,229	55,369
Total assets in unconsolidated VIEs maximum exposure to loss	$ 96,085	$ 93,937

Interest Income and Interest 88

Interest Income and Interest Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Interest income
Total loans	$ 34,866	$ 31,727
Total loans, held for sale, at fair value	1,402	1,434
Mortgage backed securities, at fair value	882	723
Total interest income	37,150	33,884
Interest expense
Secured borrowings	(7,182)	(7,197)
Securitized debt obligations of consolidated VIEs	(7,202)	(5,122)
Guaranteed loan financing	(2,815)	(3,264)
Senior secured note	(3,239)	(790)
Convertible note	(2,187)
Promissory note	(41)	(68)
Total interest expense	(22,666)	(16,441)
Net interest income before provision for loan losses	14,484	17,443
Acquired SBA 7(a) loans
Interest income
Total loans	7,872	9,872
Acquired loans
Interest income
Total loans	9,461	10,044
Total loans, held for sale, at fair value	13	421
Originated Transitional loans
Interest income
Total loans	8,910	4,103
Originated SBC loans, at fair value
Interest income
Total loans	2,028	1,626
Originated SBC loans
Interest income
Total loans	5,740	5,611
Originated SBA 7(a) loans
Interest income
Total loans	843	271
Originated Residential Agency loans
Interest income
Total loans	12	200
Total loans, held for sale, at fair value	877	830
Originated Freddie Mac loans
Interest income
Total loans, held for sale, at fair value	$ 512	$ 183

Derivative Instruments (Details

Derivative Instruments (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2018USD ($)instrument	Mar. 31, 2017USD ($)	Dec. 31, 2017USD ($)instrument
Notional Amount	$ 518,774		$ 573,914
Asset Derivatives Fair Value	5,022		4,725
Liabilities Derivatives Fair Value	(756)		$ (282)
Net Realized Gain (Loss) on Financial Instruments
Net Realized Gain (Loss)	4,555	$ (224)
Net Unrealized Gain (Loss) on Financial Instruments
Net Change in Unrealized Gain (Loss)	$ (177)	(1,411)
Credit default swaps
Number of derivative instrument held | instrument	1		1
Liabilities Derivatives Fair Value	$ (58)		$ (66)
Credit default swaps | Credit Risk
Notional Amount	15,000		15,000
Liabilities Derivatives Fair Value	(58)		$ (66)
Credit default swaps | Net Unrealized Gain (Loss) on Financial Instruments
Net Change in Unrealized Gain (Loss)	$ 8	30
Interest rate swaps
Number of derivative instrument held | instrument	44		52
Liabilities Derivatives Fair Value	$ (698)		$ (216)
Interest rate swaps | Interest Rate Risk
Notional Amount	267,771		391,381
Asset Derivatives Fair Value	1,552		2,898
Liabilities Derivatives Fair Value	(698)		(216)
Interest rate swaps | Net Realized Gain (Loss) on Financial Instruments
Net Realized Gain (Loss)	4,555	(224)
Interest rate swaps | Net Unrealized Gain (Loss) on Financial Instruments
Net Change in Unrealized Gain (Loss)	(1,346)	135
Residential mortgage banking activities interest rate swaps | Net Unrealized Gain (Loss) on Financial Instruments
Net Change in Unrealized Gain (Loss)	(482)	(264)
Interest rate lock commitments (IRLCs) | Interest Rate Risk
Notional Amount	236,003		167,533
Asset Derivatives Fair Value	3,470		$ 1,827
Interest rate lock commitments (IRLCs) | Net Unrealized Gain (Loss) on Financial Instruments
Net Change in Unrealized Gain (Loss)	$ 1,643	$ (1,312)

Related Party Transactions (Det

Related Party Transactions (Details) $ in Thousands	1 Months Ended	3 Months Ended
	Mar. 31, 2018USD ($)loan	Mar. 31, 2018USD ($)	Mar. 31, 2017USD ($)	Dec. 31, 2017USD ($)
Related-party transactions
Amount unpaid	$ 2,961	$ 2,961		$ 2,042
Purchase of loans, held-for-investment		142,000	$ 5,577
Investment in unconsolidated joint venture	50,229	$ 50,229		$ 55,369
Management Agreement
Related-party transactions
Term of agreement		3 years
Automatically renewal period		1 year
Minimum notice period for termination		180 days
Termination fee multiplier		3
Period immediately preceding the termination used as basis for determination of the termination fee due		24 months
Management Fee
Related-party transactions
Fee percentage for results up to threshold		1.50%
Fee threshold		$ 500,000
Fee percentage for results in excess of threshold		1.00%
Incentive Distribution
Related-party transactions
Incentive multiplier		15.00%
Core earnings period		12 months
Percentage of Incentive fee multiplied by the weighted average of issue price		8.00%
The period over which core earnings must exceed the minimum threshold per the terms of the agreement		48 months
Minimum core earnings threshold		$ 0
Minimum | Management Agreement
Related-party transactions
Independent director votes required for approval		66.70%
Manager | Management Fee
Related-party transactions
Fees		$ 2,000	2,000
Amount unpaid	2,600	2,600	2,400
Manager | Incentive Distribution
Related-party transactions
Amount unpaid	400	400
Incentive distribution paid		400
Manager | Expense Reimbursement
Related-party transactions
Amount unpaid	$ 800	800	700
Reimbursable expenses		900	$ 900
Waterfall Olympic Master Fund LP
Related-party transactions
Number of loans acquired | loan	75
Purchase of loans, held-for-investment	$ 51,600
Unpaid principal balance	$ 51,800	$ 51,800

Other Asset and Other Liabili91

Other Asset and Other Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Other assets:
Due from servicers	$ 6,040	$ 9,964
Intangible assets	3,177	3,264
Accrued interest	6,836	6,494
Real estate accrued in settlement of loans	1,652	1,644
Deferred financing costs	1,765	446
Deferred tax asset	17,155	17,155
Prepaid taxes	3,682	6,014
Other	13,285	11,859
Total other assets	53,592	56,840
Accounts payable and other accrued liabilities:
Accrued salaries, wages and commissions	9,969	16,508
Servicing principal and interest payable	7,168	5,659
Repair and denial reserve	5,797	5,687
Liability under subservicing agreements	1,507	1,496
Unapplied cash	1,786	2,445
Accrued interest payable	7,677	10,317
Payable to related parties	2,961	2,042
Deferred tax liability	18,506	18,506
Other	9,119	11,976
Total accounts payable and other accrued liabilities	$ 64,490	$ 74,636

Other Asset and Other Liabili92

Other Asset and Other Liabilities - Real Estate Acquired in Settlement of Loans (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Real estate accrued in settlement of loans
Real estate accrued in settlement of loans	$ 1,652	$ 1,644
Loan indemnification reserve
Loan indemnification reserve	1,700	3,000
ILLINOIS
Real estate accrued in settlement of loans
Real estate accrued in settlement of loans	863	863
FLORIDA
Real estate accrued in settlement of loans
Real estate accrued in settlement of loans	324	303
OHIO
Real estate accrued in settlement of loans
Real estate accrued in settlement of loans	172	51
Other
Real estate accrued in settlement of loans
Real estate accrued in settlement of loans	$ 293	$ 427

Other Income and Other Operat93

Other Income and Other Operating Expenses (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Other income
Origination income	$ 1,153	$ 691
Release/(Increase) of repair and denial reserve	(110)	166
Other	291
Other		(17)
Total other income	1,334	840
Other operating expenses
Origination costs	1,856	959
Technology expense	783	911
Charge off of real estate acquired in settlement of loans	19	103
Rent expense	522	559
Recruiting, training and travel expenses	703	467
Other	4,128	2,535
Total other operating expenses	$ 8,011	$ 5,534

Stockholders_ Equity - Common S

Stockholders’ Equity - Common Stock Dividends (Details) - $ / shares	Apr. 30, 2018	Mar. 14, 2018	Jan. 31, 2018	Dec. 13, 2017	Oct. 20, 2017	Sep. 12, 2017	Jul. 31, 2017	Jun. 15, 2017	Apr. 13, 2017	Mar. 14, 2017	Jan. 27, 2017	Dec. 21, 2016	Mar. 31, 2018	Mar. 31, 2017
Dividends
Dividend per Share, declared		$ 0.37		$ 0.37		$ 0.37		$ 0.37		$ 0.37		$ 0.35	$ 0.37	$ 0.37
Dividend per Share, paid	$ 0.37		$ 0.37		$ 0.37		$ 0.37		$ 0.37		$ 0.35

Stockholders_ Equity - Manager

Stockholders’ Equity - Manager Equity Incentive (Details)	3 Months Ended
	Mar. 31, 2018
Stockholders’ Equity
Percentage of shares of common stock issued and outstanding on a fully diluted basis	5.00%

Stockholders_ Equity - RSU acti

Stockholders’ Equity - RSU activity (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Weighted-average grant date fair value (per share)
Stock-based compensation	$ 200	$ 400
Non-cash compensation expense not yet charged to net income	$ 1,500	$ 200
RSU | Independent director
Number of shares
Granted (in shares)	23,104
Vested (in shares)	(5,776)
Outstanding, Ending balance	17,328
Weighted-average grant date fair value
Granted	$ 320
Vested	(80)
Ending balance	$ 240
Weighted-average grant date fair value (per share)
Granted (in per share)	$ 13.85
Vested (in per share)	13.85
Ending balance	$ 13.85
RSAs | Certain employees
Number of shares
Outstanding, Beginning balance	25,851
Granted (in shares)	101,670
Outstanding, Ending balance	127,521
Weighted-average grant date fair value
Beginning balance	$ 380
Granted	1,408
Ending balance	$ 1,788
Weighted-average grant date fair value (per share)
Beginning balance	$ 14.70
Granted (in per share)	13.85
Ending balance	$ 14.02

Earnings per Share of Common 97

Earnings per Share of Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Continuing Operations
Net Income	$ 18,518	$ 9,557
Less: Net income attributable to non-controlling interest	664	701
Less: Income attributable to participating shares	61	3
Basic earnings	17,793	8,853
Diluted Earnings
Less: Income attributable to participating shares	61
Diluted earnings	$ 17,793	$ 8,856
Basic — Average shares outstanding	32,036,504	30,549,806
Effect of dilutive securities — Unvested participating shares	9,340
Diluted — Average shares outstanding	32,045,844	30,549,806
Earnings (loss) per share
Basic	$ 0.56	$ 0.29
Diluted	$ 0.56	$ 0.29
Conversion spread value on Convertible Notes	$ 0
Impact of Convertible Notes on diluted EPS	$ 0

Earnings per Common Share - Ope

Earnings per Common Share - Operating Partnership Units (Details) - shares	3 Months Ended	12 Months Ended
	Mar. 31, 2018	Dec. 31, 2017
Operating Partnership | Noncontrolling Interests
Noncontrolling interest
Units held by noncontrolling interest unit holders	1,150,827	1,150,827

Offsetting Assets and Liabili99

Offsetting Assets and Liabilities - Assets (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Effect of offsetting of the Company’s recognized assets
Gross Amounts of Recognized Assets	$ 1,552	$ 2,898
Assets Presented in the Consolidated Balance Sheets	1,552	2,898
Cash Collateral Received	1,552	2,898
Interest rate swaps
Effect of offsetting of the Company’s recognized assets
Gross Amounts of Recognized Assets	1,552	2,898
Assets Presented in the Consolidated Balance Sheets	1,552	2,898
Cash Collateral Received	$ 1,552	$ 2,898

Offsetting Assets and Liabil100

Offsetting Assets and Liabilities - Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Effect of offsetting recognized liabilities, Derivative
Gross Amounts of Recognized Liabilities, Derivative	$ 756	$ 282
Effect of offsetting recognized liabilities, Total
Gross Amounts of Recognized Liabilities, Total	663,872	637,675
Liabilities Presented in the Consolidated Balance Sheets, Total	663,872	637,675
Financial Instruments, Total	663,116	637,393
Cash Collateral Paid, Total	756	282
Interest rate swaps
Effect of offsetting recognized liabilities, Derivative
Gross Amounts of Recognized Liabilities, Derivative	698	216
Liabilities Presented in the Consolidated Balance Sheets, Derivative	698	216
Cash Collateral Paid, Derivative	698	216
Credit default swaps
Effect of offsetting recognized liabilities, Derivative
Gross Amounts of Recognized Liabilities, Derivative	58	66
Liabilities Presented in the Consolidated Balance Sheets, Derivative	58	66
Cash Collateral Paid, Derivative	58	66
Secured borrowings
Effect of offsetting recognized liabilities, Borrowings
Gross Amounts of Recognized Liabilities, Borrowings	657,233	631,286
Liabilities Presented in the Consolidated Balance Sheets, Borrowings	657,233	631,286
Financial Instruments, Borrowings	657,233	631,286
Promissory note
Effect of offsetting recognized liabilities, Borrowings
Gross Amounts of Recognized Liabilities, Borrowings	5,883	6,107
Liabilities Presented in the Consolidated Balance Sheets, Borrowings	5,883	6,107
Financial Instruments, Borrowings	$ 5,883	$ 6,107

Commitments, Contingencies a101

Commitments, Contingencies and Indemnifications (Details) - USD ($) $ in Millions	Mar. 31, 2018	Dec. 31, 2017
Commitments, contingencies and indemnifications
Commitments to originate loans	$ 224.1	$ 147.6
Unfunded loan commitments
Commitments, contingencies and indemnifications
Unfunded loan commitments, loans held at fair value	2.9	9.6
Unfunded loan commitments, loans held-for-investment	$ 39.3	$ 84.7

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
REIT requirements and income tax information
Percentage of nondeductible excise tax the entity would be subject to if they fail to meet the minimum distributions requirement	4.00%
Number of taxable years an entity would not be able to qualify as a REIT if qualification lapses	4 years
Income tax expense (benefit)	$ 2,563	$ 1,034
Minimum
REIT requirements and income tax information
Percentage of taxable income distributed in the form of qualifying distributions	90.00%
Maximum
REIT requirements and income tax information
Percentage of taxable income distributed in the form of qualifying distributions	100.00%

Segment Reporting (Details)

Segment Reporting (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2018USD ($)segment	Mar. 31, 2017USD ($)
Segment reporting
Number of Reportable Segments | segment	4
Interest income	$ 37,150	$ 33,884
Interest expense	(22,666)	(16,441)
Net interest income before provision for loan losses	14,484	17,443
Provision for loan losses	(167)	(1,232)
Net interest income after provision for loan losses	14,317	16,211
Non-interest income
Gains on residential mortgage banking activities, net of variable loan expenses	11,734	10,509
Other income	1,334	840
Income on unconsolidated joint venture	5,739
Servicing income	6,410	4,442
Total non-interest income	25,217	15,791
Non-interest expense
Employee compensation and benefits	(15,320)	(13,464)
Allocated employee compensation and benefits from related party	(1,200)	(1,012)
Professional fees	(2,648)	(2,159)
Management fees – related party	(2,013)	(1,977)
Incentive fees – related party	(408)
Loan servicing expense	(4,093)	(1,513)
Other operating expenses	(8,011)	(5,534)
Total non-interest expense	(33,693)	(25,659)
Net realized gain (loss) on financial instruments	12,232	2,966
Net unrealized gain (loss) on financial instruments	3,008	1,282
Net income (loss) before provision for income taxes	21,081	10,591
Total Assets	2,640,954	2,527,522
Corporate-Other
Segment reporting
Interest expense		(989)
Net interest income before provision for loan losses		(989)
Net interest income after provision for loan losses		(989)
Non-interest expense
Employee compensation and benefits	(141)	(448)
Allocated employee compensation and benefits from related party	(1,080)	(910)
Professional fees	(1,354)	(847)
Management fees – related party	(2,013)	(1,977)
Incentive fees – related party	(408)
Other operating expenses	(704)	(480)
Total non-interest expense	(5,700)	(4,662)
Net realized gain (loss) on financial instruments		269
Net unrealized gain (loss) on financial instruments		70
Net income (loss) before provision for income taxes	(5,700)	(5,312)
Total Assets	20,837	242,386
Loan Acquisitions | Operating Segments
Segment reporting
Interest income	9,688	11,188
Interest expense	(5,831)	(7,933)
Net interest income before provision for loan losses	3,857	3,255
Provision for loan losses	(272)	(622)
Net interest income after provision for loan losses	3,585	2,633
Non-interest income
Other income	156	(110)
Income on unconsolidated joint venture	5,739
Servicing income	5	6
Total non-interest income	5,900	(104)
Non-interest expense
Employee compensation and benefits	(173)	(173)
Allocated employee compensation and benefits from related party	(120)	(102)
Professional fees	(317)	(197)
Loan servicing expense	(808)	(666)
Other operating expenses	(818)	(1,051)
Total non-interest expense	(2,236)	(2,189)
Net realized gain (loss) on financial instruments	148	306
Net unrealized gain (loss) on financial instruments	(46)	473
Net income (loss) before provision for income taxes	7,351	1,119
Total Assets	609,997	566,038
SBC Originations | Operating Segments
Segment reporting
Interest income	17,858	11,523
Interest expense	(12,470)	(2,825)
Net interest income before provision for loan losses	5,388	8,698
Provision for loan losses	36	(96)
Net interest income after provision for loan losses	5,424	8,602
Non-interest income
Other income	1,259	630
Servicing income	252	(503)
Total non-interest income	1,511	127
Non-interest expense
Employee compensation and benefits	(2,637)	(2,026)
Professional fees	(389)	(328)
Loan servicing expense	(631)	(481)
Other operating expenses	(2,679)	(1,547)
Total non-interest expense	(6,336)	(4,382)
Net realized gain (loss) on financial instruments	8,699	1,336
Net unrealized gain (loss) on financial instruments	(2,367)	1,292
Net income (loss) before provision for income taxes	6,931	6,975
Total Assets	1,223,608	832,057
SBA Loan Origination, Acquisitions, and Servicing | Operating Segments
Segment reporting
Interest income	8,715	10,143
Interest expense	(3,620)	(4,008)
Net interest income before provision for loan losses	5,095	6,135
Provision for loan losses	69	(514)
Net interest income after provision for loan losses	5,164	5,621
Non-interest income
Other income	(123)	302
Servicing income	1,252	797
Total non-interest income	1,129	1,099
Non-interest expense
Employee compensation and benefits	(3,255)	(2,199)
Professional fees	(479)	(487)
Loan servicing expense	76	1,108
Other operating expenses	(1,110)	(839)
Total non-interest expense	(4,768)	(2,417)
Net realized gain (loss) on financial instruments	3,385	1,055
Net unrealized gain (loss) on financial instruments	533
Net income (loss) before provision for income taxes	5,443	5,358
Total Assets	503,512	572,561
Residential Mortgage Banking | Operating Segments
Segment reporting
Interest income	889	1,030
Interest expense	(745)	(686)
Net interest income before provision for loan losses	144	344
Net interest income after provision for loan losses	144	344
Non-interest income
Gains on residential mortgage banking activities, net of variable loan expenses	11,734	10,509
Other income	42	18
Servicing income	4,901	4,142
Total non-interest income	16,677	14,669
Non-interest expense
Employee compensation and benefits	(9,114)	(8,618)
Professional fees	(109)	(300)
Loan servicing expense	(2,730)	(1,474)
Other operating expenses	(2,700)	(1,617)
Total non-interest expense	(14,653)	(12,009)
Net unrealized gain (loss) on financial instruments	4,888	(553)
Net income (loss) before provision for income taxes	7,056	2,451
Total Assets	$ 283,000	$ 314,480

Supplemental Financial Data (De

Supplemental Financial Data (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Supplemental Financial Data
Ownership percentage	50.00%
Net realized gain (loss) on financial instruments	$ 12,232	$ 2,966
Net unrealized gain (loss) on financial instruments	3,008	1,282
Net Income	17,854	$ 8,856
Income on unconsolidated joint venture	5,739
Girod HoldCo, LLC
Supplemental Financial Data
Interest income	7,847
Net realized gain (loss) on financial instruments	13,903
Net unrealized gain (loss) on financial instruments	3,263
Servicing expense and other	(2,005)
Net Income	23,008
WFLLA LLC
Supplemental Financial Data
Interest income	3,916
Net realized gain (loss) on financial instruments	6,938
Net unrealized gain (loss) on financial instruments	1,628
Servicing expense and other	(1,003)
Net Income	$ 11,479
Sutherland Asset Management | WFLLA LLC
Supplemental Financial Data
Ownership percentage	50.00%
WFLLA LLC | Girod HoldCo, LLC
Supplemental Financial Data
Ownership percentage	49.90%

Subsequent Events (Details)

Subsequent Events (Details) - Subsequent event $ in Millions	1 Months Ended
	Apr. 30, 2018USD ($)
Subsequent Event
Gross proceeds, sale of units IPO	$ 50
Interest rate (as a percent)	6.50%
Debt Instrument, Frequency of Periodic Payment	quarterly