Document_and_Entity_Informatio
Document and Entity Information (USD $) | 3 Months Ended | |
Mar. 31, 2015 | 1-May-15 | |
Document And Entity Information | ||
Entity Registrant Name | New Residential Investment Corp. | |
Entity Central Index Key | 1556593 | |
Document Type | 10-Q | |
Document Period End Date | 31-Mar-15 | |
Amendment Flag | FALSE | |
Current Fiscal Year End Date | -19 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Par Value | $0.01 | |
Entity Common Stock, Shares Outstanding (in shares) | 198,934,905 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2015 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (Unaudited) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Investments in: | ||
Excess mortgage servicing rights, at fair value | $526,662 | $417,733 |
Excess mortgage servicing rights, equity method investees, at fair value | 225,111 | 330,876 |
Servicer advances, at fair value | 3,245,457 | 3,270,839 |
Real estate securities, available-for-sale | 2,324,915 | 2,463,163 |
Residential mortgage loans, held-for-investment | 44,967 | 47,838 |
Residential mortgage loans, held-for-sale | 500,174 | 1,126,439 |
Real estate owned | 35,905 | 61,933 |
Consumer loans, equity method investees | 0 | 0 |
Cash and cash equivalents | 459,334 | 212,985 |
Restricted cash | 28,325 | 29,418 |
Derivative assets | 71 | 32,597 |
Other assets | 76,701 | 99,869 |
Total assets | 7,467,622 | 8,093,690 |
Liabilities | ||
Repurchase agreements | 2,339,389 | 3,149,090 |
Notes payable | 2,999,418 | 2,913,209 |
Trades payable | 196,000 | 2,678 |
Due to affiliates | 6,465 | 57,424 |
Dividends payable | 53,745 | 53,745 |
Deferred tax liability | 13,414 | 15,114 |
Accrued expenses and other liabilities | 44,777 | 52,505 |
Total liabilities | 5,653,208 | 6,243,765 |
Commitments and Contingencies | ||
Equity | ||
Common Stock, $0.01 par value, 2,000,000,000 shares authorized, 141,434,905 and 141,434,905 issued and outstanding at March 31, 2015 and December 31, 2014, respectively | 1,414 | 1,414 |
Additional paid-in capital | 1,328,587 | 1,328,587 |
Retained earnings | 217,689 | 237,769 |
Accumulated other comprehensive income, net of tax | 19,825 | 28,319 |
Total New Residential stockholders’ equity | 1,567,515 | 1,596,089 |
Noncontrolling interests in equity of consolidated subsidiaries | 246,899 | 253,836 |
Total Equity | 1,814,414 | 1,849,925 |
Total Liabilities And Stockholders Equity | $7,467,622 | $8,093,690 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $0.01 | $0.01 |
Common stock, shares authorized (in shares) | 2,000,000,000 | 2,000,000,000 |
Common stock, shares issued (in shares) | 141,434,905 | 141,434,905 |
Common stock, shares outstanding (in shares) | 141,434,905 | 141,434,905 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Income (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Income Statement [Abstract] | ||
Interest income | $84,373 | $71,490 |
Interest expense | 33,979 | 38,997 |
Net interest income (expense) | 50,394 | 32,493 |
Impairment | ||
Other-than-temporary impairment (“OTTIâ€) on securities | 1,071 | 328 |
Valuation provision on loans and real estate owned | 977 | 164 |
Total Impairment Charges | 2,048 | 492 |
Net interest income after impairment | 48,346 | 32,001 |
Other Income | ||
Change in fair value of investments in excess mortgage servicing rights | -1,761 | 6,602 |
Change in fair value of investments in excess mortgage servicing rights, equity method investees | 4,921 | 6,374 |
Change in fair value of investments in servicer advances | -7,669 | 0 |
Earnings from investments in consumer loans, equity method investees | 0 | 16,360 |
Gain on settlement of investments, net | 14,767 | 4,357 |
Other income (loss), net | 2,037 | 1,357 |
Other Income | 12,295 | 35,050 |
Operating Expenses | ||
General and administrative expenses | 8,560 | 1,985 |
Management fee to affiliate | 5,126 | 4,486 |
Incentive compensation to affiliate | 3,693 | 3,338 |
Loan servicing expense | 4,891 | 90 |
Total Operating Expenses | 22,270 | 9,899 |
Income (Loss) Before Income Taxes | 38,371 | 57,152 |
Income tax expense (benefit) | -3,427 | 287 |
Net Income (Loss) | 41,798 | 56,865 |
Noncontrolling Interests in Income of Consolidated Subsidiaries | 5,823 | 8,093 |
Net Income Attributable to Common Stockholders | $35,975 | $48,772 |
Net Income Per Share of Common Stock | ||
Basic (in dollars per share) | $0.25 | $0.39 |
Diluted (in dollars per share) | $0.25 | $0.38 |
Weighted Average Number of Shares of Common Stock Outstanding | ||
Basic (in shares) | 141,434,905 | 126,604,510 |
Diluted (in shares) | 144,911,309 | 129,919,967 |
Dividend declared per share (in dollars per share) | $0.38 | $0.35 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Comprehensive Income (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Comprehensive income (loss), net of tax | ||
Net income | $41,798 | $56,865 |
Other comprehensive income (loss) | ||
Net unrealized gain on securities | 15,132 | 10,878 |
Reclassification of net realized (gain) on securities into earnings | -23,626 | -4,164 |
Total other comprehensive income (loss) | -8,494 | 6,714 |
Total comprehensive income | 33,304 | 63,579 |
Comprehensive income attributable to noncontrolling interests | 5,823 | 8,093 |
Comprehensive income attributable to common stockholders | $27,481 | $55,486 |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statement of Changes in Stockholders' Equity (Unaudited) (USD $) | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income [Member] | Total New Residential Stockholders’ Equity [Member] | Noncontrolling Interests in Equity of Consolidated Subsidiaries [Member] |
In Thousands, except Share data, unless otherwise specified | |||||||
Equity - December 31, 2014 at Dec. 31, 2014 | $1,849,925 | $1,414 | $1,328,587 | $237,769 | $28,319 | $1,596,089 | $253,836 |
Equity - December 31, 2014 (in shares) at Dec. 31, 2014 | 141,434,905 | ||||||
Dividends declared | -53,745 | -53,745 | -53,745 | ||||
Capital contributions | 0 | 0 | |||||
Capital distributions | -12,760 | -12,760 | |||||
Modified retrospective adjustment for the adoption of ASU No. 2014-11 | -2,310 | -2,310 | -2,310 | ||||
Comprehensive income (loss) (net of tax) | |||||||
Net Income (Loss) | 41,798 | 35,975 | 35,975 | 5,823 | |||
Net unrealized gain (loss) on securities | 15,132 | 15,132 | 15,132 | ||||
Reclassification of net realized (gain) loss on securities into earnings | -23,626 | -23,626 | -23,626 | ||||
Total comprehensive income (loss) | 33,304 | 27,481 | 5,823 | ||||
Equity - March 31, 2015 at Mar. 31, 2015 | $1,814,414 | $1,414 | $1,328,587 | $217,689 | $19,825 | $1,567,515 | $246,899 |
Equity - March 31, 2015 (in shares) at Mar. 31, 2015 | 141,434,905 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Cash Flows From Operating Activities | ||
Net income | $41,798 | $56,865 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Change in fair value of investments in excess mortgage servicing rights | 1,761 | -6,602 |
Change in fair value of investments in excess mortgage servicer rights, equity method investees | -4,921 | -6,374 |
Change in fair value of investments in servicer advances | 7,669 | 0 |
Earnings from consumer loan equity method investees | 0 | -16,360 |
Change in fair value of investments in derivative assets | 7,030 | -1,357 |
Accretion and other amortization | -61,345 | -56,650 |
(Gain) / loss on settlement of investments (net) | -17,701 | -4,357 |
(Gain) / loss on transfer of loans to REO | 544 | 0 |
Loss on extinguishment of debt | 2,934 | 0 |
(Gain) / loss on mortgage servicing rights recapture agreement | -730 | 0 |
Other-than-temporary impairment (“OTTIâ€) | 1,071 | 328 |
Valuation provision on loans and real estate owned | 977 | 164 |
Unrealized loss on other ABS | 290 | 0 |
Non-cash directors’ compensation | 0 | 78 |
Deferred income tax expense | -3,007 | 0 |
Changes in: | ||
Restricted cash | 1,093 | -1,269 |
Other assets | -1,849 | 5,531 |
Due to affiliates | -50,959 | -11,172 |
Accrued expenses and other liabilities | 618 | 1,179 |
Other operating cash flows: | ||
Interest received from excess mortgage servicing rights | 12,692 | 13,816 |
Interest received from servicer advance investments | 23,168 | 16,304 |
Interest received from Non-Agency RMBS | 8,050 | 0 |
Net cash provided by (used in) operating activities | -18,591 | 2,064 |
Cash Flows From Investing Activities | ||
Acquisition of investments in excess mortgage servicing rights | -23,831 | -19,132 |
Purchase of servicer advance investments | -1,765,294 | -2,205,070 |
Purchase of Agency RMBS | -1,026,525 | -37,922 |
Purchase of Non-Agency RMBS | -26,649 | -1,038,721 |
Purchase of residential mortgage loans | -19,032 | 0 |
Purchase of derivative assets | 0 | -71,923 |
Payments for settlement of derivatives | -25,007 | 0 |
Return of investments in excess mortgage servicing rights | 17,122 | 8,121 |
Principal repayments from servicer advance investments | 1,802,188 | 1,442,648 |
Principal repayments from Agency RMBS | 46,967 | 75,470 |
Principal repayments from Non-Agency RMBS | 14,952 | 13,890 |
Principal repayments from non-performing loans | 0 | 1,900 |
Principal repayments from residential mortgage loans, held-for-investment | 9,022 | 0 |
Proceeds from sale of residential mortgage loans | 627,719 | 0 |
Proceeds from sale of Agency RMBS | 1,060,569 | 162,897 |
Proceeds from sale of Non-Agency RMBS | 389,719 | 258,449 |
Proceeds from settlement of derivatives | 2,417 | 0 |
Proceeds from sale of real estate owned | 34,930 | 0 |
Net cash provided by (used in) investing activities | 1,119,469 | -1,400,500 |
Cash Flows From Financing Activities | ||
Repayments of repurchase agreements | -2,016,777 | -1,080,197 |
Margin deposits under repurchase agreements and derivatives | -123,289 | -43,270 |
Repayments of notes payable | -396,125 | -3,117,213 |
Payment of deferred financing fees | -666 | -5,660 |
Common stock dividends paid | -53,745 | -63,297 |
Borrowings | 1,121,121 | 1,618,664 |
Return of margin deposits under repurchase agreements and derivatives | 145,378 | 66,899 |
Borrowings under notes payable | 482,334 | 3,862,782 |
Noncontrolling interest in equity of consolidated subsidiaries - contributions | 0 | 142,024 |
Noncontrolling interest in equity of consolidated subsidiaries - distributions | -12,760 | -113,795 |
Net cash provided by (used in) financing activities | -854,529 | 1,266,937 |
Net Increase (Decrease) in Cash and Cash Equivalents | 246,349 | -131,499 |
Cash and Cash Equivalents, Beginning of Period | 212,985 | 271,994 |
Cash and Cash Equivalents, End of Period | 459,334 | 140,495 |
Supplemental Disclosure of Cash Flow Information | ||
Cash paid during the period for interest | 32,880 | 35,194 |
Cash paid during the period for income taxes | 305 | 0 |
Supplemental Schedule of Non-Cash Investing and Financing Activities | ||
Dividends payable | 53,745 | 44,312 |
Application of ASU No. 2014-11 non-cash activity from investing to financing | 2,310 | |
Purchase of Non-Agency RMBS settled after quarter end | 196,000 | 0 |
Excess MSRs Investees [Member] | ||
Other operating cash flows: | ||
Distributions of earnings from excess mortgage servicing rights, equity method investees | 12,226 | 11,940 |
Cash Flows From Investing Activities | ||
Return of investments in excess mortgage servicing rights, equity method investees | 202 | 8,893 |
Accounting Standards Update 2014-11 [Member] | ||
Supplemental Schedule of Non-Cash Investing and Financing Activities | ||
Application of ASU No. 2014-11 non-cash activity from investing to financing | $85,955 | $0 |
ORGANIZATION
ORGANIZATION | 3 Months Ended |
Mar. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION | ORGANIZATION |
New Residential Investment Corp. (together with its subsidiaries, “New Residential”) is a Delaware corporation that was formed as a limited liability company in September 2011 for the purpose of making real estate related investments and commenced operations on December 8, 2011. On December 20, 2012, New Residential was converted to a corporation. Newcastle Investment Corp. (“Newcastle”) was the sole stockholder of New Residential until the spin-off (Note 13), which was completed on May 15, 2013. Newcastle is listed on the New York Stock Exchange (“NYSE”) under the symbol “NCT.” | |
Following the spin-off, New Residential is an independent publicly traded real estate investment trust (“REIT”) primarily focused on investing in residential mortgage related assets. New Residential is listed on the NYSE under the symbol “NRZ.” | |
New Residential has elected and intends to qualify to be taxed as a REIT for U.S. federal income tax purposes. As such, New Residential will generally not be subject to U.S. federal corporate income tax on that portion of its net income that is distributed to stockholders if it distributes at least 90% of its REIT taxable income to its stockholders by prescribed dates and complies with various other requirements. See Note 17 regarding New Residential’s taxable REIT subsidiaries. | |
New Residential has entered into a management agreement (the “Management Agreement”) with FIG LLC (the “Manager”), an affiliate of Fortress Investment Group LLC (“Fortress”), pursuant to which the Manager provides for a management team and other professionals who are responsible for implementing New Residential’s business strategy, subject to the supervision of New Residential’s board of directors. For its services, the Manager is entitled to management fees and incentive compensation, both defined in, and in accordance with the terms of, the Management Agreement. The Manager also manages Newcastle and investment funds that own a majority of Nationstar Mortgage LLC (“Nationstar”), a leading residential mortgage servicer, and Springleaf Holdings, Inc. (“Springleaf”), managing member of the Consumer Loan Companies (Note 9). | |
As of March 31, 2015, New Residential conducted its business through the following segments: (i) investments in Excess MSRs, (ii) investments in servicer advances, (iii) investments in real estate securities, (iv) investments in real estate loans, (v) investments in consumer loans and (vi) corporate. | |
Approximately 2.4 million shares of New Residential’s common stock were held by Fortress, through its affiliates, and its principals as of March 31, 2015. In addition, Fortress, through its affiliates, held options to purchase approximately 8.5 million shares of New Residential’s common stock as of March 31, 2015. | |
The accompanying condensed consolidated financial statements and related notes of New Residential have been prepared in accordance with accounting principles generally accepted in the United States for interim financial reporting and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared under U.S. generally accepted accounting principles have been condensed or omitted. In the opinion of management, all adjustments considered necessary for a fair presentation of New Residential’s financial position, results of operations and cash flows have been included and are of a normal and recurring nature. The operating results presented for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. These condensed consolidated financial statements should be read in conjunction with New Residential’s consolidated financial statements for the year ended December 31, 2014 and notes thereto included in New Residential’s Annual Report on Form 10-K filed with the Securities and Exchange Commission. Capitalized terms used herein, and not otherwise defined, are defined in New Residential’s consolidated financial statements for the year ended December 31, 2014. | |
Certain prior period amounts have been reclassified to conform to the current period’s presentation. In addition, New Residential completed a one-for-two reverse stock split in October 2014 (Note 13). The impact of this reverse stock split has been retroactively applied to all periods presented. | |
Recent Accounting Pronouncements | |
In May 2014, the FASB issued ASU No. 2014-09, Revenues from Contracts with Customers (Topic 606). The standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In effect, companies will be required to exercise further judgment and make more estimates prospectively. These may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. ASU No. 2014-09 is effective for New Residential in the first quarter of 2017. Early adoption is not permitted. Entities have the option of using either a full retrospective or a modified approach to adopt the guidance in ASU No. 2014-09. New Residential is currently evaluating the new guidance to determine the impact it may have on its condensed consolidated financial statements. | |
In June 2014, the FASB issued ASU No. 2014-11, Transfers and Servicing (Topic 860): Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures. The standard changes the accounting for repurchase-to-maturity transactions and linked repurchase financing transactions to secured borrowing accounting. ASU No. 2014-11 also expands disclosure requirements related to certain transfers of financial assets that are accounted for as sales and certain transfers accounted for as secured borrowings. ASU No. 2014-11 is effective for New Residential in the first quarter of 2015. Early adoption is not permitted. Disclosures are not required for comparative periods presented before the effective date. New Residential has determined that, as of January 1, 2015, its linked transactions (Note 10) are accounted for as secured borrowings. | |
In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. The standard provides guidance on management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern by requiring management to assess an entity’s ability to continue as a going concern by incorporating and expanding on certain principles that are currently in U.S. auditing standards. ASU No. 2014-15 is effective for New Residential for the annual period ending on December 31, 2016. Early adoption is permitted. New Residential is currently evaluating the new guidance to determine the impact that it may have on its condensed consolidated financial statements. | |
In February 2015, the FASB issued ASU No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis. The standard amends the consolidation considerations when evaluating certain limited partnerships, variable interest entities and investment funds. ASU No. 2015-02 is effective for New Residential in the first quarter of 2016. Early adoption is permitted. New Residential does not expect the adoption of this new guidance to have an impact on its condensed consolidated financial statements. | |
In April 2015, the FASB issued ASU No. 2015-03, Interest - Imputation of Interest. The standard amends the balance sheet presentation requirements for debt issuance costs such that they are no longer recognized as deferred charges but are rather presented in the balance sheet as a direct deduction from the carrying amount of the related debt liability, consistent with debt discounts. ASU No. 2015-03 is effective for New Residential in the first quarter of 2016. Early adoption is permitted. New Residential has not yet adopted ASU No. 2015-03 but has determined that the adoption of ASU No. 2015-03 will result in an immaterial reclassification of its Deferred Financing Costs, Net (Note 2) to an offset of its Notes Payable (Note 11). | |
The FASB has recently issued or discussed a number of proposed standards on such topics as financial statement presentation, financial instruments and hedging. Some of the proposed changes are significant and could have a material impact on New Residential’s reporting. New Residential has not yet fully evaluated the potential impact of these proposals, but will make such an evaluation as the standards are finalized. |
OTHER_INCOME_ASSETS_AND_LIABIL
OTHER INCOME, ASSETS AND LIABILITIES | 3 Months Ended | |||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||
Other Income Assets And Liabilities | ||||||||||||||||||
OTHER INCOME, ASSETS AND LIABILITIES | OTHER INCOME, ASSETS AND LIABILITIES | |||||||||||||||||
Other income, net, is comprised of the following: | ||||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||
2015 | 2014 | |||||||||||||||||
Unrealized gain (loss) on derivative instruments | $ | (7,030 | ) | $ | 1,357 | |||||||||||||
Gain (loss) on transfer of loans to REO | (544 | ) | — | |||||||||||||||
Gain on consumer loans investment | 10,447 | — | ||||||||||||||||
Other income (loss) | (836 | ) | — | |||||||||||||||
$ | 2,037 | $ | 1,357 | |||||||||||||||
Gain on settlement of investments, net is comprised of the following: | ||||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||
2015 | 2014 | |||||||||||||||||
Gain on sale of real estate securities, net | $ | 24,697 | $ | 4,492 | ||||||||||||||
Gain (loss) on sale of residential mortgage loans, net | 20,830 | — | ||||||||||||||||
Gain (loss) on settlement of derivatives | (22,590 | ) | (135 | ) | ||||||||||||||
Gain (loss) on liquidated residential mortgage loans, held-for-investment | 400 | — | ||||||||||||||||
Gain (loss) on sale of REO(A) | (5,636 | ) | — | |||||||||||||||
Other gains (losses) | (2,934 | ) | — | |||||||||||||||
$ | 14,767 | $ | 4,357 | |||||||||||||||
(A) | Includes approximately $3.2 million loss on REO sold as a part of the residential mortgage loan sales described in Note 8. | |||||||||||||||||
Other assets and liabilities are comprised of the following: | ||||||||||||||||||
Other Assets | Accrued Expenses and Other Liabilities | |||||||||||||||||
31-Mar-15 | 31-Dec-14 | 31-Mar-15 | 31-Dec-14 | |||||||||||||||
Margin receivable, net | $ | 36,934 | $ | 59,021 | Interest payable | $ | 7,516 | $ | 7,857 | |||||||||
Interest and other receivables | 11,320 | 10,455 | Accounts payable | 16,068 | 28,059 | |||||||||||||
Deferred financing costs, net(A) | 2,817 | 4,446 | Derivative liabilities | 21,127 | 14,220 | |||||||||||||
Principal paydown receivable | 3,761 | 3,595 | Current taxes payable | 47 | 2,349 | |||||||||||||
Receivable from government | 9,380 | 9,108 | Other liabilities | 19 | 20 | |||||||||||||
agency | ||||||||||||||||||
Call rights | 3,828 | 3,728 | $ | 44,777 | $ | 52,505 | ||||||||||||
Other assets | 8,661 | 9,516 | ||||||||||||||||
$ | 76,701 | $ | 99,869 | |||||||||||||||
(A) | Deferred financing costs are net of accumulated amortization of $5.4 million and $8.8 million as of March 31, 2015 and December 31, 2014, respectively. | |||||||||||||||||
As reflected on the Condensed Consolidated Statements of Cash Flows, accretion and other amortization is comprised of the following: | ||||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||
2015 | 2014 | |||||||||||||||||
Accretion of servicer advance interest income | $ | 42,349 | $ | 45,716 | ||||||||||||||
Accretion of excess mortgage servicing rights income | 15,037 | 13,816 | ||||||||||||||||
Accretion of net discount on securities and loans | 5,399 | 356 | ||||||||||||||||
Amortization of deferred financing costs | (1,440 | ) | (3,238 | ) | ||||||||||||||
$ | 61,345 | $ | 56,650 | |||||||||||||||
SEGMENT_REPORTING
SEGMENT REPORTING | 3 Months Ended | |||||||||||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||||||||||
SEGMENT REPORTING | SEGMENT REPORTING | |||||||||||||||||||||||||||
New Residential conducts its business through the following segments: (i) investments in Excess MSRs, (ii) investments in servicer advances, (iii) investments in real estate securities, (iv) investments in real estate loans, (v) investments in consumer loans, and (vi) corporate. The corporate segment consists primarily of (i) general and administrative expenses, (ii) the management fees and incentive compensation owed to the Manager by New Residential following the spin-off, (iii) corporate cash and related interest income, and (iv) the secured corporate loan and related interest expense during the period it was outstanding. | ||||||||||||||||||||||||||||
Summary financial data on New Residential’s segments is given below, together with a reconciliation to the same data for New Residential as a whole: | ||||||||||||||||||||||||||||
Servicing Related Assets | Residential Securities and Loans | |||||||||||||||||||||||||||
Excess MSRs | Servicer Advances | Real Estate Securities | Real Estate Loans | Consumer Loans | Corporate | Total | ||||||||||||||||||||||
Three Months Ended March 31, 2015 | ||||||||||||||||||||||||||||
Interest income | $ | 15,037 | $ | 42,349 | $ | 14,263 | $ | 12,724 | $ | — | $ | — | $ | 84,373 | ||||||||||||||
Interest expense | — | 23,637 | 3,480 | 6,093 | — | 769 | 33,979 | |||||||||||||||||||||
Net interest income (expense) | 15,037 | 18,712 | 10,783 | 6,631 | — | (769 | ) | 50,394 | ||||||||||||||||||||
Impairment | — | — | 1,071 | 977 | — | — | 2,048 | |||||||||||||||||||||
Other income | 3,890 | (10,727 | ) | (5,090 | ) | 13,775 | 10,447 | — | 12,295 | |||||||||||||||||||
Operating expenses | 88 | 575 | (102 | ) | 6,104 | 57 | 15,548 | 22,270 | ||||||||||||||||||||
Income (Loss) Before Income Taxes | 18,839 | 7,410 | 4,724 | 13,325 | 10,390 | (16,317 | ) | 38,371 | ||||||||||||||||||||
Income tax expense (benefit) | — | (3,240 | ) | — | (187 | ) | — | — | (3,427 | ) | ||||||||||||||||||
Net Income (Loss) | $ | 18,839 | $ | 10,650 | $ | 4,724 | $ | 13,512 | $ | 10,390 | $ | (16,317 | ) | $ | 41,798 | |||||||||||||
Noncontrolling interests in income | $ | — | $ | 5,823 | $ | — | $ | — | $ | — | $ | — | $ | 5,823 | ||||||||||||||
(loss) of consolidated subsidiaries | ||||||||||||||||||||||||||||
Net income (loss) attributable to | $ | 18,839 | $ | 4,827 | $ | 4,724 | $ | 13,512 | $ | 10,390 | $ | (16,317 | ) | $ | 35,975 | |||||||||||||
common stockholders | ||||||||||||||||||||||||||||
Servicing Related Assets | Residential Securities and Loans | |||||||||||||||||||||||||||
Excess MSRs | Servicer Advances | Real Estate Securities | Real Estate Loans | Consumer Loans | Corporate | Total | ||||||||||||||||||||||
March 31, 2015 | ||||||||||||||||||||||||||||
Investments | $ | 751,773 | $ | 3,245,457 | $ | 2,324,915 | $ | 581,046 | $ | — | $ | — | $ | 6,903,191 | ||||||||||||||
Cash and cash equivalents | 267 | 69,180 | 5,288 | 5,895 | — | 378,704 | 459,334 | |||||||||||||||||||||
Restricted cash | 37 | 28,288 | — | — | — | — | 28,325 | |||||||||||||||||||||
Derivative assets | — | 71 | — | — | — | — | 71 | |||||||||||||||||||||
Other assets | 34 | 6,622 | 51,610 | 15,925 | 543 | 1,967 | 76,701 | |||||||||||||||||||||
Total assets | $ | 752,111 | $ | 3,349,618 | $ | 2,381,813 | $ | 602,866 | $ | 543 | $ | 380,671 | $ | 7,467,622 | ||||||||||||||
Debt | $ | — | $ | 2,875,412 | $ | 1,928,891 | $ | 434,504 | $ | — | $ | 100,000 | $ | 5,338,807 | ||||||||||||||
Other liabilities | 2,921 | 19,642 | 219,603 | 5,680 | 58 | 66,497 | 314,401 | |||||||||||||||||||||
Total liabilities | 2,921 | 2,895,054 | 2,148,494 | 440,184 | 58 | 166,497 | 5,653,208 | |||||||||||||||||||||
Total equity | 749,190 | 454,564 | 233,319 | 162,682 | 485 | 214,174 | 1,814,414 | |||||||||||||||||||||
Noncontrolling interests in equity | — | 246,899 | — | — | — | — | 246,899 | |||||||||||||||||||||
of consolidated subsidiaries | ||||||||||||||||||||||||||||
Total New Residential | $ | 749,190 | $ | 207,665 | $ | 233,319 | $ | 162,682 | $ | 485 | $ | 214,174 | $ | 1,567,515 | ||||||||||||||
stockholders’ equity | ||||||||||||||||||||||||||||
Investments in equity method | $ | 225,111 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 225,111 | ||||||||||||||
investees | ||||||||||||||||||||||||||||
Servicing Related Assets | Residential Securities and Loans | |||||||||||||||||||||||||||
Excess MSRs | Servicer Advances | Real Estate Securities | Real Estate Loans | Consumer Loans | Corporate | Total | ||||||||||||||||||||||
Three Months Ended March 31, 2014 | ||||||||||||||||||||||||||||
Interest income | $ | 13,816 | $ | 45,716 | $ | 11,238 | $ | 720 | $ | — | $ | — | $ | 71,490 | ||||||||||||||
Interest expense | 1,291 | 31,956 | 4,069 | 198 | 1,483 | — | 38,997 | |||||||||||||||||||||
Net interest income (expense) | 12,525 | 13,760 | 7,169 | 522 | (1,483 | ) | — | 32,493 | ||||||||||||||||||||
Impairment | — | — | 328 | 164 | — | — | 492 | |||||||||||||||||||||
Other income | 12,976 | — | 5,042 | 671 | 16,360 | 1 | 35,050 | |||||||||||||||||||||
Operating expenses | 65 | 250 | 60 | 90 | 23 | 9,411 | 9,899 | |||||||||||||||||||||
Income (Loss) Before Income Taxes | 25,436 | 13,510 | 11,823 | 939 | 14,854 | (9,410 | ) | 57,152 | ||||||||||||||||||||
Income tax expense (benefit) | — | 287 | — | — | — | — | 287 | |||||||||||||||||||||
Net Income (Loss) | $ | 25,436 | $ | 13,223 | $ | 11,823 | $ | 939 | $ | 14,854 | $ | (9,410 | ) | $ | 56,865 | |||||||||||||
Noncontrolling interests in income | $ | — | $ | 8,093 | $ | — | $ | — | $ | — | $ | — | $ | 8,093 | ||||||||||||||
(loss) of consolidated subsidiaries | ||||||||||||||||||||||||||||
Net income (loss) attributable to | $ | 25,436 | $ | 5,130 | $ | 11,823 | $ | 939 | $ | 14,854 | $ | (9,410 | ) | $ | 48,772 | |||||||||||||
common stockholders | ||||||||||||||||||||||||||||
INVESTMENTS_IN_EXCESS_MORTGAGE
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS | 3 Months Ended | |||||||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||||||
Transfers and Servicing [Abstract] | ||||||||||||||||||||||||
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS | INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS | |||||||||||||||||||||||
The following table presents activity related to the carrying value of New Residential’s investments in Excess MSRs: | ||||||||||||||||||||||||
Servicer | ||||||||||||||||||||||||
Nationstar | SLS(A) | Total | ||||||||||||||||||||||
Balance as of December 31, 2014 | $ | 409,076 | $ | 8,657 | $ | 417,733 | ||||||||||||||||||
Transfers from indirect ownership | 98,258 | — | 98,258 | |||||||||||||||||||||
Purchases | 26,479 | — | 26,479 | |||||||||||||||||||||
Interest income | 14,856 | 181 | 15,037 | |||||||||||||||||||||
Other income | 730 | — | 730 | |||||||||||||||||||||
Proceeds from repayments | (29,544 | ) | (270 | ) | (29,814 | ) | ||||||||||||||||||
Change in fair value | (1,472 | ) | (289 | ) | (1,761 | ) | ||||||||||||||||||
Balance as of March 31, 2015 | $ | 518,383 | $ | 8,279 | $ | 526,662 | ||||||||||||||||||
(A) Specialized Loan Servicing LLC (“SLS”). See Note 6 for a description of the SLS Transaction. | ||||||||||||||||||||||||
Nationstar or SLS, as applicable, as servicer, performs all servicing and advancing functions, and retains the ancillary income, servicing obligations and liabilities as the servicer of the underlying loans in the portfolio. | ||||||||||||||||||||||||
On January 16, 2015, New Residential invested approximately $23.8 million to acquire a 33.3% interest in the Excess MSR on a portfolio of Freddie Mac residential mortgage loans with an aggregate UPB of $8.4 billion. Fortress-managed funds and Nationstar each agreed to acquire a 33.3% interest in the Excess MSRs. Nationstar as servicer will perform all servicing and advancing functions, and retain the ancillary income, servicing obligations and liabilities as the servicer of the underlying loans in each of the portfolios. Under the terms of the investment, to the extent that any loans in the portfolio are refinanced by Nationstar, the resulting Excess MSRs are shared on a pro rata basis by New Residential, the Fortress-managed funds and Nationstar, subject to certain limitations. | ||||||||||||||||||||||||
New Residential has entered into a “Recapture Agreement” in each of the Excess MSR investments through March 31, 2015, including those Excess MSR investments made through investments in joint ventures (Note 5). Under such Recapture Agreements, New Residential is generally entitled to a pro rata interest in the Excess MSRs on any initial or subsequent refinancing by Nationstar of a loan in the original portfolio. These Recapture Agreements do not apply to New Residential’s investments in servicer advances (Note 6). | ||||||||||||||||||||||||
New Residential elected to record its investments in Excess MSRs at fair value pursuant to the fair value option for financial instruments in order to provide users of the financial statements with better information regarding the effects of prepayment risk and other market factors on the Excess MSRs. | ||||||||||||||||||||||||
The following is a summary of New Residential’s direct investments in Excess MSRs: | ||||||||||||||||||||||||
March 31, 2015 | 31-Dec-14 | |||||||||||||||||||||||
Unpaid Principal Balance (“UPB”) of Underlying Mortgages | Interest in Excess MSR | Weighted Average Life Years(A) | Amortized Cost Basis(B) | Carrying Value(C) | Carrying Value(C) | |||||||||||||||||||
New Residential | Fortress-managed funds | Nationstar | ||||||||||||||||||||||
Agency | ||||||||||||||||||||||||
Original and Recaptured Pools | $ | 54,829,877 | 32.5%-66.7% | 0.0%-33.3% | 33.3%-35% | 5.9 | $ | 161,109 | $ | 209,114 | $ | 188,733 | ||||||||||||
Recapture Agreements | — | 32.5%-66.7% | 0.0%-33.3% | 33.3%-35% | 12.9 | 9,927 | 29,865 | 28,786 | ||||||||||||||||
54,829,877 | 6.3 | 171,036 | 238,979 | 217,519 | ||||||||||||||||||||
Non-Agency(D) | ||||||||||||||||||||||||
Original and Recaptured Pools | $ | 108,742,559 | 33.3%-80.0% | 0.0%-50.0% | 0.0%-33.3% | 4.9 | $ | 231,228 | $ | 270,365 | $ | 189,812 | ||||||||||||
Recapture Agreements | — | 33.3%-80.0% | 0.0%-50.0% | 0.0%-33.3% | 11.8 | 16,638 | 17,318 | 10,402 | ||||||||||||||||
108,742,559 | 5.4 | 247,866 | 287,683 | 200,214 | ||||||||||||||||||||
Total | $ | 163,572,436 | 5.8 | $ | 418,902 | $ | 526,662 | $ | 417,733 | |||||||||||||||
(A) | Weighted Average Life represents the weighted average expected timing of the receipt of expected cash flows for this investment. | |||||||||||||||||||||||
(B) | The amortized cost basis of the Recapture Agreements is determined based on the relative fair values of the Recapture Agreements and related Excess MSRs at the time they were acquired. | |||||||||||||||||||||||
(C) | Carrying Value represents the fair value of the pools or Recapture Agreements, as applicable. | |||||||||||||||||||||||
(D) | Excess MSR investments in which New Residential also invested in related servicer advances, including the basic fee component of the related MSR as of March 31, 2015 (Note 6). | |||||||||||||||||||||||
Changes in fair value recorded in other income are comprised of the following: | ||||||||||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||||||||
2015 | 2014 | |||||||||||||||||||||||
Original and Recaptured Pools | $ | (1,976 | ) | $ | 7,088 | |||||||||||||||||||
Recapture Agreements | 215 | (486 | ) | |||||||||||||||||||||
$ | (1,761 | ) | $ | 6,602 | ||||||||||||||||||||
In the first quarter of 2015, a weighted average discount rate of 9.6% was used to value New Residential’s investments in Excess MSRs (directly and through equity method investees). | ||||||||||||||||||||||||
The table below summarizes the geographic distribution of the underlying residential mortgage loans of the direct investments in Excess MSRs: | ||||||||||||||||||||||||
Percentage of Total Outstanding Unpaid Principal Amount as of | ||||||||||||||||||||||||
State Concentration | 31-Mar-15 | 31-Dec-14 | ||||||||||||||||||||||
California | 33 | % | 31.5 | % | ||||||||||||||||||||
Florida | 9.3 | % | 7.7 | % | ||||||||||||||||||||
New York | 4.9 | % | 4.3 | % | ||||||||||||||||||||
Maryland | 3.8 | % | 4 | % | ||||||||||||||||||||
Texas | 3.6 | % | 4.2 | % | ||||||||||||||||||||
New Jersey | 3.5 | % | 3.2 | % | ||||||||||||||||||||
Virginia | 3.2 | % | 3.3 | % | ||||||||||||||||||||
Illinois | 3.2 | % | 3.2 | % | ||||||||||||||||||||
Washington | 3.2 | % | 3.6 | % | ||||||||||||||||||||
Arizona | 2.7 | % | 3.2 | % | ||||||||||||||||||||
Other U.S. | 29.6 | % | 31.8 | % | ||||||||||||||||||||
100 | % | 100 | % | |||||||||||||||||||||
Geographic concentrations of investments expose New Residential to the risk of economic downturns within the relevant states. Any such downturn in a state where New Residential holds significant investments could affect the underlying borrower’s ability to make mortgage payments and therefore could have a meaningful, negative impact on the Excess MSRs. |
INVESTMENTS_IN_EXCESS_MORTGAGE1
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS, EQUITY METHOD INVESTEES | 3 Months Ended | |||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||
Equity Method Investments and Joint Ventures [Abstract] | ||||||||||||||||||||
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS, EQUITY METHOD INVESTEES | INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS, EQUITY METHOD INVESTEES | |||||||||||||||||||
New Residential entered into investments in joint ventures (“Excess MSR joint ventures”) jointly controlled by New Residential and Fortress-managed funds investing in Excess MSRs. New Residential elected to record these investments at fair value pursuant to the fair value option for financial instruments to provide users of the financial statements with better information regarding the effects of prepayment risk and other market factors. | ||||||||||||||||||||
During the first quarter of 2015, New Residential and the Fortress-managed funds restructured their investments in two of the Excess MSR joint ventures and now each directly owns its share of the underlying assets of the joint ventures. | ||||||||||||||||||||
The following tables summarize the financial results of the Excess MSR joint ventures, accounted for as equity method investees, held by New Residential: | ||||||||||||||||||||
March 31, 2015 | December 31, 2014 | |||||||||||||||||||
Excess MSR assets | $ | 440,714 | $ | 653,293 | ||||||||||||||||
Other assets | 9,508 | 8,472 | ||||||||||||||||||
Other liabilities | — | (13 | ) | |||||||||||||||||
Equity | $ | 450,222 | $ | 661,752 | ||||||||||||||||
New Residential’s investment | $ | 225,111 | $ | 330,876 | ||||||||||||||||
New Residential’s ownership | 50 | % | 50 | % | ||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||||
2015 | 2014 | |||||||||||||||||||
Interest income | $ | 11,701 | $ | 18,493 | ||||||||||||||||
Other income (loss) | (1,835 | ) | (5,705 | ) | ||||||||||||||||
Expenses | (25 | ) | (40 | ) | ||||||||||||||||
Net income | $ | 9,841 | $ | 12,748 | ||||||||||||||||
New Residential’s investments in equity method investees changed during the three months ended March 31, 2015 as follows: | ||||||||||||||||||||
Balance at December 31, 2014 | $ | 330,876 | ||||||||||||||||||
Contributions to equity method investees | — | |||||||||||||||||||
Transfers to direct ownership | (98,258 | ) | ||||||||||||||||||
Distributions of earnings from equity method investees | (12,226 | ) | ||||||||||||||||||
Distributions of capital from equity method investees | (202 | ) | ||||||||||||||||||
Change in fair value of investments in equity method investees | 4,921 | |||||||||||||||||||
Balance at March 31, 2015 | $ | 225,111 | ||||||||||||||||||
The following is a summary of New Residential’s Excess MSR investments made through equity method investees: | ||||||||||||||||||||
March 31, 2015 | ||||||||||||||||||||
Unpaid Principal Balance | Investee Interest in Excess MSR(A) | New Residential Interest in Investees | Amortized Cost Basis(B) | Carrying Value(C) | Weighted Average Life (Years)(D) | |||||||||||||||
Agency | ||||||||||||||||||||
Original and Recaptured Pools | $ | 84,000,746 | 66.7 | % | 50 | % | $ | 289,745 | $ | 358,909 | 5.5 | |||||||||
Recapture Agreements | — | 66.7 | % | 50 | % | 62,190 | 81,805 | 11.7 | ||||||||||||
Total | $ | 84,000,746 | $ | 351,935 | $ | 440,714 | 6.6 | |||||||||||||
(A) | The remaining interests are held by Nationstar. | |||||||||||||||||||
(B) | Represents the amortized cost basis of the equity method investees in which New Residential holds a 50% interest. The amortized cost basis of the Recapture Agreements is determined based on the relative fair values of the Recapture Agreements and related Excess MSRs at the time they were acquired. | |||||||||||||||||||
(C) | Represents the carrying value of the Excess MSRs held in equity method investees, in which New Residential holds a 50% interest. Carrying value represents the fair value of the pools or Recapture Agreements, as applicable. | |||||||||||||||||||
(D) | The weighted average life represents the weighted average expected timing of the receipt of cash flows of each investment. | |||||||||||||||||||
In the first quarter of 2015, a weighted average discount rate of 9.6% was used to value New Residential’s investments in Excess MSRs (directly and through equity method investees). | ||||||||||||||||||||
The table below summarizes the geographic distribution of the underlying residential mortgage loans of the Excess MSR investments made through equity method investees: | ||||||||||||||||||||
Percentage of Total Outstanding Unpaid Principal Amount as of | ||||||||||||||||||||
State Concentration | 31-Mar-15 | 31-Dec-14 | ||||||||||||||||||
California | 13.1 | % | 23.5 | % | ||||||||||||||||
Florida | 7.4 | % | 8.9 | % | ||||||||||||||||
Texas | 6.1 | % | 4.8 | % | ||||||||||||||||
Georgia | 5.6 | % | 4.1 | % | ||||||||||||||||
New York | 5.5 | % | 5.6 | % | ||||||||||||||||
New Jersey | 4.1 | % | 3.9 | % | ||||||||||||||||
Illinois | 4 | % | 3.5 | % | ||||||||||||||||
Virginia | 3.2 | % | 3.2 | % | ||||||||||||||||
Maryland | 3.2 | % | 3.3 | % | ||||||||||||||||
Pennsylvania | 3 | % | 2.3 | % | ||||||||||||||||
Other U.S. | 44.8 | % | 36.9 | % | ||||||||||||||||
100 | % | 100 | % | |||||||||||||||||
Geographic concentrations of investments expose New Residential to the risk of economic downturns within the relevant states. Any such downturn in a state where New Residential holds significant investments could affect the underlying borrower’s ability to make mortgage payments and therefore could have a meaningful, negative impact on the Excess MSRs. |
INVESTMENTS_IN_SERVICER_ADVANC
INVESTMENTS IN SERVICER ADVANCES | 3 Months Ended | |||||||||||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||||||||||
Investments, All Other Investments [Abstract] | ||||||||||||||||||||||||||||
INVESTMENTS IN SERVICER ADVANCES | INVESTMENTS IN SERVICER ADVANCES | |||||||||||||||||||||||||||
In December 2013, New Residential and third-party co-investors, through a joint venture entity (Advance Purchaser LLC, the “Buyer”) consolidated by New Residential, agreed to purchase the outstanding servicer advances on a portfolio of loans, which is a subset of the same portfolio of loans in which New Residential invests in a portion of the Excess MSRs (Notes 4 and 5), including the basic fee component of the related MSRs. As of March 31, 2015, New Residential and third-party co-investors had settled $2.9 billion of servicer advances, net of recoveries, financed with $2.7 billion of notes payables outstanding (Note 11). A taxable wholly owned subsidiary of New Residential is the managing member of the Buyer and owned an approximately 44.5% interest in the Buyer as of March 31, 2015. As of March 31, 2015, noncontrolling third-party investors, owning the remaining interest in the Buyer have funded capital commitments to the Buyer of $389.6 million and New Residential has funded capital commitments to the Buyer of $312.7 million. The Buyer may call capital up to the commitment amount on unfunded commitments and recall capital to the extent the Buyer makes a distribution to the co-investors, including New Residential. As of March 31, 2015, the third-party co-investors and New Residential have previously funded their commitments, however the Buyer may recall $238.4 million and $188.3 million of capital distributed to the third-party co-investors and New Residential, respectively. Neither the third-party co-investors nor New Residential is obligated to fund amounts in excess of their respective capital commitments, regardless of the capital requirements of the Buyer that holds its investment in servicer advances. | ||||||||||||||||||||||||||||
The Buyer has purchased servicer advances from Nationstar, is required to purchase all future servicer advances made with respect to these pools from Nationstar, and receives cash flows from advance recoveries and the basic fee component of the related MSRs, net of compensation paid back to Nationstar in consideration of Nationstar’s servicing activities. The compensation paid to Nationstar as of March 31, 2015 was approximately 9.2% of the basic fee component of the related MSRs plus a performance fee that represents a portion (up to 100%) of the cash flows in excess of those required for the Buyer to obtain a specified return on its equity. | ||||||||||||||||||||||||||||
In December 2014, New Residential agreed to acquire (the “SLS Transaction”) 50% of the Excess MSRs, all of the servicer advances and related basic fee portion of the MSRs (the “Advance Fee”), and a portion of the call rights related to an underlying pool of residential mortgage loans with a UPB of approximately $3.0 billion which is serviced by SLS. Fortress-managed funds acquired the other 50% of the Excess MSRs. The aggregate purchase price was approximately $229.7 million. The par amount of the total advance commitments for the SLS Transaction was $219.2 million (with related financing of $195.5 million). As of December 31, 2014, the closed portion of the purchase of $93.8 million included $8.4 million for 50% of the Excess MSRs, $83.8 million for servicer advances and Advance Fee (of which $74.3 million was financed as of December 31, 2014), and $1.6 million to fund a portion of the call rights on 57 of the 99 underlying securitization trusts. The remaining portion of the purchase price of $135.9 million included servicer advances and Advance Fee unfunded commitments of approximately $133.8 million that were funded in January 2015 (with approximately $121.2 million of related financing) and $2.1 million to fund the remaining portion of the call rights on 57 of the 99 underlying securitization trusts. As of March 31, 2015, New Residential had settled $168.4 million of servicer advances, net of recoveries, financed with $150.1 million of notes payable outstanding (Note 11). SLS will continue to service the loans in exchange for a servicing fee of 10.75 bps and an incentive fee (the “Incentive Fee”) which is based on the ratio of the outstanding servicer advances to the UPB of the underlying loans. | ||||||||||||||||||||||||||||
New Residential elected to record its investments in servicer advances, including the right to the basic fee component of the related MSRs, at fair value pursuant to the fair value option for financial instruments to provide users of the financial statements with better information regarding the effects of market factors. | ||||||||||||||||||||||||||||
The following is a summary of the investments in servicer advances, including the right to the basic fee component of the related MSRs: | ||||||||||||||||||||||||||||
Amortized Cost Basis | Carrying Value(A) | Weighted Average Discount Rate | Weighted Average Life (Years)(B) | |||||||||||||||||||||||||
31-Mar-15 | ||||||||||||||||||||||||||||
Servicer advances | $ | 3,168,909 | $ | 3,245,457 | 5.4 | % | 3.9 | |||||||||||||||||||||
As of December 31, 2014 | ||||||||||||||||||||||||||||
Servicer advances | $ | 3,186,622 | $ | 3,270,839 | 5.4 | % | 4 | |||||||||||||||||||||
(A) | Carrying value represents the fair value of the investments in servicer advances, including the basic fee component of the related MSRs. | |||||||||||||||||||||||||||
(B) | Weighted Average Life represents the weighted average expected timing of the receipt of expected net cash flows for this investment. | |||||||||||||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||||||||||||
2015 | 2014 | |||||||||||||||||||||||||||
Changes in Fair Value Recorded in Other Income | $ | (7,669 | ) | $ | — | |||||||||||||||||||||||
The following is additional information regarding the servicer advances and related financing: | ||||||||||||||||||||||||||||
Loan-to-Value | Cost of Funds(B) | |||||||||||||||||||||||||||
UPB of Underlying Residential Mortgage Loans | Outstanding Servicer Advances | Servicer Advances to UPB of Underlying Residential Mortgage Loans | Carrying Value of Notes Payable | Gross | Net(A) | Gross | Net | |||||||||||||||||||||
March 31, 2015 | ||||||||||||||||||||||||||||
Servicer advances(C) | $ | 92,159,246 | $ | 3,068,306 | 3.3 | % | $ | 2,875,412 | 91.5 | % | 90.6 | % | 2.6 | % | 2.2 | % | ||||||||||||
December 31, 2014 | ||||||||||||||||||||||||||||
Servicer advances(C) | $ | 96,547,773 | $ | 3,102,492 | 3.2 | % | $ | 2,890,230 | 91.4 | % | 90.4 | % | 3 | % | 2.3 | % | ||||||||||||
(A) | Ratio of face amount of borrowings to par amount of servicer advance collateral, net of an interest reserve maintained by the Buyer. | |||||||||||||||||||||||||||
(B) | Annualized measure of the cost associated with borrowings. Gross Cost of Funds primarily includes interest expense and facility fees. Net Cost of Funds excludes facility fees. | |||||||||||||||||||||||||||
(C) | The following types of advances comprise the investments in servicer advances: | |||||||||||||||||||||||||||
March 31, 2015 | December 31, 2014 | |||||||||||||||||||||||||||
Principal and interest advances | $ | 737,845 | $ | 729,713 | ||||||||||||||||||||||||
Escrow advances (taxes and insurance advances) | 1,514,848 | 1,600,713 | ||||||||||||||||||||||||||
Foreclosure advances | 815,613 | 772,066 | ||||||||||||||||||||||||||
Total | $ | 3,068,306 | $ | 3,102,492 | ||||||||||||||||||||||||
Interest income recognized by New Residential related to its investments in servicer advances was comprised of the following: | ||||||||||||||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||||||||||||
2015 | 2014 | |||||||||||||||||||||||||||
Interest income, gross of amounts attributable to servicer compensation | $ | 63,357 | $ | 67,138 | ||||||||||||||||||||||||
Amounts attributable to base servicer compensation | (6,601 | ) | (6,280 | ) | ||||||||||||||||||||||||
Amounts attributable to incentive servicer compensation | (14,407 | ) | (15,142 | ) | ||||||||||||||||||||||||
Interest income from investments in servicer advances | $ | 42,349 | $ | 45,716 | ||||||||||||||||||||||||
Others’ interests in the equity of the Buyer is computed as follows: | ||||||||||||||||||||||||||||
March 31, 2015 | December 31, 2014 | |||||||||||||||||||||||||||
Total Advance Purchaser LLC equity | $ | 445,041 | $ | 457,545 | ||||||||||||||||||||||||
Others’ ownership interest | 55.5 | % | 55.5 | % | ||||||||||||||||||||||||
Others’ interest in equity of consolidated subsidiary | $ | 246,899 | $ | 253,836 | ||||||||||||||||||||||||
Others’ interests in the Buyer’s net income is computed as follows: | ||||||||||||||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||||||||||||
2015 | 2014 | |||||||||||||||||||||||||||
Net Advance Purchaser LLC income | $ | 10,496 | $ | 13,511 | ||||||||||||||||||||||||
Others’ ownership interest as a percent of total(A) | 55.5 | % | 59.9 | % | ||||||||||||||||||||||||
Others’ interest in net income (loss) of consolidated subsidiaries | $ | 5,823 | $ | 8,093 | ||||||||||||||||||||||||
(A) | As a result, New Residential owned 44.5% and 40.1% of the Buyer, on average during the three months ended March 31, 2015 and 2014, respectively. |
INVESTMENTS_IN_REAL_ESTATE_SEC
INVESTMENTS IN REAL ESTATE SECURITIES | 3 Months Ended | ||||||||||||||||||||||||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||
INVESTMENTS IN REAL ESTATE SECURITIES | INVESTMENTS IN REAL ESTATE SECURITIES | ||||||||||||||||||||||||||||||||||||||||
During the three months ended March 31, 2015, New Residential acquired $257.8 million face amount of Non-Agency RMBS for approximately $222.1 million and $979.8 million face amount of Agency RMBS for approximately $1.0 billion. New Residential sold Non-Agency RMBS with a face amount of approximately $441.1 million and an amortized cost basis of approximately $385.9 million for approximately $389.7 million, recording a gain on sale of approximately $3.8 million. Furthermore, New Residential sold Agency RMBS with a face amount of $1.0 billion and an amortized cost basis of approximately $1.0 billion for approximately $1.1 billion, recording a gain on sale of approximately $20.9 million. | |||||||||||||||||||||||||||||||||||||||||
See Note 10 for a discussion of transactions formerly accounted for as linked transactions. | |||||||||||||||||||||||||||||||||||||||||
The following is a summary of New Residential’s real estate securities, all of which are classified as available-for-sale and are, therefore, reported at fair value with changes in fair value recorded in other comprehensive income, except for securities that are other-than-temporarily impaired and except for securities which New Residential elected to carry at fair value and record changes to valuation through the income statement. | |||||||||||||||||||||||||||||||||||||||||
Gross Unrealized | Weighted Average | 31-Dec-14 | |||||||||||||||||||||||||||||||||||||||
Asset Type | Outstanding Face Amount | Amortized Cost Basis | Gains | Losses | Carrying Value(A) | Number of Securities | Rating(B) | Coupon | Yield | Life (Years)(C) | Principal Subordination(D) | Carrying Value | |||||||||||||||||||||||||||||
Agency | $ | 1,575,759 | $ | 1,659,781 | $ | 7,510 | $ | (2,295 | ) | $ | 1,664,996 | 102 | AAA | 3.11 | % | 2.18 | % | 5.4 | N/A | $ | 1,740,163 | ||||||||||||||||||||
RMBS(E)(F) | |||||||||||||||||||||||||||||||||||||||||
Non-Agency | 1,820,536 | 647,915 | 14,641 | (2,637 | ) | 659,919 | 137 | BBB- | 0.76 | % | 5.74 | % | 9.7 | 26 | % | 723,000 | |||||||||||||||||||||||||
RMBS(G) (H) | |||||||||||||||||||||||||||||||||||||||||
Total/ | $ | 3,396,295 | $ | 2,307,696 | $ | 22,151 | $ | (4,932 | ) | $ | 2,324,915 | 239 | AA- | 2.45 | % | 3.18 | % | 6.6 | $ | 2,463,163 | |||||||||||||||||||||
Weighted | |||||||||||||||||||||||||||||||||||||||||
Average | |||||||||||||||||||||||||||||||||||||||||
(A) | Fair value, which is equal to carrying value for all securities. See Note 12 regarding the estimation of fair value. | ||||||||||||||||||||||||||||||||||||||||
(B) | Represents the weighted average of the ratings of all securities in each asset type, expressed as an S&P equivalent rating. This excludes the ratings of the collateral underlying 20 bonds which either have never been rated or for which rating information is no longer provided. For each security rated by multiple rating agencies, the lowest rating is used. New Residential used an implied AAA rating for the Agency RMBS. Ratings provided were determined by third party rating agencies, and represent the most recent credit ratings available as of the reporting date and may not be current. | ||||||||||||||||||||||||||||||||||||||||
(C) | The weighted average life is based on the timing of expected principal reduction on the assets. | ||||||||||||||||||||||||||||||||||||||||
(D) | Percentage of the outstanding face amount of securities that is subordinate to New Residential’s investments. | ||||||||||||||||||||||||||||||||||||||||
(E) | Includes securities issued or guaranteed by U.S. Government agencies such as the Federal National Mortgage Association (“Fannie Mae”) or the Federal Home Loan Mortgage Corporation (“Freddie Mac”). | ||||||||||||||||||||||||||||||||||||||||
(F) | The total outstanding face amount was $979.8 million for fixed rate securities and $595.9 million for floating rate securities as of March 31, 2015. | ||||||||||||||||||||||||||||||||||||||||
(G) | The total outstanding face amount was $1.2 billion (including $927.5 million of residual and interest-only notional amount) for fixed rate securities and $654.0 million (including $101.1 million of residual and interest-only notional amount) for floating rate securities as of March 31, 2015. | ||||||||||||||||||||||||||||||||||||||||
(H) | Includes Other ABS consisting primarily of interest-only securities which New Residential elected to carry at fair value and record changes to valuation through the income statement and representing 8.5% of the carrying value of the Non-Agency RMBS portfolio. | ||||||||||||||||||||||||||||||||||||||||
Gross Unrealized | Weighted Average | ||||||||||||||||||||||||||||||||||||||||
Asset Type | Outstanding Face Amount | Amortized Cost Basis | Gains | Losses | Carrying Value | Number of Securities | Rating | Coupon | Yield | Life (Years) | Principal Subordination | ||||||||||||||||||||||||||||||
Other ABS | $ | 984,460 | $ | 56,414 | $ | 829 | $ | (1,119 | ) | $ | 56,124 | 8 | AA+ | 1.98 | % | 8.65 | % | 4 | — | % | |||||||||||||||||||||
Unrealized losses that are considered other than temporary are recognized currently in earnings. During the three months ended March 31, 2015, New Residential recorded other-than-temporary impairment charges (“OTTI”) of $1.1 million with respect to real estate securities. Any remaining unrealized losses on New Residential’s securities were primarily the result of changes in market factors, rather than issue-specific credit impairment. New Residential performed analyses in relation to such securities, using management’s best estimate of their cash flows, which support its belief that the carrying values of such securities were fully recoverable over their expected holding period. New Residential has no intent to sell, and is not more likely than not to be required to sell, these securities. | |||||||||||||||||||||||||||||||||||||||||
The following table summarizes New Residential’s securities in an unrealized loss position as of March 31, 2015. | |||||||||||||||||||||||||||||||||||||||||
Amortized Cost Basis | Weighted Average | ||||||||||||||||||||||||||||||||||||||||
Securities in an Unrealized Loss Position | Outstanding Face Amount | Before Impairment | Other-Than- | After Impairment | Gross Unrealized Losses | Carrying Value | Number of Securities | Rating(B) | Coupon | Yield | Life | ||||||||||||||||||||||||||||||
Temporary Impairment(A) | (Years) | ||||||||||||||||||||||||||||||||||||||||
Less than Twelve | $ | 1,297,224 | $ | 494,733 | $ | (1,071 | ) | $ | 493,662 | $ | (3,202 | ) | $ | 490,460 | 70 | AA- | 1.37 | % | 2.2 | % | 7.2 | ||||||||||||||||||||
Months | |||||||||||||||||||||||||||||||||||||||||
Twelve or More | 128,605 | 123,794 | — | 123,794 | (1,730 | ) | 122,064 | 22 | AA+ | 2.39 | % | 1.96 | % | 4.4 | |||||||||||||||||||||||||||
Months | |||||||||||||||||||||||||||||||||||||||||
Total/Weighted | $ | 1,425,829 | $ | 618,527 | $ | (1,071 | ) | $ | 617,456 | $ | (4,932 | ) | $ | 612,524 | 92 | AA | 1.57 | % | 2.15 | % | 6.7 | ||||||||||||||||||||
Average | |||||||||||||||||||||||||||||||||||||||||
(A) | This amount represents other-than-temporary impairment recorded on securities that are in an unrealized loss position as of March 31, 2015. | ||||||||||||||||||||||||||||||||||||||||
(B) | The weighted average rating of securities in an unrealized loss position for less than twelve months excludes the rating of 20 bonds which either have never been rated or for which rating information is no longer provided. | ||||||||||||||||||||||||||||||||||||||||
New Residential performed an assessment of all of its debt securities that are in an unrealized loss position (an unrealized loss position exists when a security’s amortized cost basis, excluding the effect of OTTI, exceeds its fair value) and determined the following: | |||||||||||||||||||||||||||||||||||||||||
March 31, 2015 | |||||||||||||||||||||||||||||||||||||||||
Unrealized Losses | |||||||||||||||||||||||||||||||||||||||||
Fair Value | Amortized Cost Basis After Impairment | Credit(A) | Non-Credit(B) | ||||||||||||||||||||||||||||||||||||||
Securities New Residential intends to sell(C) | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||||
Securities New Residential is more likely than not to be | — | — | — | N/A | |||||||||||||||||||||||||||||||||||||
required to sell(D) | |||||||||||||||||||||||||||||||||||||||||
Securities New Residential has no intent to sell and is not | |||||||||||||||||||||||||||||||||||||||||
more likely than not to be required to sell: | |||||||||||||||||||||||||||||||||||||||||
Credit impaired securities | 107,612 | 108,440 | (1,071 | ) | (828 | ) | |||||||||||||||||||||||||||||||||||
Non-credit impaired securities | 504,912 | 509,016 | — | (4,104 | ) | ||||||||||||||||||||||||||||||||||||
Total debt securities in an unrealized loss position | $ | 612,524 | $ | 617,456 | $ | (1,071 | ) | $ | (4,932 | ) | |||||||||||||||||||||||||||||||
(A) | This amount is required to be recorded as other-than-temporary impairment through earnings. In measuring the portion of credit losses, New Residential’s management estimates the expected cash flow for each of the securities. This evaluation includes a review of the credit status and the performance of the collateral supporting those securities, including the credit of the issuer, key terms of the securities and the effect of local, industry and broader economic trends. Significant inputs in estimating the cash flows include management’s expectations of prepayment speeds, default rates and loss severities. Credit losses are measured as the decline in the present value of the expected future cash flows discounted at the investment’s effective interest rate. | ||||||||||||||||||||||||||||||||||||||||
(B) | This amount represents unrealized losses on securities that are due to non-credit factors and recorded through other comprehensive income. | ||||||||||||||||||||||||||||||||||||||||
(C) | A portion of securities New Residential intends to sell have a fair value equal to their amortized cost basis after impairment and, therefore, do not have unrealized losses reflected in other comprehensive income as of March 31, 2015. | ||||||||||||||||||||||||||||||||||||||||
(D) | New Residential may, at times, be more likely than not to be required to sell certain securities for liquidity purposes. While the amount of the securities to be sold may be an estimate, and the securities to be sold have not yet been identified, New Residential must make its best estimate, which is subject to significant judgment regarding future events, and may differ materially from actual future sales. | ||||||||||||||||||||||||||||||||||||||||
The following table summarizes the activity related to credit losses on debt securities: | |||||||||||||||||||||||||||||||||||||||||
Three Months Ended March 31, 2015 | |||||||||||||||||||||||||||||||||||||||||
Beginning balance of credit losses on debt securities for which a portion of an OTTI was | $ | 1,127 | |||||||||||||||||||||||||||||||||||||||
recognized in other comprehensive income | |||||||||||||||||||||||||||||||||||||||||
Increases to credit losses on securities for which an OTTI was previously recognized and a portion | 6 | ||||||||||||||||||||||||||||||||||||||||
of an OTTI was recognized in other comprehensive income | |||||||||||||||||||||||||||||||||||||||||
Additions for credit losses on securities for which an OTTI was not previously recognized | 1,065 | ||||||||||||||||||||||||||||||||||||||||
Reductions for securities for which the amount previously recognized in other comprehensive | — | ||||||||||||||||||||||||||||||||||||||||
income was recognized in earnings because the entity intends to sell the security or more likely | |||||||||||||||||||||||||||||||||||||||||
than not will be required to sell the security before recovery of its amortized cost basis | |||||||||||||||||||||||||||||||||||||||||
Reduction for credit losses on securities for which no OTTI was recognized in other | — | ||||||||||||||||||||||||||||||||||||||||
comprehensive income at the current measurement date | |||||||||||||||||||||||||||||||||||||||||
Reduction for securities sold during the period | (228 | ) | |||||||||||||||||||||||||||||||||||||||
Ending balance of credit losses on debt securities for which a portion of an OTTI was recognized | $ | 1,970 | |||||||||||||||||||||||||||||||||||||||
in other comprehensive income | |||||||||||||||||||||||||||||||||||||||||
The table below summarizes the geographic distribution of the collateral securing New Residential’s Non-Agency RMBS: | |||||||||||||||||||||||||||||||||||||||||
31-Mar-15 | 31-Dec-14 | ||||||||||||||||||||||||||||||||||||||||
Geographic Location | Outstanding Face Amount | Percentage of Total Outstanding | Outstanding Face Amount | Percentage of Total Outstanding | |||||||||||||||||||||||||||||||||||||
Western U.S. | $ | 614,391 | 33.6 | % | $ | 779,930 | 41.1 | % | |||||||||||||||||||||||||||||||||
Southeastern U.S. | 479,970 | 26.4 | % | 409,755 | 21.6 | % | |||||||||||||||||||||||||||||||||||
Northeastern U.S. | 327,308 | 18 | % | 344,716 | 18.2 | % | |||||||||||||||||||||||||||||||||||
Midwestern U.S. | 160,246 | 8.8 | % | 190,480 | 10 | % | |||||||||||||||||||||||||||||||||||
Southwestern U.S. | 238,127 | 13.1 | % | 170,829 | 9 | % | |||||||||||||||||||||||||||||||||||
Other(A) | 494 | 0.1 | % | 440 | 0.1 | % | |||||||||||||||||||||||||||||||||||
$ | 1,820,536 | 100 | % | $ | 1,896,150 | 100 | % | ||||||||||||||||||||||||||||||||||
(A) | Represents collateral for which New Residential was unable to obtain geographic information. | ||||||||||||||||||||||||||||||||||||||||
New Residential evaluates the credit quality of its real estate securities, as of the acquisition date, for evidence of credit quality deterioration. As a result, New Residential identified a population of real estate securities for which it was determined that it was probable that New Residential would be unable to collect all contractually required payments. For securities acquired during the three months ended March 31, 2015, excluding residual and interest-only securities, the face amount of these real estate securities was $36.4 million, with total expected cash flows of $45.5 million and a fair value of $21.9 million on the dates that New Residential purchased the respective securities. | |||||||||||||||||||||||||||||||||||||||||
The following is the outstanding face amount and carrying value for securities, for which, as of the acquisition date, it was probable that New Residential would be unable to collect all contractually required payments, excluding residual and interest-only securities: | |||||||||||||||||||||||||||||||||||||||||
Outstanding Face Amount | Carrying Value | ||||||||||||||||||||||||||||||||||||||||
March 31, 2015 | $ | 234,289 | $ | 147,137 | |||||||||||||||||||||||||||||||||||||
December 31, 2014 | 536,342 | 414,298 | |||||||||||||||||||||||||||||||||||||||
The following is a summary of the changes in accretable yield for these securities: | |||||||||||||||||||||||||||||||||||||||||
Three Months Ended March 31, 2015 | |||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2014 | $ | 181,671 | |||||||||||||||||||||||||||||||||||||||
Additions | 23,599 | ||||||||||||||||||||||||||||||||||||||||
Accretion | (4,321 | ) | |||||||||||||||||||||||||||||||||||||||
Reclassifications from (to) non-accretable difference | (3,605 | ) | |||||||||||||||||||||||||||||||||||||||
Disposals | (100,536 | ) | |||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2015 | $ | 96,808 | |||||||||||||||||||||||||||||||||||||||
See Note 18 for recent activities related to New Residential’s investments in real estate securities. |
INVESTMENTS_IN_RESIDENTIAL_MOR
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS | 3 Months Ended | ||||||||||||||||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||||||||||||||||
Receivables [Abstract] | |||||||||||||||||||||||||||||||||
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS | INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS | ||||||||||||||||||||||||||||||||
During the three months ended March 31, 2015, New Residential sold several portfolios of reperforming and non-performing residential mortgage loans as discussed below: | |||||||||||||||||||||||||||||||||
• | On February 27, 2015, New Residential sold a portfolio of non-performing residential mortgage loans with a UPB of approximately $135.2 million and a carrying value of approximately $102.4 million at a price of $102.8 million and recorded a gain of $0.4 million. | ||||||||||||||||||||||||||||||||
• | On March 19, 2015, New Residential sold a portfolio of reperforming residential mortgage loans with a UPB of approximately $176.5 million and a carrying value of approximately $142.1 million at a price of $148.6 million and recorded a gain of $6.5 million. | ||||||||||||||||||||||||||||||||
• | On March 26, 2015, New Residential sold a portfolio of reperforming residential mortgage loans with a UPB of approximately $6.4 million and a carrying value of approximately $5.1 million at a price of $5.3 million and recorded a gain of $0.2 million. | ||||||||||||||||||||||||||||||||
• | On March 27, 2015, New Residential sold a portfolio of non-performing residential mortgage loans and REO with a UPB of approximately $469.6 million and a carrying value of approximately $362.0 million at a price of $373.0 million and recorded a gain of $11.0 million. | ||||||||||||||||||||||||||||||||
Loans are accounted for based on management’s strategy for the loan, and on whether the loan was credit-impaired at the date of acquisition. New Residential accounts for loans based on the following categories: | |||||||||||||||||||||||||||||||||
• | Loans Held-for-Investment: | ||||||||||||||||||||||||||||||||
◦ | Reverse Mortgage Loans | ||||||||||||||||||||||||||||||||
◦ | Performing Loans | ||||||||||||||||||||||||||||||||
◦ | Purchased Credit Impaired (“PCI”) Loans | ||||||||||||||||||||||||||||||||
• | Loans Held-for-Sale (“HFS”) | ||||||||||||||||||||||||||||||||
• | Real Estate Owned (“REO”) | ||||||||||||||||||||||||||||||||
The following table presents certain information regarding New Residential’s residential mortgage loans outstanding by loan type, excluding REO: | |||||||||||||||||||||||||||||||||
March 31, 2015 | |||||||||||||||||||||||||||||||||
Outstanding Face Amount | Carrying | Loan | Weighted Average Yield | Weighted Average Life (Years)(A) | Floating Rate Loans as a % of Face Amount | Loan to Value Ratio (“LTV”)(B) | Weighted Avg. Delinquency(C) | Weighted Average FICO(D) | December 31, 2014 Carrying Value | ||||||||||||||||||||||||
Value | Count | ||||||||||||||||||||||||||||||||
Loan Type | |||||||||||||||||||||||||||||||||
Reverse Mortgage Loans(E)(F) | $ | 42,306 | $ | 23,294 | 182 | 10 | % | 4 | 21.4 | % | 109.6 | % | 78.2 | % | N/A | $ | 24,965 | ||||||||||||||||
Performing Loans(G) | 23,548 | 21,673 | 709 | 8.7 | % | 5.8 | 17.9 | % | 79.6 | % | 0.3 | % | 620 | 22,873 | |||||||||||||||||||
Total Residential Mortgage Loans, held-for- | $ | 65,854 | $ | 44,967 | 891 | 9.6 | % | 4.7 | 19.4 | % | 98.5 | % | 53 | % | 620 | $ | 47,838 | ||||||||||||||||
investment | |||||||||||||||||||||||||||||||||
Performing Loans, held-for-sale(G) | $ | 268,731 | $ | 270,407 | 4,832 | 4.9 | % | 7 | 27.6 | % | 82.1 | % | — | % | 621 | $ | 388,485 | ||||||||||||||||
Purchased Credit Impaired (“PCI”) Loans, | 300,598 | 229,767 | 2,133 | 5.9 | % | 2.4 | 32.4 | % | 105.9 | % | 87.4 | % | 547 | 737,954 | |||||||||||||||||||
held-for-sale(H) | |||||||||||||||||||||||||||||||||
Residential Mortgage Loans, held-for-sale | $ | 569,329 | $ | 500,174 | 6,965 | 5.4 | % | 4.5 | 30.1 | % | 94.7 | % | 46.2 | % | 582 | $ | 1,126,439 | ||||||||||||||||
(A) | The weighted average life is based on the expected timing of the receipt of cash flows. | ||||||||||||||||||||||||||||||||
(B) | LTV refers to the ratio comparing the loan’s unpaid principal balance to the value of the collateral property. | ||||||||||||||||||||||||||||||||
(C) | Represents the percentage of the total principal balance that are 60+ days delinquent. | ||||||||||||||||||||||||||||||||
(D) | The weighted average FICO score is based on the weighted average of information updated and provided by the loan servicer on a monthly basis. | ||||||||||||||||||||||||||||||||
(E) | Represents a 70% interest that New Residential holds in reverse mortgage loans. The average loan balance outstanding based on total UPB is $0.3 million. 76% of these loans have reached a termination event. As a result, the borrower can no longer make draws on these loans. Each loan matures upon the occurrence of a termination event. | ||||||||||||||||||||||||||||||||
(F) | FICO scores are not used in determining how much a borrower can access via a reverse mortgage loan. | ||||||||||||||||||||||||||||||||
(G) | Includes loans that are current or less than 30 days past due at acquisition where New Residential expects to collect all contractually required principal and interest payments. Presented net of unamortized premiums of $0.7 million. | ||||||||||||||||||||||||||||||||
(H) | Includes loans with evidence of credit deterioration since origination where it is probable that New Residential will not collect all contractually required principal and interest payments. As of March 31, 2015, New Residential has placed all of these loans on nonaccrual status. | ||||||||||||||||||||||||||||||||
New Residential generally considers the delinquency status, loan-to-value ratios, and geographic area of residential mortgage loans as its credit quality indicators. Delinquency status is a primary credit quality indicator as loans that are more than 30 days past due provide an early warning of borrowers who may be experiencing financial difficulties. For residential mortgage loans, the current LTV ratio is an indicator of the potential loss severity in the event of default. Finally, 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, home price changes and specific events will affect credit quality. | |||||||||||||||||||||||||||||||||
The table below summarizes the geographic distribution of the underlying residential mortgage loans: | |||||||||||||||||||||||||||||||||
Percentage of Total Outstanding Unpaid Principal Amount as of | |||||||||||||||||||||||||||||||||
State Concentration | 31-Mar-15 | 31-Dec-14 | |||||||||||||||||||||||||||||||
New York | 11.2 | % | 12.2 | % | |||||||||||||||||||||||||||||
California | 9 | % | 15 | % | |||||||||||||||||||||||||||||
Florida | 7.1 | % | 6.3 | % | |||||||||||||||||||||||||||||
New Jersey | 5.5 | % | 7 | % | |||||||||||||||||||||||||||||
Georgia | 4.8 | % | 3.6 | % | |||||||||||||||||||||||||||||
Texas | 4.7 | % | 4.1 | % | |||||||||||||||||||||||||||||
Pennsylvania | 4.7 | % | 3.9 | % | |||||||||||||||||||||||||||||
North Carolina | 4.6 | % | 3 | % | |||||||||||||||||||||||||||||
Ohio | 4.4 | % | 3.1 | % | |||||||||||||||||||||||||||||
Illinois | 4.1 | % | 4.4 | % | |||||||||||||||||||||||||||||
Other U.S. | 39.9 | % | 37.4 | % | |||||||||||||||||||||||||||||
100 | % | 100 | % | ||||||||||||||||||||||||||||||
Reverse Mortgage Loans | |||||||||||||||||||||||||||||||||
In February 2013, New Residential, through a subsidiary, entered into an agreement to co-invest in a portfolio of reverse mortgage loans. New Residential acquired a 70% interest in the reverse mortgage loans. Nationstar has co-invested on a pari passu basis with New Residential in 30% of the reverse mortgage loans and is the servicer of the loans performing all servicing and advancing functions and retaining the ancillary income, servicing obligations and liabilities as the servicer. | |||||||||||||||||||||||||||||||||
Performing Loans | |||||||||||||||||||||||||||||||||
The following table provides past due information for New Residential’s Performing Loans, which is an important indicator of credit quality and the establishment of the allowance for loan losses: | |||||||||||||||||||||||||||||||||
March 31, 2015 | |||||||||||||||||||||||||||||||||
Days Past Due | Delinquency Status(A) | ||||||||||||||||||||||||||||||||
Current | 86.1 | % | |||||||||||||||||||||||||||||||
30-59 | 13.9 | % | |||||||||||||||||||||||||||||||
60-89 | — | % | |||||||||||||||||||||||||||||||
90-119(B) | — | % | |||||||||||||||||||||||||||||||
120+(C) | — | % | |||||||||||||||||||||||||||||||
100 | % | ||||||||||||||||||||||||||||||||
(A) | Represents the percentage of the total principal balance that corresponds to loans that are in each delinquency status. | ||||||||||||||||||||||||||||||||
(B) | Includes loans 90-119 days past due and still accruing because they are generally placed on nonaccrual status at 120 days or more past due. | ||||||||||||||||||||||||||||||||
(C) | Represents nonaccrual loans. | ||||||||||||||||||||||||||||||||
Activities related to the carrying value of residential mortgage loans held-for-investment were as follows: | |||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, 2015 | |||||||||||||||||||||||||||||||||
Reverse Mortgage Loans | Performing Loans | ||||||||||||||||||||||||||||||||
Balance at December 31, 2014 | $ | 24,965 | $ | 22,873 | |||||||||||||||||||||||||||||
Purchases/additional fundings | 340 | — | |||||||||||||||||||||||||||||||
Proceeds from repayments | — | (854 | ) | ||||||||||||||||||||||||||||||
Accretion of loan discount (premium) and other amortization | 1,274 | (228 | ) | ||||||||||||||||||||||||||||||
Provision for loan losses | (202 | ) | (118 | ) | |||||||||||||||||||||||||||||
Transfer of loans to other assets | (2,720 | ) | — | ||||||||||||||||||||||||||||||
Transfer of loans to real estate owned | (363 | ) | — | ||||||||||||||||||||||||||||||
Transfer of loans to held-for-sale | — | — | |||||||||||||||||||||||||||||||
Reversal of valuation provision on loans transferred to other assets | — | — | |||||||||||||||||||||||||||||||
Balance at March 31, 2015 | $ | 23,294 | $ | 21,673 | |||||||||||||||||||||||||||||
Activities related to the valuation provision on reverse mortgage loans and allowance for loan losses on performing loans held-for-investment were as follows: | |||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, 2015 | |||||||||||||||||||||||||||||||||
Reverse Mortgage Loans | Performing Loans | ||||||||||||||||||||||||||||||||
Balance at December 31, 2014 | $ | 1,518 | $ | 1,447 | |||||||||||||||||||||||||||||
Allowance for loan losses(A) | 202 | 118 | |||||||||||||||||||||||||||||||
Charge-offs(B) | — | (1,371 | ) | ||||||||||||||||||||||||||||||
Reversal of valuation provision on loans transferred to other assets | — | — | |||||||||||||||||||||||||||||||
Balance at March 31, 2015 | $ | 1,720 | $ | 194 | |||||||||||||||||||||||||||||
(A) | Based on an analysis of collective borrower performance, credit ratings of borrowers, loan-to-value ratios, estimated value of the underlying collateral, key terms of the loans and historical and anticipated trends in defaults and loss severities at a pool level. | ||||||||||||||||||||||||||||||||
(B) | Loans, other than PCI loans, are generally charged off or charged down to the net realizable value of the collateral (i.e., fair value less costs to sell), with an offset to the allowance for loan losses, when available information confirms that loans are uncollectible. | ||||||||||||||||||||||||||||||||
Purchased Credit Impaired Loans | |||||||||||||||||||||||||||||||||
All of New Residential’s PCI loans were classified as held-for-sale at December 31, 2014 and throughout the three months ended March 31, 2015, and therefore, are not subject to the accounting in ASC 310-30. | |||||||||||||||||||||||||||||||||
Loans Held-for-Sale | |||||||||||||||||||||||||||||||||
Activities related to the carrying value of loans held-for-sale were as follows: | |||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, 2015 | |||||||||||||||||||||||||||||||||
Loans Held-for-Sale | |||||||||||||||||||||||||||||||||
Balance at December 31, 2014 | $ | 1,126,439 | |||||||||||||||||||||||||||||||
Purchases(A) | — | ||||||||||||||||||||||||||||||||
Sales | (606,155 | ) | |||||||||||||||||||||||||||||||
Transfer of loans to real estate owned | (15,417 | ) | |||||||||||||||||||||||||||||||
Adoption of ASU 2014-11(B) | 1,831 | ||||||||||||||||||||||||||||||||
Proceeds from repayments | (5,682 | ) | |||||||||||||||||||||||||||||||
Valuation provision on loans(C) | (842 | ) | |||||||||||||||||||||||||||||||
Balance at March 31, 2015 | $ | 500,174 | |||||||||||||||||||||||||||||||
(A) | Represents loans acquired with the intent to sell. | ||||||||||||||||||||||||||||||||
(B) | Represents loans financed with the selling counterparty that were previously accounted for as linked transactions. | ||||||||||||||||||||||||||||||||
(C) | Represents the fair value adjustments to loans upon transfer to held-for-sale and provision recorded on certain purchased held-for-sale loans. | ||||||||||||||||||||||||||||||||
Real estate owned (REO) | |||||||||||||||||||||||||||||||||
During the three months ended March 31, 2015, New Residential received properties in satisfaction of non-performing residential mortgage loans. As a result, New Residential has recognized REO assets totaling approximately $15.2 million during the three months ended March 31, 2015. As of March 31, 2015, New Residential had non-performing residential mortgage loans that were in the process of foreclosure with an unpaid principal balance of $204.8 million. | |||||||||||||||||||||||||||||||||
Linked Transactions | |||||||||||||||||||||||||||||||||
See Note 10 for a discussion of transactions formerly accounted for as linked transactions. |
INVESTMENTS_IN_CONSUMER_LOANS_
INVESTMENTS IN CONSUMER LOANS, EQUITY METHOD INVESTEES | 3 Months Ended | ||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||
Investments In Consumer Loans Equity Method Investees [Abstract] | |||||||||||||||||||
INVESTMENTS IN CONSUMER LOANS, EQUITY METHOD INVESTEES | INVESTMENTS IN CONSUMER LOANS, EQUITY METHOD INVESTEES | ||||||||||||||||||
In April 2013, New Residential completed, through newly formed limited liability companies (together, the “Consumer Loan Companies”), a co-investment in a portfolio of consumer loans. The portfolio included personal unsecured loans and personal homeowner loans originated through subsidiaries of HSBC Finance Corporation. The Consumer Loan Companies acquired the portfolio from HSBC Finance Corporation and its affiliates. New Residential acquired 30% membership interests in each of the Consumer Loan Companies. Of the remaining 70% of the membership interests, Springleaf acquired 47% and an affiliate of Blackstone Tactical Opportunities Advisors L.L.C. acquired 23%. Springleaf acts as the managing member of the Consumer Loan Companies. The Consumer Loan Companies initially financed approximately 73% of the original purchase price with asset-backed notes. In September 2013, the Consumer Loan Companies issued and sold additional asset-backed notes that were subordinate to the debt issued in April 2013. The Consumer Loan Companies were formed on March 19, 2013, for the purpose of making this investment, and commenced operations upon the completion of the investment. After a servicing transition period, Springleaf became the servicer of the loans and provides all servicing and advancing functions for the portfolio. | |||||||||||||||||||
On October 3, 2014, the Consumer Loan Companies refinanced the outstanding asset-backed notes with an asset-backed securitization for approximately $2.6 billion. The proceeds in excess of the refinanced debt were distributed to the respective co-investors. New Residential received approximately $337.8 million, which reduced New Residential’s basis in the consumer loans investment to $0.0 million and resulted in a gain of approximately $80.1 million. Subsequent to this refinancing, New Residential has discontinued recording its share of the underlying earnings of the Consumer Loan Companies until such time as their cumulative earnings exceed their cumulative distributions. During the three months ended March 31, 2015, the Consumer Loan Companies distributed $10.4 million to New Residential in excess of its basis, resulting in a corresponding gain. | |||||||||||||||||||
The following tables summarize the investment in the Consumer Loan Companies held by New Residential: | |||||||||||||||||||
March 31, 2015 | December 31, 2014 | ||||||||||||||||||
Consumer loan assets (amortized cost basis) | $ | 1,981,271 | $ | 2,088,330 | |||||||||||||||
Other assets | 92,028 | 92,051 | |||||||||||||||||
Debt | (2,282,438 | ) | (2,411,421 | ) | |||||||||||||||
Other liabilities | (5,854 | ) | (12,340 | ) | |||||||||||||||
Equity | $ | (214,993 | ) | $ | (243,380 | ) | |||||||||||||
New Residential’s investment | $ | — | $ | — | |||||||||||||||
New Residential’s ownership | 30 | % | 30 | % | |||||||||||||||
Three Months Ended March 31, | |||||||||||||||||||
2015 | 2014 | ||||||||||||||||||
Interest income | $ | 121,869 | $ | 142,815 | |||||||||||||||
Interest expense | (23,107 | ) | (22,195 | ) | |||||||||||||||
Provision for finance receivable losses | (19,636 | ) | (34,156 | ) | |||||||||||||||
Other expenses, net | (15,964 | ) | (20,452 | ) | |||||||||||||||
Change in fair value of debt | — | (16,867 | ) | ||||||||||||||||
Net income | $ | 63,162 | $ | 49,145 | |||||||||||||||
New Residential’s equity in net income (through October 3, 2014) | $ | — | $ | 16,360 | |||||||||||||||
New Residential’s ownership | 30 | % | 30 | % | |||||||||||||||
The following is a summary of New Residential’s consumer loan investments made through equity method investees: | |||||||||||||||||||
Unpaid Principal Balance(A) | Interest in Consumer Loan Companies | Carrying Value(B) | Weighted Average Coupon(C) | Weighted Average Yield | Weighted Average Expected Life (Years)(D) | ||||||||||||||
31-Mar-15 | $ | 2,460,743 | 30 | % | $ | 1,981,271 | 18.2 | % | 16.3 | % | 3.6 | ||||||||
31-Dec-14 | $ | 2,589,748 | 30 | % | $ | 2,088,330 | 18.1 | % | 16.1 | % | 3.6 | ||||||||
(A) | Represents the February 28, 2015 and November 30, 2014 balances, respectively. | ||||||||||||||||||
(B) | Represents the carrying value of the consumer loans held by the Consumer Loan Companies. | ||||||||||||||||||
(C) | Substantially all of the cash flows received on the loans is required to be used to make payments on the notes described above. | ||||||||||||||||||
(D) | Weighted Average Expected Life represents the weighted average expected timing of the receipt of expected cash flows for this investment. |
DERIVATIVES
DERIVATIVES | 3 Months Ended | |||||||||
Mar. 31, 2015 | ||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||
DERIVATIVES | DERIVATIVES | |||||||||
As of March 31, 2015, New Residential’s derivative instruments included economic hedges that were not designated as hedges for accounting purposes. New Residential uses economic hedges to hedge a portion of its interest rate risk exposure. Interest rate risk is sensitive to many factors including governmental monetary and tax policies, domestic and international economic and political considerations, as well as other factors. New Residential’s credit risk with respect to economic hedges and linked transactions is the risk of default on New Residential’s investments that results from a borrower’s or counterparty’s inability or unwillingness to make contractually required payments. | ||||||||||
As of March 31, 2015, New Residential held to-be-announced forward contract positions (“TBAs”) of $980.0 million in a short notional amount of Agency RMBS and any amounts or obligations owed by or to New Residential are subject to the right of set-off with the TBA counterparty. New Residential’s net short position in TBAs of $980.0 million notional was entered into as an economic hedge in order to mitigate New Residential’s interest rate risk on certain residential mortgage loans and specified mortgage backed securities. | ||||||||||
As of March 31, 2015, New Residential held TBA positions of $980.0 million in a short notional amount of Agency RMBS and any amounts or obligations owed by or to New Residential are subject to the right of set-off with the TBA counterparty. As part of executing these trades, New Residential has entered into agreements with its TBA counterparties that govern the transactions for the TBA purchases or sales made, including margin maintenance, payment and transfer, events of default, settlements, and various other provisions. New Residential has fulfilled all obligations and requirements entered into under these agreements. | ||||||||||
As a result of ASU No. 2014-11 (Note 2), New Residential has determined that, as of January 1, 2015, its linked transactions are accounted for as secured borrowings. As a result, $32.4 million carrying amount of derivatives was removed from the balance sheet and replaced with $116.8 million carrying amount of Non-Agency RMBS, $1.8 million carrying amount of Residential Mortgage Loans, Held-for-Investment, $86.0 million of Repurchase Agreements, and $0.2 million of other liabilities. | ||||||||||
New Residential’s derivatives are recorded at fair value on the Condensed Consolidated Balance Sheets as follows: | ||||||||||
Balance Sheet Location | 31-Mar-15 | 31-Dec-14 | ||||||||
Derivative assets | ||||||||||
Real Estate Securities(A) | Derivative assets | $ | — | $ | 32,090 | |||||
Non-Performing Loans(A) | Derivative assets | — | 312 | |||||||
Interest Rate Caps | Derivative assets | 71 | 195 | |||||||
$ | 71 | $ | 32,597 | |||||||
Derivative liabilities | ||||||||||
TBAs | Accrued expenses and other liabilities | $ | 8,539 | $ | 4,985 | |||||
Interest Rate Swaps | Accrued expenses and other liabilities | 12,588 | 9,235 | |||||||
$ | 21,127 | $ | 14,220 | |||||||
(A) | For December 31, 2014, investments purchased from, and financed by, the selling counterparty that New Residential accounted for as linked transactions are reflected as derivatives. Upon the adoption of ASU 2014-11 on January 1, 2015, these transactions are accounted for as secured borrowings. | |||||||||
The following table summarizes notional amounts related to derivatives: | ||||||||||
March 31, 2015 | December 31, 2014 | |||||||||
Non-Performing Loans(A) | $ | — | $ | 2,931 | ||||||
Real Estate Securities(B) | — | 186,694 | ||||||||
TBAs, short position(C) | 980,000 | 1,234,000 | ||||||||
Interest Rate Caps(D) | 210,000 | 210,000 | ||||||||
Interest Rate Swaps, short position(E) | 1,107,000 | 1,107,000 | ||||||||
(A) | For December 31, 2014, represents the UPB of the underlying loans of the non-performing loan pools within linked transactions. | |||||||||
(B) | For December 31, 2014, represents the face amount of the real estate securities within linked transactions. | |||||||||
(C) | Represents the notional amount of Agency RMBS, classified as derivatives. | |||||||||
(D) | Caps LIBOR at 3.0%. | |||||||||
(E) | Receive LIBOR and pay a fixed rate. | |||||||||
The following table summarizes gains (losses) recorded in relation to derivatives: | ||||||||||
For the Three Months Ended March 31, | ||||||||||
2015 | 2014 | |||||||||
Other income (loss) | ||||||||||
Non-Performing Loans(A) | $ | — | $ | 671 | ||||||
TBAs | (3,554 | ) | 362 | |||||||
Interest Rate Swaps | (3,352 | ) | (84 | ) | ||||||
U.S.T. Short Positions | — | 408 | ||||||||
Interest Rate Caps | (124 | ) | — | |||||||
(7,030 | ) | 1,357 | ||||||||
Gain (loss) on settlement of investments | ||||||||||
Real Estate Securities(A) | — | — | ||||||||
TBAs | (16,033 | ) | 43 | |||||||
Interest Rate Swaps | (6,557 | ) | (178 | ) | ||||||
(22,590 | ) | (135 | ) | |||||||
Total gains (losses) | $ | (29,620 | ) | $ | 1,222 | |||||
(A) | For December 31, 2014, investments purchased from, and financed by, the selling counterparty that New Residential accounts for as linked transactions are reflected as derivatives. Upon the adoption of ASU 2014-11 on January 1, 2015, these transactions are accounted for as secured borrowings. |
DEBT_OBLIGATIONS
DEBT OBLIGATIONS | 3 Months Ended | |||||||||||||||||||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||
DEBT OBLIGATIONS | DEBT OBLIGATIONS | |||||||||||||||||||||||||||||||||||
The following table presents certain information regarding New Residential’s debt obligations: | ||||||||||||||||||||||||||||||||||||
31-Mar-15 | 31-Dec-14 | |||||||||||||||||||||||||||||||||||
Collateral | ||||||||||||||||||||||||||||||||||||
Debt Obligations/Collateral | Month Issued | Outstanding Face Amount | Carrying Value | Final Stated Maturity | Weighted Average Funding Cost | Weighted Average Life (Years) | Outstanding Face | Amortized Cost Basis | Carrying Value | Weighted Average Life (Years) | Carrying Value | |||||||||||||||||||||||||
Repurchase Agreements(A) | ||||||||||||||||||||||||||||||||||||
Agency | Various | $ | 1,612,972 | $ | 1,612,972 | Apr-15 to May-15 | 0.36 | % | 0.1 | $ | 1,575,759 | $ | 1,659,781 | $ | 1,664,996 | 5.4 | $ | 1,707,602 | ||||||||||||||||||
RMBS(B) | ||||||||||||||||||||||||||||||||||||
Non-Agency | Various | 315,919 | 315,919 | Apr-15 to Jun-15 | 1.77 | % | 0.1 | 1,500,816 | 428,696 | 439,579 | 9 | 539,049 | ||||||||||||||||||||||||
RMBS (C) | ||||||||||||||||||||||||||||||||||||
Residential | Various | 392,521 | 392,521 | May-15 to Aug-16 | 2.37 | % | 0.8 | 584,085 | 514,109 | 514,109 | 4.6 | 867,334 | ||||||||||||||||||||||||
Mortgage | ||||||||||||||||||||||||||||||||||||
Loans(D) | ||||||||||||||||||||||||||||||||||||
Real Estate | Various | 17,977 | 17,977 | May-15 to Aug-16 | 2.82 | % | 1.1 | N/A | N/A | 33,408 | N/A | 35,105 | ||||||||||||||||||||||||
Owned(E) | ||||||||||||||||||||||||||||||||||||
Total | 2,339,389 | 2,339,389 | 0.91 | % | 0.2 | 3,149,090 | ||||||||||||||||||||||||||||||
Repurchase | ||||||||||||||||||||||||||||||||||||
Agreements | ||||||||||||||||||||||||||||||||||||
Notes Payable | ||||||||||||||||||||||||||||||||||||
Secured | 15-Jan | 100,000 | 100,000 | 15-Jul | 3.93 | % | 0.3 | 105,939,876 | 239,540 | 279,404 | 5.3 | — | ||||||||||||||||||||||||
Corporate | ||||||||||||||||||||||||||||||||||||
Loan (F) | ||||||||||||||||||||||||||||||||||||
Servicer | Various | 2,875,412 | 2,875,412 | Dec-15 to Mar-17 | 2.62 | % | 1.4 | 3,068,306 | 3,168,909 | 3,245,457 | 3.9 | 2,890,230 | ||||||||||||||||||||||||
Advances(G) | ||||||||||||||||||||||||||||||||||||
Residential | 14-Oct | 23,604 | 23,604 | 15-Oct | 3.08 | % | 0.6 | 42,306 | 25,013 | 23,294 | 4 | 22,194 | ||||||||||||||||||||||||
Mortgage | ||||||||||||||||||||||||||||||||||||
Loans(H) | ||||||||||||||||||||||||||||||||||||
Real Estate | 14-Oct | 402 | 402 | 15-Oct | 3.08 | % | 0.6 | N/A | N/A | 397 | N/A | 785 | ||||||||||||||||||||||||
Owned(H) | ||||||||||||||||||||||||||||||||||||
Total Notes | 2,999,418 | 2,999,418 | 2.66 | % | 1.3 | 2,913,209 | ||||||||||||||||||||||||||||||
Payable | ||||||||||||||||||||||||||||||||||||
Total/ Weighted | $ | 5,338,807 | $ | 5,338,807 | 1.9 | % | 0.8 | $ | 6,062,299 | |||||||||||||||||||||||||||
Average | ||||||||||||||||||||||||||||||||||||
(A) | These repurchase agreements had approximately $2.0 million of associated accrued interest payable as of March 31, 2015. | |||||||||||||||||||||||||||||||||||
(B) | The counterparties of these repurchase agreements are Mizuho ($89.6 million), Morgan Stanley ($73.3 million), Barclays ($788.7 million), Daiwa ($338.9 million) and Jefferies ($322.5 million) and were subject to customary margin call provisions. All of the Agency RMBS repurchase agreements have a fixed rate. | |||||||||||||||||||||||||||||||||||
(C) | The counterparties of these repurchase agreements are Barclays ($5.6 million), Credit Suisse ($107.3 million), Royal Bank of Canada ($10.2 million), Bank of America, N.A. ($80.1 million), Goldman Sachs ($60.9 million) and UBS ($51.8 million) and were subject to customary margin call provisions. All of the Non-Agency repurchase agreements have LIBOR-based floating interest rates. | |||||||||||||||||||||||||||||||||||
(D) | The counterparties on these repurchase agreements are Bank of America N.A. ($39.5 million maturing in August 2016), Nomura ($68.7 million maturing in May 2016), Citibank ($4.8 million maturing in May 2015) and Credit Suisse ($279.5 million maturing in November 2015). All of these repurchase agreements have LIBOR-based floating interest rates. | |||||||||||||||||||||||||||||||||||
(E) | The counterparties of these repurchase agreements are Credit Suisse ($1.2 million), Bank of America, N.A. ($2.0 million), Citibank ($0.4 million) and Nomura ($14.4 million). All of these repurchase agreements have LIBOR-based floating interest rates. | |||||||||||||||||||||||||||||||||||
(F) | The loan bears interest equal to the sum of (i) a floating rate index equal to one-month LIBOR and (ii) a margin of 3.75%. The outstanding face of the collateral represents the UPB of the residential mortgage loans underlying the Excess MSRs that secure this corporate loan. | |||||||||||||||||||||||||||||||||||
(G) | $0.7 billion face amount of the notes have a fixed rate while the remaining notes bear interest equal to the sum of (i) a floating rate index rate equal to one-month LIBOR or a cost of funds rate, as applicable, and (ii) a margin ranging from 1.9% to 2.0%. | |||||||||||||||||||||||||||||||||||
(H) | The note is payable to Nationstar and bears interest equal to one-month LIBOR plus 2.875%. | |||||||||||||||||||||||||||||||||||
Certain of the debt obligations included above are obligations of New Residential’s consolidated subsidiaries, which own the related collateral. In some cases, including the servicer advances, such collateral is not available to other creditors of New Residential. | ||||||||||||||||||||||||||||||||||||
New Residential has margin exposure on $2.3 billion of repurchase agreements. To the extent that the value of the collateral underlying these repurchase agreements declines, New Residential may be required to post margin, which could significantly impact its liquidity. | ||||||||||||||||||||||||||||||||||||
Activities related to the carrying value of New Residential’s debt obligations were as follows: | ||||||||||||||||||||||||||||||||||||
Servicer Advances | Real Estate Securities | Real Estate Loans | Other | Total | ||||||||||||||||||||||||||||||||
Balance at December 31, 2014(A) | $ | 2,890,230 | $ | 2,246,651 | $ | 925,418 | $ | — | $ | 6,062,299 | ||||||||||||||||||||||||||
Repurchase Agreements | ||||||||||||||||||||||||||||||||||||
Borrowings | — | 1,089,257 | 31,864 | — | 1,121,121 | |||||||||||||||||||||||||||||||
Modified retrospective adjustment for the adoption of ASU No. 2014-11 | — | 84,649 | 1,306 | — | 85,955 | |||||||||||||||||||||||||||||||
Repayments | — | (1,491,666 | ) | (525,111 | ) | — | (2,016,777 | ) | ||||||||||||||||||||||||||||
Notes Payable | ||||||||||||||||||||||||||||||||||||
Borrowings | 380,702 | — | 1,632 | 100,000 | 482,334 | |||||||||||||||||||||||||||||||
Repayments | (395,520 | ) | — | (605 | ) | — | (396,125 | ) | ||||||||||||||||||||||||||||
Balance at March 31, 2015 | $ | 2,875,412 | $ | 1,928,891 | $ | 434,504 | $ | 100,000 | $ | 5,338,807 | ||||||||||||||||||||||||||
(A) Excludes debt related to linked transactions (Note 10). | ||||||||||||||||||||||||||||||||||||
Servicer Advances | ||||||||||||||||||||||||||||||||||||
During the first quarter of 2015, the Buyer entered into agreements to increase financing pursuant to one servicer advance facility and one of the notes, which settled in March 2015. The facility increased capacity from $500.0 million to $1.0 billion, and the note increased from $650.0 million to $800.0 million with a fixed interest rate equal to 2.50% and an expected repayment date of March 2017. | ||||||||||||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||||||||||||
During the first quarter of 2015, New Residential entered into a $100.0 million secured corporate loan with Credit Suisse First Boston Mortgage Capital LLC, an affiliate of Credit Suisse Securities (USA) LLC. The loan bears interest equal to the sum of (i) a floating rate index rate equal to one-month LIBOR and (ii) a margin of 3.75%. The loan agreement contains customary covenants and event of default provisions. | ||||||||||||||||||||||||||||||||||||
Maturities | ||||||||||||||||||||||||||||||||||||
New Residential’s debt obligations as of March 31, 2015 had contractual maturities as follows: | ||||||||||||||||||||||||||||||||||||
Year | Nonrecourse | Recourse | Total | |||||||||||||||||||||||||||||||||
April 1 through December 31, 2015 | $ | 150,128 | $ | 2,338,753 | $ | 2,488,881 | ||||||||||||||||||||||||||||||
2016 | 2,107,255 | 41,473 | 2,148,728 | |||||||||||||||||||||||||||||||||
2017 | 701,198 | — | 701,198 | |||||||||||||||||||||||||||||||||
$ | 2,958,581 | $ | 2,380,226 | $ | 5,338,807 | |||||||||||||||||||||||||||||||
Borrowing Capacity | ||||||||||||||||||||||||||||||||||||
The following table represents New Residential’s borrowing capacity as of March 31, 2015: | ||||||||||||||||||||||||||||||||||||
Debt Obligations/ Collateral | Collateral Type | Borrowing Capacity | Balance Outstanding | Available Financing | ||||||||||||||||||||||||||||||||
Repurchase Agreements | ||||||||||||||||||||||||||||||||||||
Residential Mortgage Loans | Real Estate Loans | $ | 1,720,000 | $ | 410,498 | $ | 1,309,502 | |||||||||||||||||||||||||||||
Notes Payable | ||||||||||||||||||||||||||||||||||||
Servicer Advances(A) | Servicer Advances | 3,300,000 | 2,875,412 | 424,588 | ||||||||||||||||||||||||||||||||
$ | 5,020,000 | $ | 3,285,910 | $ | 1,734,090 | |||||||||||||||||||||||||||||||
(A) | New Residential’s unused borrowing capacity is available if New Residential has additional eligible collateral to pledge and meets other borrowing conditions as set forth in the applicable agreements, including any applicable advance rate. New Residential pays a 0.3% fee on the unused borrowing capacity. | |||||||||||||||||||||||||||||||||||
Certain of the debt obligations are subject to customary loan covenants and event of default provisions, including event of default provisions triggered by a 50% equity decline over any 12-month period or a 35% decline over any 3-month period and a 4:1 indebtedness to tangible net worth provision. New Residential was in compliance with all of its debt covenants as of March 31, 2015. |
FAIR_VALUE_OF_FINANCIAL_INSTRU
FAIR VALUE OF FINANCIAL INSTRUMENTS | 3 Months Ended | |||||||||||||||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||
FAIR VALUE OF FINANCIAL INSTRUMENTS | FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||||||||||||||||||||
The carrying values and fair values of New Residential’s financial assets recorded at fair value on a recurring basis, as well as other financial instruments for which fair value is disclosed, as of March 31, 2015 were as follows: | ||||||||||||||||||||||||||||||||
Fair Value | ||||||||||||||||||||||||||||||||
Principal Balance or Notional Amount | Carrying Value | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||
Investments in: | ||||||||||||||||||||||||||||||||
Excess mortgage servicing rights, at fair | $ | 163,572,436 | $ | 526,662 | $ | — | $ | — | $ | 526,662 | $ | 526,662 | ||||||||||||||||||||
value(A) | ||||||||||||||||||||||||||||||||
Excess mortgage servicing rights, equity | 84,000,746 | 225,111 | — | — | 225,111 | 225,111 | ||||||||||||||||||||||||||
method investees, at fair value(A) | ||||||||||||||||||||||||||||||||
Servicer advances | 3,068,306 | 3,245,457 | — | — | 3,245,457 | 3,245,457 | ||||||||||||||||||||||||||
Real estate securities, available-for-sale | 3,396,295 | 2,324,915 | — | 1,664,996 | 659,919 | 2,324,915 | ||||||||||||||||||||||||||
Residential mortgage loans, held-for- | 65,854 | 44,967 | — | — | 45,900 | 45,900 | ||||||||||||||||||||||||||
investment | ||||||||||||||||||||||||||||||||
Residential mortgage loans, held-for- | 569,329 | 500,174 | — | — | 506,986 | 506,986 | ||||||||||||||||||||||||||
sale | ||||||||||||||||||||||||||||||||
Non-hedge derivatives | 210,000 | 71 | — | 71 | — | 71 | ||||||||||||||||||||||||||
Cash and cash equivalents | 459,334 | 459,334 | 459,334 | — | — | 459,334 | ||||||||||||||||||||||||||
Restricted cash | 28,325 | 28,325 | 28,325 | — | — | 28,325 | ||||||||||||||||||||||||||
$ | 7,355,016 | $ | 487,659 | $ | 1,665,067 | $ | 5,210,035 | $ | 7,362,761 | |||||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||||||||
Repurchase agreements | $ | 2,339,389 | $ | 2,339,389 | $ | — | $ | 1,928,891 | $ | 410,498 | $ | 2,339,389 | ||||||||||||||||||||
Notes payable | 2,999,418 | 2,999,418 | — | — | 2,999,418 | 2,999,418 | ||||||||||||||||||||||||||
Derivative liabilities | 2,087,000 | 21,127 | — | 21,127 | — | 21,127 | ||||||||||||||||||||||||||
$ | 5,359,934 | $ | — | $ | 1,950,018 | $ | 3,409,916 | $ | 5,359,934 | |||||||||||||||||||||||
(A) | The notional amount represents the total unpaid principal balance of the mortgage loans underlying the Excess MSRs. New Residential does not receive an excess mortgage servicing amount on non-performing loans in Agency portfolios. | |||||||||||||||||||||||||||||||
New Residential’s financial assets measured at fair value on a recurring basis using Level 3 inputs changed as follows: | ||||||||||||||||||||||||||||||||
Level 3 | ||||||||||||||||||||||||||||||||
Excess MSRs(A) | Excess MSRs in Equity Method Investees(A)(B) | |||||||||||||||||||||||||||||||
Agency | Non-Agency | Agency | Non-Agency | Servicer Advances | Non-Agency RMBS | Linked Transactions | Total | |||||||||||||||||||||||||
Balance at December 31, 2014 | $ | 217,519 | $ | 200,214 | $ | 232,618 | $ | 98,258 | $ | 3,270,839 | $ | 723,000 | $ | 32,402 | $ | 4,774,850 | ||||||||||||||||
Transfers(C) | ||||||||||||||||||||||||||||||||
Transfers from Level 3 | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Transfers to Level 3 | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Transfers from investments in excess mortgage servicing rights, equity method investees, to investments in excess mortgage servicing rights | — | 98,258 | — | (98,258 | ) | — | — | — | — | |||||||||||||||||||||||
Gains (losses) included in net income | ||||||||||||||||||||||||||||||||
Included in other-than-temporary | — | — | — | — | — | (1,071 | ) | — | (1,071 | ) | ||||||||||||||||||||||
impairment (“OTTI”) on securities(D) | ||||||||||||||||||||||||||||||||
Included in change in fair value of | (234 | ) | (1,527 | ) | — | — | — | — | — | (1,761 | ) | |||||||||||||||||||||
investments in excess mortgage | ||||||||||||||||||||||||||||||||
servicing rights(D) | ||||||||||||||||||||||||||||||||
Included in change in fair value of | — | — | 4,921 | — | — | — | — | 4,921 | ||||||||||||||||||||||||
investments in excess mortgage | ||||||||||||||||||||||||||||||||
servicing rights, equity method | ||||||||||||||||||||||||||||||||
investees(D) | ||||||||||||||||||||||||||||||||
Included in change in fair value of | — | — | — | — | (7,669 | ) | — | — | (7,669 | ) | ||||||||||||||||||||||
investments in servicer advances | ||||||||||||||||||||||||||||||||
Included in gain on settlement of | — | — | — | — | — | 3,808 | — | 3,808 | ||||||||||||||||||||||||
investments, net | ||||||||||||||||||||||||||||||||
Included in other income(D) | 730 | — | — | — | — | — | — | 730 | ||||||||||||||||||||||||
Gains (losses) included in other | — | — | — | — | — | (481 | ) | — | (481 | ) | ||||||||||||||||||||||
comprehensive income, net of tax(E) | ||||||||||||||||||||||||||||||||
Interest income | 6,458 | 8,579 | — | — | 42,349 | 8,450 | — | 65,836 | ||||||||||||||||||||||||
Purchases, sales, repayments and transfers | ||||||||||||||||||||||||||||||||
Purchases | 26,479 | — | — | — | 1,765,294 | 222,102 | — | 2,013,875 | ||||||||||||||||||||||||
Proceeds from sales | — | — | — | — | — | (389,719 | ) | — | (389,719 | ) | ||||||||||||||||||||||
Proceeds from repayments | (11,973 | ) | (17,841 | ) | (12,428 | ) | — | (1,825,356 | ) | (23,002 | ) | — | (1,890,600 | ) | ||||||||||||||||||
De-linked transactions(F) | — | — | — | — | — | 116,832 | (32,402 | ) | 84,430 | |||||||||||||||||||||||
Balance at March 31, 2015 | $ | 238,979 | $ | 287,683 | $ | 225,111 | $ | — | $ | 3,245,457 | $ | 659,919 | $ | — | $ | 4,657,149 | ||||||||||||||||
(A) | Includes the Recapture Agreement for each respective pool. | |||||||||||||||||||||||||||||||
(B) | Amounts represent New Residential’s portion of the Excess MSRs held by the respective joint ventures in which New Residential has a 50% interest. | |||||||||||||||||||||||||||||||
(C) | Transfers are assumed to occur at the beginning of each respective period. | |||||||||||||||||||||||||||||||
(D) | The gains (losses) recorded in earnings during the period are attributable to the change in unrealized gains (losses) relating to Level 3 assets still held at the reporting dates. | |||||||||||||||||||||||||||||||
(E) | These gains (losses) were included in net unrealized gain (loss) on securities in the Condensed Consolidated Statements of Comprehensive Income. | |||||||||||||||||||||||||||||||
(F) | See Note 10 for a discussion of transactions formerly accounted for as linked transactions. | |||||||||||||||||||||||||||||||
Investments in Excess MSRs and Excess MSRs Equity Method Investees Valuation | ||||||||||||||||||||||||||||||||
The following table summarizes certain information regarding the weighted average inputs used in valuing the Excess MSRs owned directly and through equity method investees as of March 31, 2015: | ||||||||||||||||||||||||||||||||
Significant Inputs(A) | ||||||||||||||||||||||||||||||||
Directly Held (Note 4) | Prepayment Speed(B) | Delinquency(C) | Recapture Rate(D) | Excess Mortgage Servicing Amount | ||||||||||||||||||||||||||||
(bps)(E) | ||||||||||||||||||||||||||||||||
Agency | ||||||||||||||||||||||||||||||||
Original and Recaptured Pools | 10.1 | % | 5.4 | % | 31.5 | % | 21 | |||||||||||||||||||||||||
Recapture Agreement | 7.9 | % | 5 | % | 19.9 | % | 21 | |||||||||||||||||||||||||
10 | % | 5.4 | % | 30.8 | % | 21 | ||||||||||||||||||||||||||
Non-Agency(F) | ||||||||||||||||||||||||||||||||
Original and Recaptured Pools | 12.7 | % | N/A | 10.2 | % | 14 | ||||||||||||||||||||||||||
Recapture Agreement | 8 | % | N/A | 20 | % | 20 | ||||||||||||||||||||||||||
12.5 | % | N/A | 10.7 | % | 14 | |||||||||||||||||||||||||||
Total/Weighted Average--Directly Held | 11.5 | % | 5.4 | % | 18.9 | % | 17 | |||||||||||||||||||||||||
Held through Equity Method Investees (Note 5) | ||||||||||||||||||||||||||||||||
Agency | ||||||||||||||||||||||||||||||||
Original and Recaptured Pools | 13 | % | 6.5 | % | 33.5 | % | 19 | |||||||||||||||||||||||||
Recapture Agreement | 8 | % | 5 | % | 20 | % | 23 | |||||||||||||||||||||||||
Total/Weighted Average--Held through Investees | 12.1 | % | 6.2 | % | 31.1 | % | 19 | |||||||||||||||||||||||||
Total/Weighted Average--All Pools | 11.7 | % | 5.7 | % | 24.5 | % | 18 | |||||||||||||||||||||||||
(A) | Weighted by amortized cost basis of the mortgage loan portfolio. | |||||||||||||||||||||||||||||||
(B) | Projected annualized weighted average lifetime voluntary and involuntary prepayment rate using a prepayment vector. | |||||||||||||||||||||||||||||||
(C) | Projected percentage of mortgage loans in the pool that will miss their mortgage payments. | |||||||||||||||||||||||||||||||
(D) | Percentage of voluntarily prepaid loans that are expected to be refinanced by Nationstar. | |||||||||||||||||||||||||||||||
(E) | Weighted average total mortgage servicing amount in excess of the basic fee. | |||||||||||||||||||||||||||||||
(F) | For certain pools, the Excess MSR will be paid on the total UPB of the mortgage portfolio (including both performing and delinquent loans until REO). For these pools, no delinquency assumption is used. | |||||||||||||||||||||||||||||||
As of March 31, 2015, a weighted average discount rate of 9.6% was used to value New Residential’s investments in Excess MSRs (directly and through equity method investees). | ||||||||||||||||||||||||||||||||
Investments in Servicer Advances Valuation | ||||||||||||||||||||||||||||||||
The following table summarizes certain information regarding the inputs used in valuing the servicer advances: | ||||||||||||||||||||||||||||||||
Significant Inputs | ||||||||||||||||||||||||||||||||
Weighted Average | ||||||||||||||||||||||||||||||||
Outstanding Servicer Advances to UPB of Underlying Residential Mortgage Loans | Prepayment Speed | Delinquency | Mortgage Servicing Amount(A) | Discount Rate | ||||||||||||||||||||||||||||
March 31, 2015 | 2.1 | % | 12.5 | % | 14.3 | % | 19.4 | bps | 5.4 | % | ||||||||||||||||||||||
(A) | Mortgage servicing amount excludes the amounts New Residential pays Nationstar and SLS as a monthly servicing fee. | |||||||||||||||||||||||||||||||
Real Estate Securities Valuation | ||||||||||||||||||||||||||||||||
As of March 31, 2015, New Residential’s securities valuation methodology and results are further detailed as follows: | ||||||||||||||||||||||||||||||||
Fair Value | ||||||||||||||||||||||||||||||||
Asset Type | Outstanding Face Amount | Amortized Cost Basis | Multiple Quotes(A) | Single Quote(B) | Total | Level | ||||||||||||||||||||||||||
Agency RMBS | $ | 1,575,759 | $ | 1,659,781 | $ | 1,664,996 | $ | — | $ | 1,664,996 | 2 | |||||||||||||||||||||
Non-Agency RMBS(C) | 1,820,536 | 647,915 | 650,746 | 9,173 | 659,919 | 3 | ||||||||||||||||||||||||||
Total | $ | 3,396,295 | $ | 2,307,696 | $ | 2,315,742 | $ | 9,173 | $ | 2,324,915 | ||||||||||||||||||||||
(A) | Management generally obtained pricing service quotations or broker quotations from two sources, one of which was generally the seller (the party that sold New Residential the security) for Non-Agency RMBS. Management selected one of the quotes received as being most representative of the fair value and did not use an average of the quotes. Even if New Residential receives two or more quotes on a particular security that come from non-selling brokers or pricing services, it does not use an average because management believes using an actual quote more closely represents a transactable price for the security than an average level. Furthermore, in some cases there is a wide disparity between the quotes New Residential receives. Management believes using an average of the quotes in these cases would not represent the fair value of the asset. Based on New Residential’s own fair value analysis, management selects one of the quotes which is believed to more accurately reflect fair value. New Residential never adjusts quotes received. These quotations are generally received via email and contain disclaimers which state that they are “indicative” and not “actionable” — meaning that the party giving the quotation is not bound to actually purchase the security at the quoted price. | |||||||||||||||||||||||||||||||
(B) | Management was unable to obtain quotations from more than one source on these securities. The one source was the seller (the party that sold New Residential the security). | |||||||||||||||||||||||||||||||
(C) | Includes New Residential’s investments in interest-only notes for which the fair value option for financial instruments was elected. | |||||||||||||||||||||||||||||||
Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis | ||||||||||||||||||||||||||||||||
Certain assets are measured at fair value on a nonrecurring basis; that is, they are not measured at fair value on an ongoing basis but are subject to fair value adjustments only in certain circumstances, such as when there is evidence of impairment. For residential mortgage loans held-for-sale and foreclosed real estate accounted for as REO, New Residential applies the lower of cost or fair value accounting and may be required, from time to time, to record a nonrecurring fair value adjustment. | ||||||||||||||||||||||||||||||||
At March 31, 2015 and December 31, 2014, assets measured at fair value on a nonrecurring basis were $213.1 million and $666.6 million, respectively. The $213.1 million represents residential mortgage loans held-for-sale and the $666.6 million includes approximately $610.1 million of residential mortgage loans held-for-sale and $56.5 million of REO. The fair value of New Residential’s mortgage loans held-for-sale are estimated based on a discounted cash flow model analysis using internal pricing models and categorized within Level 3 of the fair value hierarchy. The following table summarizes the inputs used in valuing these residential mortgage loans as of March 31, 2015: | ||||||||||||||||||||||||||||||||
March 31, 2015 | Fair Value | Discount Rate | Weighted Average Life (Years) (A) | Prepayment Rate | CDR(B) | Loss Severity(C) | ||||||||||||||||||||||||||
PCI Loans | $ | 213,058 | 5.5 | % | 2.4 | 3 | % | N/A | 50 | % | ||||||||||||||||||||||
(A) | The weighted average life is based on the expected timing of the receipt of cash flows. | |||||||||||||||||||||||||||||||
(B) | Represents the annualized rate of the involuntary prepayments (defaults) as a percentage of the total principal balance. | |||||||||||||||||||||||||||||||
(C) | Loss severity is the expected amount of future realized losses resulting from the ultimate liquidation of a particular loan, expressed as the net amount of loss relative to the outstanding loan balance. | |||||||||||||||||||||||||||||||
The fair value of REO is estimated using a broker’s price opinion discounted based upon New Residential’s experience with actual liquidation values and, therefore, is categorized within Level 3 of the fair value hierarchy. These discounts to the broker price opinion are generally 10%. As of March 31, 2015, New Residential’s REO did not show evidence of impairment and continued to be measured at cost. | ||||||||||||||||||||||||||||||||
The total change in the recorded value of assets for which a fair value adjustment was included in the Consolidated Statements of Income for the period ended March 31, 2015 was a reduction of approximately $0.8 million for residential mortgage loans held-for-sale. | ||||||||||||||||||||||||||||||||
Residential Mortgage Loans for Which Fair Value is Only Disclosed | ||||||||||||||||||||||||||||||||
The fair value of New Residential’s residential mortgage loans are estimated based on a discounted cash flow model analysis using internal pricing models and are categorized within Level 3 of the fair value hierarchy. | ||||||||||||||||||||||||||||||||
The following table summarizes the inputs used in valuing residential mortgage loans as of March 31, 2015: | ||||||||||||||||||||||||||||||||
Carrying Value | Fair Value | Valuation Provision/ (Reversal) In Current Year | Discount Rate | Weighted Average Life (Years)(A) | Prepayment Rate | CDR(B) | Loss Severity(C) | |||||||||||||||||||||||||
Reverse Mortgage Loans(D) | $ | 23,294 | $ | 23,294 | $ | 202 | 10 | % | 4 | N/A | N/A | 6.3 | % | |||||||||||||||||||
Performing Loans | 292,080 | 296,970 | N/A | 4.9 | % | 6.9 | 6 | % | 2.1 | % | 46.1 | % | ||||||||||||||||||||
PCI Loans | 16,709 | 19,564 | N/A | 5.5 | % | 2.4 | 3 | % | N/A | 50 | % | |||||||||||||||||||||
Total/Weighted Average | $ | 332,083 | $ | 339,828 | $ | 202 | 5.3 | % | 6.4 | 43.5 | % | |||||||||||||||||||||
(A) | The weighted average life is based on the expected timing of the receipt of cash flows. | |||||||||||||||||||||||||||||||
(B) | Represents the annualized rate of the involuntary prepayments (defaults) as a percentage of the total principal balance. | |||||||||||||||||||||||||||||||
(C) | Loss severity is the expected amount of future realized losses resulting from the ultimate liquidation of a particular loan, expressed as the net amount of loss relative to the outstanding loan balance. | |||||||||||||||||||||||||||||||
(D) | Carrying value and fair value represent a 70% interest New Residential holds in the reverse mortgage loans. | |||||||||||||||||||||||||||||||
Derivative Valuation | ||||||||||||||||||||||||||||||||
New Residential enters into economic hedges including interest rate swaps and TBAs, which are categorized as Level 2 in the valuation hierarchy. Management generally values such derivatives using quotations, similarly to the method of valuation used for New Residential’s other assets that are categorized as Level 2. | ||||||||||||||||||||||||||||||||
Liabilities for Which Fair Value is Only Disclosed | ||||||||||||||||||||||||||||||||
Repurchase agreements and notes payable are not measured at fair value. They are generally considered to be Level 2 and Level 3 in the valuation hierarchy, respectively, with significant valuation variables including the amount and timing of expected cash flows, interest rates and collateral funding spreads. | ||||||||||||||||||||||||||||||||
Short-term repurchase agreements and short-term notes payable have an estimated fair value equal to their carrying value due to their short duration and generally floating interest rates. Longer-term notes payable are valued based on internal models utilizing both observable and unobservable inputs. As of March 31, 2015, these longer-term notes have an estimated fair value of $2,875.4 million and a carrying value of $2,875.4 million. |
EQUITY_AND_EARNINGS_PER_SHARE
EQUITY AND EARNINGS PER SHARE | 3 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Equity and Earnings Per Share [Abstract] | ||||||||||||||||
EQUITY AND EARNINGS PER SHARE | EQUITY AND EARNINGS PER SHARE | |||||||||||||||
Equity and Dividends | ||||||||||||||||
New Residential’s Board of Directors authorized a one-for-two reverse stock split on August 5, 2014, subject to stockholder approval. In a special meeting on October 15, 2014, New Residential’s stockholders approved the reverse split. On October 17, 2014, New Residential effected the one-for-two reverse stock split of its common stock. As a result of the reverse stock split, every two shares of New Residential’s common stock were converted into one share of common stock, reducing the number of issued and outstanding shares of New Residential’s common stock from approximately 282.8 million to approximately 141.4 million. The impact of this reverse stock split has been retroactively applied to all periods presented. | ||||||||||||||||
On December 18, 2014, New Residential’s board of directors declared a fourth quarter 2014 dividend of $0.38 per common share or $53.7 million, which was paid on January 30, 2015 to stockholders of record as of December 30, 2014. | ||||||||||||||||
On March 16, 2015, New Residential’s board of directors declared a first quarter 2015 dividend of $0.38 per common share or $53.7 million, which was paid on April 30, 2015 to stockholders of record as of March 26, 2015. | ||||||||||||||||
Approximately 2.4 million shares of New Residential’s common stock were held by Fortress, through its affiliates, and its principals at March 31, 2015. | ||||||||||||||||
Option Plan | ||||||||||||||||
As of March 31, 2015, New Residential’s outstanding options were summarized as follows: | ||||||||||||||||
Issued Prior to 2011 | Issued in 2011-2014 | Total | ||||||||||||||
Held by the Manager | 343,440 | 8,173,847 | 8,517,287 | |||||||||||||
Issued to the Manager and subsequently transferred to certain of the | 90,560 | 1,959,247 | 2,049,807 | |||||||||||||
Manager’s employees | ||||||||||||||||
Issued to the independent directors | 1,000 | 4,000 | 5,000 | |||||||||||||
Total | 435,000 | 10,137,094 | 10,572,094 | |||||||||||||
The following table summarizes New Residential’s outstanding options as of March 31, 2015. The last sales price on the New York Stock Exchange for New Residential’s common stock in the quarter ended March 31, 2015 was $15.03 per share. | ||||||||||||||||
Recipient | Date of | Number of | Options | Weighted | Intrinsic | |||||||||||
Grant/ | Options | Exercisable | Average | Value as of | ||||||||||||
Exercise(A) | as of | Exercise | March 31, | |||||||||||||
March 31, | Price(B) | 2015 | ||||||||||||||
2015 | (millions) | |||||||||||||||
Directors | Various | 6,000 | 5,000 | $ | 17.54 | $ | — | |||||||||
Manager(C) | 2003 - 2007 | 1,226,555 | 434,000 | 31.36 | — | |||||||||||
Manager(C) | 11-Mar | 838,417 | 547,583 | 6.58 | 4.6 | |||||||||||
Manager(C) | 11-Sep | 1,269,917 | 849,916 | 4.98 | 8.5 | |||||||||||
Manager(C) | 12-Apr | 948,750 | 920,983 | 6.82 | 7.6 | |||||||||||
Manager(C) | 12-May | 1,150,000 | 1,117,333 | 7.34 | 8.6 | |||||||||||
Manager(C) | 12-Jul | 1,265,000 | 1,234,783 | 7.34 | 9.5 | |||||||||||
Manager(C) | 13-Jan | 2,875,000 | 2,491,665 | 10.24 | 11.9 | |||||||||||
Manager(C) | 13-Feb | 1,150,000 | 958,332 | 11.48 | 3.4 | |||||||||||
Manager(C) | 14-Apr | 1,437,500 | 527,083 | 12.2 | 1.5 | |||||||||||
Exercised(D) | 2013-2014 | (802,492 | ) | N/A | 5.81 | N/A | ||||||||||
Expired unexercised | 2003-2005 | (792,553 | ) | N/A | N/A | N/A | ||||||||||
Outstanding | 10,572,094 | 9,086,678 | ||||||||||||||
(A) | Options expire on the tenth anniversary from date of grant. | |||||||||||||||
(B) | The strike prices are subject to adjustment in connection with return of capital dividends. | |||||||||||||||
(C) | The Manager assigned certain of its options to Fortress’s employees as follows: | |||||||||||||||
Date of Grant | Range of Strike | Total Unexercised | ||||||||||||||
Prices | Inception to Date | |||||||||||||||
2004 - 2007 | $29.92 to $33.80 | 90,560 | ||||||||||||||
2012 | $6.82 to $7.34 | 600,000 | ||||||||||||||
2013 | $10.24 to $11.48 | 1,100,497 | ||||||||||||||
2014 | $12.20 | 258,750 | ||||||||||||||
Total | 2,049,807 | |||||||||||||||
(D) | Exercised by employees of Fortress, subsequent to their assignment, or by directors. The options exercised had an intrinsic value of $4.5 million. | |||||||||||||||
Income and Earnings Per Share | ||||||||||||||||
New Residential is required to present both basic and diluted earnings per share (“EPS”). Basic EPS is calculated by dividing net income by the weighted average number of shares of common stock outstanding. Diluted EPS is computed by dividing net income by the weighted average number of shares of common stock outstanding plus the additional dilutive effect, if any, of common stock equivalents during each period. New Residential’s common stock equivalents are its outstanding stock options. During the three months ended March 31, 2015, based on the treasury stock method, New Residential had 3,476,404 dilutive common stock equivalents outstanding. During the three months ended March 31, 2014, based on the treasury stock method, New Residential had 3,315,457 dilutive common stock equivalents outstanding. | ||||||||||||||||
Noncontrolling Interests | ||||||||||||||||
Noncontrolling interests is comprised of the interests held by third parties in consolidated entities that hold New Residential’s investments in servicer advances (Note 6). |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES |
Litigation – New Residential may, from time to time, be a defendant in legal actions from transactions conducted in the ordinary course of business. As of March 31, 2015, New Residential is not subject to any material litigation, individually or in the aggregate, nor, to management’s knowledge, is any material litigation currently threatened against New Residential, except as described below. | |
Following the Acquisition (see Note 18 for related defined terms), material potential claims, lawsuits, and other proceedings, of which New Residential is currently aware, are as follows. New Residential has not accrued losses in connection with these legal contingencies because management does not believe there is probable and reasonably estimable loss. | |
Three putative class action lawsuits have been filed against HLSS and certain of its current and former officers and directors in the United States District Court for the Southern District of New York entitled: (i) Oliveira v. Home Loan Servicing Solutions, Ltd., et al., No. 15-CV-652 (S.D.N.Y.), filed on January 29, 2015; (ii) Berglan v. Home Loan Servicing Solutions, Ltd., et al., No. 15-CV-947 (S.D.N.Y.), filed on February 9, 2015; and (iii) W. Palm Beach Police Pension Fund v. Home Loan Servicing Solutions, Ltd., et al., No. 15-CV-1063 (S.D.N.Y.), filed on February 13, 2015. These three lawsuits, which are collectively referred to as the “New York Actions,” were consolidated by an order dated April 2, 2015. On April 28, 2015, lead plaintiff, lead counsel and liaison counsel were appointed in the New York Actions. | |
The New York Actions name as defendants HLSS, former HLSS Chairman William C. Erbey, HLSS Director, President, and Chief Executive Officer John P. Van Vlack, and HLSS Chief Financial Officer James E. Lauter. The New York Actions assert causes of action under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 based on certain public disclosures made by HLSS relating to its relationship with Ocwen. These actions allege that HLSS misled investors by failing to disclose, among other things, the extent of HLSS’s dependence on Ocwen, information regarding governmental investigations of Ocwen’s business practices, and HLSS’s own purportedly inadequate internal controls. New Residential intends to vigorously defend the New York Actions. | |
Two shareholder derivative actions have been filed purportedly on behalf of Ocwen Financial Corporation naming as defendants HLSS and certain current and former directors and officers of Ocwen, including former HLSS Chairman William C. Erbey, entitled (i) Sokolowski v. Erbey, et al., No. 9:14-CV-81601 (S.D. Fla.), filed on December 24, 2014 (the “Sokolowski Action”), and (ii) Moncavage v. Faris, et al., No. 2015CA003244 (Fla. Palm Beach Cty. Ct.), filed on March 20, 2015 (collectively, with the Sokolowski Action, the “Ocwen Derivative Actions”). The original complaint in the Sokolowski Action named as defendants certain current and former directors and officers of Ocwen, including former HLSS Chairman William C. Erbey. On February 11, 2015, plaintiff in the Sokolowski Action filed an amended complaint naming additional defendants, including HLSS. The Ocwen Derivative Actions assert a cause of action for aiding and abetting certain alleged breaches of fiduciary duty under Florida law against HLSS and others, and claim that HLSS (i) substantially assisted Ocwen’s alleged wrongful conduct by purchasing Ocwen’s mortgage servicing rights and (ii) received improper benefits as a result of its business dealings with Ocwen due to Mr. Erbey’s purported control over both HLSS and Ocwen. Additionally, the Sokolowski Action asserts a cause of action for unjust enrichment against HLSS and others. | |
On March 11, 2015, plaintiff David Rattner filed a shareholder derivative action purportedly on behalf of HLSS entitled Rattner v. Van Vlack, et al., No. 2015CA002833 (Fla. Palm Beach Cty. Ct.) (the “HLSS Derivative Action”). The lawsuit names as defendants HLSS directors John P. Van Vlack, Robert J. McGinnis, Kerry Kennedy, Richard J. Lochrie, and David B. Reiner (collectively, the “Director Defendants”), New Residential Investment Corp., and Hexagon Merger Sub, Ltd. The HLSS Derivative Action alleges that the Director Defendants breached their fiduciary duties of due care, diligence, loyalty, honesty and good faith and the duty to act in the best interests of HLSS under Cayman law and claims that the Director Defendants approved a proposed merger with New Residential Investment Corp. that (i) provided inadequate consideration to HLSS’s shareholders, (ii) included unfair deal protection devices, (iii) and was the result of an inadequate process due to conflicts of interest. | |
On September 15, 2014, HLSS received a subpoena from the SEC requesting that it provide certain information related to HLSS’s prior accounting conventions for and valuations of its Notes receivable - Rights to MSRs that resulted in the restatement of HLSS’s consolidated financial statements for the years ended December 31, 2013 and 2012 and for the quarter ended March 31, 2014 during August 2014. On December 22, 2014, HLSS received a subpoena from the SEC requesting that it provide information related to certain governance documents and transactions and certain communications regarding the same. New Residential and HLSS are cooperating with the SEC in these matters. | |
HLSS has been and continues to be subject to other inquiries by government and other entities, as disclosed in HLSS’s filings with the SEC. New Residential is, from time to time, subject to inquiries by government entities in the ordinary course of business. New Residential currently does not believe any of these inquiries would result in a material adverse effect on New Residential’s business. | |
Indemnifications – In the normal course of business, New Residential and its subsidiaries enter into contracts that contain a variety of representations and warranties and that provide general indemnifications. New Residential’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against New Residential that have not yet occurred. However, based on Newcastle’s and its own experience, New Residential expects the risk of material loss to be remote. | |
Capital Commitments — As of March 31, 2015, New Residential had outstanding capital commitments related to investments in the following investment types (also refer to Note 18 for additional capital commitments entered into subsequent to March 31, 2015): | |
Excess MSRs — As of March 31, 2015, New Residential had outstanding capital commitments related to the acquisition of Excess MSRs on portfolios of Agency residential mortgage loans as discussed in Note 18. See Notes 4 and 5 for information on New Residential’s investments in Excess MSRs. | |
Servicer Advances — New Residential and third-party co-investors agreed to purchase future servicer advances related to Non-Agency mortgage loans. The actual amount of future advances purchased will be based on: (a) the credit and prepayment performance of the underlying loans, (b) the amount of advances recoverable prior to liquidation of the related collateral and (c) the percentage of the loans with respect to which no additional advance obligations are made. The actual amount of future advances is subject to significant uncertainty. See Note 6 for information on New Residential’s investments in servicer advances. | |
Residential Mortgage Loans — As part of its investment in residential mortgage loans, New Residential may be required to outlay capital. These capital outflows primarily consist of advance escrow and tax payments, residential maintenance and property disposition fees. The actual amount of these outflows is subject to significant uncertainty. See Note 8 for information on New Residential’s investments in residential mortgage loans. | |
Debt Covenants — New Residential’s debt obligations contain various customary loan covenants (Note 11). | |
Certain Tax-Related Covenants — If New Residential is treated as a successor to Newcastle under applicable U.S. federal income tax rules, and if Newcastle fails to qualify as a REIT, New Residential could be prohibited from electing to be a REIT. Accordingly, Newcastle has (i) represented that it has no knowledge of any fact or circumstance that would cause New Residential to fail to qualify as a REIT, (ii) covenanted to use commercially reasonable efforts to cooperate with New Residential as necessary to enable New Residential to qualify for taxation as a REIT and receive customary legal opinions concerning REIT status, including providing information and representations to New Residential and its tax counsel with respect to the composition of Newcastle’s income and assets, the composition of its stockholders, and its operation as a REIT; and (iii) covenanted to use its reasonable best efforts to maintain its REIT status for each of Newcastle’s taxable years ending on or before December 31, 2014 (unless Newcastle obtains an opinion from a nationally recognized tax counsel or a private letter ruling from the IRS to the effect that Newcastle’s failure to maintain its REIT status will not cause New Residential to fail to qualify as a REIT under the successor REIT rule referred to above). Additionally, New Residential covenanted to use its reasonable best efforts to qualify for taxation as a REIT for its taxable year ended December 31, 2013. |
TRANSACTIONS_WITH_AFFILIATES_A
TRANSACTIONS WITH AFFILIATES AND AFFILIATED ENTITIES | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Transactions With Affiliates And Affiliated Entities | ||||||||
TRANSACTIONS WITH AFFILIATES AND AFFILIATED ENTITIES | TRANSACTIONS WITH AFFILIATES AND AFFILIATED ENTITIES | |||||||
New Residential is party to a Management Agreement with its Manager which provides for automatically renewing one-year terms subject to certain termination rights. The Manager’s performance is reviewed annually and the Management Agreement may be terminated by New Residential by payment of a termination fee, as defined in the Management Agreement, equal to the amount of management fees earned by the Manager during the twelve consecutive calendar months immediately preceding the termination, upon the affirmative vote of at least two-thirds of the independent directors, or by a majority vote of the holders of common stock. Pursuant to the Management Agreement, the Manager, under the supervision of New Residential’s board of directors, formulates investment strategies, arranges for the acquisition of assets and associated financing, monitors the performance of New Residential’s assets and provides certain advisory, administrative and managerial services in connection with the operations of New Residential. | ||||||||
Effective May 15, 2013, the Manager is entitled to receive a management fee in an amount equal to 1.5% per annum of New Residential’s gross equity calculated and payable monthly in arrears in cash. Gross equity is generally the equity transferred by Newcastle on the distribution date, plus total net proceeds from stock offerings, plus certain capital contributions to subsidiaries, less capital distributions and repurchases of common stock. | ||||||||
In addition, effective May 15, 2013, the Manager is entitled to receive annual incentive compensation in an amount equal to the product of (A) 25% of the dollar amount by which (1) (a) New Residential’s funds from operations before the incentive compensation, excluding funds from operations from investments in the Consumer Loan Companies and any unrealized gains or losses from mark-to-market valuation changes on investments and debt (and any deferred tax impact thereof), per share of common stock, plus (b) earnings (or losses) from the Consumer Loan Companies computed on a level-yield basis (such that the loans are treated as if they qualified as loans acquired with a discount for credit quality as set forth in ASC 310-30, as such codification was in effect on June 30, 2013) as if the Consumer Loan Companies had been acquired at their GAAP basis on May 15, 2013, earnings (or losses) from equity method investees invested in Excess MSRs as if such equity method investees had not made a fair value election, and gains (or losses) from debt restructuring and gains (or losses) from sales of property and other assets, in each case per share of common stock, exceed (2) an amount equal to (a) the weighted average of the book value per share of the equity transferred by Newcastle on the date of the spin-off and the prices per share of New Residential’s common stock in any offerings (adjusted for prior capital dividends or capital distributions) multiplied by (b) a simple interest rate of 10% per annum, multiplied by (B) the weighted average number of shares of common stock outstanding. “Funds from operations” means net income (computed in accordance with GAAP), excluding gains (or losses) from debt restructuring and gains (or losses) from sales of property, plus depreciation on real estate assets, and after adjustments for unconsolidated partnerships and joint ventures. Funds from operations will be computed on an unconsolidated basis. The computation of funds from operations may be adjusted at the direction of New Residential’s independent directors based on changes in, or certain applications of, GAAP. Funds from operations is determined from the date of the spin-off and without regard to Newcastle’s prior performance. | ||||||||
In addition to the management fee and incentive compensation, New Residential is responsible for reimbursing the Manager for certain expenses paid by the Manager on behalf of New Residential. | ||||||||
Due to affiliates is comprised of the following amounts: | ||||||||
March 31, 2015 | December 31, 2014 | |||||||
Management fees | $ | 1,709 | $ | 1,710 | ||||
Incentive compensation | 3,693 | 54,334 | ||||||
Expense reimbursements and other | 1,063 | 1,380 | ||||||
$ | 6,465 | $ | 57,424 | |||||
Affiliate expenses and fees were comprised of: | ||||||||
Three Months Ended March 31, | ||||||||
2015 | 2014 | |||||||
Management fees | $ | 5,126 | $ | 4,486 | ||||
Incentive compensation | 3,693 | 3,338 | ||||||
Expense reimbursements(A) | 125 | 125 | ||||||
Total | $ | 8,944 | $ | 7,949 | ||||
(A) | Included in General and Administrative Expenses in the Condensed Consolidated Statements of Income. | |||||||
See Notes 4, 5, 6, 7, 8, 11, 14 and 18 for a discussion of transactions with Nationstar. As of March 31, 2015, 98.9% and 97.0% of the UPB of the loans underlying New Residential’s investments in Excess MSRs and servicer advances, respectively, was serviced or master serviced by Nationstar. As of March 31, 2015, a total face amount of $1.5 billion of New Residential’s Non-Agency RMBS portfolio and approximately $88.3 million of New Residential’s Agency RMBS portfolio was serviced or master serviced by Nationstar. The total UPB of the loans underlying these Nationstar serviced Non-Agency RMBS was approximately $6.0 billion as of March 31, 2015. New Residential holds a limited right to cleanup call options with respect to certain securitization trusts serviced or master serviced by Nationstar with an aggregate UPB of underlying mortgage loans of approximately $92.8 billion whereby, when the outstanding balance falls below a pre-determined threshold, it can effectively purchase the underlying mortgage loans by repaying all of the outstanding securitization financing at par, in exchange for a fee paid to Nationstar. As of March 31, 2015, $243.5 million UPB of New Residential’s residential mortgage loans and $24.8 million of New Residential’s REO were being serviced by Nationstar. As a result of these relationships, New Residential routinely has receivables from, and payables to, Nationstar, which are included in Other Assets and Accrued Expenses and Other Liabilities, respectively. | ||||||||
See Note 9 for a discussion of a transaction with Springleaf. |
RECLASSIFICATION_FROM_ACCUMULA
RECLASSIFICATION FROM ACCUMULATED OTHER COMPREHENSIVE INCOME INTO NET INCOME | 3 Months Ended | ||||||||||
Mar. 31, 2015 | |||||||||||
Equity [Abstract] | |||||||||||
RECLASSIFICATION FROM ACCUMULATED OTHER COMPREHENSIVE INCOME INTO NET INCOME | RECLASSIFICATION FROM ACCUMULATED OTHER COMPREHENSIVE INCOME INTO NET INCOME | ||||||||||
The following table summarizes the amounts reclassified out of accumulated other comprehensive income into net income: | |||||||||||
Accumulated Other Comprehensive | Statement of Income Location | Three Months Ended March 31, | |||||||||
Income Components | |||||||||||
2015 | 2014 | ||||||||||
Reclassification of net realized (gain) | Gain on settlement of securities | $ | (24,697 | ) | $ | (4,492 | ) | ||||
loss on securities into earnings | |||||||||||
Reclassification of net realized (gain) | Other-than-temporary impairment on | 1,071 | 328 | ||||||||
loss on securities into earnings | securities | ||||||||||
Total reclassifications | $ | (23,626 | ) | $ | (4,164 | ) |
INCOME_TAXES
INCOME TAXES | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Income Tax Disclosure [Abstract] | |||||||||
INCOME TAXES | INCOME TAXES | ||||||||
Income tax expense (benefit) consists of the following: | |||||||||
Three Months Ended March 31, | |||||||||
2015 | 2014 | ||||||||
Current: | |||||||||
Federal | $ | 736 | $ | 217 | |||||
State and Local | (1,156 | ) | 70 | ||||||
Total Current Income Tax Expense (Benefit) | (420 | ) | 287 | ||||||
Deferred: | |||||||||
Federal | (1,323 | ) | — | ||||||
State and Local | (1,684 | ) | — | ||||||
Total Deferred Income Tax Expense (Benefit) | (3,007 | ) | — | ||||||
Total Income Tax Expense (Benefit) | $ | (3,427 | ) | $ | 287 | ||||
New Residential intends to qualify as a REIT for the tax years ending December 31, 2014 and 2015. A REIT is generally not subject to U.S. federal corporate income tax on that portion of its income that is distributed to stockholders if it distributes at least 90% of its REIT taxable income to its stockholders by prescribed dates and complies with various other requirements. | |||||||||
New Residential operates a securitization vehicle and has made certain investments, particularly its investments in servicer advances (Note 6) and REO (Note 8), through TRSs that are subject to regular corporate income taxes which have been provided for in the provision for income taxes, as applicable. New Residential and its subsidiaries file income tax returns with the U.S. federal government and various state and local jurisdictions beginning with the tax year ending December 31, 2013. Generally, these income tax returns will be subject to tax examinations by tax authorities for a period of three years after the date of filing. | |||||||||
As of December 31, 2014, New Residential recorded an increase to the income tax provision of $2.3 million for unrecognized tax benefits. The reserve for unrecognized tax benefits related to state and local tax positions expected to be taken on the income tax returns. As a result of information received from local tax authorities, New Residential has determined that the reserve for unrecognized tax benefits is no longer needed and has reduced the reserve for unrecognized tax benefits to zero as of March 31, 2015. As a result, New Residential recorded a benefit of $2.3 million to the income tax provision as of March 31, 2015. | |||||||||
New Residential has recorded a net deferred tax liability of approximately $13.4 million as of March 31, 2015. This deferred tax liability primarily relates to unrealized gains from New Residential’s investment in servicer advances. |
RECENT_ACTIVITIES
RECENT ACTIVITIES | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Subsequent Events [Abstract] | ||||||||
RECENT ACTIVITIES | RECENT ACTIVITIES | |||||||
These financial statements include a discussion of material events that have occurred subsequent to March 31, 2015 (referred to as “subsequent events”) through the issuance of these condensed consolidated financial statements. Events subsequent to that date have not been considered in these financial statements. | ||||||||
Excess MSRs | ||||||||
On April 16, 2015, New Residential invested the remaining $2.6 million to complete the acquisition of a 33.3% interest in the Excess MSR on a portfolio of Freddie Mac residential mortgage loans with an aggregate UPB of $8.4 billion. Fortress-managed funds and Nationstar each agreed to acquire a 33.3% interest in the Excess MSRs. Nationstar as servicer will perform all servicing and advancing functions, and retain the ancillary income, servicing obligations and liabilities as the servicer of the underlying loans in each of the portfolios. Under the terms of the investment, to the extent that any loans in the portfolio are refinanced by Nationstar, the resulting Excess MSRs are shared on a pro rata basis by New Residential, the Fortress-managed funds and Nationstar, subject to certain limitations. | ||||||||
On April 30, 2015, New Residential invested approximately $3.5 million to acquire a 33.3% interest in the Excess MSR on a portfolio of Fannie Mae residential mortgage loans with an aggregate UPB of $1.6 billion. Fortress-managed funds and Nationstar each agreed to acquire a 33.3% interest in the Excess MSRs. Nationstar as servicer will perform all servicing and advancing functions, and retain the ancillary income, servicing obligations and liabilities as the servicer of the underlying loans in each of the portfolios. Under the terms of the investment, to the extent that any loans in the portfolio are refinanced by Nationstar, the resulting Excess MSRs are shared on a pro rata basis by New Residential, the Fortress-managed funds and Nationstar, subject to certain limitations. | ||||||||
Servicer Advances | ||||||||
Subsequent to March 31, 2015 and prior to May 11, 2015, the Buyer funded a total of $363.4 million of servicer advances and recovered $552.0 million of existing servicer advances. Notes payable outstanding decreased by $170.0 million and restricted cash decreased approximately $0.5 million in relation to these fundings. Additionally, the Buyer paid $5.5 million to Nationstar as a contractual incentive fee. | ||||||||
Subsequent to March 31, 2015 and prior to May 11, 2015, New Residential funded a total of $41.0 million of SLS servicer advances and recovered $54.0 million of existing SLS servicer advances. Notes payable outstanding decreased by $11.4 million and restricted cash increased approximately $0.02 million in relation to these fundings. | ||||||||
Real Estate Securities | ||||||||
Subsequent to March 31, 2015, New Residential acquired Non-Agency RMBS with an aggregate face amount of approximately $73.3 million for approximately $58.6 million, financed with repurchase agreements. New Residential sold Agency RMBS with a face amount of $374.4 million and an amortized cost basis of approximately $391.0 million for approximately $394.6 million and recorded a gain of approximately $3.6 million. New Residential sold no Non-Agency RMBS. Subsequent to March 31, 2015, New Residential rolled $1.3 billion within various repurchase facilities to mature between May 2015 and July 2015. | ||||||||
Subsequent to March 31, 2015, New Residential financed an additional $190.0 million of Non-Agency RMBS within various repurchase facilities as a result of purchases. New Residential also rolled substantially all of its Non-Agency RMBS repurchase facilities to mature between May 2015 and August 2015. | ||||||||
Residential Mortgage Loans | ||||||||
Subsequent to March 31, 2015 and prior to May 11, 2015, New Residential sold a portfolio of performing residential mortgage loans with a UPB of approximately $268.7 million for net proceeds of $282.2 million. | ||||||||
Subsequent to March 31, 2015 and prior to May 11, 2015, New Residential sold a portfolio of non-performing residential mortgage loans with a UPB of approximately $22.1 million for net proceeds of $19.5 million. | ||||||||
Derivatives | ||||||||
Subsequent to March 31, 2015, New Residential entered into two separate interest rate swap agreements with a single counterparty totaling a $500 million notional amount to further hedge a portion of its interest rate exposure. | ||||||||
Corporate Activities | ||||||||
On March 16, 2015, New Residential’s board of directors declared a first quarter 2015 dividend of $0.38 per common share or $53.7 million, which was paid on April 30, 2015 to stockholders of record as of March 26, 2015. | ||||||||
Subsequent to March 31, 2015, New Residential paid off the outstanding secured corporate loan with Credit Suisse First Boston Mortgage Capital LLC, an affiliate of Credit Suisse Securities (USA) LLC for approximately $100.0 million. | ||||||||
Subsequent to March 31, 2015, New Residential entered into a $165.0 million secured corporate loan with Barclays maturing in April 2016. The loan bears interest equal to the sum of (i) a floating rate index rate equal to one-month LIBOR and (ii) a margin of 5.00% until July 2015, after which the loan bears interest equal to the sum of (i) a floating rate index rate equal to one-month LIBOR and (ii) a margin of 8.00%. The loan contains customary covenants and event of default provisions. | ||||||||
Subsequent to March 31, 2015, New Residential issued a $219.4 million secured corporate note maturing in April 2017. The loan bears interest equal to the sum of (i) a floating rate index rate equal to one-month LIBOR and (ii) a margin of 5.25% until May 2016, after which the loan bears interest equal to the sum of (i) a floating rate index rate equal to one-month LIBOR and (ii) a margin of 7.25%. The loan contains customary covenants and event of default provisions. | ||||||||
On February 22, 2015, New Residential entered into an Agreement and Plan of Merger (the “Initial Merger Agreement”) with Home Loan Servicing Solutions, Ltd., a Cayman Islands exempted company (“HLSS”) and Hexagon Merger Sub, Ltd., a Cayman Islands exempted company and a wholly owned subsidiary of New Residential (“Merger Sub”). As described in more detail below, on April 6, 2015, the parties terminated the Initial Merger Agreement pursuant to the Termination Agreement (as defined below) and simultaneously entered into the Acquisition Agreement (as defined below). | ||||||||
The Initial Merger Agreement provided that, upon the terms and subject to the conditions set forth therein, Merger Sub would have merged with and into HLSS, with HLSS continuing as the surviving company and a wholly owned subsidiary of New Residential, and at the effective time of the merger, each ordinary share of HLSS issued and outstanding immediately prior to the effective time (except as set otherwise forth in the Initial Merger Agreement), would have been automatically converted into the right to receive $18.25 in cash, without interest (the “Initial Merger”). Each party’s obligation to consummate the Initial Merger was subject to, among other conditions, the other party’s compliance with its covenants and agreements contained in the Initial Merger Agreement. Among other covenants and agreements, HLSS agreed to provide notice to New Residential within twenty-four hours of becoming aware that HLSS was reasonably likely to receive a going concern qualification from its auditors with respect to its then-most recent fiscal year (a “Going Concern Qualification”). The Initial Merger Agreement specified that, upon the receipt by HLSS of a Going Concern Qualification, New Residential would have the right to immediately terminate the Initial Merger Agreement. | ||||||||
On April 6, 2015, HLSS provided formal notice to New Residential that it was reasonably likely to receive a Going Concern Qualification, unless the parties entered into an alternative transaction. Based on the shared expectation of New Residential and HLSS that HLSS could not satisfy the conditions to the consummation of the Initial Merger set forth in the Initial Merger Agreement, HLSS and New Residential finalized the terms of an alternative transaction (described below). The alternative transaction enabled HLSS to file its annual report, including an unqualified opinion of its auditors, on April 6, 2015. On April 6, 2015, with the approval of their respective Boards of Directors, New Residential and HLSS, together with certain of their respective subsidiaries, entered into a Termination Agreement (the “Termination Agreement”) (providing for the termination of the Initial Merger Agreement) and simultaneously entered into a Share and Asset Purchase Agreement (the “Acquisition Agreement”). | ||||||||
The parties to the Acquisition Agreement included New Residential, HLSS, HLSS Advances Acquisition Corp., a Delaware corporation and wholly owned subsidiary of New Residential (“HLSS Advances”), and HLSS MSR-EBO Acquisition LLC, a Delaware limited liability company and wholly owned subsidiary of New Residential (together with HLSS Advances, the “Buyers”). Pursuant to the Acquisition Agreement, the Buyers acquired from HLSS substantially all of the assets of HLSS (including all of the issued share capital of HLSS’s first-tier subsidiaries) and assumed (and agreed to indemnify HLSS for) the liabilities of HLSS (together, the “Acquisition”), other than post-closing liabilities in an amount up to the Retained Amount (as defined below), for aggregate consideration (net of certain transaction expenses being reimbursed by HLSS), consisting of approximately $1.007 billion in cash and 28,286,980 shares of common stock, par value $0.01 per share (“New Residential Common Stock”), of New Residential delivered to HLSS in a private placement. The closing of the Acquisition (the “Acquisition Closing”) occurred simultaneously with the execution of the Acquisition Agreement. | ||||||||
The Acquisition Agreement includes certain customary post-closing covenants of New Residential, the Buyers and HLSS. In addition, the Board of Directors of HLSS also approved a wind down plan (the “Distribution and Liquidation Plan”), pursuant to which HLSS sold the shares of New Residential Common Stock received in the Acquisition on April 8, 2015 and distributed to HLSS shareholders the cash consideration from the Acquisition and the cash proceeds from the sale of shares of New Residential Common Stock; provided that under the terms of the Distribution and Liquidation Plan, HLSS retained $50.0 million of cash (the “Retained Amount”) for wind down costs. | ||||||||
At the Acquisition Closing, HLSS Advances entered into a Services Agreement, dated as of April 6, 2015, with HLSS (the “Services Agreement”). Pursuant to the Services Agreement, HLSS Advances has agreed to manage the assets and affairs of HLSS in accordance with terms and conditions set forth therein and, in all cases, in accordance with the Distribution and Liquidation Plan. The Services Agreement provides that HLSS Advances will be responsible for the operations of HLSS and will perform (or cause to be performed) such services and activities relating to the assets and operations of HLSS as may be appropriate, including, among other things, administering the Distribution and Liquidation Plan and handling all claims, disputes or controversies in which HLSS is a party or may otherwise be involved. HLSS Advances will not be compensated by HLSS for its services under the Services Agreement but will be reimbursed by HLSS for expenses incurred on behalf of HLSS. | ||||||||
At the Acquisition Closing, New Residential and Merger Sub entered into an Agreement and Plan of Merger, dated April 6, 2015, with HLSS (the “New Merger Agreement”), pursuant to which, upon the terms and subject to the conditions set forth therein (including the approval of HLSS’s shareholders), HLSS (which at the time of the New Merger (as defined below) will have previously sold substantially all of its assets and transferred all liabilities to the Buyers, and have distributed the proceeds (other than the Retained Amount) received from such sale to HLSS shareholders and substantially wound-down its operations) will merge with and into Merger Sub, with Merger Sub continuing as the surviving company and a wholly owned subsidiary of New Residential (the “New Merger”). | ||||||||
Pursuant to the New Merger Agreement, and upon the terms and conditions set forth therein, at the effective time of the New Merger (the “Effective Time”), each ordinary share of HLSS, par value $0.01 per share, issued and outstanding immediately prior to the Effective Time (other than those shares of HLSS owned by New Residential or any direct or indirect wholly-owned subsidiary of New Residential and shares of HLSS as to which dissenters’ rights have been properly exercised), will be automatically converted into the right to receive $0.704059 per share in cash, without interest. | ||||||||
The New Merger does not require the approval of New Residential’s shareholders. However, consummation of the New Merger is subject to, among other things: (i) approval of the New Merger by the requisite vote of HLSS’s shareholders; (ii) not more than 10% of HLSS’s issued and outstanding shares properly exercising appraisal rights as of the time immediately before the closing of the New Merger (the “New Merger Closing”); and (iii) certain other customary closing conditions. Moreover, each party’s obligation to consummate the New Merger is subject to certain other conditions, including without limitation, (i) the accuracy of the other party’s representations and warranties and (ii) the other party’s compliance with its covenants and agreements contained in the New Merger Agreement (in each case subject to customary materiality qualifiers). In addition, the obligations of New Residential and Merger Sub to consummate the New Merger are subject to the absence of any Company Material Adverse Effect (as defined in the New Merger Agreement). The New Merger Agreement may be terminated by either party under certain circumstances, including, among others: (i) if the New Merger Closing has not occurred by the nine-month anniversary of the New Merger Agreement; (ii) if a court or other governmental entity has issued a final and non-appealable order prohibiting the New Merger Closing; (iii) if HLSS fails to obtain the HLSS Shareholder Approval; and (iv) upon a material uncured breach by the other party that would result in a failure of the conditions to the New Merger Closing to be satisfied. | ||||||||
Unaudited Supplemental Pro Forma Financial Information - The following table presents unaudited pro forma combined Interest Income and Income (Loss) Before Incomes Taxes for the three months ended March 31, 2014 and 2015 prepared as if the Acquisition of HLSS had been consummated on January 1, 2014. | ||||||||
Three Months Ended March 31, | ||||||||
2015 | 2014 | |||||||
(unaudited) | (unaudited) | |||||||
Pro Forma | ||||||||
Interest income | $ | 165,055 | $ | 176,989 | ||||
Income (Loss) Before Income Taxes | 71,465 | 103,683 | ||||||
The 2015 unaudited supplemental pro forma financial information has been adjusted to exclude, and the 2014 unaudited supplemental pro forma financial information has been adjusted to include, approximately $17.8 million of acquisition-related costs incurred by New Residential and HLSS in 2015. The unaudited supplemental pro forma financial information has not been adjusted for transactions other than the Acquisition, or for the conforming of accounting policies. The unaudited supplemental pro forma financial information does not include any anticipated synergies or other anticipated benefits of the Acquisition and, accordingly, the unaudited supplemental pro forma financial information is not necessarily indicative of either future results of operations or results that might have been achieved had the Acquisition occurred on January 1, 2014. | ||||||||
In April 2015, New Residential issued 29,213,020 shares of its common stock in a public offering at a price to the public of $15.25 per share for net proceeds of approximately $436.1 million. One of New Residential’s executive officers participated in this offering and purchased 250,000 shares at the public offering price. For the purpose of compensating the Manager for its successful efforts in raising capital for New Residential, in connection with this offering and the New Residential Common Stock issued in the Acquisition, New Residential granted options to the Manager to purchase 5,750,000 shares of New Residential’s common stock at a price of $15.25, which had a fair value of approximately $8.9 million as of the grant date. The assumptions used in valuing the options were: a 2.02% risk-free rate, a 6.71% dividend yield, 24.04% volatility and a 10 year term. |
ORGANIZATION_Policies
ORGANIZATION (Policies) | 3 Months Ended |
Mar. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements |
In May 2014, the FASB issued ASU No. 2014-09, Revenues from Contracts with Customers (Topic 606). The standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In effect, companies will be required to exercise further judgment and make more estimates prospectively. These may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. ASU No. 2014-09 is effective for New Residential in the first quarter of 2017. Early adoption is not permitted. Entities have the option of using either a full retrospective or a modified approach to adopt the guidance in ASU No. 2014-09. New Residential is currently evaluating the new guidance to determine the impact it may have on its condensed consolidated financial statements. | |
In June 2014, the FASB issued ASU No. 2014-11, Transfers and Servicing (Topic 860): Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures. The standard changes the accounting for repurchase-to-maturity transactions and linked repurchase financing transactions to secured borrowing accounting. ASU No. 2014-11 also expands disclosure requirements related to certain transfers of financial assets that are accounted for as sales and certain transfers accounted for as secured borrowings. ASU No. 2014-11 is effective for New Residential in the first quarter of 2015. Early adoption is not permitted. Disclosures are not required for comparative periods presented before the effective date. New Residential has determined that, as of January 1, 2015, its linked transactions (Note 10) are accounted for as secured borrowings. | |
In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. The standard provides guidance on management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern by requiring management to assess an entity’s ability to continue as a going concern by incorporating and expanding on certain principles that are currently in U.S. auditing standards. ASU No. 2014-15 is effective for New Residential for the annual period ending on December 31, 2016. Early adoption is permitted. New Residential is currently evaluating the new guidance to determine the impact that it may have on its condensed consolidated financial statements. | |
In February 2015, the FASB issued ASU No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis. The standard amends the consolidation considerations when evaluating certain limited partnerships, variable interest entities and investment funds. ASU No. 2015-02 is effective for New Residential in the first quarter of 2016. Early adoption is permitted. New Residential does not expect the adoption of this new guidance to have an impact on its condensed consolidated financial statements. | |
In April 2015, the FASB issued ASU No. 2015-03, Interest - Imputation of Interest. The standard amends the balance sheet presentation requirements for debt issuance costs such that they are no longer recognized as deferred charges but are rather presented in the balance sheet as a direct deduction from the carrying amount of the related debt liability, consistent with debt discounts. ASU No. 2015-03 is effective for New Residential in the first quarter of 2016. Early adoption is permitted. New Residential has not yet adopted ASU No. 2015-03 but has determined that the adoption of ASU No. 2015-03 will result in an immaterial reclassification of its Deferred Financing Costs, Net (Note 2) to an offset of its Notes Payable (Note 11). | |
The FASB has recently issued or discussed a number of proposed standards on such topics as financial statement presentation, financial instruments and hedging. Some of the proposed changes are significant and could have a material impact on New Residential’s reporting. New Residential has not yet fully evaluated the potential impact of these proposals, but will make such an evaluation as the standards are finalized. |
OTHER_INCOME_ASSETS_AND_LIABIL1
OTHER INCOME, ASSETS AND LIABILITIES (Tables) | 3 Months Ended | |||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||
Other Income Assets And Liabilities | ||||||||||||||||||
Schedule of Other Income | Other income, net, is comprised of the following: | |||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||
2015 | 2014 | |||||||||||||||||
Unrealized gain (loss) on derivative instruments | $ | (7,030 | ) | $ | 1,357 | |||||||||||||
Gain (loss) on transfer of loans to REO | (544 | ) | — | |||||||||||||||
Gain on consumer loans investment | 10,447 | — | ||||||||||||||||
Other income (loss) | (836 | ) | — | |||||||||||||||
$ | 2,037 | $ | 1,357 | |||||||||||||||
Schedule of Gain on Settlement of Investments | Gain on settlement of investments, net is comprised of the following: | |||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||
2015 | 2014 | |||||||||||||||||
Gain on sale of real estate securities, net | $ | 24,697 | $ | 4,492 | ||||||||||||||
Gain (loss) on sale of residential mortgage loans, net | 20,830 | — | ||||||||||||||||
Gain (loss) on settlement of derivatives | (22,590 | ) | (135 | ) | ||||||||||||||
Gain (loss) on liquidated residential mortgage loans, held-for-investment | 400 | — | ||||||||||||||||
Gain (loss) on sale of REO(A) | (5,636 | ) | — | |||||||||||||||
Other gains (losses) | (2,934 | ) | — | |||||||||||||||
$ | 14,767 | $ | 4,357 | |||||||||||||||
(A) | Includes approximately $3.2 million loss on REO sold as a part of the residential mortgage loan sales described in Note 8. | |||||||||||||||||
Schedule of Other Assets and Other Liabilities | Other assets and liabilities are comprised of the following: | |||||||||||||||||
Other Assets | Accrued Expenses and Other Liabilities | |||||||||||||||||
31-Mar-15 | 31-Dec-14 | 31-Mar-15 | 31-Dec-14 | |||||||||||||||
Margin receivable, net | $ | 36,934 | $ | 59,021 | Interest payable | $ | 7,516 | $ | 7,857 | |||||||||
Interest and other receivables | 11,320 | 10,455 | Accounts payable | 16,068 | 28,059 | |||||||||||||
Deferred financing costs, net(A) | 2,817 | 4,446 | Derivative liabilities | 21,127 | 14,220 | |||||||||||||
Principal paydown receivable | 3,761 | 3,595 | Current taxes payable | 47 | 2,349 | |||||||||||||
Receivable from government | 9,380 | 9,108 | Other liabilities | 19 | 20 | |||||||||||||
agency | ||||||||||||||||||
Call rights | 3,828 | 3,728 | $ | 44,777 | $ | 52,505 | ||||||||||||
Other assets | 8,661 | 9,516 | ||||||||||||||||
$ | 76,701 | $ | 99,869 | |||||||||||||||
(A) | Deferred financing costs are net of accumulated amortization of $5.4 million and $8.8 million as of March 31, 2015 and December 31, 2014, respectively. | |||||||||||||||||
Schedule of Accretion and Other Amortization | As reflected on the Condensed Consolidated Statements of Cash Flows, accretion and other amortization is comprised of the following: | |||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||
2015 | 2014 | |||||||||||||||||
Accretion of servicer advance interest income | $ | 42,349 | $ | 45,716 | ||||||||||||||
Accretion of excess mortgage servicing rights income | 15,037 | 13,816 | ||||||||||||||||
Accretion of net discount on securities and loans | 5,399 | 356 | ||||||||||||||||
Amortization of deferred financing costs | (1,440 | ) | (3,238 | ) | ||||||||||||||
$ | 61,345 | $ | 56,650 | |||||||||||||||
SEGMENT_REPORTING_Tables
SEGMENT REPORTING (Tables) | 3 Months Ended | |||||||||||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||||||||||
Summary of Segment Financial Data | Summary financial data on New Residential’s segments is given below, together with a reconciliation to the same data for New Residential as a whole: | |||||||||||||||||||||||||||
Servicing Related Assets | Residential Securities and Loans | |||||||||||||||||||||||||||
Excess MSRs | Servicer Advances | Real Estate Securities | Real Estate Loans | Consumer Loans | Corporate | Total | ||||||||||||||||||||||
Three Months Ended March 31, 2015 | ||||||||||||||||||||||||||||
Interest income | $ | 15,037 | $ | 42,349 | $ | 14,263 | $ | 12,724 | $ | — | $ | — | $ | 84,373 | ||||||||||||||
Interest expense | — | 23,637 | 3,480 | 6,093 | — | 769 | 33,979 | |||||||||||||||||||||
Net interest income (expense) | 15,037 | 18,712 | 10,783 | 6,631 | — | (769 | ) | 50,394 | ||||||||||||||||||||
Impairment | — | — | 1,071 | 977 | — | — | 2,048 | |||||||||||||||||||||
Other income | 3,890 | (10,727 | ) | (5,090 | ) | 13,775 | 10,447 | — | 12,295 | |||||||||||||||||||
Operating expenses | 88 | 575 | (102 | ) | 6,104 | 57 | 15,548 | 22,270 | ||||||||||||||||||||
Income (Loss) Before Income Taxes | 18,839 | 7,410 | 4,724 | 13,325 | 10,390 | (16,317 | ) | 38,371 | ||||||||||||||||||||
Income tax expense (benefit) | — | (3,240 | ) | — | (187 | ) | — | — | (3,427 | ) | ||||||||||||||||||
Net Income (Loss) | $ | 18,839 | $ | 10,650 | $ | 4,724 | $ | 13,512 | $ | 10,390 | $ | (16,317 | ) | $ | 41,798 | |||||||||||||
Noncontrolling interests in income | $ | — | $ | 5,823 | $ | — | $ | — | $ | — | $ | — | $ | 5,823 | ||||||||||||||
(loss) of consolidated subsidiaries | ||||||||||||||||||||||||||||
Net income (loss) attributable to | $ | 18,839 | $ | 4,827 | $ | 4,724 | $ | 13,512 | $ | 10,390 | $ | (16,317 | ) | $ | 35,975 | |||||||||||||
common stockholders | ||||||||||||||||||||||||||||
Servicing Related Assets | Residential Securities and Loans | |||||||||||||||||||||||||||
Excess MSRs | Servicer Advances | Real Estate Securities | Real Estate Loans | Consumer Loans | Corporate | Total | ||||||||||||||||||||||
March 31, 2015 | ||||||||||||||||||||||||||||
Investments | $ | 751,773 | $ | 3,245,457 | $ | 2,324,915 | $ | 581,046 | $ | — | $ | — | $ | 6,903,191 | ||||||||||||||
Cash and cash equivalents | 267 | 69,180 | 5,288 | 5,895 | — | 378,704 | 459,334 | |||||||||||||||||||||
Restricted cash | 37 | 28,288 | — | — | — | — | 28,325 | |||||||||||||||||||||
Derivative assets | — | 71 | — | — | — | — | 71 | |||||||||||||||||||||
Other assets | 34 | 6,622 | 51,610 | 15,925 | 543 | 1,967 | 76,701 | |||||||||||||||||||||
Total assets | $ | 752,111 | $ | 3,349,618 | $ | 2,381,813 | $ | 602,866 | $ | 543 | $ | 380,671 | $ | 7,467,622 | ||||||||||||||
Debt | $ | — | $ | 2,875,412 | $ | 1,928,891 | $ | 434,504 | $ | — | $ | 100,000 | $ | 5,338,807 | ||||||||||||||
Other liabilities | 2,921 | 19,642 | 219,603 | 5,680 | 58 | 66,497 | 314,401 | |||||||||||||||||||||
Total liabilities | 2,921 | 2,895,054 | 2,148,494 | 440,184 | 58 | 166,497 | 5,653,208 | |||||||||||||||||||||
Total equity | 749,190 | 454,564 | 233,319 | 162,682 | 485 | 214,174 | 1,814,414 | |||||||||||||||||||||
Noncontrolling interests in equity | — | 246,899 | — | — | — | — | 246,899 | |||||||||||||||||||||
of consolidated subsidiaries | ||||||||||||||||||||||||||||
Total New Residential | $ | 749,190 | $ | 207,665 | $ | 233,319 | $ | 162,682 | $ | 485 | $ | 214,174 | $ | 1,567,515 | ||||||||||||||
stockholders’ equity | ||||||||||||||||||||||||||||
Investments in equity method | $ | 225,111 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 225,111 | ||||||||||||||
investees | ||||||||||||||||||||||||||||
Servicing Related Assets | Residential Securities and Loans | |||||||||||||||||||||||||||
Excess MSRs | Servicer Advances | Real Estate Securities | Real Estate Loans | Consumer Loans | Corporate | Total | ||||||||||||||||||||||
Three Months Ended March 31, 2014 | ||||||||||||||||||||||||||||
Interest income | $ | 13,816 | $ | 45,716 | $ | 11,238 | $ | 720 | $ | — | $ | — | $ | 71,490 | ||||||||||||||
Interest expense | 1,291 | 31,956 | 4,069 | 198 | 1,483 | — | 38,997 | |||||||||||||||||||||
Net interest income (expense) | 12,525 | 13,760 | 7,169 | 522 | (1,483 | ) | — | 32,493 | ||||||||||||||||||||
Impairment | — | — | 328 | 164 | — | — | 492 | |||||||||||||||||||||
Other income | 12,976 | — | 5,042 | 671 | 16,360 | 1 | 35,050 | |||||||||||||||||||||
Operating expenses | 65 | 250 | 60 | 90 | 23 | 9,411 | 9,899 | |||||||||||||||||||||
Income (Loss) Before Income Taxes | 25,436 | 13,510 | 11,823 | 939 | 14,854 | (9,410 | ) | 57,152 | ||||||||||||||||||||
Income tax expense (benefit) | — | 287 | — | — | — | — | 287 | |||||||||||||||||||||
Net Income (Loss) | $ | 25,436 | $ | 13,223 | $ | 11,823 | $ | 939 | $ | 14,854 | $ | (9,410 | ) | $ | 56,865 | |||||||||||||
Noncontrolling interests in income | $ | — | $ | 8,093 | $ | — | $ | — | $ | — | $ | — | $ | 8,093 | ||||||||||||||
(loss) of consolidated subsidiaries | ||||||||||||||||||||||||||||
Net income (loss) attributable to | $ | 25,436 | $ | 5,130 | $ | 11,823 | $ | 939 | $ | 14,854 | $ | (9,410 | ) | $ | 48,772 | |||||||||||||
common stockholders | ||||||||||||||||||||||||||||
INVESTMENTS_IN_EXCESS_MORTGAGE2
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS (Tables) | 3 Months Ended | |||||||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||||||
Transfers and Servicing [Abstract] | ||||||||||||||||||||||||
Schedule of Activity Related to the Carrying Value of Investments in Excess MSRs | The following table presents activity related to the carrying value of New Residential’s investments in Excess MSRs: | |||||||||||||||||||||||
Servicer | ||||||||||||||||||||||||
Nationstar | SLS(A) | Total | ||||||||||||||||||||||
Balance as of December 31, 2014 | $ | 409,076 | $ | 8,657 | $ | 417,733 | ||||||||||||||||||
Transfers from indirect ownership | 98,258 | — | 98,258 | |||||||||||||||||||||
Purchases | 26,479 | — | 26,479 | |||||||||||||||||||||
Interest income | 14,856 | 181 | 15,037 | |||||||||||||||||||||
Other income | 730 | — | 730 | |||||||||||||||||||||
Proceeds from repayments | (29,544 | ) | (270 | ) | (29,814 | ) | ||||||||||||||||||
Change in fair value | (1,472 | ) | (289 | ) | (1,761 | ) | ||||||||||||||||||
Balance as of March 31, 2015 | $ | 518,383 | $ | 8,279 | $ | 526,662 | ||||||||||||||||||
(A) Specialized Loan Servicing LLC (“SLS”). See Note 6 for a description of the SLS Transaction. | ||||||||||||||||||||||||
Summary of Direct Investments in Excess MSRs | The following is a summary of New Residential’s direct investments in Excess MSRs: | |||||||||||||||||||||||
March 31, 2015 | 31-Dec-14 | |||||||||||||||||||||||
Unpaid Principal Balance (“UPB”) of Underlying Mortgages | Interest in Excess MSR | Weighted Average Life Years(A) | Amortized Cost Basis(B) | Carrying Value(C) | Carrying Value(C) | |||||||||||||||||||
New Residential | Fortress-managed funds | Nationstar | ||||||||||||||||||||||
Agency | ||||||||||||||||||||||||
Original and Recaptured Pools | $ | 54,829,877 | 32.5%-66.7% | 0.0%-33.3% | 33.3%-35% | 5.9 | $ | 161,109 | $ | 209,114 | $ | 188,733 | ||||||||||||
Recapture Agreements | — | 32.5%-66.7% | 0.0%-33.3% | 33.3%-35% | 12.9 | 9,927 | 29,865 | 28,786 | ||||||||||||||||
54,829,877 | 6.3 | 171,036 | 238,979 | 217,519 | ||||||||||||||||||||
Non-Agency(D) | ||||||||||||||||||||||||
Original and Recaptured Pools | $ | 108,742,559 | 33.3%-80.0% | 0.0%-50.0% | 0.0%-33.3% | 4.9 | $ | 231,228 | $ | 270,365 | $ | 189,812 | ||||||||||||
Recapture Agreements | — | 33.3%-80.0% | 0.0%-50.0% | 0.0%-33.3% | 11.8 | 16,638 | 17,318 | 10,402 | ||||||||||||||||
108,742,559 | 5.4 | 247,866 | 287,683 | 200,214 | ||||||||||||||||||||
Total | $ | 163,572,436 | 5.8 | $ | 418,902 | $ | 526,662 | $ | 417,733 | |||||||||||||||
(A) | Weighted Average Life represents the weighted average expected timing of the receipt of expected cash flows for this investment. | |||||||||||||||||||||||
(B) | The amortized cost basis of the Recapture Agreements is determined based on the relative fair values of the Recapture Agreements and related Excess MSRs at the time they were acquired. | |||||||||||||||||||||||
(C) | Carrying Value represents the fair value of the pools or Recapture Agreements, as applicable. | |||||||||||||||||||||||
(D) | Excess MSR investments in which New Residential also invested in related servicer advances, including the basic fee component of the related MSR as of March 31, 2015 (Note 6). | |||||||||||||||||||||||
Changes in fair value recorded in other income are comprised of the following: | ||||||||||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||||||||
2015 | 2014 | |||||||||||||||||||||||
Original and Recaptured Pools | $ | (1,976 | ) | $ | 7,088 | |||||||||||||||||||
Recapture Agreements | 215 | (486 | ) | |||||||||||||||||||||
$ | (1,761 | ) | $ | 6,602 | ||||||||||||||||||||
Summary of the Geographic Distribution of the Underlying Residential Mortgage Loans of the Direct Investments in Excess MSRs | The table below summarizes the geographic distribution of the underlying residential mortgage loans of the direct investments in Excess MSRs: | |||||||||||||||||||||||
Percentage of Total Outstanding Unpaid Principal Amount as of | ||||||||||||||||||||||||
State Concentration | 31-Mar-15 | 31-Dec-14 | ||||||||||||||||||||||
California | 33 | % | 31.5 | % | ||||||||||||||||||||
Florida | 9.3 | % | 7.7 | % | ||||||||||||||||||||
New York | 4.9 | % | 4.3 | % | ||||||||||||||||||||
Maryland | 3.8 | % | 4 | % | ||||||||||||||||||||
Texas | 3.6 | % | 4.2 | % | ||||||||||||||||||||
New Jersey | 3.5 | % | 3.2 | % | ||||||||||||||||||||
Virginia | 3.2 | % | 3.3 | % | ||||||||||||||||||||
Illinois | 3.2 | % | 3.2 | % | ||||||||||||||||||||
Washington | 3.2 | % | 3.6 | % | ||||||||||||||||||||
Arizona | 2.7 | % | 3.2 | % | ||||||||||||||||||||
Other U.S. | 29.6 | % | 31.8 | % | ||||||||||||||||||||
100 | % | 100 | % |
INVESTMENTS_IN_EXCESS_MORTGAGE3
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS, EQUITY METHOD INVESTEES (Tables) | 3 Months Ended | |||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||
Equity Method Investments and Joint Ventures [Abstract] | ||||||||||||||||||||
Summary of the Financial Results of Excess MSR Joint Ventures, Accounted for as Equity Method Investees | The following tables summarize the financial results of the Excess MSR joint ventures, accounted for as equity method investees, held by New Residential: | |||||||||||||||||||
March 31, 2015 | December 31, 2014 | |||||||||||||||||||
Excess MSR assets | $ | 440,714 | $ | 653,293 | ||||||||||||||||
Other assets | 9,508 | 8,472 | ||||||||||||||||||
Other liabilities | — | (13 | ) | |||||||||||||||||
Equity | $ | 450,222 | $ | 661,752 | ||||||||||||||||
New Residential’s investment | $ | 225,111 | $ | 330,876 | ||||||||||||||||
New Residential’s ownership | 50 | % | 50 | % | ||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||||
2015 | 2014 | |||||||||||||||||||
Interest income | $ | 11,701 | $ | 18,493 | ||||||||||||||||
Other income (loss) | (1,835 | ) | (5,705 | ) | ||||||||||||||||
Expenses | (25 | ) | (40 | ) | ||||||||||||||||
Net income | $ | 9,841 | $ | 12,748 | ||||||||||||||||
New Residential’s investments in equity method investees changed during the three months ended March 31, 2015 as follows: | ||||||||||||||||||||
Balance at December 31, 2014 | $ | 330,876 | ||||||||||||||||||
Contributions to equity method investees | — | |||||||||||||||||||
Transfers to direct ownership | (98,258 | ) | ||||||||||||||||||
Distributions of earnings from equity method investees | (12,226 | ) | ||||||||||||||||||
Distributions of capital from equity method investees | (202 | ) | ||||||||||||||||||
Change in fair value of investments in equity method investees | 4,921 | |||||||||||||||||||
Balance at March 31, 2015 | $ | 225,111 | ||||||||||||||||||
Summary of Excess MSR Investments made through Equity Method Investees | The following is a summary of New Residential’s Excess MSR investments made through equity method investees: | |||||||||||||||||||
March 31, 2015 | ||||||||||||||||||||
Unpaid Principal Balance | Investee Interest in Excess MSR(A) | New Residential Interest in Investees | Amortized Cost Basis(B) | Carrying Value(C) | Weighted Average Life (Years)(D) | |||||||||||||||
Agency | ||||||||||||||||||||
Original and Recaptured Pools | $ | 84,000,746 | 66.7 | % | 50 | % | $ | 289,745 | $ | 358,909 | 5.5 | |||||||||
Recapture Agreements | — | 66.7 | % | 50 | % | 62,190 | 81,805 | 11.7 | ||||||||||||
Total | $ | 84,000,746 | $ | 351,935 | $ | 440,714 | 6.6 | |||||||||||||
(A) | The remaining interests are held by Nationstar. | |||||||||||||||||||
(B) | Represents the amortized cost basis of the equity method investees in which New Residential holds a 50% interest. The amortized cost basis of the Recapture Agreements is determined based on the relative fair values of the Recapture Agreements and related Excess MSRs at the time they were acquired. | |||||||||||||||||||
(C) | Represents the carrying value of the Excess MSRs held in equity method investees, in which New Residential holds a 50% interest. Carrying value represents the fair value of the pools or Recapture Agreements, as applicable. | |||||||||||||||||||
(D) | The weighted average life represents the weighted average expected timing of the receipt of cash flows of each investment. | |||||||||||||||||||
Summary of the Geographic Distribution of the Underlying Residential Mortgage Loans of the Excess MSR Investments made through Equity Method Investees | The table below summarizes the geographic distribution of the underlying residential mortgage loans of the Excess MSR investments made through equity method investees: | |||||||||||||||||||
Percentage of Total Outstanding Unpaid Principal Amount as of | ||||||||||||||||||||
State Concentration | 31-Mar-15 | 31-Dec-14 | ||||||||||||||||||
California | 13.1 | % | 23.5 | % | ||||||||||||||||
Florida | 7.4 | % | 8.9 | % | ||||||||||||||||
Texas | 6.1 | % | 4.8 | % | ||||||||||||||||
Georgia | 5.6 | % | 4.1 | % | ||||||||||||||||
New York | 5.5 | % | 5.6 | % | ||||||||||||||||
New Jersey | 4.1 | % | 3.9 | % | ||||||||||||||||
Illinois | 4 | % | 3.5 | % | ||||||||||||||||
Virginia | 3.2 | % | 3.2 | % | ||||||||||||||||
Maryland | 3.2 | % | 3.3 | % | ||||||||||||||||
Pennsylvania | 3 | % | 2.3 | % | ||||||||||||||||
Other U.S. | 44.8 | % | 36.9 | % | ||||||||||||||||
100 | % | 100 | % |
INVESTMENTS_IN_SERVICER_ADVANC1
INVESTMENTS IN SERVICER ADVANCES (Tables) | 3 Months Ended | |||||||||||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||||||||||
Investments, All Other Investments [Abstract] | ||||||||||||||||||||||||||||
Summary of Investments in Servicer Advances | The following is a summary of the investments in servicer advances, including the right to the basic fee component of the related MSRs: | |||||||||||||||||||||||||||
Amortized Cost Basis | Carrying Value(A) | Weighted Average Discount Rate | Weighted Average Life (Years)(B) | |||||||||||||||||||||||||
31-Mar-15 | ||||||||||||||||||||||||||||
Servicer advances | $ | 3,168,909 | $ | 3,245,457 | 5.4 | % | 3.9 | |||||||||||||||||||||
As of December 31, 2014 | ||||||||||||||||||||||||||||
Servicer advances | $ | 3,186,622 | $ | 3,270,839 | 5.4 | % | 4 | |||||||||||||||||||||
(A) | Carrying value represents the fair value of the investments in servicer advances, including the basic fee component of the related MSRs. | |||||||||||||||||||||||||||
(B) | Weighted Average Life represents the weighted average expected timing of the receipt of expected net cash flows for this investment. | |||||||||||||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||||||||||||
2015 | 2014 | |||||||||||||||||||||||||||
Changes in Fair Value Recorded in Other Income | $ | (7,669 | ) | $ | — | |||||||||||||||||||||||
The following is additional information regarding the servicer advances and related financing: | ||||||||||||||||||||||||||||
Loan-to-Value | Cost of Funds(B) | |||||||||||||||||||||||||||
UPB of Underlying Residential Mortgage Loans | Outstanding Servicer Advances | Servicer Advances to UPB of Underlying Residential Mortgage Loans | Carrying Value of Notes Payable | Gross | Net(A) | Gross | Net | |||||||||||||||||||||
March 31, 2015 | ||||||||||||||||||||||||||||
Servicer advances(C) | $ | 92,159,246 | $ | 3,068,306 | 3.3 | % | $ | 2,875,412 | 91.5 | % | 90.6 | % | 2.6 | % | 2.2 | % | ||||||||||||
December 31, 2014 | ||||||||||||||||||||||||||||
Servicer advances(C) | $ | 96,547,773 | $ | 3,102,492 | 3.2 | % | $ | 2,890,230 | 91.4 | % | 90.4 | % | 3 | % | 2.3 | % | ||||||||||||
(A) | Ratio of face amount of borrowings to par amount of servicer advance collateral, net of an interest reserve maintained by the Buyer. | |||||||||||||||||||||||||||
(B) | Annualized measure of the cost associated with borrowings. Gross Cost of Funds primarily includes interest expense and facility fees. Net Cost of Funds excludes facility fees. | |||||||||||||||||||||||||||
(C) | The following types of advances comprise the investments in servicer advances: | |||||||||||||||||||||||||||
March 31, 2015 | December 31, 2014 | |||||||||||||||||||||||||||
Principal and interest advances | $ | 737,845 | $ | 729,713 | ||||||||||||||||||||||||
Escrow advances (taxes and insurance advances) | 1,514,848 | 1,600,713 | ||||||||||||||||||||||||||
Foreclosure advances | 815,613 | 772,066 | ||||||||||||||||||||||||||
Total | $ | 3,068,306 | $ | 3,102,492 | ||||||||||||||||||||||||
Schedule of Interest Income Related to Investments in Servicer Advances | Interest income recognized by New Residential related to its investments in servicer advances was comprised of the following: | |||||||||||||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||||||||||||
2015 | 2014 | |||||||||||||||||||||||||||
Interest income, gross of amounts attributable to servicer compensation | $ | 63,357 | $ | 67,138 | ||||||||||||||||||||||||
Amounts attributable to base servicer compensation | (6,601 | ) | (6,280 | ) | ||||||||||||||||||||||||
Amounts attributable to incentive servicer compensation | (14,407 | ) | (15,142 | ) | ||||||||||||||||||||||||
Interest income from investments in servicer advances | $ | 42,349 | $ | 45,716 | ||||||||||||||||||||||||
Others’ interests in the equity of the Buyer is computed as follows: | ||||||||||||||||||||||||||||
March 31, 2015 | December 31, 2014 | |||||||||||||||||||||||||||
Total Advance Purchaser LLC equity | $ | 445,041 | $ | 457,545 | ||||||||||||||||||||||||
Others’ ownership interest | 55.5 | % | 55.5 | % | ||||||||||||||||||||||||
Others’ interest in equity of consolidated subsidiary | $ | 246,899 | $ | 253,836 | ||||||||||||||||||||||||
Others’ interests in the Buyer’s net income is computed as follows: | ||||||||||||||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||||||||||||
2015 | 2014 | |||||||||||||||||||||||||||
Net Advance Purchaser LLC income | $ | 10,496 | $ | 13,511 | ||||||||||||||||||||||||
Others’ ownership interest as a percent of total(A) | 55.5 | % | 59.9 | % | ||||||||||||||||||||||||
Others’ interest in net income (loss) of consolidated subsidiaries | $ | 5,823 | $ | 8,093 | ||||||||||||||||||||||||
(A) | As a result, New Residential owned 44.5% and 40.1% of the Buyer, on average during the three months ended March 31, 2015 and 2014, respectively. |
INVESTMENTS_IN_REAL_ESTATE_SEC1
INVESTMENTS IN REAL ESTATE SECURITIES (Tables) | 3 Months Ended | ||||||||||||||||||||||||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||
Summary of Real Estate Securities | The following is a summary of New Residential’s real estate securities, all of which are classified as available-for-sale and are, therefore, reported at fair value with changes in fair value recorded in other comprehensive income, except for securities that are other-than-temporarily impaired and except for securities which New Residential elected to carry at fair value and record changes to valuation through the income statement. | ||||||||||||||||||||||||||||||||||||||||
Gross Unrealized | Weighted Average | 31-Dec-14 | |||||||||||||||||||||||||||||||||||||||
Asset Type | Outstanding Face Amount | Amortized Cost Basis | Gains | Losses | Carrying Value(A) | Number of Securities | Rating(B) | Coupon | Yield | Life (Years)(C) | Principal Subordination(D) | Carrying Value | |||||||||||||||||||||||||||||
Agency | $ | 1,575,759 | $ | 1,659,781 | $ | 7,510 | $ | (2,295 | ) | $ | 1,664,996 | 102 | AAA | 3.11 | % | 2.18 | % | 5.4 | N/A | $ | 1,740,163 | ||||||||||||||||||||
RMBS(E)(F) | |||||||||||||||||||||||||||||||||||||||||
Non-Agency | 1,820,536 | 647,915 | 14,641 | (2,637 | ) | 659,919 | 137 | BBB- | 0.76 | % | 5.74 | % | 9.7 | 26 | % | 723,000 | |||||||||||||||||||||||||
RMBS(G) (H) | |||||||||||||||||||||||||||||||||||||||||
Total/ | $ | 3,396,295 | $ | 2,307,696 | $ | 22,151 | $ | (4,932 | ) | $ | 2,324,915 | 239 | AA- | 2.45 | % | 3.18 | % | 6.6 | $ | 2,463,163 | |||||||||||||||||||||
Weighted | |||||||||||||||||||||||||||||||||||||||||
Average | |||||||||||||||||||||||||||||||||||||||||
(A) | Fair value, which is equal to carrying value for all securities. See Note 12 regarding the estimation of fair value. | ||||||||||||||||||||||||||||||||||||||||
(B) | Represents the weighted average of the ratings of all securities in each asset type, expressed as an S&P equivalent rating. This excludes the ratings of the collateral underlying 20 bonds which either have never been rated or for which rating information is no longer provided. For each security rated by multiple rating agencies, the lowest rating is used. New Residential used an implied AAA rating for the Agency RMBS. Ratings provided were determined by third party rating agencies, and represent the most recent credit ratings available as of the reporting date and may not be current. | ||||||||||||||||||||||||||||||||||||||||
(C) | The weighted average life is based on the timing of expected principal reduction on the assets. | ||||||||||||||||||||||||||||||||||||||||
(D) | Percentage of the outstanding face amount of securities that is subordinate to New Residential’s investments. | ||||||||||||||||||||||||||||||||||||||||
(E) | Includes securities issued or guaranteed by U.S. Government agencies such as the Federal National Mortgage Association (“Fannie Mae”) or the Federal Home Loan Mortgage Corporation (“Freddie Mac”). | ||||||||||||||||||||||||||||||||||||||||
(F) | The total outstanding face amount was $979.8 million for fixed rate securities and $595.9 million for floating rate securities as of March 31, 2015. | ||||||||||||||||||||||||||||||||||||||||
(G) | The total outstanding face amount was $1.2 billion (including $927.5 million of residual and interest-only notional amount) for fixed rate securities and $654.0 million (including $101.1 million of residual and interest-only notional amount) for floating rate securities as of March 31, 2015. | ||||||||||||||||||||||||||||||||||||||||
(H) | Includes Other ABS consisting primarily of interest-only securities which New Residential elected to carry at fair value and record changes to valuation through the income statement and representing 8.5% of the carrying value of the Non-Agency RMBS portfolio. | ||||||||||||||||||||||||||||||||||||||||
Gross Unrealized | Weighted Average | ||||||||||||||||||||||||||||||||||||||||
Asset Type | Outstanding Face Amount | Amortized Cost Basis | Gains | Losses | Carrying Value | Number of Securities | Rating | Coupon | Yield | Life (Years) | Principal Subordination | ||||||||||||||||||||||||||||||
Other ABS | $ | 984,460 | $ | 56,414 | $ | 829 | $ | (1,119 | ) | $ | 56,124 | 8 | AA+ | 1.98 | % | 8.65 | % | 4 | — | % | |||||||||||||||||||||
Summary of Real Estate Securities in an Unrealized Loss Position | The following table summarizes New Residential’s securities in an unrealized loss position as of March 31, 2015. | ||||||||||||||||||||||||||||||||||||||||
Amortized Cost Basis | Weighted Average | ||||||||||||||||||||||||||||||||||||||||
Securities in an Unrealized Loss Position | Outstanding Face Amount | Before Impairment | Other-Than- | After Impairment | Gross Unrealized Losses | Carrying Value | Number of Securities | Rating(B) | Coupon | Yield | Life | ||||||||||||||||||||||||||||||
Temporary Impairment(A) | (Years) | ||||||||||||||||||||||||||||||||||||||||
Less than Twelve | $ | 1,297,224 | $ | 494,733 | $ | (1,071 | ) | $ | 493,662 | $ | (3,202 | ) | $ | 490,460 | 70 | AA- | 1.37 | % | 2.2 | % | 7.2 | ||||||||||||||||||||
Months | |||||||||||||||||||||||||||||||||||||||||
Twelve or More | 128,605 | 123,794 | — | 123,794 | (1,730 | ) | 122,064 | 22 | AA+ | 2.39 | % | 1.96 | % | 4.4 | |||||||||||||||||||||||||||
Months | |||||||||||||||||||||||||||||||||||||||||
Total/Weighted | $ | 1,425,829 | $ | 618,527 | $ | (1,071 | ) | $ | 617,456 | $ | (4,932 | ) | $ | 612,524 | 92 | AA | 1.57 | % | 2.15 | % | 6.7 | ||||||||||||||||||||
Average | |||||||||||||||||||||||||||||||||||||||||
(A) | This amount represents other-than-temporary impairment recorded on securities that are in an unrealized loss position as of March 31, 2015. | ||||||||||||||||||||||||||||||||||||||||
(B) | The weighted average rating of securities in an unrealized loss position for less than twelve months excludes the rating of 20 bonds which either have never been rated or for which rating information is no longer provided. | ||||||||||||||||||||||||||||||||||||||||
New Residential performed an assessment of all of its debt securities that are in an unrealized loss position (an unrealized loss position exists when a security’s amortized cost basis, excluding the effect of OTTI, exceeds its fair value) and determined the following: | |||||||||||||||||||||||||||||||||||||||||
March 31, 2015 | |||||||||||||||||||||||||||||||||||||||||
Unrealized Losses | |||||||||||||||||||||||||||||||||||||||||
Fair Value | Amortized Cost Basis After Impairment | Credit(A) | Non-Credit(B) | ||||||||||||||||||||||||||||||||||||||
Securities New Residential intends to sell(C) | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||||
Securities New Residential is more likely than not to be | — | — | — | N/A | |||||||||||||||||||||||||||||||||||||
required to sell(D) | |||||||||||||||||||||||||||||||||||||||||
Securities New Residential has no intent to sell and is not | |||||||||||||||||||||||||||||||||||||||||
more likely than not to be required to sell: | |||||||||||||||||||||||||||||||||||||||||
Credit impaired securities | 107,612 | 108,440 | (1,071 | ) | (828 | ) | |||||||||||||||||||||||||||||||||||
Non-credit impaired securities | 504,912 | 509,016 | — | (4,104 | ) | ||||||||||||||||||||||||||||||||||||
Total debt securities in an unrealized loss position | $ | 612,524 | $ | 617,456 | $ | (1,071 | ) | $ | (4,932 | ) | |||||||||||||||||||||||||||||||
(A) | This amount is required to be recorded as other-than-temporary impairment through earnings. In measuring the portion of credit losses, New Residential’s management estimates the expected cash flow for each of the securities. This evaluation includes a review of the credit status and the performance of the collateral supporting those securities, including the credit of the issuer, key terms of the securities and the effect of local, industry and broader economic trends. Significant inputs in estimating the cash flows include management’s expectations of prepayment speeds, default rates and loss severities. Credit losses are measured as the decline in the present value of the expected future cash flows discounted at the investment’s effective interest rate. | ||||||||||||||||||||||||||||||||||||||||
(B) | This amount represents unrealized losses on securities that are due to non-credit factors and recorded through other comprehensive income. | ||||||||||||||||||||||||||||||||||||||||
(C) | A portion of securities New Residential intends to sell have a fair value equal to their amortized cost basis after impairment and, therefore, do not have unrealized losses reflected in other comprehensive income as of March 31, 2015. | ||||||||||||||||||||||||||||||||||||||||
(D) | New Residential may, at times, be more likely than not to be required to sell certain securities for liquidity purposes. While the amount of the securities to be sold may be an estimate, and the securities to be sold have not yet been identified, New Residential must make its best estimate, which is subject to significant judgment regarding future events, and may differ materially from actual future sales. | ||||||||||||||||||||||||||||||||||||||||
Summary of Activity Related to Credit Losses on Debt Securities | The following table summarizes the activity related to credit losses on debt securities: | ||||||||||||||||||||||||||||||||||||||||
Three Months Ended March 31, 2015 | |||||||||||||||||||||||||||||||||||||||||
Beginning balance of credit losses on debt securities for which a portion of an OTTI was | $ | 1,127 | |||||||||||||||||||||||||||||||||||||||
recognized in other comprehensive income | |||||||||||||||||||||||||||||||||||||||||
Increases to credit losses on securities for which an OTTI was previously recognized and a portion | 6 | ||||||||||||||||||||||||||||||||||||||||
of an OTTI was recognized in other comprehensive income | |||||||||||||||||||||||||||||||||||||||||
Additions for credit losses on securities for which an OTTI was not previously recognized | 1,065 | ||||||||||||||||||||||||||||||||||||||||
Reductions for securities for which the amount previously recognized in other comprehensive | — | ||||||||||||||||||||||||||||||||||||||||
income was recognized in earnings because the entity intends to sell the security or more likely | |||||||||||||||||||||||||||||||||||||||||
than not will be required to sell the security before recovery of its amortized cost basis | |||||||||||||||||||||||||||||||||||||||||
Reduction for credit losses on securities for which no OTTI was recognized in other | — | ||||||||||||||||||||||||||||||||||||||||
comprehensive income at the current measurement date | |||||||||||||||||||||||||||||||||||||||||
Reduction for securities sold during the period | (228 | ) | |||||||||||||||||||||||||||||||||||||||
Ending balance of credit losses on debt securities for which a portion of an OTTI was recognized | $ | 1,970 | |||||||||||||||||||||||||||||||||||||||
in other comprehensive income | |||||||||||||||||||||||||||||||||||||||||
Summary of the Geographic Distribution of the Collateral Securing Non-Agency RMBS | The table below summarizes the geographic distribution of the collateral securing New Residential’s Non-Agency RMBS: | ||||||||||||||||||||||||||||||||||||||||
31-Mar-15 | 31-Dec-14 | ||||||||||||||||||||||||||||||||||||||||
Geographic Location | Outstanding Face Amount | Percentage of Total Outstanding | Outstanding Face Amount | Percentage of Total Outstanding | |||||||||||||||||||||||||||||||||||||
Western U.S. | $ | 614,391 | 33.6 | % | $ | 779,930 | 41.1 | % | |||||||||||||||||||||||||||||||||
Southeastern U.S. | 479,970 | 26.4 | % | 409,755 | 21.6 | % | |||||||||||||||||||||||||||||||||||
Northeastern U.S. | 327,308 | 18 | % | 344,716 | 18.2 | % | |||||||||||||||||||||||||||||||||||
Midwestern U.S. | 160,246 | 8.8 | % | 190,480 | 10 | % | |||||||||||||||||||||||||||||||||||
Southwestern U.S. | 238,127 | 13.1 | % | 170,829 | 9 | % | |||||||||||||||||||||||||||||||||||
Other(A) | 494 | 0.1 | % | 440 | 0.1 | % | |||||||||||||||||||||||||||||||||||
$ | 1,820,536 | 100 | % | $ | 1,896,150 | 100 | % | ||||||||||||||||||||||||||||||||||
(A) | Represents collateral for which New Residential was unable to obtain geographic information. | ||||||||||||||||||||||||||||||||||||||||
Schedule of the Outstanding Face Amount and Carrying Value for Securities Uncollectible | The following is the outstanding face amount and carrying value for securities, for which, as of the acquisition date, it was probable that New Residential would be unable to collect all contractually required payments, excluding residual and interest-only securities: | ||||||||||||||||||||||||||||||||||||||||
Outstanding Face Amount | Carrying Value | ||||||||||||||||||||||||||||||||||||||||
March 31, 2015 | $ | 234,289 | $ | 147,137 | |||||||||||||||||||||||||||||||||||||
December 31, 2014 | 536,342 | 414,298 | |||||||||||||||||||||||||||||||||||||||
Summary of Changes in Accretable Yield for Securities | The following is a summary of the changes in accretable yield for these securities: | ||||||||||||||||||||||||||||||||||||||||
Three Months Ended March 31, 2015 | |||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2014 | $ | 181,671 | |||||||||||||||||||||||||||||||||||||||
Additions | 23,599 | ||||||||||||||||||||||||||||||||||||||||
Accretion | (4,321 | ) | |||||||||||||||||||||||||||||||||||||||
Reclassifications from (to) non-accretable difference | (3,605 | ) | |||||||||||||||||||||||||||||||||||||||
Disposals | (100,536 | ) | |||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2015 | $ | 96,808 | |||||||||||||||||||||||||||||||||||||||
INVESTMENTS_IN_RESIDENTIAL_MOR1
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS (Tables) | 3 Months Ended | ||||||||||||||||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||||||||||||||||
Receivables [Abstract] | |||||||||||||||||||||||||||||||||
Schedule of Residential Mortgage Loans Outstanding by Loan Type, Excluding REO | The following table presents certain information regarding New Residential’s residential mortgage loans outstanding by loan type, excluding REO: | ||||||||||||||||||||||||||||||||
March 31, 2015 | |||||||||||||||||||||||||||||||||
Outstanding Face Amount | Carrying | Loan | Weighted Average Yield | Weighted Average Life (Years)(A) | Floating Rate Loans as a % of Face Amount | Loan to Value Ratio (“LTV”)(B) | Weighted Avg. Delinquency(C) | Weighted Average FICO(D) | December 31, 2014 Carrying Value | ||||||||||||||||||||||||
Value | Count | ||||||||||||||||||||||||||||||||
Loan Type | |||||||||||||||||||||||||||||||||
Reverse Mortgage Loans(E)(F) | $ | 42,306 | $ | 23,294 | 182 | 10 | % | 4 | 21.4 | % | 109.6 | % | 78.2 | % | N/A | $ | 24,965 | ||||||||||||||||
Performing Loans(G) | 23,548 | 21,673 | 709 | 8.7 | % | 5.8 | 17.9 | % | 79.6 | % | 0.3 | % | 620 | 22,873 | |||||||||||||||||||
Total Residential Mortgage Loans, held-for- | $ | 65,854 | $ | 44,967 | 891 | 9.6 | % | 4.7 | 19.4 | % | 98.5 | % | 53 | % | 620 | $ | 47,838 | ||||||||||||||||
investment | |||||||||||||||||||||||||||||||||
Performing Loans, held-for-sale(G) | $ | 268,731 | $ | 270,407 | 4,832 | 4.9 | % | 7 | 27.6 | % | 82.1 | % | — | % | 621 | $ | 388,485 | ||||||||||||||||
Purchased Credit Impaired (“PCI”) Loans, | 300,598 | 229,767 | 2,133 | 5.9 | % | 2.4 | 32.4 | % | 105.9 | % | 87.4 | % | 547 | 737,954 | |||||||||||||||||||
held-for-sale(H) | |||||||||||||||||||||||||||||||||
Residential Mortgage Loans, held-for-sale | $ | 569,329 | $ | 500,174 | 6,965 | 5.4 | % | 4.5 | 30.1 | % | 94.7 | % | 46.2 | % | 582 | $ | 1,126,439 | ||||||||||||||||
(A) | The weighted average life is based on the expected timing of the receipt of cash flows. | ||||||||||||||||||||||||||||||||
(B) | LTV refers to the ratio comparing the loan’s unpaid principal balance to the value of the collateral property. | ||||||||||||||||||||||||||||||||
(C) | Represents the percentage of the total principal balance that are 60+ days delinquent. | ||||||||||||||||||||||||||||||||
(D) | The weighted average FICO score is based on the weighted average of information updated and provided by the loan servicer on a monthly basis. | ||||||||||||||||||||||||||||||||
(E) | Represents a 70% interest that New Residential holds in reverse mortgage loans. The average loan balance outstanding based on total UPB is $0.3 million. 76% of these loans have reached a termination event. As a result, the borrower can no longer make draws on these loans. Each loan matures upon the occurrence of a termination event. | ||||||||||||||||||||||||||||||||
(F) | FICO scores are not used in determining how much a borrower can access via a reverse mortgage loan. | ||||||||||||||||||||||||||||||||
(G) | Includes loans that are current or less than 30 days past due at acquisition where New Residential expects to collect all contractually required principal and interest payments. Presented net of unamortized premiums of $0.7 million. | ||||||||||||||||||||||||||||||||
(H) | Includes loans with evidence of credit deterioration since origination where it is probable that New Residential will not collect all contractually required principal and interest payments. As of March 31, 2015, New Residential has placed all of these loans on nonaccrual status. | ||||||||||||||||||||||||||||||||
Summary of the Geographic Distribution of the Underlying Residential Mortgage Loans | The table below summarizes the geographic distribution of the underlying residential mortgage loans: | ||||||||||||||||||||||||||||||||
Percentage of Total Outstanding Unpaid Principal Amount as of | |||||||||||||||||||||||||||||||||
State Concentration | 31-Mar-15 | 31-Dec-14 | |||||||||||||||||||||||||||||||
New York | 11.2 | % | 12.2 | % | |||||||||||||||||||||||||||||
California | 9 | % | 15 | % | |||||||||||||||||||||||||||||
Florida | 7.1 | % | 6.3 | % | |||||||||||||||||||||||||||||
New Jersey | 5.5 | % | 7 | % | |||||||||||||||||||||||||||||
Georgia | 4.8 | % | 3.6 | % | |||||||||||||||||||||||||||||
Texas | 4.7 | % | 4.1 | % | |||||||||||||||||||||||||||||
Pennsylvania | 4.7 | % | 3.9 | % | |||||||||||||||||||||||||||||
North Carolina | 4.6 | % | 3 | % | |||||||||||||||||||||||||||||
Ohio | 4.4 | % | 3.1 | % | |||||||||||||||||||||||||||||
Illinois | 4.1 | % | 4.4 | % | |||||||||||||||||||||||||||||
Other U.S. | 39.9 | % | 37.4 | % | |||||||||||||||||||||||||||||
100 | % | 100 | % | ||||||||||||||||||||||||||||||
Schedule of Past Due Information for Performing Loans | The following table provides past due information for New Residential’s Performing Loans, which is an important indicator of credit quality and the establishment of the allowance for loan losses: | ||||||||||||||||||||||||||||||||
March 31, 2015 | |||||||||||||||||||||||||||||||||
Days Past Due | Delinquency Status(A) | ||||||||||||||||||||||||||||||||
Current | 86.1 | % | |||||||||||||||||||||||||||||||
30-59 | 13.9 | % | |||||||||||||||||||||||||||||||
60-89 | — | % | |||||||||||||||||||||||||||||||
90-119(B) | — | % | |||||||||||||||||||||||||||||||
120+(C) | — | % | |||||||||||||||||||||||||||||||
100 | % | ||||||||||||||||||||||||||||||||
(A) | Represents the percentage of the total principal balance that corresponds to loans that are in each delinquency status. | ||||||||||||||||||||||||||||||||
(B) | Includes loans 90-119 days past due and still accruing because they are generally placed on nonaccrual status at 120 days or more past due. | ||||||||||||||||||||||||||||||||
(C) | Represents nonaccrual loans. | ||||||||||||||||||||||||||||||||
Summary of Activities Related to the Carrying Value of Reverse Mortgage Loans and Performing Loans and PCI Loans Held for Investment | Activities related to the carrying value of residential mortgage loans held-for-investment were as follows: | ||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, 2015 | |||||||||||||||||||||||||||||||||
Reverse Mortgage Loans | Performing Loans | ||||||||||||||||||||||||||||||||
Balance at December 31, 2014 | $ | 24,965 | $ | 22,873 | |||||||||||||||||||||||||||||
Purchases/additional fundings | 340 | — | |||||||||||||||||||||||||||||||
Proceeds from repayments | — | (854 | ) | ||||||||||||||||||||||||||||||
Accretion of loan discount (premium) and other amortization | 1,274 | (228 | ) | ||||||||||||||||||||||||||||||
Provision for loan losses | (202 | ) | (118 | ) | |||||||||||||||||||||||||||||
Transfer of loans to other assets | (2,720 | ) | — | ||||||||||||||||||||||||||||||
Transfer of loans to real estate owned | (363 | ) | — | ||||||||||||||||||||||||||||||
Transfer of loans to held-for-sale | — | — | |||||||||||||||||||||||||||||||
Reversal of valuation provision on loans transferred to other assets | — | — | |||||||||||||||||||||||||||||||
Balance at March 31, 2015 | $ | 23,294 | $ | 21,673 | |||||||||||||||||||||||||||||
Summary of Activities Related to the Valuation Provision on Reverse Mortgage Loans and Allowance for Loan Losses on Performing Loans | Activities related to the valuation provision on reverse mortgage loans and allowance for loan losses on performing loans held-for-investment were as follows: | ||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, 2015 | |||||||||||||||||||||||||||||||||
Reverse Mortgage Loans | Performing Loans | ||||||||||||||||||||||||||||||||
Balance at December 31, 2014 | $ | 1,518 | $ | 1,447 | |||||||||||||||||||||||||||||
Allowance for loan losses(A) | 202 | 118 | |||||||||||||||||||||||||||||||
Charge-offs(B) | — | (1,371 | ) | ||||||||||||||||||||||||||||||
Reversal of valuation provision on loans transferred to other assets | — | — | |||||||||||||||||||||||||||||||
Balance at March 31, 2015 | $ | 1,720 | $ | 194 | |||||||||||||||||||||||||||||
(A) | Based on an analysis of collective borrower performance, credit ratings of borrowers, loan-to-value ratios, estimated value of the underlying collateral, key terms of the loans and historical and anticipated trends in defaults and loss severities at a pool level. | ||||||||||||||||||||||||||||||||
(B) | Loans, other than PCI loans, are generally charged off or charged down to the net realizable value of the collateral (i.e., fair value less costs to sell), with an offset to the allowance for loan losses, when available information confirms that loans are uncollectible. | ||||||||||||||||||||||||||||||||
Summary of Activities Related to the Carrying Value of Loans Held-for-sale | Activities related to the carrying value of loans held-for-sale were as follows: | ||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, 2015 | |||||||||||||||||||||||||||||||||
Loans Held-for-Sale | |||||||||||||||||||||||||||||||||
Balance at December 31, 2014 | $ | 1,126,439 | |||||||||||||||||||||||||||||||
Purchases(A) | — | ||||||||||||||||||||||||||||||||
Sales | (606,155 | ) | |||||||||||||||||||||||||||||||
Transfer of loans to real estate owned | (15,417 | ) | |||||||||||||||||||||||||||||||
Adoption of ASU 2014-11(B) | 1,831 | ||||||||||||||||||||||||||||||||
Proceeds from repayments | (5,682 | ) | |||||||||||||||||||||||||||||||
Valuation provision on loans(C) | (842 | ) | |||||||||||||||||||||||||||||||
Balance at March 31, 2015 | $ | 500,174 | |||||||||||||||||||||||||||||||
(A) | Represents loans acquired with the intent to sell. | ||||||||||||||||||||||||||||||||
(B) | Represents loans financed with the selling counterparty that were previously accounted for as linked transactions. | ||||||||||||||||||||||||||||||||
(C) | Represents the fair value adjustments to loans upon transfer to held-for-sale and provision recorded on certain purchased held-for-sale loans. |
INVESTMENTS_IN_CONSUMER_LOANS_1
INVESTMENTS IN CONSUMER LOANS, EQUITY METHOD INVESTEES (Tables) | 3 Months Ended | ||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||
Investments In Consumer Loans Equity Method Investees [Abstract] | |||||||||||||||||||
Summary of the Investment in Consumer Loan Companies | The following tables summarize the investment in the Consumer Loan Companies held by New Residential: | ||||||||||||||||||
March 31, 2015 | December 31, 2014 | ||||||||||||||||||
Consumer loan assets (amortized cost basis) | $ | 1,981,271 | $ | 2,088,330 | |||||||||||||||
Other assets | 92,028 | 92,051 | |||||||||||||||||
Debt | (2,282,438 | ) | (2,411,421 | ) | |||||||||||||||
Other liabilities | (5,854 | ) | (12,340 | ) | |||||||||||||||
Equity | $ | (214,993 | ) | $ | (243,380 | ) | |||||||||||||
New Residential’s investment | $ | — | $ | — | |||||||||||||||
New Residential’s ownership | 30 | % | 30 | % | |||||||||||||||
Three Months Ended March 31, | |||||||||||||||||||
2015 | 2014 | ||||||||||||||||||
Interest income | $ | 121,869 | $ | 142,815 | |||||||||||||||
Interest expense | (23,107 | ) | (22,195 | ) | |||||||||||||||
Provision for finance receivable losses | (19,636 | ) | (34,156 | ) | |||||||||||||||
Other expenses, net | (15,964 | ) | (20,452 | ) | |||||||||||||||
Change in fair value of debt | — | (16,867 | ) | ||||||||||||||||
Net income | $ | 63,162 | $ | 49,145 | |||||||||||||||
New Residential’s equity in net income (through October 3, 2014) | $ | — | $ | 16,360 | |||||||||||||||
New Residential’s ownership | 30 | % | 30 | % | |||||||||||||||
Summary of Consumer Loan Investments made through Equity Method Investees | The following is a summary of New Residential’s consumer loan investments made through equity method investees: | ||||||||||||||||||
Unpaid Principal Balance(A) | Interest in Consumer Loan Companies | Carrying Value(B) | Weighted Average Coupon(C) | Weighted Average Yield | Weighted Average Expected Life (Years)(D) | ||||||||||||||
31-Mar-15 | $ | 2,460,743 | 30 | % | $ | 1,981,271 | 18.2 | % | 16.3 | % | 3.6 | ||||||||
31-Dec-14 | $ | 2,589,748 | 30 | % | $ | 2,088,330 | 18.1 | % | 16.1 | % | 3.6 | ||||||||
(A) | Represents the February 28, 2015 and November 30, 2014 balances, respectively. | ||||||||||||||||||
(B) | Represents the carrying value of the consumer loans held by the Consumer Loan Companies. | ||||||||||||||||||
(C) | Substantially all of the cash flows received on the loans is required to be used to make payments on the notes described above. | ||||||||||||||||||
(D) | Weighted Average Expected Life represents the weighted average expected timing of the receipt of expected cash flows for this investment. |
DERIVATIVES_Tables
DERIVATIVES (Tables) | 3 Months Ended | |||||||||
Mar. 31, 2015 | ||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||
Schedule of Derivatives | New Residential’s derivatives are recorded at fair value on the Condensed Consolidated Balance Sheets as follows: | |||||||||
Balance Sheet Location | 31-Mar-15 | 31-Dec-14 | ||||||||
Derivative assets | ||||||||||
Real Estate Securities(A) | Derivative assets | $ | — | $ | 32,090 | |||||
Non-Performing Loans(A) | Derivative assets | — | 312 | |||||||
Interest Rate Caps | Derivative assets | 71 | 195 | |||||||
$ | 71 | $ | 32,597 | |||||||
Derivative liabilities | ||||||||||
TBAs | Accrued expenses and other liabilities | $ | 8,539 | $ | 4,985 | |||||
Interest Rate Swaps | Accrued expenses and other liabilities | 12,588 | 9,235 | |||||||
$ | 21,127 | $ | 14,220 | |||||||
(A) | For December 31, 2014, investments purchased from, and financed by, the selling counterparty that New Residential accounted for as linked transactions are reflected as derivatives. Upon the adoption of ASU 2014-11 on January 1, 2015, these transactions are accounted for as secured borrowings. | |||||||||
The following table summarizes notional amounts related to derivatives: | ||||||||||
March 31, 2015 | December 31, 2014 | |||||||||
Non-Performing Loans(A) | $ | — | $ | 2,931 | ||||||
Real Estate Securities(B) | — | 186,694 | ||||||||
TBAs, short position(C) | 980,000 | 1,234,000 | ||||||||
Interest Rate Caps(D) | 210,000 | 210,000 | ||||||||
Interest Rate Swaps, short position(E) | 1,107,000 | 1,107,000 | ||||||||
(A) | For December 31, 2014, represents the UPB of the underlying loans of the non-performing loan pools within linked transactions. | |||||||||
(B) | For December 31, 2014, represents the face amount of the real estate securities within linked transactions. | |||||||||
(C) | Represents the notional amount of Agency RMBS, classified as derivatives. | |||||||||
(D) | Caps LIBOR at 3.0%. | |||||||||
(E) | Receive LIBOR and pay a fixed rate. | |||||||||
The following table summarizes gains (losses) recorded in relation to derivatives: | ||||||||||
For the Three Months Ended March 31, | ||||||||||
2015 | 2014 | |||||||||
Other income (loss) | ||||||||||
Non-Performing Loans(A) | $ | — | $ | 671 | ||||||
TBAs | (3,554 | ) | 362 | |||||||
Interest Rate Swaps | (3,352 | ) | (84 | ) | ||||||
U.S.T. Short Positions | — | 408 | ||||||||
Interest Rate Caps | (124 | ) | — | |||||||
(7,030 | ) | 1,357 | ||||||||
Gain (loss) on settlement of investments | ||||||||||
Real Estate Securities(A) | — | — | ||||||||
TBAs | (16,033 | ) | 43 | |||||||
Interest Rate Swaps | (6,557 | ) | (178 | ) | ||||||
(22,590 | ) | (135 | ) | |||||||
Total gains (losses) | $ | (29,620 | ) | $ | 1,222 | |||||
(A) | For December 31, 2014, investments purchased from, and financed by, the selling counterparty that New Residential accounts for as linked transactions are reflected as derivatives. Upon the adoption of ASU 2014-11 on January 1, 2015, these transactions are accounted for as secured borrowings. |
DEBT_OBLIGATIONS_Tables
DEBT OBLIGATIONS (Tables) | 3 Months Ended | |||||||||||||||||||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||
Schedule of Debt Obligations | Activities related to the carrying value of New Residential’s debt obligations were as follows: | |||||||||||||||||||||||||||||||||||
Servicer Advances | Real Estate Securities | Real Estate Loans | Other | Total | ||||||||||||||||||||||||||||||||
Balance at December 31, 2014(A) | $ | 2,890,230 | $ | 2,246,651 | $ | 925,418 | $ | — | $ | 6,062,299 | ||||||||||||||||||||||||||
Repurchase Agreements | ||||||||||||||||||||||||||||||||||||
Borrowings | — | 1,089,257 | 31,864 | — | 1,121,121 | |||||||||||||||||||||||||||||||
Modified retrospective adjustment for the adoption of ASU No. 2014-11 | — | 84,649 | 1,306 | — | 85,955 | |||||||||||||||||||||||||||||||
Repayments | — | (1,491,666 | ) | (525,111 | ) | — | (2,016,777 | ) | ||||||||||||||||||||||||||||
Notes Payable | ||||||||||||||||||||||||||||||||||||
Borrowings | 380,702 | — | 1,632 | 100,000 | 482,334 | |||||||||||||||||||||||||||||||
Repayments | (395,520 | ) | — | (605 | ) | — | (396,125 | ) | ||||||||||||||||||||||||||||
Balance at March 31, 2015 | $ | 2,875,412 | $ | 1,928,891 | $ | 434,504 | $ | 100,000 | $ | 5,338,807 | ||||||||||||||||||||||||||
(A) Excludes debt related to linked transactions (Note 10). | ||||||||||||||||||||||||||||||||||||
The following table presents certain information regarding New Residential’s debt obligations: | ||||||||||||||||||||||||||||||||||||
31-Mar-15 | 31-Dec-14 | |||||||||||||||||||||||||||||||||||
Collateral | ||||||||||||||||||||||||||||||||||||
Debt Obligations/Collateral | Month Issued | Outstanding Face Amount | Carrying Value | Final Stated Maturity | Weighted Average Funding Cost | Weighted Average Life (Years) | Outstanding Face | Amortized Cost Basis | Carrying Value | Weighted Average Life (Years) | Carrying Value | |||||||||||||||||||||||||
Repurchase Agreements(A) | ||||||||||||||||||||||||||||||||||||
Agency | Various | $ | 1,612,972 | $ | 1,612,972 | Apr-15 to May-15 | 0.36 | % | 0.1 | $ | 1,575,759 | $ | 1,659,781 | $ | 1,664,996 | 5.4 | $ | 1,707,602 | ||||||||||||||||||
RMBS(B) | ||||||||||||||||||||||||||||||||||||
Non-Agency | Various | 315,919 | 315,919 | Apr-15 to Jun-15 | 1.77 | % | 0.1 | 1,500,816 | 428,696 | 439,579 | 9 | 539,049 | ||||||||||||||||||||||||
RMBS (C) | ||||||||||||||||||||||||||||||||||||
Residential | Various | 392,521 | 392,521 | May-15 to Aug-16 | 2.37 | % | 0.8 | 584,085 | 514,109 | 514,109 | 4.6 | 867,334 | ||||||||||||||||||||||||
Mortgage | ||||||||||||||||||||||||||||||||||||
Loans(D) | ||||||||||||||||||||||||||||||||||||
Real Estate | Various | 17,977 | 17,977 | May-15 to Aug-16 | 2.82 | % | 1.1 | N/A | N/A | 33,408 | N/A | 35,105 | ||||||||||||||||||||||||
Owned(E) | ||||||||||||||||||||||||||||||||||||
Total | 2,339,389 | 2,339,389 | 0.91 | % | 0.2 | 3,149,090 | ||||||||||||||||||||||||||||||
Repurchase | ||||||||||||||||||||||||||||||||||||
Agreements | ||||||||||||||||||||||||||||||||||||
Notes Payable | ||||||||||||||||||||||||||||||||||||
Secured | 15-Jan | 100,000 | 100,000 | 15-Jul | 3.93 | % | 0.3 | 105,939,876 | 239,540 | 279,404 | 5.3 | — | ||||||||||||||||||||||||
Corporate | ||||||||||||||||||||||||||||||||||||
Loan (F) | ||||||||||||||||||||||||||||||||||||
Servicer | Various | 2,875,412 | 2,875,412 | Dec-15 to Mar-17 | 2.62 | % | 1.4 | 3,068,306 | 3,168,909 | 3,245,457 | 3.9 | 2,890,230 | ||||||||||||||||||||||||
Advances(G) | ||||||||||||||||||||||||||||||||||||
Residential | 14-Oct | 23,604 | 23,604 | 15-Oct | 3.08 | % | 0.6 | 42,306 | 25,013 | 23,294 | 4 | 22,194 | ||||||||||||||||||||||||
Mortgage | ||||||||||||||||||||||||||||||||||||
Loans(H) | ||||||||||||||||||||||||||||||||||||
Real Estate | 14-Oct | 402 | 402 | 15-Oct | 3.08 | % | 0.6 | N/A | N/A | 397 | N/A | 785 | ||||||||||||||||||||||||
Owned(H) | ||||||||||||||||||||||||||||||||||||
Total Notes | 2,999,418 | 2,999,418 | 2.66 | % | 1.3 | 2,913,209 | ||||||||||||||||||||||||||||||
Payable | ||||||||||||||||||||||||||||||||||||
Total/ Weighted | $ | 5,338,807 | $ | 5,338,807 | 1.9 | % | 0.8 | $ | 6,062,299 | |||||||||||||||||||||||||||
Average | ||||||||||||||||||||||||||||||||||||
(A) | These repurchase agreements had approximately $2.0 million of associated accrued interest payable as of March 31, 2015. | |||||||||||||||||||||||||||||||||||
(B) | The counterparties of these repurchase agreements are Mizuho ($89.6 million), Morgan Stanley ($73.3 million), Barclays ($788.7 million), Daiwa ($338.9 million) and Jefferies ($322.5 million) and were subject to customary margin call provisions. All of the Agency RMBS repurchase agreements have a fixed rate. | |||||||||||||||||||||||||||||||||||
(C) | The counterparties of these repurchase agreements are Barclays ($5.6 million), Credit Suisse ($107.3 million), Royal Bank of Canada ($10.2 million), Bank of America, N.A. ($80.1 million), Goldman Sachs ($60.9 million) and UBS ($51.8 million) and were subject to customary margin call provisions. All of the Non-Agency repurchase agreements have LIBOR-based floating interest rates. | |||||||||||||||||||||||||||||||||||
(D) | The counterparties on these repurchase agreements are Bank of America N.A. ($39.5 million maturing in August 2016), Nomura ($68.7 million maturing in May 2016), Citibank ($4.8 million maturing in May 2015) and Credit Suisse ($279.5 million maturing in November 2015). All of these repurchase agreements have LIBOR-based floating interest rates. | |||||||||||||||||||||||||||||||||||
(E) | The counterparties of these repurchase agreements are Credit Suisse ($1.2 million), Bank of America, N.A. ($2.0 million), Citibank ($0.4 million) and Nomura ($14.4 million). All of these repurchase agreements have LIBOR-based floating interest rates. | |||||||||||||||||||||||||||||||||||
(F) | The loan bears interest equal to the sum of (i) a floating rate index equal to one-month LIBOR and (ii) a margin of 3.75%. The outstanding face of the collateral represents the UPB of the residential mortgage loans underlying the Excess MSRs that secure this corporate loan. | |||||||||||||||||||||||||||||||||||
(G) | $0.7 billion face amount of the notes have a fixed rate while the remaining notes bear interest equal to the sum of (i) a floating rate index rate equal to one-month LIBOR or a cost of funds rate, as applicable, and (ii) a margin ranging from 1.9% to 2.0%. | |||||||||||||||||||||||||||||||||||
(H) | The note is payable to Nationstar and bears interest equal to one-month LIBOR plus 2.875%. | |||||||||||||||||||||||||||||||||||
Schedule of Contractual Maturities of Debt Obligations | New Residential’s debt obligations as of March 31, 2015 had contractual maturities as follows: | |||||||||||||||||||||||||||||||||||
Year | Nonrecourse | Recourse | Total | |||||||||||||||||||||||||||||||||
April 1 through December 31, 2015 | $ | 150,128 | $ | 2,338,753 | $ | 2,488,881 | ||||||||||||||||||||||||||||||
2016 | 2,107,255 | 41,473 | 2,148,728 | |||||||||||||||||||||||||||||||||
2017 | 701,198 | — | 701,198 | |||||||||||||||||||||||||||||||||
$ | 2,958,581 | $ | 2,380,226 | $ | 5,338,807 | |||||||||||||||||||||||||||||||
Schedule of Borrowing Capacity | The following table represents New Residential’s borrowing capacity as of March 31, 2015: | |||||||||||||||||||||||||||||||||||
Debt Obligations/ Collateral | Collateral Type | Borrowing Capacity | Balance Outstanding | Available Financing | ||||||||||||||||||||||||||||||||
Repurchase Agreements | ||||||||||||||||||||||||||||||||||||
Residential Mortgage Loans | Real Estate Loans | $ | 1,720,000 | $ | 410,498 | $ | 1,309,502 | |||||||||||||||||||||||||||||
Notes Payable | ||||||||||||||||||||||||||||||||||||
Servicer Advances(A) | Servicer Advances | 3,300,000 | 2,875,412 | 424,588 | ||||||||||||||||||||||||||||||||
$ | 5,020,000 | $ | 3,285,910 | $ | 1,734,090 | |||||||||||||||||||||||||||||||
(A) | New Residential’s unused borrowing capacity is available if New Residential has additional eligible collateral to pledge and meets other borrowing conditions as set forth in the applicable agreements, including any applicable advance rate. New Residential pays a 0.3% fee on the unused borrowing capacity. |
FAIR_VALUE_OF_FINANCIAL_INSTRU1
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 3 Months Ended | |||||||||||||||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||
Schedule of Carrying Values and Fair Values of Financial Assets Recorded at Fair Value on a Recurring Basis | The carrying values and fair values of New Residential’s financial assets recorded at fair value on a recurring basis, as well as other financial instruments for which fair value is disclosed, as of March 31, 2015 were as follows: | |||||||||||||||||||||||||||||||
Fair Value | ||||||||||||||||||||||||||||||||
Principal Balance or Notional Amount | Carrying Value | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||
Investments in: | ||||||||||||||||||||||||||||||||
Excess mortgage servicing rights, at fair | $ | 163,572,436 | $ | 526,662 | $ | — | $ | — | $ | 526,662 | $ | 526,662 | ||||||||||||||||||||
value(A) | ||||||||||||||||||||||||||||||||
Excess mortgage servicing rights, equity | 84,000,746 | 225,111 | — | — | 225,111 | 225,111 | ||||||||||||||||||||||||||
method investees, at fair value(A) | ||||||||||||||||||||||||||||||||
Servicer advances | 3,068,306 | 3,245,457 | — | — | 3,245,457 | 3,245,457 | ||||||||||||||||||||||||||
Real estate securities, available-for-sale | 3,396,295 | 2,324,915 | — | 1,664,996 | 659,919 | 2,324,915 | ||||||||||||||||||||||||||
Residential mortgage loans, held-for- | 65,854 | 44,967 | — | — | 45,900 | 45,900 | ||||||||||||||||||||||||||
investment | ||||||||||||||||||||||||||||||||
Residential mortgage loans, held-for- | 569,329 | 500,174 | — | — | 506,986 | 506,986 | ||||||||||||||||||||||||||
sale | ||||||||||||||||||||||||||||||||
Non-hedge derivatives | 210,000 | 71 | — | 71 | — | 71 | ||||||||||||||||||||||||||
Cash and cash equivalents | 459,334 | 459,334 | 459,334 | — | — | 459,334 | ||||||||||||||||||||||||||
Restricted cash | 28,325 | 28,325 | 28,325 | — | — | 28,325 | ||||||||||||||||||||||||||
$ | 7,355,016 | $ | 487,659 | $ | 1,665,067 | $ | 5,210,035 | $ | 7,362,761 | |||||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||||||||
Repurchase agreements | $ | 2,339,389 | $ | 2,339,389 | $ | — | $ | 1,928,891 | $ | 410,498 | $ | 2,339,389 | ||||||||||||||||||||
Notes payable | 2,999,418 | 2,999,418 | — | — | 2,999,418 | 2,999,418 | ||||||||||||||||||||||||||
Derivative liabilities | 2,087,000 | 21,127 | — | 21,127 | — | 21,127 | ||||||||||||||||||||||||||
$ | 5,359,934 | $ | — | $ | 1,950,018 | $ | 3,409,916 | $ | 5,359,934 | |||||||||||||||||||||||
(A) | The notional amount represents the total unpaid principal balance of the mortgage loans underlying the Excess MSRs. New Residential does not receive an excess mortgage servicing amount on non-performing loans in Agency portfolios. | |||||||||||||||||||||||||||||||
Schedule of Financial Assets Measured at Fair Value on a Recurring Basis using Level 3 Inputs | New Residential’s financial assets measured at fair value on a recurring basis using Level 3 inputs changed as follows: | |||||||||||||||||||||||||||||||
Level 3 | ||||||||||||||||||||||||||||||||
Excess MSRs(A) | Excess MSRs in Equity Method Investees(A)(B) | |||||||||||||||||||||||||||||||
Agency | Non-Agency | Agency | Non-Agency | Servicer Advances | Non-Agency RMBS | Linked Transactions | Total | |||||||||||||||||||||||||
Balance at December 31, 2014 | $ | 217,519 | $ | 200,214 | $ | 232,618 | $ | 98,258 | $ | 3,270,839 | $ | 723,000 | $ | 32,402 | $ | 4,774,850 | ||||||||||||||||
Transfers(C) | ||||||||||||||||||||||||||||||||
Transfers from Level 3 | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Transfers to Level 3 | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Transfers from investments in excess mortgage servicing rights, equity method investees, to investments in excess mortgage servicing rights | — | 98,258 | — | (98,258 | ) | — | — | — | — | |||||||||||||||||||||||
Gains (losses) included in net income | ||||||||||||||||||||||||||||||||
Included in other-than-temporary | — | — | — | — | — | (1,071 | ) | — | (1,071 | ) | ||||||||||||||||||||||
impairment (“OTTI”) on securities(D) | ||||||||||||||||||||||||||||||||
Included in change in fair value of | (234 | ) | (1,527 | ) | — | — | — | — | — | (1,761 | ) | |||||||||||||||||||||
investments in excess mortgage | ||||||||||||||||||||||||||||||||
servicing rights(D) | ||||||||||||||||||||||||||||||||
Included in change in fair value of | — | — | 4,921 | — | — | — | — | 4,921 | ||||||||||||||||||||||||
investments in excess mortgage | ||||||||||||||||||||||||||||||||
servicing rights, equity method | ||||||||||||||||||||||||||||||||
investees(D) | ||||||||||||||||||||||||||||||||
Included in change in fair value of | — | — | — | — | (7,669 | ) | — | — | (7,669 | ) | ||||||||||||||||||||||
investments in servicer advances | ||||||||||||||||||||||||||||||||
Included in gain on settlement of | — | — | — | — | — | 3,808 | — | 3,808 | ||||||||||||||||||||||||
investments, net | ||||||||||||||||||||||||||||||||
Included in other income(D) | 730 | — | — | — | — | — | — | 730 | ||||||||||||||||||||||||
Gains (losses) included in other | — | — | — | — | — | (481 | ) | — | (481 | ) | ||||||||||||||||||||||
comprehensive income, net of tax(E) | ||||||||||||||||||||||||||||||||
Interest income | 6,458 | 8,579 | — | — | 42,349 | 8,450 | — | 65,836 | ||||||||||||||||||||||||
Purchases, sales, repayments and transfers | ||||||||||||||||||||||||||||||||
Purchases | 26,479 | — | — | — | 1,765,294 | 222,102 | — | 2,013,875 | ||||||||||||||||||||||||
Proceeds from sales | — | — | — | — | — | (389,719 | ) | — | (389,719 | ) | ||||||||||||||||||||||
Proceeds from repayments | (11,973 | ) | (17,841 | ) | (12,428 | ) | — | (1,825,356 | ) | (23,002 | ) | — | (1,890,600 | ) | ||||||||||||||||||
De-linked transactions(F) | — | — | — | — | — | 116,832 | (32,402 | ) | 84,430 | |||||||||||||||||||||||
Balance at March 31, 2015 | $ | 238,979 | $ | 287,683 | $ | 225,111 | $ | — | $ | 3,245,457 | $ | 659,919 | $ | — | $ | 4,657,149 | ||||||||||||||||
(A) | Includes the Recapture Agreement for each respective pool. | |||||||||||||||||||||||||||||||
(B) | Amounts represent New Residential’s portion of the Excess MSRs held by the respective joint ventures in which New Residential has a 50% interest. | |||||||||||||||||||||||||||||||
(C) | Transfers are assumed to occur at the beginning of each respective period. | |||||||||||||||||||||||||||||||
(D) | The gains (losses) recorded in earnings during the period are attributable to the change in unrealized gains (losses) relating to Level 3 assets still held at the reporting dates. | |||||||||||||||||||||||||||||||
(E) | These gains (losses) were included in net unrealized gain (loss) on securities in the Condensed Consolidated Statements of Comprehensive Income. | |||||||||||||||||||||||||||||||
(F) | See Note 10 for a discussion of transactions formerly accounted for as linked transactions. | |||||||||||||||||||||||||||||||
Summary of Certain Information Regarding the Inputs used in Valuing the Servicer Advances | The following table summarizes certain information regarding the weighted average inputs used in valuing the Excess MSRs owned directly and through equity method investees as of March 31, 2015: | |||||||||||||||||||||||||||||||
Significant Inputs(A) | ||||||||||||||||||||||||||||||||
Directly Held (Note 4) | Prepayment Speed(B) | Delinquency(C) | Recapture Rate(D) | Excess Mortgage Servicing Amount | ||||||||||||||||||||||||||||
(bps)(E) | ||||||||||||||||||||||||||||||||
Agency | ||||||||||||||||||||||||||||||||
Original and Recaptured Pools | 10.1 | % | 5.4 | % | 31.5 | % | 21 | |||||||||||||||||||||||||
Recapture Agreement | 7.9 | % | 5 | % | 19.9 | % | 21 | |||||||||||||||||||||||||
10 | % | 5.4 | % | 30.8 | % | 21 | ||||||||||||||||||||||||||
Non-Agency(F) | ||||||||||||||||||||||||||||||||
Original and Recaptured Pools | 12.7 | % | N/A | 10.2 | % | 14 | ||||||||||||||||||||||||||
Recapture Agreement | 8 | % | N/A | 20 | % | 20 | ||||||||||||||||||||||||||
12.5 | % | N/A | 10.7 | % | 14 | |||||||||||||||||||||||||||
Total/Weighted Average--Directly Held | 11.5 | % | 5.4 | % | 18.9 | % | 17 | |||||||||||||||||||||||||
Held through Equity Method Investees (Note 5) | ||||||||||||||||||||||||||||||||
Agency | ||||||||||||||||||||||||||||||||
Original and Recaptured Pools | 13 | % | 6.5 | % | 33.5 | % | 19 | |||||||||||||||||||||||||
Recapture Agreement | 8 | % | 5 | % | 20 | % | 23 | |||||||||||||||||||||||||
Total/Weighted Average--Held through Investees | 12.1 | % | 6.2 | % | 31.1 | % | 19 | |||||||||||||||||||||||||
Total/Weighted Average--All Pools | 11.7 | % | 5.7 | % | 24.5 | % | 18 | |||||||||||||||||||||||||
(A) | Weighted by amortized cost basis of the mortgage loan portfolio. | |||||||||||||||||||||||||||||||
(B) | Projected annualized weighted average lifetime voluntary and involuntary prepayment rate using a prepayment vector. | |||||||||||||||||||||||||||||||
(C) | Projected percentage of mortgage loans in the pool that will miss their mortgage payments. | |||||||||||||||||||||||||||||||
(D) | Percentage of voluntarily prepaid loans that are expected to be refinanced by Nationstar. | |||||||||||||||||||||||||||||||
(E) | Weighted average total mortgage servicing amount in excess of the basic fee. | |||||||||||||||||||||||||||||||
(F) | For certain pools, the Excess MSR will be paid on the total UPB of the mortgage portfolio (including both performing and delinquent loans until REO). For these pools, no delinquency assumption is used. | |||||||||||||||||||||||||||||||
Summary of Certain Information Regarding the Inputs used in Valuing the Servicer Advances | The following table summarizes certain information regarding the inputs used in valuing the servicer advances: | |||||||||||||||||||||||||||||||
Significant Inputs | ||||||||||||||||||||||||||||||||
Weighted Average | ||||||||||||||||||||||||||||||||
Outstanding Servicer Advances to UPB of Underlying Residential Mortgage Loans | Prepayment Speed | Delinquency | Mortgage Servicing Amount(A) | Discount Rate | ||||||||||||||||||||||||||||
March 31, 2015 | 2.1 | % | 12.5 | % | 14.3 | % | 19.4 | bps | 5.4 | % | ||||||||||||||||||||||
(A) | Mortgage servicing amount excludes the amounts New Residential pays Nationstar and SLS as a monthly servicing fee. | |||||||||||||||||||||||||||||||
Schedule of Securities Valuation Methodology and Results | As of March 31, 2015, New Residential’s securities valuation methodology and results are further detailed as follows: | |||||||||||||||||||||||||||||||
Fair Value | ||||||||||||||||||||||||||||||||
Asset Type | Outstanding Face Amount | Amortized Cost Basis | Multiple Quotes(A) | Single Quote(B) | Total | Level | ||||||||||||||||||||||||||
Agency RMBS | $ | 1,575,759 | $ | 1,659,781 | $ | 1,664,996 | $ | — | $ | 1,664,996 | 2 | |||||||||||||||||||||
Non-Agency RMBS(C) | 1,820,536 | 647,915 | 650,746 | 9,173 | 659,919 | 3 | ||||||||||||||||||||||||||
Total | $ | 3,396,295 | $ | 2,307,696 | $ | 2,315,742 | $ | 9,173 | $ | 2,324,915 | ||||||||||||||||||||||
(A) | Management generally obtained pricing service quotations or broker quotations from two sources, one of which was generally the seller (the party that sold New Residential the security) for Non-Agency RMBS. Management selected one of the quotes received as being most representative of the fair value and did not use an average of the quotes. Even if New Residential receives two or more quotes on a particular security that come from non-selling brokers or pricing services, it does not use an average because management believes using an actual quote more closely represents a transactable price for the security than an average level. Furthermore, in some cases there is a wide disparity between the quotes New Residential receives. Management believes using an average of the quotes in these cases would not represent the fair value of the asset. Based on New Residential’s own fair value analysis, management selects one of the quotes which is believed to more accurately reflect fair value. New Residential never adjusts quotes received. These quotations are generally received via email and contain disclaimers which state that they are “indicative” and not “actionable” — meaning that the party giving the quotation is not bound to actually purchase the security at the quoted price. | |||||||||||||||||||||||||||||||
(B) | Management was unable to obtain quotations from more than one source on these securities. The one source was the seller (the party that sold New Residential the security). | |||||||||||||||||||||||||||||||
(C) | Includes New Residential’s investments in interest-only notes for which the fair value option for financial instruments was elected. | |||||||||||||||||||||||||||||||
Schedule of Inputs Used in Valuing Residential Mortgage Loans | The following table summarizes the inputs used in valuing these residential mortgage loans as of March 31, 2015: | |||||||||||||||||||||||||||||||
March 31, 2015 | Fair Value | Discount Rate | Weighted Average Life (Years) (A) | Prepayment Rate | CDR(B) | Loss Severity(C) | ||||||||||||||||||||||||||
PCI Loans | $ | 213,058 | 5.5 | % | 2.4 | 3 | % | N/A | 50 | % | ||||||||||||||||||||||
(A) | The weighted average life is based on the expected timing of the receipt of cash flows. | |||||||||||||||||||||||||||||||
(B) | Represents the annualized rate of the involuntary prepayments (defaults) as a percentage of the total principal balance. | |||||||||||||||||||||||||||||||
(C) | Loss severity is the expected amount of future realized losses resulting from the ultimate liquidation of a particular loan, expressed as the net amount of loss relative to the outstanding loan balance. | |||||||||||||||||||||||||||||||
The following table summarizes the inputs used in valuing residential mortgage loans as of March 31, 2015: | ||||||||||||||||||||||||||||||||
Carrying Value | Fair Value | Valuation Provision/ (Reversal) In Current Year | Discount Rate | Weighted Average Life (Years)(A) | Prepayment Rate | CDR(B) | Loss Severity(C) | |||||||||||||||||||||||||
Reverse Mortgage Loans(D) | $ | 23,294 | $ | 23,294 | $ | 202 | 10 | % | 4 | N/A | N/A | 6.3 | % | |||||||||||||||||||
Performing Loans | 292,080 | 296,970 | N/A | 4.9 | % | 6.9 | 6 | % | 2.1 | % | 46.1 | % | ||||||||||||||||||||
PCI Loans | 16,709 | 19,564 | N/A | 5.5 | % | 2.4 | 3 | % | N/A | 50 | % | |||||||||||||||||||||
Total/Weighted Average | $ | 332,083 | $ | 339,828 | $ | 202 | 5.3 | % | 6.4 | 43.5 | % | |||||||||||||||||||||
(A) | The weighted average life is based on the expected timing of the receipt of cash flows. | |||||||||||||||||||||||||||||||
(B) | Represents the annualized rate of the involuntary prepayments (defaults) as a percentage of the total principal balance. | |||||||||||||||||||||||||||||||
(C) | Loss severity is the expected amount of future realized losses resulting from the ultimate liquidation of a particular loan, expressed as the net amount of loss relative to the outstanding loan balance. | |||||||||||||||||||||||||||||||
(D) | Carrying value and fair value represent a 70% interest New Residential holds in the reverse mortgage loans. |
EQUITY_AND_EARNINGS_PER_SHARE_
EQUITY AND EARNINGS PER SHARE (Tables) | 3 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Equity and Earnings Per Share [Abstract] | ||||||||||||||||
Summary of Outstanding Options | As of March 31, 2015, New Residential’s outstanding options were summarized as follows: | |||||||||||||||
Issued Prior to 2011 | Issued in 2011-2014 | Total | ||||||||||||||
Held by the Manager | 343,440 | 8,173,847 | 8,517,287 | |||||||||||||
Issued to the Manager and subsequently transferred to certain of the | 90,560 | 1,959,247 | 2,049,807 | |||||||||||||
Manager’s employees | ||||||||||||||||
Issued to the independent directors | 1,000 | 4,000 | 5,000 | |||||||||||||
Total | 435,000 | 10,137,094 | 10,572,094 | |||||||||||||
The following table summarizes New Residential’s outstanding options as of March 31, 2015. The last sales price on the New York Stock Exchange for New Residential’s common stock in the quarter ended March 31, 2015 was $15.03 per share. | ||||||||||||||||
Recipient | Date of | Number of | Options | Weighted | Intrinsic | |||||||||||
Grant/ | Options | Exercisable | Average | Value as of | ||||||||||||
Exercise(A) | as of | Exercise | March 31, | |||||||||||||
March 31, | Price(B) | 2015 | ||||||||||||||
2015 | (millions) | |||||||||||||||
Directors | Various | 6,000 | 5,000 | $ | 17.54 | $ | — | |||||||||
Manager(C) | 2003 - 2007 | 1,226,555 | 434,000 | 31.36 | — | |||||||||||
Manager(C) | 11-Mar | 838,417 | 547,583 | 6.58 | 4.6 | |||||||||||
Manager(C) | 11-Sep | 1,269,917 | 849,916 | 4.98 | 8.5 | |||||||||||
Manager(C) | 12-Apr | 948,750 | 920,983 | 6.82 | 7.6 | |||||||||||
Manager(C) | 12-May | 1,150,000 | 1,117,333 | 7.34 | 8.6 | |||||||||||
Manager(C) | 12-Jul | 1,265,000 | 1,234,783 | 7.34 | 9.5 | |||||||||||
Manager(C) | 13-Jan | 2,875,000 | 2,491,665 | 10.24 | 11.9 | |||||||||||
Manager(C) | 13-Feb | 1,150,000 | 958,332 | 11.48 | 3.4 | |||||||||||
Manager(C) | 14-Apr | 1,437,500 | 527,083 | 12.2 | 1.5 | |||||||||||
Exercised(D) | 2013-2014 | (802,492 | ) | N/A | 5.81 | N/A | ||||||||||
Expired unexercised | 2003-2005 | (792,553 | ) | N/A | N/A | N/A | ||||||||||
Outstanding | 10,572,094 | 9,086,678 | ||||||||||||||
(A) | Options expire on the tenth anniversary from date of grant. | |||||||||||||||
(B) | The strike prices are subject to adjustment in connection with return of capital dividends. | |||||||||||||||
(C) | The Manager assigned certain of its options to Fortress’s employees as follows: | |||||||||||||||
Date of Grant | Range of Strike | Total Unexercised | ||||||||||||||
Prices | Inception to Date | |||||||||||||||
2004 - 2007 | $29.92 to $33.80 | 90,560 | ||||||||||||||
2012 | $6.82 to $7.34 | 600,000 | ||||||||||||||
2013 | $10.24 to $11.48 | 1,100,497 | ||||||||||||||
2014 | $12.20 | 258,750 | ||||||||||||||
Total | 2,049,807 | |||||||||||||||
(D) | Exercised by employees of Fortress, subsequent to their assignment, or by directors. The options exercised had an intrinsic value of $4.5 million. |
TRANSACTIONS_WITH_AFFILIATES_A1
TRANSACTIONS WITH AFFILIATES AND AFFILIATED ENTITIES (Tables) | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Transactions With Affiliates And Affiliated Entities | ||||||||
Schedule of Affiliate Transactions | Due to affiliates is comprised of the following amounts: | |||||||
March 31, 2015 | December 31, 2014 | |||||||
Management fees | $ | 1,709 | $ | 1,710 | ||||
Incentive compensation | 3,693 | 54,334 | ||||||
Expense reimbursements and other | 1,063 | 1,380 | ||||||
$ | 6,465 | $ | 57,424 | |||||
Affiliate expenses and fees were comprised of: | ||||||||
Three Months Ended March 31, | ||||||||
2015 | 2014 | |||||||
Management fees | $ | 5,126 | $ | 4,486 | ||||
Incentive compensation | 3,693 | 3,338 | ||||||
Expense reimbursements(A) | 125 | 125 | ||||||
Total | $ | 8,944 | $ | 7,949 | ||||
(A) | Included in General and Administrative Expenses in the Condensed Consolidated Statements of Income. |
RECLASSIFICATION_FROM_ACCUMULA1
RECLASSIFICATION FROM ACCUMULATED OTHER COMPREHENSIVE INCOME INTO NET INCOME (Tables) | 3 Months Ended | ||||||||||
Mar. 31, 2015 | |||||||||||
Equity [Abstract] | |||||||||||
Summary of Amounts Reclassified out of Accumulated Other Comprehensive Income into Net Income | The following table summarizes the amounts reclassified out of accumulated other comprehensive income into net income: | ||||||||||
Accumulated Other Comprehensive | Statement of Income Location | Three Months Ended March 31, | |||||||||
Income Components | |||||||||||
2015 | 2014 | ||||||||||
Reclassification of net realized (gain) | Gain on settlement of securities | $ | (24,697 | ) | $ | (4,492 | ) | ||||
loss on securities into earnings | |||||||||||
Reclassification of net realized (gain) | Other-than-temporary impairment on | 1,071 | 328 | ||||||||
loss on securities into earnings | securities | ||||||||||
Total reclassifications | $ | (23,626 | ) | $ | (4,164 | ) |
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Income Tax Disclosure [Abstract] | |||||||||
Schedule of Income Tax Expense (Benefit) | Income tax expense (benefit) consists of the following: | ||||||||
Three Months Ended March 31, | |||||||||
2015 | 2014 | ||||||||
Current: | |||||||||
Federal | $ | 736 | $ | 217 | |||||
State and Local | (1,156 | ) | 70 | ||||||
Total Current Income Tax Expense (Benefit) | (420 | ) | 287 | ||||||
Deferred: | |||||||||
Federal | (1,323 | ) | — | ||||||
State and Local | (1,684 | ) | — | ||||||
Total Deferred Income Tax Expense (Benefit) | (3,007 | ) | — | ||||||
Total Income Tax Expense (Benefit) | $ | (3,427 | ) | $ | 287 | ||||
RECENT_ACTIVITIES_Tables
RECENT ACTIVITIES (Tables) | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Subsequent Events [Abstract] | ||||||||
Summary of Unaudited Pro Forma Combined Interest Income and Income (Loss) Before Income Taxes | The following table presents unaudited pro forma combined Interest Income and Income (Loss) Before Incomes Taxes for the three months ended March 31, 2014 and 2015 prepared as if the Acquisition of HLSS had been consummated on January 1, 2014. | |||||||
Three Months Ended March 31, | ||||||||
2015 | 2014 | |||||||
(unaudited) | (unaudited) | |||||||
Pro Forma | ||||||||
Interest income | $ | 165,055 | $ | 176,989 | ||||
Income (Loss) Before Income Taxes | 71,465 | 103,683 | ||||||
ORGANIZATION_Narrative_Details
ORGANIZATION - Narrative (Details) | 0 Months Ended | |||
Oct. 17, 2014 | Mar. 31, 2015 | Dec. 31, 2014 | Oct. 17, 2014 | |
Related Party Transaction [Line Items] | ||||
Common stock, shares outstanding (in shares) | 141,400,000 | 141,434,905 | 141,434,905 | 141,400,000 |
Reverse stock split | 0.5 | |||
Fortress [Member] | ||||
Related Party Transaction [Line Items] | ||||
Common stock, shares outstanding (in shares) | 2,400,000 | |||
Stock options outstanding (in shares) | 8,500,000 |
OTHER_INCOME_ASSETS_AND_LIABIL2
OTHER INCOME, ASSETS AND LIABILITIES - Schedule of Other Income (Details) (USD $) | 0 Months Ended | 3 Months Ended | |
In Thousands, unless otherwise specified | Oct. 03, 2014 | Mar. 31, 2015 | Mar. 31, 2014 |
Other income (loss), net | |||
Unrealized gain (loss) on derivative instruments | ($7,030) | $1,357 | |
Gain (loss) on transfer of loans to REO | -544 | 0 | |
Gain on consumer loans investment | 80,100 | 10,447 | 0 |
Other income (loss) | -836 | 0 | |
Total Other income (loss), net | $2,037 | $1,357 |
OTHER_INCOME_ASSETS_AND_LIABIL3
OTHER INCOME, ASSETS AND LIABILITIES - Schedule of Gain on Settlement of Investments (Details) (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | ||
Other Income Assets And Liabilities | ||||
Gain on sale of real estate securities, net | $24,697 | $4,492 | ||
Gain (loss) on sale of residential mortgage loans, net | 20,830 | 0 | ||
Gain (loss) on settlement of derivatives | -22,590 | -135 | ||
Gain (loss) on liquidated residential mortgage loans, held-for-investment | 400 | 0 | ||
Gain (loss) on sale of REO | -5,636 | [1] | 0 | [1] |
Other gains (losses) | -2,934 | 0 | ||
Gain on settlement of investments | $14,767 | $4,357 | ||
[1] | Includes approximately $3.2 million loss on REO sold as a part of the residential mortgage loan sales described in Note 8. |
OTHER_INCOME_ASSETS_AND_LIABIL4
OTHER INCOME, ASSETS AND LIABILITIES - Schedule of Gain on Settlement of Investments (Footnote) (Details) (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | ||
Investment [Line Items] | ||||
Loss on REO sold as part of residential mortgage loan sales | $5,636 | [1] | $0 | [1] |
Residential Mortgage Loan Sales [Member] | ||||
Investment [Line Items] | ||||
Loss on REO sold as part of residential mortgage loan sales | $3,200 | |||
[1] | Includes approximately $3.2 million loss on REO sold as a part of the residential mortgage loan sales described in Note 8. |
OTHER_INCOME_ASSETS_AND_LIABIL5
OTHER INCOME, ASSETS AND LIABILITIES - Schedule of Other Assets and Other Liabilities (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 | ||
In Thousands, unless otherwise specified | ||||
Other Assets | ||||
Margin receivable, net | $36,934 | $59,021 | ||
Interest and other receivables | 11,320 | 10,455 | ||
Deferred financing costs, net | 2,817 | [1] | 4,446 | [1] |
Principal paydown receivable | 3,761 | 3,595 | ||
Receivable from government agency | 9,380 | 9,108 | ||
Call rights | 3,828 | 3,728 | ||
Other assets | 8,661 | 9,516 | ||
Other Assets | 76,701 | 99,869 | ||
Other Liabilities | ||||
Interest payable | 7,516 | 7,857 | ||
Accounts payable | 16,068 | 28,059 | ||
Derivative liabilities | 21,127 | 14,220 | ||
Current taxes payable | 47 | 2,349 | ||
Other liabilities | 19 | 20 | ||
Accrued Expenses and Other Liabilities | $44,777 | $52,505 | ||
[1] | Deferred financing costs are net of accumulated amortization of $5.4 million and $8.8 million as of March 31, 2015 and December 31, 2014, respectively. |
OTHER_INCOME_ASSETS_AND_LIABIL6
OTHER INCOME, ASSETS AND LIABILITIES - Schedule of Other Assets and Other Liabilities (Footnote) (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Other Income Assets And Liabilities | ||
Amortization of deferred financing costs | $5,400 | $8,800 |
OTHER_INCOME_ASSETS_AND_LIABIL7
OTHER INCOME, ASSETS AND LIABILITIES - Schedule of Accretion and Other Amortization (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Accretion of discount and other amortization: | ||
Accretion of servicer advance interest income | $42,349 | $45,716 |
Accretion of excess mortgage servicing rights income | 15,037 | 13,816 |
Accretion of net discount on securities and loans | 5,399 | 356 |
Amortization of deferred financing costs | -1,440 | -3,238 |
Accretion and other amortization | $61,345 | $56,650 |
SEGMENT_REPORTING_Summary_of_S
SEGMENT REPORTING - Summary of Segment Financial Data (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 |
Segment Reporting Information [Line Items] | |||
Interest income | $84,373 | $71,490 | |
Interest expense | 33,979 | 38,997 | |
Net interest income (expense) | 50,394 | 32,493 | |
Impairment | 2,048 | 492 | |
Other income | 12,295 | 35,050 | |
Operating expenses | 22,270 | 9,899 | |
Income (Loss) Before Income Taxes | 38,371 | 57,152 | |
Income tax expense (benefit) | -3,427 | 287 | |
Net Income (Loss) | 41,798 | 56,865 | |
Noncontrolling interests in income (loss) of consolidated subsidiaries | 5,823 | 8,093 | |
Net income (loss) attributable to common stockholders | 35,975 | 48,772 | |
Investments | 6,903,191 | ||
Cash and cash equivalents | 459,334 | ||
Restricted cash | 28,325 | 29,418 | |
Derivative assets | 71 | 32,597 | |
Other assets | 76,701 | 99,869 | |
Total assets | 7,467,622 | 8,093,690 | |
Debt | 5,338,807 | 6,062,299 | |
Other liabilities | 314,401 | ||
Total liabilities | 5,653,208 | 6,243,765 | |
Total equity | 1,814,414 | 1,849,925 | |
Noncontrolling interests in equity of consolidated subsidiaries | 246,899 | 253,836 | |
Total New Residential stockholders’ equity | 1,567,515 | 1,596,089 | |
Investments in equity method investees | 225,111 | ||
Operating Segments [Member] | Excess MSRs [Member] | |||
Segment Reporting Information [Line Items] | |||
Interest income | 15,037 | 13,816 | |
Interest expense | 0 | 1,291 | |
Net interest income (expense) | 15,037 | 12,525 | |
Impairment | 0 | 0 | |
Other income | 3,890 | 12,976 | |
Operating expenses | 88 | 65 | |
Income (Loss) Before Income Taxes | 18,839 | 25,436 | |
Income tax expense (benefit) | 0 | 0 | |
Net Income (Loss) | 18,839 | 25,436 | |
Noncontrolling interests in income (loss) of consolidated subsidiaries | 0 | 0 | |
Net income (loss) attributable to common stockholders | 18,839 | 25,436 | |
Investments | 751,773 | ||
Cash and cash equivalents | 267 | ||
Restricted cash | 37 | ||
Derivative assets | 0 | ||
Other assets | 34 | ||
Total assets | 752,111 | ||
Debt | 0 | ||
Other liabilities | 2,921 | ||
Total liabilities | 2,921 | ||
Total equity | 749,190 | ||
Noncontrolling interests in equity of consolidated subsidiaries | 0 | ||
Total New Residential stockholders’ equity | 749,190 | ||
Investments in equity method investees | 225,111 | ||
Operating Segments [Member] | Servicer Advances [Member] | |||
Segment Reporting Information [Line Items] | |||
Interest income | 42,349 | 45,716 | |
Interest expense | 23,637 | 31,956 | |
Net interest income (expense) | 18,712 | 13,760 | |
Impairment | 0 | 0 | |
Other income | -10,727 | 0 | |
Operating expenses | 575 | 250 | |
Income (Loss) Before Income Taxes | 7,410 | 13,510 | |
Income tax expense (benefit) | -3,240 | 287 | |
Net Income (Loss) | 10,650 | 13,223 | |
Noncontrolling interests in income (loss) of consolidated subsidiaries | 5,823 | 8,093 | |
Net income (loss) attributable to common stockholders | 4,827 | 5,130 | |
Investments | 3,245,457 | ||
Cash and cash equivalents | 69,180 | ||
Restricted cash | 28,288 | ||
Derivative assets | 71 | ||
Other assets | 6,622 | ||
Total assets | 3,349,618 | ||
Debt | 2,875,412 | ||
Other liabilities | 19,642 | ||
Total liabilities | 2,895,054 | ||
Total equity | 454,564 | ||
Noncontrolling interests in equity of consolidated subsidiaries | 246,899 | ||
Total New Residential stockholders’ equity | 207,665 | ||
Investments in equity method investees | 0 | ||
Operating Segments [Member] | Real Estate Securities [Member] | |||
Segment Reporting Information [Line Items] | |||
Interest income | 14,263 | 11,238 | |
Interest expense | 3,480 | 4,069 | |
Net interest income (expense) | 10,783 | 7,169 | |
Impairment | 1,071 | 328 | |
Other income | -5,090 | 5,042 | |
Operating expenses | -102 | 60 | |
Income (Loss) Before Income Taxes | 4,724 | 11,823 | |
Income tax expense (benefit) | 0 | 0 | |
Net Income (Loss) | 4,724 | 11,823 | |
Noncontrolling interests in income (loss) of consolidated subsidiaries | 0 | 0 | |
Net income (loss) attributable to common stockholders | 4,724 | 11,823 | |
Investments | 2,324,915 | ||
Cash and cash equivalents | 5,288 | ||
Restricted cash | 0 | ||
Derivative assets | 0 | ||
Other assets | 51,610 | ||
Total assets | 2,381,813 | ||
Debt | 1,928,891 | ||
Other liabilities | 219,603 | ||
Total liabilities | 2,148,494 | ||
Total equity | 233,319 | ||
Noncontrolling interests in equity of consolidated subsidiaries | 0 | ||
Total New Residential stockholders’ equity | 233,319 | ||
Investments in equity method investees | 0 | ||
Operating Segments [Member] | Real Estate Loans [Member] | |||
Segment Reporting Information [Line Items] | |||
Interest income | 12,724 | 720 | |
Interest expense | 6,093 | 198 | |
Net interest income (expense) | 6,631 | 522 | |
Impairment | 977 | 164 | |
Other income | 13,775 | 671 | |
Operating expenses | 6,104 | 90 | |
Income (Loss) Before Income Taxes | 13,325 | 939 | |
Income tax expense (benefit) | -187 | 0 | |
Net Income (Loss) | 13,512 | 939 | |
Noncontrolling interests in income (loss) of consolidated subsidiaries | 0 | 0 | |
Net income (loss) attributable to common stockholders | 13,512 | 939 | |
Investments | 581,046 | ||
Cash and cash equivalents | 5,895 | ||
Restricted cash | 0 | ||
Derivative assets | 0 | ||
Other assets | 15,925 | ||
Total assets | 602,866 | ||
Debt | 434,504 | ||
Other liabilities | 5,680 | ||
Total liabilities | 440,184 | ||
Total equity | 162,682 | ||
Noncontrolling interests in equity of consolidated subsidiaries | 0 | ||
Total New Residential stockholders’ equity | 162,682 | ||
Investments in equity method investees | 0 | ||
Operating Segments [Member] | Consumer Loans [Member] | |||
Segment Reporting Information [Line Items] | |||
Interest income | 0 | 0 | |
Interest expense | 0 | 1,483 | |
Net interest income (expense) | 0 | -1,483 | |
Impairment | 0 | 0 | |
Other income | 10,447 | 16,360 | |
Operating expenses | 57 | 23 | |
Income (Loss) Before Income Taxes | 10,390 | 14,854 | |
Income tax expense (benefit) | 0 | 0 | |
Net Income (Loss) | 10,390 | 14,854 | |
Noncontrolling interests in income (loss) of consolidated subsidiaries | 0 | 0 | |
Net income (loss) attributable to common stockholders | 10,390 | 14,854 | |
Investments | 0 | ||
Cash and cash equivalents | 0 | ||
Restricted cash | 0 | ||
Derivative assets | 0 | ||
Other assets | 543 | ||
Total assets | 543 | ||
Debt | 0 | ||
Other liabilities | 58 | ||
Total liabilities | 58 | ||
Total equity | 485 | ||
Noncontrolling interests in equity of consolidated subsidiaries | 0 | ||
Total New Residential stockholders’ equity | 485 | ||
Investments in equity method investees | 0 | ||
Operating Segments [Member] | Corporate [Member] | |||
Segment Reporting Information [Line Items] | |||
Interest income | 0 | 0 | |
Interest expense | 769 | 0 | |
Net interest income (expense) | -769 | 0 | |
Impairment | 0 | 0 | |
Other income | 0 | 1 | |
Operating expenses | 15,548 | 9,411 | |
Income (Loss) Before Income Taxes | -16,317 | -9,410 | |
Income tax expense (benefit) | 0 | 0 | |
Net Income (Loss) | -16,317 | -9,410 | |
Noncontrolling interests in income (loss) of consolidated subsidiaries | 0 | 0 | |
Net income (loss) attributable to common stockholders | -16,317 | -9,410 | |
Investments | 0 | ||
Cash and cash equivalents | 378,704 | ||
Restricted cash | 0 | ||
Derivative assets | 0 | ||
Other assets | 1,967 | ||
Total assets | 380,671 | ||
Debt | 100,000 | ||
Other liabilities | 66,497 | ||
Total liabilities | 166,497 | ||
Total equity | 214,174 | ||
Noncontrolling interests in equity of consolidated subsidiaries | 0 | ||
Total New Residential stockholders’ equity | 214,174 | ||
Investments in equity method investees | $0 |
INVESTMENTS_IN_EXCESS_MORTGAGE4
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS - Schedule of Activity Related to the Carrying Value of Investments in Excess MSRs (Details) (Excess MSRs [Member], USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | |
Carrying Value of Investments in Excess MSRs | ||
Beginning balance | $417,733 | [1],[2] |
Transfers from indirect ownership | 98,258 | |
Purchases | 26,479 | |
Interest income | 15,037 | |
Other income | 730 | |
Proceeds from repayments | -29,814 | |
Change in fair value | -1,761 | |
Ending balance | 526,662 | [1],[2] |
Nationstar [Member] | ||
Carrying Value of Investments in Excess MSRs | ||
Beginning balance | 409,076 | |
Transfers from indirect ownership | 98,258 | |
Purchases | 26,479 | |
Interest income | 14,856 | |
Other income | 730 | |
Proceeds from repayments | -29,544 | |
Change in fair value | -1,472 | |
Ending balance | 518,383 | |
SLS [Member] | ||
Carrying Value of Investments in Excess MSRs | ||
Beginning balance | 8,657 | [3] |
Transfers from indirect ownership | 0 | [3] |
Purchases | 0 | [3] |
Interest income | 181 | [3] |
Other income | 0 | [3] |
Proceeds from repayments | -270 | [3] |
Change in fair value | -289 | [3] |
Ending balance | $8,279 | [3] |
[1] | Carrying Value represents the fair value of the pools or Recapture Agreements, as applicable. | |
[2] | Excess MSR investments in which New Residential also invested in related servicer advances, including the basic fee component of the related MSR as of March 31, 2015 (Note 6). | |
[3] | Specialized Loan Servicing LLC (“SLSâ€). See Note 6 for a description of the SLS Transaction. |
INVESTMENTS_IN_EXCESS_MORTGAGE5
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS - Summary of Direct Investments in Excess MSRs (Details) (USD $) | 3 Months Ended | ||||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | ||
Investment [Line Items] | |||||
Weighted Average Life (Years) | 10 months 2 days | ||||
Change in fair value of investments in excess mortgage servicing rights | ($1,761) | $6,602 | |||
Original and Recaptured Pools [Member] | |||||
Investment [Line Items] | |||||
Change in fair value of investments in excess mortgage servicing rights | -1,976 | 7,088 | |||
Recapture Agreements [Member] | |||||
Investment [Line Items] | |||||
Change in fair value of investments in excess mortgage servicing rights | 215 | -486 | |||
Excess MSRs [Member] | |||||
Investment [Line Items] | |||||
Unpaid Principal Balance (“UPBâ€) of Underlying Mortgages | 163,572,436 | [1] | |||
Weighted Average Life (Years) | 5 years 9 months | [1],[2] | |||
Amortized Cost Basis | 418,902 | [1],[3] | |||
Carrying Value | 526,662 | [1],[4] | 417,733 | [1],[4] | |
Excess MSRs [Member] | Agency [Member] | |||||
Investment [Line Items] | |||||
Unpaid Principal Balance (“UPBâ€) of Underlying Mortgages | 54,829,877 | ||||
Weighted Average Life (Years) | 6 years 3 months 20 days | [2] | |||
Amortized Cost Basis | 171,036 | [3] | |||
Carrying Value | 238,979 | [4] | 217,519 | [4] | |
Excess MSRs [Member] | Agency [Member] | Original and Recaptured Pools [Member] | |||||
Investment [Line Items] | |||||
Unpaid Principal Balance (“UPBâ€) of Underlying Mortgages | 54,829,877 | ||||
Weighted Average Life (Years) | 5 years 10 months 24 days | [2] | |||
Amortized Cost Basis | 161,109 | [3] | |||
Carrying Value | 209,114 | [4] | 188,733 | [4] | |
Excess MSRs [Member] | Agency [Member] | Recapture Agreements [Member] | |||||
Investment [Line Items] | |||||
Unpaid Principal Balance (“UPBâ€) of Underlying Mortgages | 0 | ||||
Weighted Average Life (Years) | 12 years 10 months 18 days | [2] | |||
Amortized Cost Basis | 9,927 | [3] | |||
Carrying Value | 29,865 | [4] | 28,786 | [4] | |
Excess MSRs [Member] | Non-Agency [Member] | |||||
Investment [Line Items] | |||||
Unpaid Principal Balance (“UPBâ€) of Underlying Mortgages | 108,742,559 | [1] | |||
Weighted Average Life (Years) | 5 years 4 months 13 days | [1],[2] | |||
Amortized Cost Basis | 247,866 | [1],[3] | |||
Carrying Value | 287,683 | [1],[4] | 200,214 | [1],[4] | |
Excess MSRs [Member] | Non-Agency [Member] | Original and Recaptured Pools [Member] | |||||
Investment [Line Items] | |||||
Unpaid Principal Balance (“UPBâ€) of Underlying Mortgages | 108,742,559 | [1] | |||
Weighted Average Life (Years) | 4 years 10 months 26 days | [1],[2] | |||
Amortized Cost Basis | 231,228 | [1],[3] | |||
Carrying Value | 270,365 | [1],[4] | 189,812 | [1],[4] | |
Excess MSRs [Member] | Non-Agency [Member] | Recapture Agreements [Member] | |||||
Investment [Line Items] | |||||
Unpaid Principal Balance (“UPBâ€) of Underlying Mortgages | 0 | [1] | |||
Weighted Average Life (Years) | 11 years 9 months 16 days | [1],[2] | |||
Amortized Cost Basis | 16,638 | [1],[3] | |||
Carrying Value | 17,318 | [1],[4] | 10,402 | [1],[4] | |
Excess MSRs [Member] | Lower Range [Member] | Agency [Member] | Original and Recaptured Pools [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 32.50% | ||||
Excess MSRs [Member] | Lower Range [Member] | Agency [Member] | Recapture Agreements [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 32.50% | ||||
Excess MSRs [Member] | Lower Range [Member] | Non-Agency [Member] | Original and Recaptured Pools [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 33.30% | [1] | |||
Excess MSRs [Member] | Lower Range [Member] | Non-Agency [Member] | Recapture Agreements [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 33.30% | [1] | |||
Excess MSRs [Member] | Upper Range [Member] | Agency [Member] | Original and Recaptured Pools [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 66.70% | ||||
Excess MSRs [Member] | Upper Range [Member] | Agency [Member] | Recapture Agreements [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 66.70% | ||||
Excess MSRs [Member] | Upper Range [Member] | Non-Agency [Member] | Original and Recaptured Pools [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 80.00% | [1] | |||
Excess MSRs [Member] | Upper Range [Member] | Non-Agency [Member] | Recapture Agreements [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 80.00% | [1] | |||
Fortress [Member] | Excess MSRs [Member] | Lower Range [Member] | Agency [Member] | Original and Recaptured Pools [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 0.00% | ||||
Fortress [Member] | Excess MSRs [Member] | Lower Range [Member] | Agency [Member] | Recapture Agreements [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 0.00% | ||||
Fortress [Member] | Excess MSRs [Member] | Lower Range [Member] | Non-Agency [Member] | Original and Recaptured Pools [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 0.00% | [1] | |||
Fortress [Member] | Excess MSRs [Member] | Lower Range [Member] | Non-Agency [Member] | Recapture Agreements [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 0.00% | [1] | |||
Fortress [Member] | Excess MSRs [Member] | Upper Range [Member] | Agency [Member] | Original and Recaptured Pools [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 33.30% | ||||
Fortress [Member] | Excess MSRs [Member] | Upper Range [Member] | Agency [Member] | Recapture Agreements [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 33.30% | ||||
Fortress [Member] | Excess MSRs [Member] | Upper Range [Member] | Non-Agency [Member] | Original and Recaptured Pools [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 50.00% | [1] | |||
Fortress [Member] | Excess MSRs [Member] | Upper Range [Member] | Non-Agency [Member] | Recapture Agreements [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 50.00% | [1] | |||
Nationstar [Member] | Excess MSRs [Member] | |||||
Investment [Line Items] | |||||
Carrying Value | $518,383 | $409,076 | |||
Nationstar [Member] | Excess MSRs [Member] | Lower Range [Member] | Agency [Member] | Original and Recaptured Pools [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 33.30% | ||||
Nationstar [Member] | Excess MSRs [Member] | Lower Range [Member] | Agency [Member] | Recapture Agreements [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 33.30% | ||||
Nationstar [Member] | Excess MSRs [Member] | Lower Range [Member] | Non-Agency [Member] | Original and Recaptured Pools [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 0.00% | [1] | |||
Nationstar [Member] | Excess MSRs [Member] | Lower Range [Member] | Non-Agency [Member] | Recapture Agreements [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 0.00% | [1] | |||
Nationstar [Member] | Excess MSRs [Member] | Upper Range [Member] | Agency [Member] | Original and Recaptured Pools [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 35.00% | ||||
Nationstar [Member] | Excess MSRs [Member] | Upper Range [Member] | Agency [Member] | Recapture Agreements [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 35.00% | ||||
Nationstar [Member] | Excess MSRs [Member] | Upper Range [Member] | Non-Agency [Member] | Original and Recaptured Pools [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 33.30% | [1] | |||
Nationstar [Member] | Excess MSRs [Member] | Upper Range [Member] | Non-Agency [Member] | Recapture Agreements [Member] | |||||
Investment [Line Items] | |||||
Interest in Excess MSR | 33.30% | [1] | |||
[1] | Excess MSR investments in which New Residential also invested in related servicer advances, including the basic fee component of the related MSR as of March 31, 2015 (Note 6). | ||||
[2] | Weighted Average Life represents the weighted average expected timing of the receipt of expected cash flows for this investment. | ||||
[3] | The amortized cost basis of the Recapture Agreements is determined based on the relative fair values of the Recapture Agreements and related Excess MSRs at the time they were acquired. | ||||
[4] | Carrying Value represents the fair value of the pools or Recapture Agreements, as applicable. |
INVESTMENTS_IN_EXCESS_MORTGAGE6
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS - Narrative (Details) (USD $) | 3 Months Ended | 0 Months Ended |
Mar. 31, 2015 | Jan. 16, 2015 | |
Excess MSRs Investees [Member] | ||
Investment [Line Items] | ||
Unpaid Principal Balance (“UPBâ€) of Underlying Mortgages | 84,000,746,000 | |
Excess MSRs Investees [Member] | MSRs [Member] | ||
Investment [Line Items] | ||
Weighted average discount rate, used to value investments in excess MSRs | 9.60% | |
Excess MSRs [Member] | ||
Investment [Line Items] | ||
Purchase of servicer advance investments | 23,800,000 | |
Unpaid Principal Balance (“UPBâ€) of Underlying Mortgages | $8,400,000,000 | |
Freddie Mac [Member] | Excess MSRs [Member] | ||
Investment [Line Items] | ||
Percentage of Excess MSRs acquired | 33.30% |
INVESTMENTS_IN_EXCESS_MORTGAGE7
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS - Summary of the Geographic Distribution of the Underlying Residential Mortgage Loans of the Direct Investments in Excess MSRs (Details) (Mortgage Loans [Member], MSRs [Member]) | Mar. 31, 2015 | Dec. 31, 2014 |
Concentration Risk [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 100.00% | 100.00% |
California [Member] | ||
Concentration Risk [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 33.00% | 31.50% |
Florida [Member] | ||
Concentration Risk [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 9.30% | 7.70% |
New York [Member] | ||
Concentration Risk [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 4.90% | 4.30% |
Maryland [Member] | ||
Concentration Risk [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 3.80% | 4.00% |
Texas [Member] | ||
Concentration Risk [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 3.60% | 4.20% |
New Jersey [Member] | ||
Concentration Risk [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 3.50% | 3.20% |
Virginia [Member] | ||
Concentration Risk [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 3.20% | 3.30% |
Illinois [Member] | ||
Concentration Risk [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 3.20% | 3.20% |
Washington [Member] | ||
Concentration Risk [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 3.20% | 3.60% |
Arizona [Member] | ||
Concentration Risk [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 2.70% | 3.20% |
Other U.S. [Member] | ||
Concentration Risk [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 29.60% | 31.80% |
INVESTMENTS_IN_EXCESS_MORTGAGE8
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS, EQUITY METHOD INVESTEES - Summary of the Financial Results of Excess MSR Joint Ventures, Accounted for as Equity Method Investees (Details) (Excess MSRs Investees [Member], USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 |
Excess MSRs Investees [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Excess MSR assets | $440,714 | $653,293 | |
Other assets | 9,508 | 8,472 | |
Other liabilities | 0 | -13 | |
Equity | 450,222 | 661,752 | |
New Residential’s investment | 225,111 | 330,876 | |
New Residential’s ownership | 50.00% | 50.00% | |
Interest income | 11,701 | 18,493 | |
Other income (loss) | -1,835 | -5,705 | |
Expenses | -25 | -40 | |
Net income | $9,841 | $12,748 |
INVESTMENTS_IN_EXCESS_MORTGAGE9
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS, EQUITY METHOD INVESTEES - Summary of the Financial Results of Excess MSR Joint Ventures, Accounted for as Equity Method Investees - Roll Forward (Details) (Recurring Basis [Member], Level 3 [Member], USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Mar. 31, 2015 |
Recurring Basis [Member] | Level 3 [Member] | |
Schedule of Equity Method Investments [Line Items] | |
Beginning balance | $330,876 |
Contributions to equity method investees | 0 |
Transfers to direct ownership | -98,258 |
Distributions of earnings from equity method investees | -12,226 |
Distributions of capital from equity method investees | -202 |
Change in fair value of investments in equity method investees | 4,921 |
Ending balance | $225,111 |
Recovered_Sheet1
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS, EQUITY METHOD INVESTEES - Summary of Excess MSR Investments made through Equity Method Investees (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 | |
Schedule of Equity Method Investments [Line Items] | |||
Weighted Average Life (Years) | 10 months 2 days | ||
Excess MSRs Investees [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Unpaid Principal Balance | 84,000,746 | ||
New Residential Interest in Investees | 50.00% | 50.00% | |
Amortized Cost Basis | 351,935 | [1] | |
Carrying Value | 440,714 | [2] | |
Agency [Member] | Excess MSRs Investees [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Weighted Average Life (Years) | 6 years 7 months 19 days | [3] | |
Agency [Member] | Excess MSRs Investees [Member] | Original and Recaptured Pools [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Unpaid Principal Balance | 84,000,746 | ||
Investee Interest in Excess MSR | 66.70% | [4] | |
New Residential Interest in Investees | 50.00% | ||
Amortized Cost Basis | 289,745 | [1] | |
Carrying Value | 358,909 | [2] | |
Weighted Average Life (Years) | 5 years 6 months 15 days | [3] | |
Agency [Member] | Excess MSRs Investees [Member] | Recapture Agreements [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Unpaid Principal Balance | 0 | ||
Investee Interest in Excess MSR | 66.70% | [4] | |
New Residential Interest in Investees | 50.00% | ||
Amortized Cost Basis | 62,190 | [1] | |
Carrying Value | 81,805 | [2] | |
Weighted Average Life (Years) | 11 years 8 months 23 days | [3] | |
[1] | Represents the amortized cost basis of the equity method investees in which New Residential holds a 50% interest. The amortized cost basis of the Recapture Agreements is determined based on the relative fair values of the Recapture Agreements and related Excess MSRs at the time they were acquired. | ||
[2] | Represents the carrying value of the Excess MSRs held in equity method investees, in which New Residential holds a 50% interest. Carrying value represents the fair value of the pools or Recapture Agreements, as applicable. | ||
[3] | The weighted average life represents the weighted average expected timing of the receipt of cash flows of each investment. | ||
[4] | The remaining interests are held by Nationstar. |
Recovered_Sheet2
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS, EQUITY METHOD INVESTEES - Summary of Excess MSR Investments made through Equity Method Investees (Footnote) (Details) (Excess MSRs Investees [Member]) | Mar. 31, 2015 | Dec. 31, 2014 |
Schedule of Equity Method Investments [Line Items] | ||
New Residential Interest in Investees | 50.00% | 50.00% |
MSRs [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
New Residential Interest in Investees | 50.00% |
Recovered_Sheet3
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS, EQUITY METHOD INVESTEES - Narrative (Details) (Excess MSRs Investees [Member], MSRs [Member]) | 3 Months Ended |
Mar. 31, 2015 | |
Excess MSRs Investees [Member] | MSRs [Member] | |
Schedule of Equity Method Investments [Line Items] | |
Weighted average discount rate, used to value investments in excess MSRs | 9.60% |
Recovered_Sheet4
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS, EQUITY METHOD INVESTEES - Summary of the Geographic Distribution of the Underlying Residential Mortgage Loans of the Excess MSR Investments made through Equity Method Investees (Details) (Mortgage Loans [Member], Excess MSRs Investees [Member]) | Mar. 31, 2015 | Dec. 31, 2014 |
Schedule of Equity Method Investments [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 100.00% | 100.00% |
California [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 13.10% | 23.50% |
Florida [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 7.40% | 8.90% |
Texas [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 6.10% | 4.80% |
Georgia [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 5.60% | 4.10% |
New York [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 5.50% | 5.60% |
New Jersey [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 4.10% | 3.90% |
Illinois [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 4.00% | 3.50% |
Virginia [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 3.20% | 3.20% |
Maryland [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 3.20% | 3.30% |
Pennsylvania [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 3.00% | 2.30% |
Other U.S. [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 44.80% | 36.90% |
INVESTMENTS_IN_SERVICER_ADVANC2
INVESTMENTS IN SERVICER ADVANCES - Narrative (Details) (USD $) | 3 Months Ended | 0 Months Ended | 1 Months Ended | 12 Months Ended | |||||
Mar. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Jan. 31, 2015 | Jan. 16, 2015 | Mar. 26, 2015 | Mar. 19, 2015 | Feb. 27, 2015 | |
securitized_trust | |||||||||
Investment [Line Items] | |||||||||
Servicer advances, net of recoveries | $200,000,000 | ||||||||
Notes payables outstanding | 200,000,000 | ||||||||
Call rights | 3,828,000 | 3,728,000 | 3,728,000 | 3,728,000 | |||||
Nationstar [Member] | |||||||||
Investment [Line Items] | |||||||||
Servicer basic fee | 9.20% | ||||||||
Performance fee percent | 100.00% | ||||||||
SLS [Member] | |||||||||
Investment [Line Items] | |||||||||
Servicing fee basis points | 0.11% | ||||||||
Fortress [Member] | |||||||||
Investment [Line Items] | |||||||||
Excess MSR purchases | 93,800,000 | 229,700,000 | |||||||
Service advances and fees | 83,800,000 | 83,800,000 | 83,800,000 | 133,800,000 | |||||
Financed service advances | 74,300,000 | 74,300,000 | 74,300,000 | 121,200,000 | |||||
Call rights | 1,600,000 | 1,600,000 | 1,600,000 | ||||||
Number of securitized trusts | 57 | 57 | 57 | ||||||
Servicer Advance Joint Venture [Member] | |||||||||
Investment [Line Items] | |||||||||
Servicer advances, net of recoveries | 2,900,000,000 | ||||||||
Notes payables outstanding | 2,700,000,000 | ||||||||
New Residential’s ownership | 44.50% | ||||||||
Funded capital commitments | 312,700,000 | ||||||||
Servicer Advance Joint Venture [Member] | Noncontrolling Third-party Investors [Member] | |||||||||
Investment [Line Items] | |||||||||
Funded capital commitments | 389,600,000 | ||||||||
Advance Purchaser LLC [Member] | |||||||||
Investment [Line Items] | |||||||||
Capital distributed to third-party co-investors | 238,400,000 | ||||||||
Capital distributed to New Residential | 188,300,000 | ||||||||
Excess MSRs [Member] | |||||||||
Investment [Line Items] | |||||||||
Unpaid Principal Balance | 8,400,000,000 | ||||||||
Excess MSRs [Member] | SLS [Member] | |||||||||
Investment [Line Items] | |||||||||
Percentage of Excess MSRs acquired | 50.00% | 50.00% | 50.00% | ||||||
Excess MSRs [Member] | Fortress [Member] | |||||||||
Investment [Line Items] | |||||||||
Percentage of Excess MSRs acquired | 50.00% | 50.00% | 50.00% | ||||||
Percentage of additional Excess MSRs acquired | 50.00% | 50.00% | 50.00% | ||||||
Excess MSR purchases | 8,400,000 | ||||||||
Servicer Advances and Fees [Member] | Fortress [Member] | |||||||||
Investment [Line Items] | |||||||||
Excess MSR purchases | 135,900,000 | ||||||||
Call rights | 2,100,000 | ||||||||
Residential Mortgage [Member] | |||||||||
Investment [Line Items] | |||||||||
Unpaid Principal Balance | 6,400,000 | 176,500,000 | 135,200,000 | ||||||
Residential Mortgage [Member] | SLS [Member] | |||||||||
Investment [Line Items] | |||||||||
Unpaid Principal Balance | 3,000,000,000 | 3,000,000,000 | 3,000,000,000 | ||||||
Total advance commitments | 219,200,000 | ||||||||
Debt | $195,500,000 | $195,500,000 | $195,500,000 | ||||||
Maximum [Member] | Fortress [Member] | |||||||||
Investment [Line Items] | |||||||||
Number of securitized trusts | 99 | 99 | 99 |
INVESTMENTS_IN_SERVICER_ADVANC3
INVESTMENTS IN SERVICER ADVANCES - Summary of Investments in Servicer Advances (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | ||
Investments in and Advances to Affiliates [Line Items] | |||||
Carrying Value | $3,245,457 | $3,270,839 | |||
Servicer Advance Joint Venture [Member] | |||||
Investments in and Advances to Affiliates [Line Items] | |||||
Amortized Cost Basis | 3,168,909 | 3,186,622 | |||
Carrying Value | 3,245,457 | [1] | 3,270,839 | [1] | |
Weighted Average Discount Rate | 5.40% | 5.40% | |||
Weighted Average Life (Years) | 3 years 11 months 10 days | [2] | 4 years | [2] | |
Changes in Fair Value Recorded in Other Income | ($7,669) | $0 | |||
[1] | Carrying value represents the fair value of the investments in servicer advances, including the basic fee component of the related MSRs. | ||||
[2] | Weighted Average Life represents the weighted average expected timing of the receipt of expected net cash flows for this investment. |
INVESTMENTS_IN_SERVICER_ADVANC4
INVESTMENTS IN SERVICER ADVANCES - Summary of Investments in Servicer Advances - Additional Information (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 | ||
In Thousands, unless otherwise specified | ||||
Investments in and Advances to Affiliates [Line Items] | ||||
Carrying Value | $3,245,457 | $3,270,839 | ||
Servicer Advance Joint Venture [Member] | ||||
Investments in and Advances to Affiliates [Line Items] | ||||
Carrying Value | 3,245,457 | [1] | 3,270,839 | [1] |
Servicer Advance Joint Venture [Member] | Servicer Advances [Member] | ||||
Investments in and Advances to Affiliates [Line Items] | ||||
Unpaid Principal Balance (“UPBâ€) of Underlying Mortgages | 92,159,246 | [2] | 96,547,773 | [2] |
Carrying Value | 3,068,306 | [2] | 3,102,492 | [2] |
Servicer Advances to UPB of Underlying Residential Mortgage Loans | 3.30% | [2] | 3.20% | [2] |
Carrying Value of Notes Payable | $2,875,412 | [2] | $2,890,230 | [2] |
Gross Loan-to-Value | 91.50% | [2] | 91.40% | [2] |
Net Loan-to-Value | 90.60% | [2],[3] | 90.40% | [2],[3] |
Gross Cost of Funds | 2.60% | [2],[4] | 3.00% | [2],[4] |
Net Cost of Funds | 2.20% | [2],[4] | 2.30% | [2],[4] |
[1] | Carrying value represents the fair value of the investments in servicer advances, including the basic fee component of the related MSRs. | |||
[2] | The following types of advances comprise the investments in servicer advances: March 31, 2015December 31, 2014Principal and interest advances$737,845$729,713Escrow advances (taxes and insurance advances)1,514,8481,600,713Foreclosure advances815,613772,066 Total$3,068,306$3,102,492 | |||
[3] | Ratio of face amount of borrowings to par amount of servicer advance collateral, net of an interest reserve maintained by the Buyer. | |||
[4] | Annualized measure of the cost associated with borrowings. Gross Cost of Funds primarily includes interest expense and facility fees. Net Cost of Funds excludes facility fees. |
INVESTMENTS_IN_SERVICER_ADVANC5
INVESTMENTS IN SERVICER ADVANCES - Summary of Investments in Servicer Advances - Components of Funded Advances (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 | ||
In Thousands, unless otherwise specified | ||||
Investment [Line Items] | ||||
Total | $3,245,457 | $3,270,839 | ||
Servicer Advance Joint Venture [Member] | ||||
Investment [Line Items] | ||||
Total | 3,245,457 | [1] | 3,270,839 | [1] |
Servicer Advance Joint Venture [Member] | Servicer Advances [Member] | ||||
Investment [Line Items] | ||||
Principal and interest advances | 737,845 | 729,713 | ||
Escrow advances (taxes and insurance advances) | 1,514,848 | 1,600,713 | ||
Foreclosure advances | 815,613 | 772,066 | ||
Total | $3,068,306 | [2] | $3,102,492 | [2] |
[1] | Carrying value represents the fair value of the investments in servicer advances, including the basic fee component of the related MSRs. | |||
[2] | The following types of advances comprise the investments in servicer advances: March 31, 2015December 31, 2014Principal and interest advances$737,845$729,713Escrow advances (taxes and insurance advances)1,514,8481,600,713Foreclosure advances815,613772,066 Total$3,068,306$3,102,492 |
INVESTMENTS_IN_SERVICER_ADVANC6
INVESTMENTS IN SERVICER ADVANCES - Schedule of Interest Income Related to Investments in Servicer Advances (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Investment [Line Items] | ||
Interest income from investments in servicer advances | $84,373 | $71,490 |
Servicer Advance Investments [Member] | ||
Investment [Line Items] | ||
Interest income, gross of amounts attributable to servicer compensation | 63,357 | 67,138 |
Amounts attributable to base servicer compensation | -6,601 | -6,280 |
Amounts attributable to incentive servicer compensation | -14,407 | -15,142 |
Interest income from investments in servicer advances | $42,349 | $45,716 |
INVESTMENTS_IN_SERVICER_ADVANC7
INVESTMENTS IN SERVICER ADVANCES - Schedule of Interest Income Related to Investments in Servicer Advances - Others' Interests (Details) (USD $) | 3 Months Ended | ||||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | ||
Servicer Advance Joint Venture [Member] | |||||
Investment [Line Items] | |||||
New Residential’s investment | $445,041 | $457,545 | |||
Others’ ownership interest | 44.50% | ||||
Net income in joint venture | 10,496 | 13,511 | |||
Others [Member] | |||||
Investment [Line Items] | |||||
New Residential’s investment | 246,899 | 253,836 | |||
Others’ ownership interest | 55.50% | 55.50% | |||
Net income in joint venture | $5,823 | $8,093 | |||
Others' ownership interest as a percent of total | 55.50% | [1] | 59.90% | [1] | |
[1] | As a result, New Residential owned 44.5% and 40.1% of the Buyer, on average during the three months ended March 31, 2015 and 2014, respectively. |
INVESTMENTS_IN_SERVICER_ADVANC8
INVESTMENTS IN SERVICER ADVANCES - Schedule of Interest Income Related to Investments in Servicer Advances - Others' Interests (Footnote) (Details) (Others [Member]) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Others [Member] | ||
Investment [Line Items] | ||
Average ownership percentage | 44.50% | 40.10% |
INVESTMENTS_IN_REAL_ESTATE_SEC2
INVESTMENTS IN REAL ESTATE SECURITIES - Narrative (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Schedule of Available-for-sale Securities [Line Items] | ||
Purchase of Non-Agency RMBS | $26,649,000 | $1,038,721,000 |
Other-than-temporary impairment (OTTI) losses | 1,100,000 | |
Real estate securities acquired during the period with credit quality deterioration, face amount | 36,400,000 | |
Real estate securities acquired during the period with credit quality deterioration, expected cash flows | 45,500,000 | |
Real estate securities acquired during the period with credit quality deterioration, fair value | 21,900,000 | |
Non-Agency RMBS [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Face amount of securities purchased | 257,800,000 | |
Purchase of Non-Agency RMBS | 222,100,000 | |
Face amount of securities sold | 441,100,000 | |
Amortized cost basis of securities sold | 385,900,000 | |
Proceeds from sale of real estate securities | 389,700,000 | |
Gain (loss) on sale of debt investments | 3,800,000 | |
Agency RMBS [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Face amount of securities purchased | 979,800,000 | |
Purchase of Non-Agency RMBS | 1,000,000,000 | |
Face amount of securities sold | 1,000,000,000 | |
Amortized cost basis of securities sold | 1,040,000,000 | |
Proceeds from sale of real estate securities | 1,060,000,000 | |
Gain (loss) on sale of debt investments | $20,900,000 |
INVESTMENTS_IN_REAL_ESTATE_SEC3
INVESTMENTS IN REAL ESTATE SECURITIES - Summary of Real Estate Securities (Details) (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 | ||
Schedule of Available-for-sale Securities [Line Items] | ||||
Outstanding Face Amount | $3,396,295 | |||
Amortized Cost Basis | 2,307,696 | |||
Carrying Value | 2,324,915 | 2,463,163 | ||
Weighted Average Life (Years) | 10 months 2 days | |||
Agency RMBS [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Outstanding Face Amount | 1,575,759 | [1],[2] | ||
Amortized Cost Basis | 1,659,781 | [1],[2] | ||
Gross Unrealized Gains | 7,510 | [1],[2] | ||
Gross Unrealized Losses | -2,295 | [1],[2] | ||
Carrying Value | 1,664,996 | [1],[2],[3] | 1,740,163 | [1],[2] |
Number of Securities | 102 | [1],[2] | ||
Weighted Average Rating | AAA | [1],[2],[4] | ||
Weighted Average Coupon | 3.11% | [1],[2] | ||
Weighted Average Yield | 2.18% | [1],[2] | ||
Weighted Average Life (Years) | 5 years 4 months 21 days | [1],[2],[5] | ||
Non-Agency RMBS [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Outstanding Face Amount | 1,820,536 | [6],[7],[8] | ||
Amortized Cost Basis | 647,915 | [6],[7],[8] | ||
Gross Unrealized Gains | 14,641 | [6],[8] | ||
Gross Unrealized Losses | -2,637 | [6],[8] | ||
Carrying Value | 659,919 | [3],[6],[8] | 723,000 | [6],[8] |
Number of Securities | 137 | [6],[8] | ||
Weighted Average Rating | BBB- | [4],[6],[8] | ||
Weighted Average Coupon | 0.76% | [6],[8] | ||
Weighted Average Yield | 5.74% | [6],[8] | ||
Weighted Average Life (Years) | 9 years 8 months 6 days | [5],[6],[8] | ||
Weighted Average Principal Subordination | 26.00% | [6],[8],[9] | ||
Other ABS [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Outstanding Face Amount | 984,460 | |||
Amortized Cost Basis | 56,414 | |||
Gross Unrealized Gains | 829 | |||
Gross Unrealized Losses | -1,119 | |||
Carrying Value | 56,124 | |||
Number of Securities | 8 | |||
Weighted Average Rating | AA+ | |||
Weighted Average Coupon | 1.98% | |||
Weighted Average Yield | 8.65% | |||
Weighted Average Life (Years) | 4 years 3 days | |||
Weighted Average Principal Subordination | 0.00% | |||
Investments in Real Estate Securities [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Outstanding Face Amount | 3,396,295 | |||
Amortized Cost Basis | 2,307,696 | |||
Gross Unrealized Gains | 22,151 | |||
Gross Unrealized Losses | -4,932 | |||
Carrying Value | $2,324,915 | [3] | $2,463,163 | |
Number of Securities | 239 | |||
Weighted Average Rating | AA- | [4] | ||
Weighted Average Coupon | 2.45% | |||
Weighted Average Yield | 3.18% | |||
Weighted Average Life (Years) | 6 years 7 months 5 days | [5] | ||
[1] | Includes securities issued or guaranteed by U.S. Government agencies such as the Federal National Mortgage Association (“Fannie Maeâ€) or the Federal Home Loan Mortgage Corporation (“Freddie Macâ€). | |||
[2] | The total outstanding face amount was $979.8 million for fixed rate securities and $595.9 million for floating rate securities as of March 31, 2015. | |||
[3] | Fair value, which is equal to carrying value for all securities. See Note 12 regarding the estimation of fair value. | |||
[4] | Represents the weighted average of the ratings of all securities in each asset type, expressed as an S&P equivalent rating. This excludes the ratings of the collateral underlying 20 bonds which either have never been rated or for which rating information is no longer provided. For each security rated by multiple rating agencies, the lowest rating is used. New Residential used an implied AAA rating for the Agency RMBS. Ratings provided were determined by third party rating agencies, and represent the most recent credit ratings available as of the reporting date and may not be current. | |||
[5] | The weighted average life is based on the timing of expected principal reduction on the assets. | |||
[6] | The total outstanding face amount was $1.2 billion (including $927.5 million of residual and interest-only notional amount) for fixed rate securities and $654.0 million (including $101.1 million of residual and interest-only notional amount) for floating rate securities as of March 31, 2015. | |||
[7] | Includes New Residential’s investments in interest-only notes for which the fair value option for financial instruments was elected. | |||
[8] | Includes Other ABS consisting primarily of interest-only securities which New Residential elected to carry at fair value and record changes to valuation through the income statement and representing 8.5% of the carrying value of the Non-Agency RMBS portfolio. Gross Unrealized Weighted AverageAsset Type Outstanding Face Amount Amortized Cost Basis Gains Losses Carrying Value Number of Securities Rating Coupon Yield Life (Years) Principal SubordinationOther ABS $984,460 $56,414 $829 $(1,119) $56,124 8 AA+ 1.98% 8.65% 4.0 —% | |||
[9] | Percentage of the outstanding face amount of securities that is subordinate to New Residential’s investments. |
INVESTMENTS_IN_REAL_ESTATE_SEC4
INVESTMENTS IN REAL ESTATE SECURITIES - Summary of Real Estate Securities (Footnote) (Details) (USD $) | Mar. 31, 2015 | |
bond | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Number of bonds which New Residential was unable to obtain rating information | 20 | |
Outstanding face amount | $3,396,295,000 | |
Agency RMBS [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Outstanding face amount | 1,575,759,000 | [1],[2] |
Non-Agency RMBS [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Outstanding face amount | 1,820,536,000 | [3],[4],[5] |
Other ABS [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Outstanding face amount | 984,460,000 | |
Percent of other RMBS representing carrying value of Non-Agency RMBS portfolio | 8.50% | |
Fixed Rate Residential Mortgage [Member] | Agency RMBS [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Outstanding face amount | 979,800,000 | |
Fixed Rate Residential Mortgage [Member] | Non-Agency RMBS [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Outstanding face amount | 1,200,000,000 | |
Residual and interest - only notional amount | 927,500,000 | |
Floating Rate Residential Mortgage [Member] | Agency RMBS [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Outstanding face amount | 595,900,000 | |
Floating Rate Residential Mortgage [Member] | Non-Agency RMBS [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Outstanding face amount | 654,000,000 | |
Residual and interest - only notional amount | $101,100,000 | |
[1] | Includes securities issued or guaranteed by U.S. Government agencies such as the Federal National Mortgage Association (“Fannie Maeâ€) or the Federal Home Loan Mortgage Corporation (“Freddie Macâ€). | |
[2] | The total outstanding face amount was $979.8 million for fixed rate securities and $595.9 million for floating rate securities as of March 31, 2015. | |
[3] | The total outstanding face amount was $1.2 billion (including $927.5 million of residual and interest-only notional amount) for fixed rate securities and $654.0 million (including $101.1 million of residual and interest-only notional amount) for floating rate securities as of March 31, 2015. | |
[4] | Includes New Residential’s investments in interest-only notes for which the fair value option for financial instruments was elected. | |
[5] | Includes Other ABS consisting primarily of interest-only securities which New Residential elected to carry at fair value and record changes to valuation through the income statement and representing 8.5% of the carrying value of the Non-Agency RMBS portfolio. Gross Unrealized Weighted AverageAsset Type Outstanding Face Amount Amortized Cost Basis Gains Losses Carrying Value Number of Securities Rating Coupon Yield Life (Years) Principal SubordinationOther ABS $984,460 $56,414 $829 $(1,119) $56,124 8 AA+ 1.98% 8.65% 4.0 —% |
INVESTMENTS_IN_REAL_ESTATE_SEC5
INVESTMENTS IN REAL ESTATE SECURITIES - Summary of Real Estate Securities in an Unrealized Loss Position (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 | |
Schedule of Available-for-sale Securities [Line Items] | |||
Outstanding Face Amount | $3,396,295 | ||
Other Than Temporary Impairment - Amortized Cost Basis | -1,970 | -1,127 | |
After Impairment | 2,307,696 | ||
Carrying Value - Total | 2,324,915 | ||
Weighted Average Life (Years) | 10 months 2 days | ||
Securities in an Unrealized Loss Position Less than Twelve Months [Member] | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Outstanding Face Amount | 1,297,224 | ||
Before Impairment - Amortized Cost Basis | 494,733 | ||
Other Than Temporary Impairment - Amortized Cost Basis | -1,071 | [1] | |
After Impairment | 493,662 | ||
Gross Unrealized Losses - Less than Twelve Months | -3,202 | ||
Carrying Value - Less than Twelve Months | 490,460 | ||
Number of Securities - Less than Twelve Months | 70 | ||
Weighted Average Rating | AA- | [2] | |
Weighted Average Coupon | 1.37% | ||
Weighted Average Yield | 2.20% | ||
Weighted Average Life (Years) | 7 years 2 months 19 days | ||
Securities in an Unrealized Loss Position Twelve Months or Greater [Member] | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Outstanding Face Amount | 128,605 | ||
Before Impairment - Amortized Cost Basis | 123,794 | ||
Other Than Temporary Impairment - Amortized Cost Basis | 0 | [1] | |
After Impairment | 123,794 | ||
Gross Unrealized Losses - Twelve or More Months | -1,730 | ||
Carrying Value - Twelve or More Months | 122,064 | ||
Number of Securities - Twelve or More Months | 22 | ||
Weighted Average Rating | AA+ | [2] | |
Weighted Average Coupon | 2.39% | ||
Weighted Average Yield | 1.96% | ||
Weighted Average Life (Years) | 4 years 5 months 1 day | ||
Securities in a Loss Position [Member] | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Outstanding Face Amount | 1,425,829 | ||
Before Impairment - Amortized Cost Basis | 618,527 | ||
Other Than Temporary Impairment - Amortized Cost Basis | -1,071 | [1] | |
After Impairment | 617,456 | ||
Gross Unrealized Losses - Total | -4,932 | ||
Carrying Value - Total | $612,524 | ||
Number of Securities - Total | 92 | ||
Weighted Average Rating | AA | [2] | |
Weighted Average Coupon | 1.57% | ||
Weighted Average Yield | 2.15% | ||
Weighted Average Life (Years) | 6 years 7 months 27 days | ||
[1] | This amount represents other-than-temporary impairment recorded on securities that are in an unrealized loss position as of March 31, 2015. | ||
[2] | The weighted average rating of securities in an unrealized loss position for less than twelve months excludes the rating of 20 bonds which either have never been rated or for which rating information is no longer provided. |
INVESTMENTS_IN_REAL_ESTATE_SEC6
INVESTMENTS IN REAL ESTATE SECURITIES - Summary of Real Estate Securities in an Unrealized Loss Position (Footnote) (Details) | Mar. 31, 2015 |
bond | |
Investments, Debt and Equity Securities [Abstract] | |
Number of bonds which New Residential was unable to obtain rating information | 20 |
INVESTMENTS_IN_REAL_ESTATE_SEC7
INVESTMENTS IN REAL ESTATE SECURITIES - Summary of Real Estate Securities in an Unrealized Loss Position - Associated Intent to Sell (Details) (USD $) | Mar. 31, 2015 | |
In Thousands, unless otherwise specified | ||
Securities Intended To Sell [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fair Value | $0 | [1] |
Amortized Cost Basis After Impairment | 0 | [1] |
Unrealized Credit Losses | 0 | [1],[2] |
Unrealized Non-Credit Losses | 0 | [1],[3] |
Securities More Likely Than Not Required to be Sold [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fair Value | 0 | [4] |
Amortized Cost Basis After Impairment | 0 | [4] |
Unrealized Credit Losses | 0 | [2],[4] |
Securities No Intent To Sell - Credit Impaired [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fair Value | 107,612 | |
Amortized Cost Basis After Impairment | 108,440 | |
Unrealized Credit Losses | -1,071 | [2] |
Unrealized Non-Credit Losses | -828 | [3] |
Securities No Intent To Sell - Non-Credit Impaired [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fair Value | 504,912 | |
Amortized Cost Basis After Impairment | 509,016 | |
Unrealized Credit Losses | 0 | [2] |
Unrealized Non-Credit Losses | -4,104 | [3] |
Securities in an Unrealized Loss Position [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fair Value | 612,524 | |
Amortized Cost Basis After Impairment | 617,456 | |
Unrealized Credit Losses | -1,071 | [2] |
Unrealized Non-Credit Losses | ($4,932) | [3] |
[1] | A portion of securities New Residential intends to sell have a fair value equal to their amortized cost basis after impairment and, therefore, do not have unrealized losses reflected in other comprehensive income as of March 31, 2015. | |
[2] | This amount is required to be recorded as other-than-temporary impairment through earnings. In measuring the portion of credit losses, New Residential’s management estimates the expected cash flow for each of the securities. This evaluation includes a review of the credit status and the performance of the collateral supporting those securities, including the credit of the issuer, key terms of the securities and the effect of local, industry and broader economic trends. Significant inputs in estimating the cash flows include management’s expectations of prepayment speeds, default rates and loss severities. Credit losses are measured as the decline in the present value of the expected future cash flows discounted at the investment’s effective interest rate. | |
[3] | This amount represents unrealized losses on securities that are due to non-credit factors and recorded through other comprehensive income. | |
[4] | New Residential may, at times, be more likely than not to be required to sell certain securities for liquidity purposes. While the amount of the securities to be sold may be an estimate, and the securities to be sold have not yet been identified, New Residential must make its best estimate, which is subject to significant judgment regarding future events, and may differ materially from actual future sales. |
INVESTMENTS_IN_REAL_ESTATE_SEC8
INVESTMENTS IN REAL ESTATE SECURITIES - Summary of Real Estate Securities in an Unrealized Loss Position - Associated Intent to Sell (Footnote) (Details) (USD $) | 3 Months Ended |
Mar. 31, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
Unrealized losses reflected in other comprehensive income | $0 |
INVESTMENTS_IN_REAL_ESTATE_SEC9
INVESTMENTS IN REAL ESTATE SECURITIES - Summary of Activity Related to Credit Losses on Debt Securities (Details) (USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Mar. 31, 2015 |
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Roll Forward] | |
Beginning balance of credit losses on debt securities for which a portion of an OTTI was recognized in other comprehensive income | $1,127 |
Increases to credit losses on securities for which an OTTI was previously recognized and a portion of an OTTI was recognized in other comprehensive income | 6 |
Additions for credit losses on securities for which an OTTI was not previously recognized | 1,065 |
Reductions for securities for which the amount previously recognized in other comprehensive income was recognized in earnings because the entity intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis | 0 |
Reduction for credit losses on securities for which no OTTI was recognized in other comprehensive income at the current measurement date | 0 |
Reduction for securities sold during the period | -228 |
Ending balance of credit losses on debt securities for which a portion of an OTTI was recognized in other comprehensive income | $1,970 |
Recovered_Sheet5
INVESTMENTS IN REAL ESTATE SECURITIES - Summary of the Geographic Distribution of the Collateral Securing Non-Agency RMBS (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 | ||
In Thousands, unless otherwise specified | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Outstanding Face Amount | $3,396,295 | |||
Non-Agency RMBS Excluding Other ABS [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Outstanding Face Amount | 1,820,536 | 1,896,150 | ||
Percentage of Total Outstanding | 100.00% | 100.00% | ||
Non-Agency RMBS Excluding Other ABS [Member] | Western U.S. [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Outstanding Face Amount | 614,391 | 779,930 | ||
Percentage of Total Outstanding | 33.60% | 41.10% | ||
Non-Agency RMBS Excluding Other ABS [Member] | Southeastern U.S. [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Outstanding Face Amount | 479,970 | 409,755 | ||
Percentage of Total Outstanding | 26.40% | 21.60% | ||
Non-Agency RMBS Excluding Other ABS [Member] | Northeastern U.S. [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Outstanding Face Amount | 327,308 | 344,716 | ||
Percentage of Total Outstanding | 18.00% | 18.20% | ||
Non-Agency RMBS Excluding Other ABS [Member] | Midwestern U.S. [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Outstanding Face Amount | 160,246 | 190,480 | ||
Percentage of Total Outstanding | 8.80% | 10.00% | ||
Non-Agency RMBS Excluding Other ABS [Member] | Southwestern U.S. [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Outstanding Face Amount | 238,127 | 170,829 | ||
Percentage of Total Outstanding | 13.10% | 9.00% | ||
Non-Agency RMBS Excluding Other ABS [Member] | Other U.S. [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Outstanding Face Amount | $494 | [1] | $440 | [1] |
Percentage of Total Outstanding | 0.10% | [1] | 0.10% | [1] |
[1] | Represents collateral for which New Residential was unable to obtain geographic information. |
Recovered_Sheet6
INVESTMENTS IN REAL ESTATE SECURITIES - Schedule of the Outstanding Face Amount and Carrying Value for Securities Uncollectible (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Investments, Debt and Equity Securities [Abstract] | ||
Outstanding Face Amount | $234,289 | $536,342 |
Carrying Value | $147,137 | $414,298 |
Recovered_Sheet7
INVESTMENTS IN REAL ESTATE SECURITIES - Summary of Changes in Accretable Yield for Securities (Details) (USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Mar. 31, 2015 |
Certain Loans Acquired in Transfer Accounted for as Available-for-sale Debt Securities, Accretable Yield Movement Schedule [Roll Forward] | |
Balance, beginning | $181,671 |
Additions | 23,599 |
Accretion | -4,321 |
Reclassifications from (to) non-accretable difference | -3,605 |
Disposals | -100,536 |
Balance, ending | $96,808 |
INVESTMENTS_IN_RESIDENTIAL_MOR2
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Narrative (Details) (USD $) | 3 Months Ended | 1 Months Ended | 0 Months Ended | |||||
Mar. 31, 2015 | Mar. 31, 2014 | Feb. 28, 2013 | Mar. 26, 2015 | Mar. 19, 2015 | Feb. 27, 2015 | Mar. 27, 2015 | Dec. 31, 2014 | |
Mortgage Loans on Real Estate [Line Items] | ||||||||
Gain (loss) on sale of residential mortgage loans, net | $20,830,000 | $0 | ||||||
Threshold period past due | 30 days | |||||||
Real Estate Owned assets total | 15,200,000 | |||||||
Reverse Mortgage Loans [Member] | ||||||||
Mortgage Loans on Real Estate [Line Items] | ||||||||
Carrying value of mortgage loans | 23,294,000 | 24,965,000 | ||||||
Interest in reverse mortgage loans | 70.00% | 70.00% | ||||||
PCI residential mortgage loans in the process of foreclosure, unpaid principal balance | 300,000 | |||||||
Residential Mortgage [Member] | ||||||||
Mortgage Loans on Real Estate [Line Items] | ||||||||
PCI residential mortgage loans in the process of foreclosure, unpaid principal balance | 204,800,000 | |||||||
Residential Mortgage [Member] | ||||||||
Mortgage Loans on Real Estate [Line Items] | ||||||||
Unpaid Principal Balance (“UPBâ€) of Underlying Mortgages | 6,400,000 | 176,500,000 | 135,200,000 | |||||
Carrying value of mortgage loans | 5,100,000 | 142,100,000 | 102,400,000 | |||||
Sale price of mortgage loans | 5,300,000 | 148,600,000 | 102,800,000 | |||||
Gain (loss) on sale of residential mortgage loans, net | 200,000 | 6,500,000 | 400,000 | |||||
Residential Mortgage and Real Estate Owned [Member] | ||||||||
Mortgage Loans on Real Estate [Line Items] | ||||||||
Unpaid Principal Balance (“UPBâ€) of Underlying Mortgages | 469,600,000 | |||||||
Carrying value of mortgage loans | 362,000,000 | |||||||
Sale price of mortgage loans | 373,000,000 | |||||||
Gain (loss) on sale of residential mortgage loans, net | $11,000,000 | |||||||
Nationstar [Member] | ||||||||
Mortgage Loans on Real Estate [Line Items] | ||||||||
Interest in reverse mortgage loans | 30.00% |
INVESTMENTS_IN_RESIDENTIAL_MOR3
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Schedule of Residential Mortgage Loans Outstanding by Loan Type, Excluding REO (Details) (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 | ||
loan | ||||
Mortgage Loans on Real Estate [Line Items] | ||||
Weighted Average Life (Years) | 10 months 2 days | |||
Reverse Mortgage Loans [Member] | ||||
Mortgage Loans on Real Estate [Line Items] | ||||
Outstanding Face Amount | $42,306 | [1],[2] | ||
Carrying Value | 23,294 | [1],[2] | 24,965 | [1],[2] |
Loan Count | 182 | [1],[2] | ||
Weighted Average Yield | 10.00% | [1],[2] | ||
Weighted Average Life (Years) | 4 years 15 days | [1],[2],[3] | ||
Floating Rate Loans as a % of Face Amount | 21.40% | [1],[2] | ||
Loan to Value Ratio | 109.60% | [1],[2],[4] | ||
Weighted Average Delinquency | 78.20% | [1],[2],[5] | ||
Performing Loans [Member] | ||||
Mortgage Loans on Real Estate [Line Items] | ||||
Outstanding Face Amount | 23,548 | [6] | ||
Carrying Value | 21,673 | [6] | 22,873 | [6] |
Loan Count | 709 | [6] | ||
Weighted Average Yield | 8.70% | [6] | ||
Weighted Average Life (Years) | 5 years 9 months 20 days | [3],[6] | ||
Floating Rate Loans as a % of Face Amount | 17.90% | [6] | ||
Loan to Value Ratio | 79.60% | [4],[6] | ||
Weighted Average Delinquency | 0.30% | [5],[6] | ||
Weighted Average FICO | 620 | [6],[7] | ||
Residential Mortgage Loans Held-for-Investment [Member] | ||||
Mortgage Loans on Real Estate [Line Items] | ||||
Outstanding Face Amount | 65,854 | |||
Carrying Value | 44,967 | 47,838 | ||
Loan Count | 891 | |||
Weighted Average Yield | 9.60% | |||
Weighted Average Life (Years) | 4 years 8 months 2 days | [3] | ||
Floating Rate Loans as a % of Face Amount | 19.40% | |||
Loan to Value Ratio | 98.50% | [4] | ||
Weighted Average Delinquency | 53.00% | [5] | ||
Weighted Average FICO | 620 | [7] | ||
Performing Loans, Held-for-sale [Member] | ||||
Mortgage Loans on Real Estate [Line Items] | ||||
Outstanding Face Amount | 268,731 | [6] | ||
Carrying Value | 270,407 | [6] | 388,485 | [6] |
Loan Count | 4,832 | [6] | ||
Weighted Average Yield | 4.90% | [6] | ||
Weighted Average Life (Years) | 6 years 11 months 13 days | [3],[6] | ||
Floating Rate Loans as a % of Face Amount | 27.60% | [6] | ||
Loan to Value Ratio | 82.10% | [4],[6] | ||
Weighted Average Delinquency | 0.00% | [5],[6] | ||
Weighted Average FICO | 621 | [6],[7] | ||
Purchase Credit Impaired Loans, Held-for-sale [Member] | ||||
Mortgage Loans on Real Estate [Line Items] | ||||
Outstanding Face Amount | 300,598 | [8] | ||
Carrying Value | 229,767 | [8] | 737,954 | [8] |
Loan Count | 2,133 | [8] | ||
Weighted Average Yield | 5.90% | [8] | ||
Weighted Average Life (Years) | 2 years 4 months 20 days | [3],[8] | ||
Floating Rate Loans as a % of Face Amount | 32.40% | [8] | ||
Loan to Value Ratio | 105.90% | [4],[8] | ||
Weighted Average Delinquency | 87.40% | [5],[8] | ||
Weighted Average FICO | 547 | [7],[8] | ||
Residential Mortgage Loans Held-for-Sale [Member] | ||||
Mortgage Loans on Real Estate [Line Items] | ||||
Outstanding Face Amount | 569,329 | |||
Carrying Value | $500,174 | $1,126,439 | ||
Loan Count | 6,965 | |||
Weighted Average Yield | 5.40% | |||
Weighted Average Life (Years) | 4 years 6 months 15 days | [3] | ||
Floating Rate Loans as a % of Face Amount | 30.10% | |||
Loan to Value Ratio | 94.70% | [4] | ||
Weighted Average Delinquency | 46.20% | [5] | ||
Weighted Average FICO | 582 | [7] | ||
[1] | Represents a 70% interest that New Residential holds in reverse mortgage loans. The average loan balance outstanding based on total UPB is $0.3 million. 76% of these loans have reached a termination event. As a result, the borrower can no longer make draws on these loans. Each loan matures upon the occurrence of a termination event. | |||
[2] | FICO scores are not used in determining how much a borrower can access via a reverse mortgage loan. | |||
[3] | The weighted average life is based on the expected timing of the receipt of cash flows. | |||
[4] | LTV refers to the ratio comparing the loan’s unpaid principal balance to the value of the collateral property. | |||
[5] | Represents the percentage of the total principal balance that are 60+ days delinquent. | |||
[6] | Includes loans that are current or less than 30 days past due at acquisition where New Residential expects to collect all contractually required principal and interest payments. Presented net of unamortized premiums of $0.7 million. | |||
[7] | The weighted average FICO score is based on the weighted average of information updated and provided by the loan servicer on a monthly basis. | |||
[8] | Includes loans with evidence of credit deterioration since origination where it is probable that New Residential will not collect all contractually required principal and interest payments. As of March 31, 2015, New Residential has placed all of these loans on nonaccrual status. |
INVESTMENTS_IN_RESIDENTIAL_MOR4
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Schedule of Residential Mortgage Loans Outstanding by Loan Type, Excluding REO (Footnote) (Details) (USD $) | 1 Months Ended | 3 Months Ended |
In Millions, unless otherwise specified | Feb. 28, 2013 | Mar. 31, 2015 |
Mortgage Loans on Real Estate [Line Items] | ||
Threshold period past due | 30 days | |
Net unamortized discounts and premiums | $0.70 | |
Reverse Mortgage Loans [Member] | ||
Mortgage Loans on Real Estate [Line Items] | ||
Interest in reverse mortgage loans | 70.00% | 70.00% |
Total unpaid principal balance | $0.30 | |
Percentage of loans that have reached a termination event | 76.00% | |
Maximum [Member] | Performing Loans [Member] | ||
Mortgage Loans on Real Estate [Line Items] | ||
Threshold period past due | 30 days |
INVESTMENTS_IN_RESIDENTIAL_MOR5
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Summary of the Geographic Distribution of the Underlying Residential Mortgage Loans (Details) (Residential Mortgage Loans Held-for-Investment [Member]) | Mar. 31, 2015 | Dec. 31, 2014 |
Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 100.00% | 100.00% |
New York [Member] | ||
Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 11.20% | 12.20% |
California [Member] | ||
Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 9.00% | 15.00% |
Florida [Member] | ||
Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 7.10% | 6.30% |
New Jersey [Member] | ||
Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 5.50% | 7.00% |
Georgia [Member] | ||
Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 4.80% | 3.60% |
Texas [Member] | ||
Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 4.70% | 4.10% |
Pennsylvania [Member] | ||
Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 4.70% | 3.90% |
North Carolina [Member] | ||
Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 4.60% | 3.00% |
Ohio [Member] | ||
Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 4.40% | 3.10% |
Illinois [Member] | ||
Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 4.10% | 4.40% |
Other U.S. [Member] | ||
Mortgage Loans on Real Estate [Line Items] | ||
Percentage of Total Outstanding Unpaid Principal Amount as of | 39.90% | 37.40% |
INVESTMENTS_IN_RESIDENTIAL_MOR6
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Schedule of Past Due Information for Performing Loans (Details) (Delinquency Status [Member]) | Mar. 31, 2015 | |
Delinquency Status [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Current | 86.10% | [1] |
30-59 | 13.90% | [1] |
60-89 | 0.00% | [1] |
90-119 | 0.00% | [1],[2] |
120 and greater | 0.00% | [1],[3] |
Total Loans | 100.00% | [1] |
[1] | Represents the percentage of the total principal balance that corresponds to loans that are in each delinquency status. | |
[2] | Includes loans 90-119 days past due and still accruing because they are generally placed on nonaccrual status at 120 days or more past due. | |
[3] | Represents nonaccrual loans. |
INVESTMENTS_IN_RESIDENTIAL_MOR7
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Schedule of Past Due Information for Performing Loans (Footnote) (Details) | 3 Months Ended |
Mar. 31, 2015 | |
Financing Receivable, Recorded Investment, Past Due [Line Items] | |
Threshold period past due | 30 days |
Equal to Greater than 90 Days Past Due [Member] | |
Financing Receivable, Recorded Investment, Past Due [Line Items] | |
Threshold period past due | 120 days |
Lower Range [Member] | Equal to Greater than 90 Days Past Due [Member] | |
Financing Receivable, Recorded Investment, Past Due [Line Items] | |
Threshold period past due | 90 days |
Upper Range [Member] | Equal to Greater than 90 Days Past Due [Member] | |
Financing Receivable, Recorded Investment, Past Due [Line Items] | |
Threshold period past due | 119 days |
INVESTMENTS_IN_RESIDENTIAL_MOR8
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Summary of Activities Related to the Carrying Value of Reverse Mortgage Loans and Performing Loans and PCI Loans Held for Investment (Details) (USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Mar. 31, 2015 |
Reverse Mortgage Loans [Member] | |
Movement in Mortgage Loans on Real Estate [Roll Forward] | |
Balance, beginning | $24,965 |
Purchases/additional fundings | 340 |
Proceeds from repayments | 0 |
Accretion of loan discount (premium) and other amortization | 1,274 |
Provision for loan losses | -202 |
Transfer of loans to other assets | -2,720 |
Transfer of loans to real estate owned | -363 |
Transfer of loans to held-for-sale | 0 |
Reversal of valuation provision on loans transferred to other assets | 0 |
Balance, ending | 23,294 |
Performing Loans [Member] | |
Movement in Mortgage Loans on Real Estate [Roll Forward] | |
Balance, beginning | 22,873 |
Purchases/additional fundings | 0 |
Proceeds from repayments | -854 |
Accretion of loan discount (premium) and other amortization | -228 |
Provision for loan losses | -118 |
Transfer of loans to other assets | 0 |
Transfer of loans to real estate owned | 0 |
Transfer of loans to held-for-sale | 0 |
Reversal of valuation provision on loans transferred to other assets | 0 |
Balance, ending | $21,673 |
INVESTMENTS_IN_RESIDENTIAL_MOR9
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Summary of Activities Related to the Valuation Provision on Reverse Mortgage Loans and Allowance for Loan Losses on Performing Loans (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | |
Reverse Mortgage Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | ||
Beginning, balance | $1,518 | |
Allowance for loan losses | 202 | [1] |
Charge-offs | 0 | [2] |
Reversal of valuation provision on loans transferred to other assets | 0 | |
Ending, balance | 1,720 | |
Performing Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | ||
Beginning, balance | 1,447 | |
Allowance for loan losses | 118 | [1] |
Charge-offs | -1,371 | [2] |
Reversal of valuation provision on loans transferred to other assets | 0 | |
Ending, balance | $194 | |
[1] | Based on an analysis of collective borrower performance, credit ratings of borrowers, loan-to-value ratios, estimated value of the underlying collateral, key terms of the loans and historical and anticipated trends in defaults and loss severities at a pool level. | |
[2] | Loans, other than PCI loans, are generally charged off or charged down to the net realizable value of the collateral (i.e., fair value less costs to sell), with an offset to the allowance for loan losses, when available information confirms that loans are uncollectible. |
Recovered_Sheet8
INVESTMENTS IN RESIDENTIAL MORTGAGE LOANS - Summary of Activities Related to the Carrying Value of Loans Held-for-sale (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | |
Loans Held-for-sale, Reconciliation [Roll Forward] | |||
Adoption of ASU No. 2014-11 | ($2,310) | ||
Loans Held-for-sale [Member] | |||
Loans Held-for-sale, Reconciliation [Roll Forward] | |||
Beginning balance, loans held-for-sale | 1,126,439 | ||
Purchases | 0 | [1] | |
Sales | -606,155 | ||
Transfer of loans to real estate owned | -15,417 | ||
Proceeds from repayments | -5,682 | ||
Valuation provision on loans | -842 | [2] | |
Ending balance, loans held-for-sale | 500,174 | ||
Accounting Standards Update 2014-11 [Member] | |||
Loans Held-for-sale, Reconciliation [Roll Forward] | |||
Adoption of ASU No. 2014-11 | -85,955 | 0 | |
Accounting Standards Update 2014-11 [Member] | Loans Held-for-sale [Member] | |||
Loans Held-for-sale, Reconciliation [Roll Forward] | |||
Adoption of ASU No. 2014-11 | $1,831 | [3] | |
[1] | Represents loans acquired with the intent to sell. | ||
[2] | Represents the fair value adjustments to loans upon transfer to held-for-sale and provision recorded on certain purchased held-for-sale loans. | ||
[3] | Represents loans financed with the selling counterparty that were previously accounted for as linked transactions. |
INVESTMENTS_IN_CONSUMER_LOANS_2
INVESTMENTS IN CONSUMER LOANS, EQUITY METHOD INVESTEES - Narrative (Details) (USD $) | 0 Months Ended | 3 Months Ended | 12 Months Ended | ||
Oct. 03, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | Apr. 30, 2013 | |
Schedule of Equity Method Investments [Line Items] | |||||
Refinanced outstanding asset-backed notes | $2,600,000,000 | ||||
Proceeds from refinancing asset backed notes | 337,800,000 | ||||
Basis in consumer loans investment | 0 | ||||
Gain on consumer loans investment | 80,100,000 | 10,447,000 | 0 | ||
Blackstone Tactical Opportunities Advisors LLC [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Percentage of portfolio co-invested by other parties | 23.00% | ||||
Consumer Loan Companies [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Percentage of portfolio financed by other parties | 73.00% | ||||
Springleaf [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Percentage of portfolio co-invested by other parties | 47.00% | ||||
Consumer Loan Investees [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership percentage in equity method investees | 30.00% | 30.00% | 30.00% | 30.00% | |
Percentage of portfolio co-invested by other parties | 70.00% | ||||
Distributions in excess to New Residential | $10,400,000 |
INVESTMENTS_IN_CONSUMER_LOANS_3
INVESTMENTS IN CONSUMER LOANS, EQUITY METHOD INVESTEES - Summary of the Investment in Consumer Loan Companies (Details) (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | Apr. 30, 2013 |
Schedule of Equity Method Investments [Line Items] | ||||
New Residential’s investment | $0 | $0 | ||
Consumer Loan Investees [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Consumer loan assets (amortized cost basis) | 1,981,271 | 2,088,330 | ||
Other assets | 92,028 | 92,051 | ||
Debt | -2,282,438 | -2,411,421 | ||
Other liabilities | -5,854 | -12,340 | ||
Equity | -214,993 | -243,380 | ||
New Residential’s investment | 0 | 0 | ||
New Residential’s ownership | 30.00% | 30.00% | 30.00% | 30.00% |
Interest income | 121,869 | 142,815 | ||
Interest expense | -23,107 | -22,195 | ||
Provision for finance receivable losses | -19,636 | -34,156 | ||
Other expenses, net | -15,964 | -20,452 | ||
Change in fair value of debt | 0 | -16,867 | ||
Net income | 63,162 | 49,145 | ||
New Residential’s equity in net income (through October 3, 2014) | $0 | $16,360 |
INVESTMENTS_IN_CONSUMER_LOANS_4
INVESTMENTS IN CONSUMER LOANS, EQUITY METHOD INVESTEES - Summary of Consumer Loan Investments made through Equity Method Investees (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 | ||
Schedule of Equity Method Investments [Line Items] | ||||
Weighted Average Expected Life (Years) | 10 months 2 days | |||
Consumer Loan Investees [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Unpaid Principal Balance | $2,460,743 | [1] | $2,589,748 | [1] |
New Residential Interest in Investees | 30.00% | 30.00% | ||
Carrying value | $1,981,271 | [2] | $2,088,330 | [2] |
Weighted Average Coupon | 18.20% | [3] | 18.10% | [3] |
Weighted Average Yield | 16.30% | 16.10% | ||
Weighted Average Expected Life (Years) | 3 years 7 months 19 days | [4] | 3 years 7 months 19 days | [4] |
[1] | Represents the February 28, 2015 and November 30, 2014 balances, respectively. | |||
[2] | Represents the carrying value of the consumer loans held by the Consumer Loan Companies. | |||
[3] | Substantially all of the cash flows received on the loans is required to be used to make payments on the notes described above. | |||
[4] | Weighted Average Expected Life represents the weighted average expected timing of the receipt of expected cash flows for this investment. |
DERIVATIVES_Narrative_Details
DERIVATIVES - Narrative (Details) (USD $) | Jan. 01, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | ||
Derivative [Line Items] | |||||
Carrying amount of derivatives | $32,400,000 | ||||
TBAs [Member] | |||||
Derivative [Line Items] | |||||
Derivative asset, notional amount | 980,000,000 | [1] | 1,234,000,000 | [1] | |
Residential Mortgage [Member] | |||||
Derivative [Line Items] | |||||
Secured borrowings | 1,800,000 | ||||
Residential Mortgage [Member] | Non-agency RMBS Repurchase Agreements [Member] | |||||
Derivative [Line Items] | |||||
Secured borrowings | 116,800,000 | ||||
Repurchase Agreements [Member] | |||||
Derivative [Line Items] | |||||
Secured borrowings | 86,000,000 | ||||
Other Liabilities [Member] | |||||
Derivative [Line Items] | |||||
Secured borrowings | 200,000 | ||||
Short [Member] | |||||
Derivative [Line Items] | |||||
Derivative asset, notional amount | $980,000,000 | ||||
[1] | Represents the notional amount of Agency RMBS, classified as derivatives. |
DERIVATIVES_Schedule_of_Deriva
DERIVATIVES - Schedule of Derivatives - Recorded at Fair Value (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 | ||
In Thousands, unless otherwise specified | ||||
Derivative [Line Items] | ||||
Derivative assets | $71 | $32,597 | ||
Derivative liabilities | 21,127 | 14,220 | ||
Real Estate Securities [Member] | ||||
Derivative [Line Items] | ||||
Derivative assets | 0 | [1] | 32,090 | [1] |
Non-Performing Loans [Member] | ||||
Derivative [Line Items] | ||||
Derivative assets | 0 | [1] | 312 | [1] |
Interest Rate Cap [Member] | ||||
Derivative [Line Items] | ||||
Derivative assets | 71 | 195 | ||
TBAs [Member] | ||||
Derivative [Line Items] | ||||
Derivative liabilities | 8,539 | 4,985 | ||
Interest Rate Swap [Member] | ||||
Derivative [Line Items] | ||||
Derivative liabilities | $12,588 | $9,235 | ||
[1] | For December 31, 2014, investments purchased from, and financed by, the selling counterparty that New Residential accounted for as linked transactions are reflected as derivatives. Upon the adoption of ASU 2014-11 on January 1, 2015, these transactions are accounted for as secured borrowings. |
DERIVATIVES_Schedule_of_Deriva1
DERIVATIVES - Schedule of Derivatives - Notional Amount (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 | ||
Non-Performing Loans [Member] | ||||
Derivative [Line Items] | ||||
Derivative asset, notional amount | $0 | [1] | $2,931,000 | [1] |
Real Estate Securities [Member] | ||||
Derivative [Line Items] | ||||
Derivative asset, notional amount | 0 | [2] | 186,694,000 | [2] |
TBAs, Short Position [Member] | ||||
Derivative [Line Items] | ||||
Derivative asset, notional amount | 980,000,000 | [3] | 1,234,000,000 | [3] |
Interest Rate Cap [Member] | ||||
Derivative [Line Items] | ||||
Derivative asset, notional amount | 210,000,000 | [4] | 210,000,000 | [4] |
Interest Rate Swap [Member] | ||||
Derivative [Line Items] | ||||
Derivative asset, notional amount | $1,107,000,000 | [5] | $1,107,000,000 | [5] |
[1] | For December 31, 2014, represents the UPB of the underlying loans of the non-performing loan pools within linked transactions. | |||
[2] | For December 31, 2014, represents the face amount of the real estate securities within linked transactions. | |||
[3] | Represents the notional amount of Agency RMBS, classified as derivatives. | |||
[4] | Caps LIBOR at 3.0%. | |||
[5] | Receive LIBOR and pay a fixed rate. |
DERIVATIVES_Schedule_of_Deriva2
DERIVATIVES - Schedule of Derivatives - Notional Amount (Footnote) (Details) | Mar. 31, 2015 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative, cap interest rate | 3.00% |
DERIVATIVES_Schedule_of_Deriva3
DERIVATIVES - Schedule of Derivatives - Gain (Losses) (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Derivative [Line Items] | ||
Unrealized gain (loss) on derivative instruments | ($7,030) | $1,357 |
Gain (loss) on settlement of derivatives | -22,590 | -135 |
Total gains (losses) | -29,620 | 1,222 |
Non-Performing Loans [Member] | ||
Derivative [Line Items] | ||
Unrealized gain (loss) on derivative instruments | 0 | 671 |
TBAs [Member] | ||
Derivative [Line Items] | ||
Unrealized gain (loss) on derivative instruments | -3,554 | 362 |
Gain (loss) on settlement of derivatives | -16,033 | 43 |
Interest Rate Swap [Member] | ||
Derivative [Line Items] | ||
Unrealized gain (loss) on derivative instruments | -3,352 | -84 |
Gain (loss) on settlement of derivatives | -6,557 | -178 |
U.S.T. Short Position [Member] | ||
Derivative [Line Items] | ||
Unrealized gain (loss) on derivative instruments | 0 | 408 |
Interest Rate Cap [Member] | ||
Derivative [Line Items] | ||
Unrealized gain (loss) on derivative instruments | -124 | 0 |
Real Estate Securities [Member] | ||
Derivative [Line Items] | ||
Gain (loss) on settlement of derivatives | $0 | $0 |
DEBT_OBLIGATIONS_Schedule_of_D
DEBT OBLIGATIONS - Schedule of Debt Obligations (Details) (USD $) | 3 Months Ended | |||
Mar. 31, 2015 | Dec. 31, 2014 | |||
Debt Instrument [Line Items] | ||||
Outstanding Face Amount | $5,338,807,000 | |||
Carrying Value | 5,338,807,000 | 6,062,299,000 | ||
Weighted Average Funding Cost | 1.90% | |||
Weighted Average Life (Years) | 10 months 2 days | |||
Repurchase Agreements [Member] | Agency RMBS [Member] | ||||
Debt Instrument [Line Items] | ||||
Outstanding Face Amount | 1,612,972,000 | [1],[2] | ||
Carrying Value | 1,612,972,000 | [1],[2] | 1,707,602,000 | [1],[2] |
Weighted Average Funding Cost | 0.36% | [1],[2] | ||
Weighted Average Life (Years) | 26 days | [1],[2] | ||
Repurchase Agreements [Member] | Agency RMBS [Member] | Collateral [Member] | ||||
Debt Instrument [Line Items] | ||||
Weighted Average Life (Years) | 5 years 4 months 21 days | [1],[2] | ||
Outstanding Face Amount of Collateral | 1,575,759,000 | [1],[2] | ||
Amortized Cost Basis of Collateral | 1,659,781,000 | [1],[2] | ||
Carrying Value of Collateral | 1,664,996,000 | [1],[2] | ||
Repurchase Agreements [Member] | Non-Agency RMBS [Member] | ||||
Debt Instrument [Line Items] | ||||
Outstanding Face Amount | 315,919,000 | [1],[3] | ||
Carrying Value | 315,919,000 | [1],[3] | 539,049,000 | [1],[3] |
Weighted Average Funding Cost | 1.77% | [1],[3] | ||
Weighted Average Life (Years) | 1 month 6 days | [1],[3] | ||
Repurchase Agreements [Member] | Non-Agency RMBS [Member] | Collateral [Member] | ||||
Debt Instrument [Line Items] | ||||
Weighted Average Life (Years) | 9 years 9 days | [1],[3] | ||
Outstanding Face Amount of Collateral | 1,500,816,000 | [1],[3] | ||
Amortized Cost Basis of Collateral | 428,696,000 | [1],[3] | ||
Carrying Value of Collateral | 439,579,000 | [1],[3] | ||
Repurchase Agreements [Member] | Residential Mortgage [Member] | ||||
Debt Instrument [Line Items] | ||||
Outstanding Face Amount | 392,521,000 | [1],[4] | ||
Carrying Value | 392,521,000 | [1],[4] | 867,334,000 | [1],[4] |
Weighted Average Funding Cost | 2.37% | [1],[4] | ||
Weighted Average Life (Years) | 9 months 7 days | [1],[4] | ||
Repurchase Agreements [Member] | Residential Mortgage [Member] | Collateral [Member] | ||||
Debt Instrument [Line Items] | ||||
Weighted Average Life (Years) | 4 years 7 months 3 days | [1],[4] | ||
Outstanding Face Amount of Collateral | 584,085,000 | [1],[4] | ||
Amortized Cost Basis of Collateral | 514,109,000 | [1],[4] | ||
Carrying Value of Collateral | 514,109,000 | [1],[4] | ||
Repurchase Agreements [Member] | Real Estate Owned [Member] | ||||
Debt Instrument [Line Items] | ||||
Outstanding Face Amount | 17,977,000 | [1],[5] | ||
Carrying Value | 17,977,000 | [1],[5] | 35,105,000 | [1],[5] |
Weighted Average Funding Cost | 2.82% | [1],[5] | ||
Weighted Average Life (Years) | 1 year 1 month 17 days | [1],[5] | ||
Repurchase Agreements [Member] | Real Estate Owned [Member] | Collateral [Member] | ||||
Debt Instrument [Line Items] | ||||
Carrying Value of Collateral | 33,408,000 | [1],[5] | ||
Repurchase Agreements [Member] | Total Repurchase Agreements [Member] | ||||
Debt Instrument [Line Items] | ||||
Outstanding Face Amount | 2,339,389,000 | [1] | ||
Carrying Value | 2,339,389,000 | [1] | 3,149,090,000 | [1] |
Weighted Average Funding Cost | 0.91% | [1] | ||
Weighted Average Life (Years) | 2 months 12 days | [1] | ||
Notes Payable [Member] | Residential Mortgage [Member] | ||||
Debt Instrument [Line Items] | ||||
Outstanding Face Amount | 23,604,000 | [6] | ||
Carrying Value | 23,604,000 | [6] | 22,194,000 | [6] |
Weighted Average Funding Cost | 3.08% | [6] | ||
Weighted Average Life (Years) | 6 months 19 days | [6] | ||
Notes Payable [Member] | Residential Mortgage [Member] | Collateral [Member] | ||||
Debt Instrument [Line Items] | ||||
Weighted Average Life (Years) | 4 years 15 days | [6] | ||
Outstanding Face Amount of Collateral | 42,306,000 | [6] | ||
Amortized Cost Basis of Collateral | 25,013,000 | [6] | ||
Carrying Value of Collateral | 23,294,000 | [6] | ||
Notes Payable [Member] | Real Estate Owned [Member] | ||||
Debt Instrument [Line Items] | ||||
Outstanding Face Amount | 402,000 | [6] | ||
Carrying Value | 402,000 | [6] | 785,000 | [6] |
Weighted Average Funding Cost | 3.08% | [6] | ||
Weighted Average Life (Years) | 6 months 19 days | [6] | ||
Notes Payable [Member] | Real Estate Owned [Member] | Collateral [Member] | ||||
Debt Instrument [Line Items] | ||||
Carrying Value of Collateral | 397,000 | [6] | ||
Notes Payable [Member] | Secured Corporate Loan [Member] | ||||
Debt Instrument [Line Items] | ||||
Outstanding Face Amount | 100,000,000 | [7] | ||
Carrying Value | 100,000,000 | [7] | 0 | [7] |
Weighted Average Funding Cost | 3.93% | [7] | ||
Weighted Average Life (Years) | 3 months 26 days | [7] | ||
Notes Payable [Member] | Secured Corporate Loan [Member] | Collateral [Member] | ||||
Debt Instrument [Line Items] | ||||
Weighted Average Life (Years) | 5 years 4 months 4 days | [7] | ||
Outstanding Face Amount of Collateral | 105,939,876,000 | [7] | ||
Amortized Cost Basis of Collateral | 239,540,000 | [7] | ||
Carrying Value of Collateral | 279,404,000 | [7] | ||
Notes Payable [Member] | Servicer Advances [Member] | ||||
Debt Instrument [Line Items] | ||||
Outstanding Face Amount | 2,875,412,000 | [8] | ||
Carrying Value | 2,875,412,000 | [8] | 2,890,230,000 | [8] |
Weighted Average Funding Cost | 2.62% | [8] | ||
Weighted Average Life (Years) | 1 year 4 months 17 days | [8] | ||
Notes Payable [Member] | Servicer Advances [Member] | Collateral [Member] | ||||
Debt Instrument [Line Items] | ||||
Weighted Average Life (Years) | 3 years 11 months 10 days | [8] | ||
Outstanding Face Amount of Collateral | 3,068,306,000 | [8] | ||
Amortized Cost Basis of Collateral | 3,168,909,000 | [8] | ||
Carrying Value of Collateral | 3,245,457,000 | [8] | ||
Notes Payable [Member] | Total Notes Payable [Member] | ||||
Debt Instrument [Line Items] | ||||
Outstanding Face Amount | 2,999,418,000 | |||
Carrying Value | $2,999,418,000 | $2,913,209,000 | ||
Weighted Average Funding Cost | 2.66% | |||
Weighted Average Life (Years) | 1 year 4 months 2 days | |||
[1] | These repurchase agreements had approximately $2.0 million of associated accrued interest payable as of March 31, 2015. | |||
[2] | The counterparties of these repurchase agreements are Mizuho ($89.6 million), Morgan Stanley ($73.3 million), Barclays ($788.7 million), Daiwa ($338.9 million) and Jefferies ($322.5 million) and were subject to customary margin call provisions. | |||
[3] | The counterparties of these repurchase agreements are Barclays ($5.6 million), Credit Suisse ($107.3 million), Royal Bank of Canada ($10.2 million), Bank of America, N.A. ($80.1 million), Goldman Sachs ($60.9 million) and UBS ($51.8 million) and were subject to customary margin call provisions. All of the Non-Agency repurchase agreements have LIBOR-based floating interest rates. | |||
[4] | The counterparties on these repurchase agreements are Bank of America N.A. ($39.5 million maturing in August 2016), Nomura ($68.7 million maturing in May 2016), Citibank ($4.8 million maturing in May 2015) and Credit Suisse ($279.5 million maturing in November 2015). All of these repurchase agreements have LIBOR-based floating interest rates. | |||
[5] | The counterparties of these repurchase agreements are Credit Suisse ($1.2 million), Bank of America, N.A. ($2.0 million), Citibank ($0.4 million) and Nomura ($14.4 million). All of these repurchase agreements have LIBOR-based floating interest rates. | |||
[6] | The note is payable to Nationstar and bears interest equal to one-month LIBOR plus 2.875%. | |||
[7] | The loan bears interest equal to the sum of (i) a floating rate index equal to one-month LIBOR and (ii) a margin of 3.75%. The outstanding face of the collateral represents the UPB of the residential mortgage loans underlying the Excess MSRs that secure this corporate loan. | |||
[8] | $0.7 billion face amount of the notes have a fixed rate while the remaining notes bear interest equal to the sum of (i)Â a floating rate index rate equal to one-month LIBOR or a cost of funds rate, as applicable, and (ii)Â a margin ranging from 1.9% to 2.0%. |
DEBT_OBLIGATIONS_Schedule_of_D1
DEBT OBLIGATIONS - Schedule of Debt Obligations (Footnote) (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Dec. 31, 2014 | |
Debt Instrument [Line Items] | ||
Accrued interest payable | 7,516,000 | $7,857,000 |
Repurchase Agreements [Member] | Total Repurchase Agreements [Member] | ||
Debt Instrument [Line Items] | ||
Accrued interest payable | 2,000,000 | |
Notes Payable [Member] | Residential Mortgage [Member] | ||
Debt Instrument [Line Items] | ||
Variable interest rate spread | 2.88% | |
Notes Payable [Member] | Secured Corporate Loan [Member] | ||
Debt Instrument [Line Items] | ||
Variable interest rate spread | 3.75% | |
Notes Payable [Member] | Servicer Advances [Member] | ||
Debt Instrument [Line Items] | ||
Face amount of fixed rate debt | 700,000,000 | |
Notes Payable [Member] | Servicer Advances [Member] | Lower Range [Member] | ||
Debt Instrument [Line Items] | ||
Variable interest rate spread | 1.90% | |
Notes Payable [Member] | Servicer Advances [Member] | Upper Range [Member] | ||
Debt Instrument [Line Items] | ||
Variable interest rate spread | 2.00% | |
Mizuho [Member] | Repurchase Agreements [Member] | Agency RMBS [Member] | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 89,600,000 | |
Morgan Stanley [Member] | Repurchase Agreements [Member] | Agency RMBS [Member] | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 73,300,000 | |
Barclays [Member] | Repurchase Agreements [Member] | Agency RMBS [Member] | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 788,700,000 | |
Barclays [Member] | Repurchase Agreements [Member] | Non-Agency RMBS [Member] | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 5,600,000 | |
Daiwa [Member] | Repurchase Agreements [Member] | Agency RMBS [Member] | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 338,900,000 | |
Jefferies [Member] | Repurchase Agreements [Member] | Agency RMBS [Member] | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 322,500,000 | |
Credit Suisse [Member] | Repurchase Agreements [Member] | Non-Agency RMBS [Member] | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 107,300,000 | |
Credit Suisse [Member] | Repurchase Agreements [Member] | Residential Mortgage [Member] | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 279,500,000 | |
Credit Suisse [Member] | Repurchase Agreements [Member] | Real Estate Owned [Member] | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 1,200,000 | |
Royal Bank of Canada [Member] | Repurchase Agreements [Member] | Non-Agency RMBS [Member] | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 10,200,000 | |
Bank of America [Member] | Repurchase Agreements [Member] | Non-Agency RMBS [Member] | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 80,100,000 | |
Bank of America [Member] | Repurchase Agreements [Member] | Residential Mortgage [Member] | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 39,500,000 | |
Bank of America [Member] | Repurchase Agreements [Member] | Real Estate Owned [Member] | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 2,000,000 | |
Goldman Sachs [Member] | Repurchase Agreements [Member] | Non-Agency RMBS [Member] | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 60,900,000 | |
UBS [Member] | Repurchase Agreements [Member] | Non-Agency RMBS [Member] | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 51,800,000 | |
Nomura [Member] | Repurchase Agreements [Member] | Residential Mortgage [Member] | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 68,700,000 | |
Nomura [Member] | Repurchase Agreements [Member] | Real Estate Owned [Member] | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 14,400,000 | |
Citibank [Member] | Repurchase Agreements [Member] | Residential Mortgage [Member] | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 4,800,000 | |
Citibank [Member] | Repurchase Agreements [Member] | Real Estate Owned [Member] | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 400,000 |
DEBT_OBLIGATIONS_Narrative_Det
DEBT OBLIGATIONS - Narrative (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 30, 2015 | |
Debt Instrument [Line Items] | ||
Face amount of debt | $5,338,807,000 | |
Percent decline in equity, first period | 50.00% | |
Decline in equity, first period | 12 months | |
Percent decline in equity, second period | 35.00% | |
Decline in equity, second period | 3 months | |
Ratio of indebtedness to tangible net worth | 4 | |
Repurchase Agreements [Member] | ||
Debt Instrument [Line Items] | ||
Margin exposure on repurchase agreements | 2,300,000,000 | |
March 2015 Facility [Member] | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity | 1,000,000,000 | 500,000,000 |
Servicer Advance Note [Member] | ||
Debt Instrument [Line Items] | ||
Face amount of debt | 800,000,000 | 650,000,000 |
Interest rate | 2.50% | |
Credit Suisse First Boston Mortgage Capital, LLC [Member] | Secured Corporate Loan [Member] | ||
Debt Instrument [Line Items] | ||
Face amount of debt | $100,000,000 | |
Variable interest rate spread | 3.75% |
DEBT_OBLIGATIONS_Schedule_of_D2
DEBT OBLIGATIONS - Schedule of Debt Obligations - Carrying Value (Details) (USD $) | 3 Months Ended | ||||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | ||
Debt Instrument [Roll Forward] | |||||
Beginning balance | $6,062,299 | [1] | |||
Borrowings | 1,121,121 | 1,618,664 | |||
Modified retrospective adjustment for the adoption of ASU No. 2014-11 | 2,310 | ||||
Repayments | -2,016,777 | -1,080,197 | |||
Ending balance | 5,338,807 | ||||
Servicer Advances [Member] | |||||
Debt Instrument [Roll Forward] | |||||
Beginning balance | 2,890,230 | [1] | |||
Ending balance | 2,875,412 | 2,890,230 | [1] | ||
Real Estate Securities [Member] | |||||
Debt Instrument [Roll Forward] | |||||
Beginning balance | 2,246,651 | [1] | |||
Ending balance | 1,928,891 | 2,246,651 | [1] | ||
Real Estate Loans [Member] | |||||
Debt Instrument [Roll Forward] | |||||
Beginning balance | 925,418 | [1] | |||
Ending balance | 434,504 | 925,418 | [1] | ||
Other [Member] | |||||
Debt Instrument [Roll Forward] | |||||
Beginning balance | 0 | [1] | |||
Ending balance | 100,000 | 0 | [1] | ||
Repurchase Agreements [Member] | |||||
Debt Instrument [Roll Forward] | |||||
Borrowings | 1,121,121 | ||||
Repayments | -2,016,777 | ||||
Repurchase Agreements [Member] | Servicer Advances [Member] | |||||
Debt Instrument [Roll Forward] | |||||
Borrowings | 0 | ||||
Repayments | 0 | ||||
Repurchase Agreements [Member] | Real Estate Securities [Member] | |||||
Debt Instrument [Roll Forward] | |||||
Borrowings | 1,089,257 | ||||
Repayments | -1,491,666 | ||||
Repurchase Agreements [Member] | Real Estate Loans [Member] | |||||
Debt Instrument [Roll Forward] | |||||
Borrowings | 31,864 | ||||
Repayments | -525,111 | ||||
Repurchase Agreements [Member] | Other [Member] | |||||
Debt Instrument [Roll Forward] | |||||
Borrowings | 0 | ||||
Repayments | 0 | ||||
Notes Payable [Member] | |||||
Debt Instrument [Roll Forward] | |||||
Borrowings | 482,334 | ||||
Repayments | -396,125 | ||||
Notes Payable [Member] | Servicer Advances [Member] | |||||
Debt Instrument [Roll Forward] | |||||
Borrowings | 380,702 | ||||
Repayments | -395,520 | ||||
Notes Payable [Member] | Real Estate Securities [Member] | |||||
Debt Instrument [Roll Forward] | |||||
Borrowings | 0 | ||||
Repayments | 0 | ||||
Notes Payable [Member] | Real Estate Loans [Member] | |||||
Debt Instrument [Roll Forward] | |||||
Borrowings | 1,632 | ||||
Repayments | -605 | ||||
Notes Payable [Member] | Other [Member] | |||||
Debt Instrument [Roll Forward] | |||||
Borrowings | 100,000 | ||||
Repayments | 0 | ||||
Accounting Standards Update 2014-11 [Member] | |||||
Debt Instrument [Roll Forward] | |||||
Modified retrospective adjustment for the adoption of ASU No. 2014-11 | 85,955 | 0 | |||
Accounting Standards Update 2014-11 [Member] | Repurchase Agreements [Member] | |||||
Debt Instrument [Roll Forward] | |||||
Modified retrospective adjustment for the adoption of ASU No. 2014-11 | 85,955 | ||||
Accounting Standards Update 2014-11 [Member] | Repurchase Agreements [Member] | Servicer Advances [Member] | |||||
Debt Instrument [Roll Forward] | |||||
Modified retrospective adjustment for the adoption of ASU No. 2014-11 | 0 | ||||
Accounting Standards Update 2014-11 [Member] | Repurchase Agreements [Member] | Real Estate Securities [Member] | |||||
Debt Instrument [Roll Forward] | |||||
Modified retrospective adjustment for the adoption of ASU No. 2014-11 | 84,649 | ||||
Accounting Standards Update 2014-11 [Member] | Repurchase Agreements [Member] | Real Estate Loans [Member] | |||||
Debt Instrument [Roll Forward] | |||||
Modified retrospective adjustment for the adoption of ASU No. 2014-11 | 1,306 | ||||
Accounting Standards Update 2014-11 [Member] | Repurchase Agreements [Member] | Other [Member] | |||||
Debt Instrument [Roll Forward] | |||||
Modified retrospective adjustment for the adoption of ASU No. 2014-11 | $0 | ||||
[1] | Excludes debt related to linked transactions (Note 10). |
DEBT_OBLIGATIONS_Schedule_of_C
DEBT OBLIGATIONS - Schedule of Contractual Maturities of Debt Obligations (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 | |
In Thousands, unless otherwise specified | |||
Debt maturing in: | |||
April 1 through December 31, 2015 | $2,488,881 | ||
2016 | 2,148,728 | ||
2017 | 701,198 | ||
Total | 5,338,807 | 6,062,299 | [1] |
Nonrecourse [Member] | |||
Debt maturing in: | |||
April 1 through December 31, 2015 | 150,128 | ||
2016 | 2,107,255 | ||
2017 | 701,198 | ||
Total | 2,958,581 | ||
Recourse [Member] | |||
Debt maturing in: | |||
April 1 through December 31, 2015 | 2,338,753 | ||
2016 | 41,473 | ||
2017 | 0 | ||
Total | $2,380,226 | ||
[1] | Excludes debt related to linked transactions (Note 10). |
DEBT_OBLIGATIONS_Schedule_of_B
DEBT OBLIGATIONS - Schedule of Borrowing Capacity (Details) (USD $) | Mar. 31, 2015 | |
In Thousands, unless otherwise specified | ||
Residential Mortgage Loans [Member] | ||
Debt Instrument [Line Items] | ||
Borrowing Capacity | $1,720,000 | |
Balance Outstanding | 410,498 | |
Available Financing | 1,309,502 | |
Servicer Advances [Member] | ||
Debt Instrument [Line Items] | ||
Borrowing Capacity | 3,300,000 | [1] |
Balance Outstanding | 2,875,412 | [1] |
Available Financing | 424,588 | [1] |
Debt Excess Borrowing Capacity [Member] | ||
Debt Instrument [Line Items] | ||
Borrowing Capacity | 5,020,000 | |
Balance Outstanding | 3,285,910 | |
Available Financing | $1,734,090 | |
[1] | New Residential’s unused borrowing capacity is available if New Residential has additional eligible collateral to pledge and meets other borrowing conditions as set forth in the applicable agreements, including any applicable advance rate. New Residential pays a 0.3% fee on the unused borrowing capacity. |
DEBT_OBLIGATIONS_Schedule_of_B1
DEBT OBLIGATIONS - Schedule of Borrowing Capacity (Footnote) (Details) (Servicer Advances [Member]) | 3 Months Ended |
Mar. 31, 2015 | |
Servicer Advances [Member] | |
Debt Instrument [Line Items] | |
Unused borrowing capacity percent fee | 0.30% |
FAIR_VALUE_OF_FINANCIAL_INSTRU2
FAIR VALUE OF FINANCIAL INSTRUMENTS - Schedule of Carrying Values and Fair Values of Financial Assets Recorded at Fair Value on a Recurring Basis (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 | |
In Thousands, unless otherwise specified | |||
Investments in: | |||
Real estate securities, available-for-sale | $2,324,915 | $2,463,163 | |
Non-hedge derivatives | 71 | 32,597 | |
Restricted cash | 28,325 | 29,418 | |
Liabilities: | |||
Repurchase agreements | 2,339,389 | 3,149,090 | |
Notes payable | 2,999,418 | 2,913,209 | |
Derivative liabilities | 21,127 | 14,220 | |
Recurring Basis [Member] | |||
Investments in: | |||
Excess mortgage servicing rights, at fair value | 163,572,436 | [1] | |
Excess mortgage servicing rights, equity method investees, at fair value | 84,000,746 | [1] | |
Servicer advances | 3,068,306 | ||
Real estate securities, available-for-sale | 3,396,295 | ||
Residential mortgage loans, held-for- investment | 65,854 | ||
Residential mortgage loans, held-for- sale | 569,329 | ||
Non-hedge derivatives | 210,000 | ||
Cash and cash equivalents | 459,334 | ||
Restricted cash | 28,325 | ||
Liabilities: | |||
Repurchase agreements | 2,339,389 | ||
Notes payable | 2,999,418 | ||
Derivative liabilities | 2,087,000 | ||
Recurring Basis [Member] | Level 1 [Member] | |||
Investments in: | |||
Excess mortgage servicing rights, at fair value | 0 | [1] | |
Excess mortgage servicing rights, equity method investees, at fair value | 0 | [1] | |
Servicer advances | 0 | ||
Real estate securities, available-for-sale | 0 | ||
Residential mortgage loans, held-for- investment | 0 | ||
Residential mortgage loans, held-for- sale | 0 | ||
Non-hedge derivatives | 0 | ||
Cash and cash equivalents | 459,334 | ||
Restricted cash | 28,325 | ||
Assets, fair value | 487,659 | ||
Liabilities: | |||
Repurchase agreements | 0 | ||
Notes payable | 0 | ||
Derivative liabilities | 0 | ||
Liabilities, fair value | 0 | ||
Recurring Basis [Member] | Level 2 [Member] | |||
Investments in: | |||
Excess mortgage servicing rights, at fair value | 0 | [1] | |
Excess mortgage servicing rights, equity method investees, at fair value | 0 | [1] | |
Servicer advances | 0 | ||
Real estate securities, available-for-sale | 1,664,996 | ||
Residential mortgage loans, held-for- investment | 0 | ||
Residential mortgage loans, held-for- sale | 0 | ||
Non-hedge derivatives | 71 | ||
Cash and cash equivalents | 0 | ||
Restricted cash | 0 | ||
Assets, fair value | 1,665,067 | ||
Liabilities: | |||
Repurchase agreements | 1,928,891 | ||
Notes payable | 0 | ||
Derivative liabilities | 21,127 | ||
Liabilities, fair value | 1,950,018 | ||
Recurring Basis [Member] | Level 3 [Member] | |||
Investments in: | |||
Excess mortgage servicing rights, at fair value | 526,662 | [1] | |
Excess mortgage servicing rights, equity method investees, at fair value | 225,111 | [1] | |
Servicer advances | 3,245,457 | ||
Real estate securities, available-for-sale | 659,919 | ||
Residential mortgage loans, held-for- investment | 45,900 | ||
Residential mortgage loans, held-for- sale | 506,986 | ||
Non-hedge derivatives | 0 | ||
Cash and cash equivalents | 0 | ||
Restricted cash | 0 | ||
Assets, fair value | 5,210,035 | ||
Liabilities: | |||
Repurchase agreements | 410,498 | ||
Notes payable | 2,999,418 | ||
Derivative liabilities | 0 | ||
Liabilities, fair value | 3,409,916 | ||
Recurring Basis [Member] | Carrying Value [Member] | |||
Investments in: | |||
Excess mortgage servicing rights, at fair value | 526,662 | [1] | |
Excess mortgage servicing rights, equity method investees, at fair value | 225,111 | [1] | |
Servicer advances | 3,245,457 | ||
Real estate securities, available-for-sale | 2,324,915 | ||
Residential mortgage loans, held-for- investment | 44,967 | ||
Residential mortgage loans, held-for- sale | 500,174 | ||
Non-hedge derivatives | 71 | ||
Cash and cash equivalents | 459,334 | ||
Restricted cash | 28,325 | ||
Assets, fair value | 7,355,016 | ||
Liabilities: | |||
Repurchase agreements | 2,339,389 | ||
Notes payable | 2,999,418 | ||
Derivative liabilities | 21,127 | ||
Liabilities, fair value | 5,359,934 | ||
Recurring Basis [Member] | Fair Value [Member] | |||
Investments in: | |||
Excess mortgage servicing rights, at fair value | 526,662 | [1] | |
Excess mortgage servicing rights, equity method investees, at fair value | 225,111 | [1] | |
Servicer advances | 3,245,457 | ||
Real estate securities, available-for-sale | 2,324,915 | ||
Residential mortgage loans, held-for- investment | 45,900 | ||
Residential mortgage loans, held-for- sale | 506,986 | ||
Non-hedge derivatives | 71 | ||
Cash and cash equivalents | 459,334 | ||
Restricted cash | 28,325 | ||
Assets, fair value | 7,362,761 | ||
Liabilities: | |||
Repurchase agreements | 2,339,389 | ||
Notes payable | 2,999,418 | ||
Derivative liabilities | 21,127 | ||
Liabilities, fair value | $5,359,934 | ||
[1] | The notional amount represents the total unpaid principal balance of the mortgage loans underlying the Excess MSRs. New Residential does not receive an excess mortgage servicing amount on non-performing loans in Agency portfolios. |
FAIR_VALUE_OF_FINANCIAL_INSTRU3
FAIR VALUE OF FINANCIAL INSTRUMENTS - Schedule of Financial Assets Measured at Fair Value on a Recurring Basis using Level 3 Inputs (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | |
Gains (losses) included in net income | |||
Included in gain on settlement of investments, net | $14,767 | $4,357 | |
Recurring Basis [Member] | Level 3 [Member] | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning | 4,774,850 | ||
Transfers from Level 3 | 0 | [1] | |
Transfers to Level 3 | 0 | [1] | |
Transfers from investments in excess mortgage servicing rights, equity method investees, to investments in excess mortgage servicing rights | 0 | [1] | |
Gains (losses) included in net income | |||
Included in other-than-temporary impairment (''OTTI'') on securities | -1,071 | [2] | |
Included in change in fair value of investments in excess mortgage servicing rights | -1,761 | [2] | |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 4,921 | [2] | |
Included in change in fair value of investments in servicer advances | -7,669 | ||
Included in gain on settlement of investments, net | 3,808 | ||
Included in other income | 730 | [2] | |
Gains (losses) included in other comprehensive income, net of tax | -481 | [3] | |
Interest income | 65,836 | ||
Purchases, sales, repayments and transfers | |||
Purchases | 2,013,875 | ||
Proceeds from sales | -389,719 | ||
Proceeds from repayments | -1,890,600 | ||
De-linked transactions | 0 | [1] | |
Balance, ending | 4,657,149 | ||
Recurring Basis [Member] | Level 3 [Member] | Linked Transactions [Member] | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning | 32,402 | ||
Transfers from Level 3 | 0 | [1] | |
Transfers to Level 3 | 0 | [1] | |
Transfers from investments in excess mortgage servicing rights, equity method investees, to investments in excess mortgage servicing rights | 0 | [1] | |
Gains (losses) included in net income | |||
Included in other-than-temporary impairment (''OTTI'') on securities | 0 | [2] | |
Included in change in fair value of investments in excess mortgage servicing rights | 0 | [2] | |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 0 | [2] | |
Included in change in fair value of investments in servicer advances | 0 | ||
Included in gain on settlement of investments, net | 0 | ||
Included in other income | 0 | [2] | |
Gains (losses) included in other comprehensive income, net of tax | 0 | [3] | |
Interest income | 0 | ||
Purchases, sales, repayments and transfers | |||
Purchases | 0 | ||
Proceeds from sales | 0 | ||
Proceeds from repayments | 0 | ||
De-linked transactions | 0 | [1] | |
Balance, ending | 0 | ||
Recurring Basis [Member] | Level 3 [Member] | Non-Agency RMBS [Member] | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning | 723,000 | ||
Transfers from Level 3 | 0 | [1] | |
Transfers to Level 3 | 0 | [1] | |
Transfers from investments in excess mortgage servicing rights, equity method investees, to investments in excess mortgage servicing rights | 0 | [1] | |
Gains (losses) included in net income | |||
Included in other-than-temporary impairment (''OTTI'') on securities | -1,071 | [2] | |
Included in change in fair value of investments in excess mortgage servicing rights | 0 | [2] | |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 0 | [2] | |
Included in change in fair value of investments in servicer advances | 0 | ||
Included in gain on settlement of investments, net | 3,808 | ||
Included in other income | 0 | [2] | |
Gains (losses) included in other comprehensive income, net of tax | -481 | [3] | |
Interest income | 8,450 | ||
Purchases, sales, repayments and transfers | |||
Purchases | 222,102 | ||
Proceeds from sales | -389,719 | ||
Proceeds from repayments | -23,002 | ||
De-linked transactions | 0 | [1] | |
Balance, ending | 659,919 | ||
Recurring Basis [Member] | Level 3 [Member] | Servicer Advances [Member] | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning | 3,270,839 | ||
Transfers from Level 3 | 0 | [1] | |
Transfers to Level 3 | 0 | [1] | |
Transfers from investments in excess mortgage servicing rights, equity method investees, to investments in excess mortgage servicing rights | 0 | [1] | |
Gains (losses) included in net income | |||
Included in other-than-temporary impairment (''OTTI'') on securities | 0 | [2] | |
Included in change in fair value of investments in excess mortgage servicing rights | 0 | [2] | |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 0 | [2] | |
Included in change in fair value of investments in servicer advances | -7,669 | ||
Included in gain on settlement of investments, net | 0 | ||
Included in other income | 0 | [2] | |
Gains (losses) included in other comprehensive income, net of tax | 0 | [3] | |
Interest income | 42,349 | ||
Purchases, sales, repayments and transfers | |||
Purchases | 1,765,294 | ||
Proceeds from sales | 0 | ||
Proceeds from repayments | -1,825,356 | ||
De-linked transactions | 0 | [1] | |
Balance, ending | 3,245,457 | ||
Recurring Basis [Member] | Level 3 [Member] | MSRs Agency [Member] | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning | 217,519 | [4] | |
Transfers from Level 3 | 0 | [1],[4] | |
Transfers to Level 3 | 0 | [1],[4] | |
Transfers from investments in excess mortgage servicing rights, equity method investees, to investments in excess mortgage servicing rights | 0 | [1],[4] | |
Gains (losses) included in net income | |||
Included in other-than-temporary impairment (''OTTI'') on securities | 0 | [2],[4] | |
Included in change in fair value of investments in excess mortgage servicing rights | -234 | [2],[4] | |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 0 | [2],[4] | |
Included in change in fair value of investments in servicer advances | 0 | [4] | |
Included in gain on settlement of investments, net | 0 | [4] | |
Included in other income | 730 | [2],[4] | |
Gains (losses) included in other comprehensive income, net of tax | 0 | [3],[4] | |
Interest income | 6,458 | [4] | |
Purchases, sales, repayments and transfers | |||
Purchases | 26,479 | [4] | |
Proceeds from sales | 0 | [4] | |
Proceeds from repayments | -11,973 | [4] | |
De-linked transactions | 0 | [1],[4] | |
Balance, ending | 238,979 | [4] | |
Recurring Basis [Member] | Level 3 [Member] | MSRs Agency [Member] | Excess MSRs Investees [Member] | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning | 232,618 | [4],[5] | |
Transfers from Level 3 | 0 | [1],[4],[5] | |
Transfers to Level 3 | 0 | [1],[4],[5] | |
Transfers from investments in excess mortgage servicing rights, equity method investees, to investments in excess mortgage servicing rights | 0 | [1],[4],[5] | |
Gains (losses) included in net income | |||
Included in other-than-temporary impairment (''OTTI'') on securities | 0 | [2],[4],[5] | |
Included in change in fair value of investments in excess mortgage servicing rights | 0 | [2],[4],[5] | |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 4,921 | [2],[4],[5] | |
Included in change in fair value of investments in servicer advances | 0 | [4],[5] | |
Included in gain on settlement of investments, net | 0 | [4],[5] | |
Included in other income | 0 | [2],[4],[5] | |
Gains (losses) included in other comprehensive income, net of tax | 0 | [3],[4],[5] | |
Interest income | 0 | [4],[5] | |
Purchases, sales, repayments and transfers | |||
Purchases | 0 | [4],[5] | |
Proceeds from sales | 0 | [4],[5] | |
Proceeds from repayments | -12,428 | [4],[5] | |
De-linked transactions | 0 | [1],[4],[5] | |
Balance, ending | 225,111 | [4],[5] | |
Recurring Basis [Member] | Level 3 [Member] | MSRs Non-Agency [Member] | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning | 200,214 | [4] | |
Transfers from Level 3 | 0 | [1],[4] | |
Transfers to Level 3 | 0 | [1],[4] | |
Transfers from investments in excess mortgage servicing rights, equity method investees, to investments in excess mortgage servicing rights | 98,258 | [1],[4] | |
Gains (losses) included in net income | |||
Included in other-than-temporary impairment (''OTTI'') on securities | 0 | [2],[4] | |
Included in change in fair value of investments in excess mortgage servicing rights | -1,527 | [2],[4] | |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 0 | [2],[4] | |
Included in change in fair value of investments in servicer advances | 0 | [4] | |
Included in gain on settlement of investments, net | 0 | [4] | |
Included in other income | 0 | [2],[4] | |
Gains (losses) included in other comprehensive income, net of tax | 0 | [3],[4] | |
Interest income | 8,579 | [4] | |
Purchases, sales, repayments and transfers | |||
Purchases | 0 | [4] | |
Proceeds from sales | 0 | [4] | |
Proceeds from repayments | -17,841 | [4] | |
De-linked transactions | 98,258 | [1],[4] | |
Balance, ending | 287,683 | [4] | |
Recurring Basis [Member] | Level 3 [Member] | MSRs Non-Agency [Member] | Excess MSRs Investees [Member] | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, beginning | 98,258 | [4],[5] | |
Transfers from Level 3 | 0 | [1],[4],[5] | |
Transfers to Level 3 | 0 | [1],[4],[5] | |
Transfers from investments in excess mortgage servicing rights, equity method investees, to investments in excess mortgage servicing rights | -98,258 | [1],[4],[5] | |
Gains (losses) included in net income | |||
Included in other-than-temporary impairment (''OTTI'') on securities | 0 | [2],[4],[5] | |
Included in change in fair value of investments in excess mortgage servicing rights | 0 | [2],[4],[5] | |
Included in change in fair value of investments in excess mortgage servicing rights, equity method investees | 0 | [2],[4],[5] | |
Included in change in fair value of investments in servicer advances | 0 | [4],[5] | |
Included in gain on settlement of investments, net | 0 | [4],[5] | |
Included in other income | 0 | [2],[4],[5] | |
Gains (losses) included in other comprehensive income, net of tax | 0 | [3],[4],[5] | |
Interest income | 0 | [4],[5] | |
Purchases, sales, repayments and transfers | |||
Purchases | 0 | [4],[5] | |
Proceeds from sales | 0 | [4],[5] | |
Proceeds from repayments | 0 | [4],[5] | |
De-linked transactions | -98,258 | [1],[4],[5] | |
Balance, ending | 0 | [4],[5] | |
Accounting Standards Update 2014-11 [Member] | Recurring Basis [Member] | Level 3 [Member] | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Transfers from investments in excess mortgage servicing rights, equity method investees, to investments in excess mortgage servicing rights | 84,430 | [6] | |
Purchases, sales, repayments and transfers | |||
De-linked transactions | 84,430 | [6] | |
Accounting Standards Update 2014-11 [Member] | Recurring Basis [Member] | Level 3 [Member] | Linked Transactions [Member] | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Transfers from investments in excess mortgage servicing rights, equity method investees, to investments in excess mortgage servicing rights | -32,402 | [6] | |
Purchases, sales, repayments and transfers | |||
De-linked transactions | -32,402 | [6] | |
Accounting Standards Update 2014-11 [Member] | Recurring Basis [Member] | Level 3 [Member] | Non-Agency RMBS [Member] | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Transfers from investments in excess mortgage servicing rights, equity method investees, to investments in excess mortgage servicing rights | 116,832 | [6] | |
Purchases, sales, repayments and transfers | |||
De-linked transactions | 116,832 | [6] | |
Accounting Standards Update 2014-11 [Member] | Recurring Basis [Member] | Level 3 [Member] | Servicer Advances [Member] | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Transfers from investments in excess mortgage servicing rights, equity method investees, to investments in excess mortgage servicing rights | 0 | [6] | |
Purchases, sales, repayments and transfers | |||
De-linked transactions | 0 | [6] | |
Accounting Standards Update 2014-11 [Member] | Recurring Basis [Member] | Level 3 [Member] | MSRs Agency [Member] | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Transfers from investments in excess mortgage servicing rights, equity method investees, to investments in excess mortgage servicing rights | 0 | [4],[6] | |
Purchases, sales, repayments and transfers | |||
De-linked transactions | 0 | [4],[6] | |
Accounting Standards Update 2014-11 [Member] | Recurring Basis [Member] | Level 3 [Member] | MSRs Agency [Member] | Excess MSRs Investees [Member] | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Transfers from investments in excess mortgage servicing rights, equity method investees, to investments in excess mortgage servicing rights | 0 | [4],[5],[6] | |
Purchases, sales, repayments and transfers | |||
De-linked transactions | 0 | [4],[5],[6] | |
Accounting Standards Update 2014-11 [Member] | Recurring Basis [Member] | Level 3 [Member] | MSRs Non-Agency [Member] | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Transfers from investments in excess mortgage servicing rights, equity method investees, to investments in excess mortgage servicing rights | 0 | [4],[6] | |
Purchases, sales, repayments and transfers | |||
De-linked transactions | 0 | [4],[6] | |
Accounting Standards Update 2014-11 [Member] | Recurring Basis [Member] | Level 3 [Member] | MSRs Non-Agency [Member] | Excess MSRs Investees [Member] | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Transfers from investments in excess mortgage servicing rights, equity method investees, to investments in excess mortgage servicing rights | 0 | [4],[5],[6] | |
Purchases, sales, repayments and transfers | |||
De-linked transactions | $0 | [4],[5],[6] | |
[1] | Transfers are assumed to occur at the beginning of each respective period. | ||
[2] | The gains (losses) recorded in earnings during the period are attributable to the change in unrealized gains (losses) relating to Level 3 assets still held at the reporting dates. | ||
[3] | These gains (losses) were included in net unrealized gain (loss) on securities in the Condensed Consolidated Statements of Comprehensive Income. | ||
[4] | Includes the Recapture Agreement for each respective pool. | ||
[5] | Amounts represent New Residential’s portion of the Excess MSRs held by the respective joint ventures in which New Residential has a 50% interest. | ||
[6] | See Note 10 for a discussion of transactions formerly accounted for as linked transactions. |
FAIR_VALUE_OF_FINANCIAL_INSTRU4
FAIR VALUE OF FINANCIAL INSTRUMENTS - Schedule of Financial Assets Measured at Fair Value on a Recurring Basis using Level 3 Inputs (Footnote) (Details) (Excess MSRs Investees [Member]) | Mar. 31, 2015 | Dec. 31, 2014 |
Excess MSRs Investees [Member] | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
New Residential’s ownership | 50.00% | 50.00% |
FAIR_VALUE_OF_FINANCIAL_INSTRU5
FAIR VALUE OF FINANCIAL INSTRUMENTS - Summary of Certain Information Regarding Inputs used in Valuing Excess MSRs Owned Directly and through Equity Method Investees (Details) | 3 Months Ended | |
Mar. 31, 2015 | ||
Directly Held (Note 4) | ||
Prepayment Speed | 11.70% | [1],[2] |
Delinquency | 5.70% | [2],[3] |
Recapture Rate | 24.50% | [2],[4] |
Excess Mortgage Servicing Amount (bps) | 18 | [2],[5] |
Directly Held [Member] | ||
Directly Held (Note 4) | ||
Prepayment Speed | 11.50% | [1],[2] |
Delinquency | 5.40% | [2],[3] |
Recapture Rate | 18.90% | [2],[4] |
Excess Mortgage Servicing Amount (bps) | 17 | [2],[5] |
Held through Equity Method Investees [Member] | ||
Directly Held (Note 4) | ||
Prepayment Speed | 12.10% | [1],[2] |
Delinquency | 6.20% | [2],[3] |
Recapture Rate | 31.10% | [2],[4] |
Excess Mortgage Servicing Amount (bps) | 19 | [2],[5] |
Agency [Member] | Directly Held [Member] | ||
Directly Held (Note 4) | ||
Prepayment Speed | 10.00% | [1],[2] |
Delinquency | 5.40% | [2],[3] |
Recapture Rate | 30.80% | [2],[4] |
Excess Mortgage Servicing Amount (bps) | 21 | [2],[5] |
Agency [Member] | Directly Held [Member] | Original and Recaptured Pools [Member] | ||
Directly Held (Note 4) | ||
Prepayment Speed | 10.10% | [1],[2] |
Delinquency | 5.40% | [2],[3] |
Recapture Rate | 31.50% | [2],[4] |
Excess Mortgage Servicing Amount (bps) | 21 | [2],[5] |
Agency [Member] | Directly Held [Member] | Recapture Agreements [Member] | ||
Directly Held (Note 4) | ||
Prepayment Speed | 7.90% | [1],[2] |
Delinquency | 5.00% | [2],[3] |
Recapture Rate | 19.90% | [2],[4] |
Excess Mortgage Servicing Amount (bps) | 21 | [2],[5] |
Agency [Member] | Held through Equity Method Investees [Member] | Original and Recaptured Pools [Member] | ||
Directly Held (Note 4) | ||
Prepayment Speed | 13.00% | [1],[2] |
Delinquency | 6.50% | [2],[3] |
Recapture Rate | 33.50% | [2],[4] |
Excess Mortgage Servicing Amount (bps) | 19 | [2],[5] |
Agency [Member] | Held through Equity Method Investees [Member] | Recapture Agreements [Member] | ||
Directly Held (Note 4) | ||
Prepayment Speed | 8.00% | [1],[2] |
Delinquency | 5.00% | [2],[3] |
Recapture Rate | 20.00% | [2],[4] |
Excess Mortgage Servicing Amount (bps) | 23 | [2],[5] |
Non-Agency [Member] | Directly Held [Member] | ||
Directly Held (Note 4) | ||
Prepayment Speed | 12.50% | [1],[2],[6] |
Recapture Rate | 10.70% | [2],[4],[6] |
Excess Mortgage Servicing Amount (bps) | 14 | [2],[5],[6] |
Non-Agency [Member] | Directly Held [Member] | Original and Recaptured Pools [Member] | ||
Directly Held (Note 4) | ||
Prepayment Speed | 12.70% | [1],[2],[6] |
Recapture Rate | 10.20% | [2],[4],[6] |
Excess Mortgage Servicing Amount (bps) | 14 | [2],[5],[6] |
Non-Agency [Member] | Directly Held [Member] | Recapture Agreements [Member] | ||
Directly Held (Note 4) | ||
Prepayment Speed | 8.00% | [1],[2],[6] |
Recapture Rate | 20.00% | [2],[4],[6] |
Excess Mortgage Servicing Amount (bps) | 20 | [2],[5],[6] |
[1] | Projected annualized weighted average lifetime voluntary and involuntary prepayment rate using a prepayment vector. | |
[2] | Weighted by amortized cost basis of the mortgage loan portfolio. | |
[3] | Projected percentage of mortgage loans in the pool that will miss their mortgage payments. | |
[4] | Percentage of voluntarily prepaid loans that are expected to be refinanced by Nationstar. | |
[5] | Weighted average total mortgage servicing amount in excess of the basic fee. | |
[6] | For certain pools, the Excess MSR will be paid on the total UPB of the mortgage portfolio (including both performing and delinquent loans until REO). For these pools, no delinquency assumption is used. |
FAIR_VALUE_OF_FINANCIAL_INSTRU6
FAIR VALUE OF FINANCIAL INSTRUMENTS - Narrative (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2015 | Dec. 31, 2014 | |||
Schedule of Equity Method Investments [Line Items] | ||||
Assets measured at fair value on a nonrecurring basis | 213,100,000 | $666,600,000 | ||
Broker price discount | 10.00% | |||
Face amount of debt | 5,338,807,000 | |||
Debt | 5,338,807,000 | 6,062,299,000 | ||
Excess MSRs Investees [Member] | MSRs [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Weighted average discount rate, used to value investments in excess MSRs | 9.60% | |||
Servicer Advances [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Carrying Value | 2,875,412,000 | [1] | ||
Notes Payable [Member] | Servicer Advances [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Face amount of debt | 2,875,412,000 | [2] | ||
Debt | 2,875,412,000 | [2] | 2,890,230,000 | [2] |
Residential Mortgage Loans [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Assets measured at fair value on a nonrecurring basis | 213,100,000 | 610,100,000 | ||
Real Estate Acquired in Satisfaction of Debt [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Assets measured at fair value on a nonrecurring basis | 56,500,000 | |||
Loans Held-for-sale [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Asset fair value reduction | $800,000 | |||
[1] | New Residential’s unused borrowing capacity is available if New Residential has additional eligible collateral to pledge and meets other borrowing conditions as set forth in the applicable agreements, including any applicable advance rate. New Residential pays a 0.3% fee on the unused borrowing capacity. | |||
[2] | $0.7 billion face amount of the notes have a fixed rate while the remaining notes bear interest equal to the sum of (i)Â a floating rate index rate equal to one-month LIBOR or a cost of funds rate, as applicable, and (ii)Â a margin ranging from 1.9% to 2.0%. |
FAIR_VALUE_OF_FINANCIAL_INSTRU7
FAIR VALUE OF FINANCIAL INSTRUMENTS - Summary of Certain Information Regarding the Inputs used in Valuing the Servicer Advances (Details) | 3 Months Ended | |
Mar. 31, 2015 | ||
Fair Value Inputs, Equity, Quantitative Information [Line Items] | ||
Prepayment Speed | 11.70% | [1],[2] |
Delinquency | 5.70% | [2],[3] |
Mortgage Servicing Amount (bps) | 18 | [2],[4] |
Servicer Advances [Member] | ||
Fair Value Inputs, Equity, Quantitative Information [Line Items] | ||
Outstanding Servicer Advances to UPB of Underlying Residential Mortgage Loans | 2.10% | |
Prepayment Speed | 12.50% | |
Delinquency | 14.30% | |
Mortgage Servicing Amount (bps) | 19.44 | [5] |
Discount Rate | 5.40% | |
[1] | Projected annualized weighted average lifetime voluntary and involuntary prepayment rate using a prepayment vector. | |
[2] | Weighted by amortized cost basis of the mortgage loan portfolio. | |
[3] | Projected percentage of mortgage loans in the pool that will miss their mortgage payments. | |
[4] | Weighted average total mortgage servicing amount in excess of the basic fee. | |
[5] | Mortgage servicing amount excludes the amounts New Residential pays Nationstar and SLS as a monthly servicing fee. |
FAIR_VALUE_OF_FINANCIAL_INSTRU8
FAIR VALUE OF FINANCIAL INSTRUMENTS - Schedule of Securities Valuation Methodology and Results (Details) (USD $) | Mar. 31, 2015 | |
In Thousands, unless otherwise specified | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Outstanding Face Amount | $3,396,295 | |
Amortized Cost Basis | 2,307,696 | |
Total Fair Value | 2,324,915 | |
Multiple Quotes [Member] | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Total Fair Value | 2,315,742 | [1] |
Single Quote [Member] | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Total Fair Value | 9,173 | [2] |
Agency RMBS [Member] | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Outstanding Face Amount | 1,575,759 | [3],[4] |
Amortized Cost Basis | 1,659,781 | [3],[4] |
Non-Agency RMBS [Member] | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Outstanding Face Amount | 1,820,536 | [5],[6],[7] |
Amortized Cost Basis | 647,915 | [5],[6],[7] |
Level 2 [Member] | Agency RMBS [Member] | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Total Fair Value | 1,664,996 | |
Level 2 [Member] | Agency RMBS [Member] | Multiple Quotes [Member] | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Total Fair Value | 1,664,996 | [1] |
Level 2 [Member] | Agency RMBS [Member] | Single Quote [Member] | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Total Fair Value | 0 | [2] |
Level 3 [Member] | Non-Agency RMBS [Member] | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Total Fair Value | 659,919 | [6] |
Level 3 [Member] | Non-Agency RMBS [Member] | Multiple Quotes [Member] | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Total Fair Value | 650,746 | [1],[6] |
Level 3 [Member] | Non-Agency RMBS [Member] | Single Quote [Member] | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Total Fair Value | $9,173 | [2],[6] |
[1] | Management generally obtained pricing service quotations or broker quotations from two sources, one of which was generally the seller (the party that sold New Residential the security) for Non-Agency RMBS. Management selected one of the quotes received as being most representative of the fair value and did not use an average of the quotes. Even if New Residential receives two or more quotes on a particular security that come from non-selling brokers or pricing services, it does not use an average because management believes using an actual quote more closely represents a transactable price for the security than an average level. Furthermore, in some cases there is a wide disparity between the quotes New Residential receives. Management believes using an average of the quotes in these cases would not represent the fair value of the asset. Based on New Residential’s own fair value analysis, management selects one of the quotes which is believed to more accurately reflect fair value. New Residential never adjusts quotes received. These quotations are generally received via email and contain disclaimers which state that they are “indicative†and not “actionable†— meaning that the party giving the quotation is not bound to actually purchase the security at the quoted price. | |
[2] | Management was unable to obtain quotations from more than one source on these securities. The one source was the seller (the party that sold New Residential the security). | |
[3] | Includes securities issued or guaranteed by U.S. Government agencies such as the Federal National Mortgage Association (“Fannie Maeâ€) or the Federal Home Loan Mortgage Corporation (“Freddie Macâ€). | |
[4] | The total outstanding face amount was $979.8 million for fixed rate securities and $595.9 million for floating rate securities as of March 31, 2015. | |
[5] | The total outstanding face amount was $1.2 billion (including $927.5 million of residual and interest-only notional amount) for fixed rate securities and $654.0 million (including $101.1 million of residual and interest-only notional amount) for floating rate securities as of March 31, 2015. | |
[6] | Includes New Residential’s investments in interest-only notes for which the fair value option for financial instruments was elected. | |
[7] | Includes Other ABS consisting primarily of interest-only securities which New Residential elected to carry at fair value and record changes to valuation through the income statement and representing 8.5% of the carrying value of the Non-Agency RMBS portfolio. Gross Unrealized Weighted AverageAsset Type Outstanding Face Amount Amortized Cost Basis Gains Losses Carrying Value Number of Securities Rating Coupon Yield Life (Years) Principal SubordinationOther ABS $984,460 $56,414 $829 $(1,119) $56,124 8 AA+ 1.98% 8.65% 4.0 —% |
FAIR_VALUE_OF_FINANCIAL_INSTRU9
FAIR VALUE OF FINANCIAL INSTRUMENTS - Schedule of Inputs Used in Valuing Residential Mortgage Loans (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | |
Mortgage Loans on Real Estate [Line Items] | |||
Valuation Provision/ (Reversal) In Current Year | $977 | $164 | |
Weighted Average Life (Years) | 10 months 2 days | ||
Prepayment Rate | 11.70% | [1],[2] | |
CDR | 5.70% | [2],[3] | |
Reverse Mortgage Loans [Member] | |||
Mortgage Loans on Real Estate [Line Items] | |||
Weighted Average Life (Years) | 4 years 15 days | [4],[5],[6] | |
Performing Loans [Member] | |||
Mortgage Loans on Real Estate [Line Items] | |||
Weighted Average Life (Years) | 5 years 9 months 20 days | [4],[7] | |
Residential Mortgage [Member] | |||
Mortgage Loans on Real Estate [Line Items] | |||
Valuation Provision/ (Reversal) In Current Year | 202 | ||
Discount Rate | 5.30% | ||
Weighted Average Life (Years) | 6 years 5 months 8 days | ||
Loss Severity | 43.50% | ||
Residential Mortgage [Member] | Reverse Mortgage Loans [Member] | |||
Mortgage Loans on Real Estate [Line Items] | |||
Valuation Provision/ (Reversal) In Current Year | 202 | ||
Discount Rate | 10.00% | ||
Weighted Average Life (Years) | 4 years 15 days | ||
Loss Severity | 6.30% | ||
Residential Mortgage [Member] | Performing Loans [Member] | |||
Mortgage Loans on Real Estate [Line Items] | |||
Discount Rate | 4.90% | ||
Weighted Average Life (Years) | 6 years 10 months 10 days | ||
Prepayment Rate | 6.00% | ||
CDR | 2.10% | ||
Loss Severity | 46.10% | ||
Residential Mortgage [Member] | Purchased Credit Impaired Loans [Member] | |||
Mortgage Loans on Real Estate [Line Items] | |||
Discount Rate | 5.50% | ||
Weighted Average Life (Years) | 2 years 4 months 20 days | ||
Prepayment Rate | 3.00% | ||
Loss Severity | 50.00% | ||
Residential Mortgage [Member] | Carrying Value [Member] | |||
Mortgage Loans on Real Estate [Line Items] | |||
Carrying Value | 332,083 | ||
Residential Mortgage [Member] | Carrying Value [Member] | Reverse Mortgage Loans [Member] | |||
Mortgage Loans on Real Estate [Line Items] | |||
Carrying Value | 23,294 | ||
Residential Mortgage [Member] | Carrying Value [Member] | Performing Loans [Member] | |||
Mortgage Loans on Real Estate [Line Items] | |||
Carrying Value | 292,080 | ||
Residential Mortgage [Member] | Carrying Value [Member] | Purchased Credit Impaired Loans [Member] | |||
Mortgage Loans on Real Estate [Line Items] | |||
Carrying Value | 16,709 | ||
Residential Mortgage [Member] | Fair Value [Member] | |||
Mortgage Loans on Real Estate [Line Items] | |||
Fair Value | 339,828 | ||
Residential Mortgage [Member] | Fair Value [Member] | Reverse Mortgage Loans [Member] | |||
Mortgage Loans on Real Estate [Line Items] | |||
Fair Value | 23,294 | ||
Residential Mortgage [Member] | Fair Value [Member] | Performing Loans [Member] | |||
Mortgage Loans on Real Estate [Line Items] | |||
Fair Value | 296,970 | ||
Residential Mortgage [Member] | Fair Value [Member] | Purchased Credit Impaired Loans [Member] | |||
Mortgage Loans on Real Estate [Line Items] | |||
Fair Value | 19,564 | ||
Fair Value, Measurements, Nonrecurring [Member] | Purchased Credit Impaired Loans [Member] | |||
Mortgage Loans on Real Estate [Line Items] | |||
Discount Rate | 5.50% | ||
Weighted Average Life (Years) | 2 years 4 months 20 days | [4] | |
Prepayment Rate | 3.00% | ||
Loss Severity | 50.00% | [8] | |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value [Member] | Purchased Credit Impaired Loans [Member] | |||
Mortgage Loans on Real Estate [Line Items] | |||
Fair Value | $213,058 | ||
[1] | Projected annualized weighted average lifetime voluntary and involuntary prepayment rate using a prepayment vector. | ||
[2] | Weighted by amortized cost basis of the mortgage loan portfolio. | ||
[3] | Projected percentage of mortgage loans in the pool that will miss their mortgage payments. | ||
[4] | The weighted average life is based on the expected timing of the receipt of cash flows. | ||
[5] | Represents a 70% interest that New Residential holds in reverse mortgage loans. The average loan balance outstanding based on total UPB is $0.3 million. 76% of these loans have reached a termination event. As a result, the borrower can no longer make draws on these loans. Each loan matures upon the occurrence of a termination event. | ||
[6] | FICO scores are not used in determining how much a borrower can access via a reverse mortgage loan. | ||
[7] | Includes loans that are current or less than 30 days past due at acquisition where New Residential expects to collect all contractually required principal and interest payments. Presented net of unamortized premiums of $0.7 million. | ||
[8] | Loss severity is the expected amount of future realized losses resulting from the ultimate liquidation of a particular loan, expressed as the net amount of loss relative to the outstanding loan balance. |
Recovered_Sheet9
FAIR VALUE OF FINANCIAL INSTRUMENTS - Schedule of Inputs Used in Valuing Residential Mortgage Loans (Footnote) (Details) (Reverse Mortgage Loans [Member]) | 1 Months Ended | 3 Months Ended |
Feb. 28, 2013 | Mar. 31, 2015 | |
Reverse Mortgage Loans [Member] | ||
Mortgage Loans on Real Estate [Line Items] | ||
Interest in reverse mortgage loans | 70.00% | 70.00% |
EQUITY_AND_EARNINGS_PER_SHARE_1
EQUITY AND EARNINGS PER SHARE - Narrative (Details) (USD $) | 0 Months Ended | 3 Months Ended | |||||
In Thousands, except Share data, unless otherwise specified | Mar. 16, 2015 | Dec. 18, 2014 | Oct. 17, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | Oct. 17, 2014 |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||||
Reverse stock split | 0.5 | ||||||
Common stock outstanding, prior to stock split (in shares) | 282,800,000 | 282,800,000 | |||||
Common stock, shares outstanding (in shares) | 141,400,000 | 141,434,905 | 141,434,905 | 141,400,000 | |||
Dividend declared per share (in dollars per share) | $0.38 | $0.38 | $0.38 | $0.35 | |||
Dividends | $53,700 | $53,700 | $53,745 | ||||
Share price (in dollars per share) | $15.03 | ||||||
Dilutive common stock equivalents (in shares) | 3,476,404 | 3,315,457 | |||||
Fortress [Member] | |||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||||
Common stock, shares outstanding (in shares) | 2,400,000 |
EQUITY_AND_EARNINGS_PER_SHARE_2
EQUITY AND EARNINGS PER SHARE - Summary of Outstanding Options (Details) | Mar. 31, 2015 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options outstanding (in shares) | 10,572,094 |
Manager [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options outstanding (in shares) | 8,517,287 |
Manager's Employees [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options outstanding (in shares) | 2,049,807 |
Independent Directors [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options outstanding (in shares) | 5,000 |
Total Affiliates [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options outstanding (in shares) | 10,572,094 |
Issued Prior to 2011 [Member] | Manager [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options outstanding (in shares) | 343,440 |
Issued Prior to 2011 [Member] | Manager's Employees [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options outstanding (in shares) | 90,560 |
Issued Prior to 2011 [Member] | Independent Directors [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options outstanding (in shares) | 1,000 |
Issued Prior to 2011 [Member] | Total Affiliates [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options outstanding (in shares) | 435,000 |
Issued in 2011 - 2014 [Member] | Manager [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options outstanding (in shares) | 8,173,847 |
Issued in 2011 - 2014 [Member] | Manager's Employees [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options outstanding (in shares) | 1,959,247 |
Issued in 2011 - 2014 [Member] | Independent Directors [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options outstanding (in shares) | 4,000 |
Issued in 2011 - 2014 [Member] | Total Affiliates [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options outstanding (in shares) | 10,137,094 |
EQUITY_AND_EARNINGS_PER_SHARE_3
EQUITY AND EARNINGS PER SHARE - Summary of Outstanding Options - Period End (Details) (USD $) | 3 Months Ended | |
In Millions, except Share data, unless otherwise specified | Mar. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Date of grant of exercised options | 2013-2014 | [1],[2] |
Date of grant of expired options | 2003-2005 | [1] |
Stock options outstanding (in shares) | 10,572,094 | |
Exercised (in shares) | -802,492 | [2] |
Expired unexercised (in shares) | -792,553 | |
Options Exercisable (in shares) | 9,086,678 | |
Weighted Average Exercise Price, Exercised (in dollars per share) | $5.81 | [2],[3] |
Independent Directors [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock options outstanding (in shares) | 5,000 | |
Independent Directors [Member] | Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Recipient | Directors | |
Date of Grant | Various | [1] |
Stock options outstanding (in shares) | 6,000 | |
Options Exercisable (in shares) | 5,000 | |
Weighted Average Exercise Price (in dollars per share) | $17.54 | [3] |
Intrinsic Value | $0 | |
2003 - 2007 [Member] | Manager [Member] | Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Recipient | Manager | [4] |
Date of Grant | 2003 - 2007 | [1],[4] |
Stock options outstanding (in shares) | 1,226,555 | [4] |
Options Exercisable (in shares) | 434,000 | [4] |
Weighted Average Exercise Price (in dollars per share) | $31.36 | [3],[4] |
Intrinsic Value | 0 | [4] |
March 2011 [Member] | Manager [Member] | Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Recipient | Manager | [4] |
Date of Grant | 11-Mar | [1],[4] |
Stock options outstanding (in shares) | 838,417 | [4] |
Options Exercisable (in shares) | 547,583 | [4] |
Weighted Average Exercise Price (in dollars per share) | $6.58 | [3],[4] |
Intrinsic Value | 4.6 | [4] |
September 2011 [Member] | Manager [Member] | Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Recipient | Manager | [4] |
Date of Grant | 11-Sep | [1],[4] |
Stock options outstanding (in shares) | 1,269,917 | [4] |
Options Exercisable (in shares) | 849,916 | [4] |
Weighted Average Exercise Price (in dollars per share) | $4.98 | [3],[4] |
Intrinsic Value | 8.5 | [4] |
April 2012 [Member] | Manager [Member] | Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Recipient | Manager | [4] |
Date of Grant | 12-Apr | [1],[4] |
Stock options outstanding (in shares) | 948,750 | [4] |
Options Exercisable (in shares) | 920,983 | [4] |
Weighted Average Exercise Price (in dollars per share) | $6.82 | [3],[4] |
Intrinsic Value | 7.6 | [4] |
May 2012 [Member] | Manager [Member] | Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Recipient | Manager | [4] |
Date of Grant | 12-May | [1],[4] |
Stock options outstanding (in shares) | 1,150,000 | [4] |
Options Exercisable (in shares) | 1,117,333 | [4] |
Weighted Average Exercise Price (in dollars per share) | $7.34 | [3],[4] |
Intrinsic Value | 8.6 | [4] |
July 2012 [Member] | Manager [Member] | Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Recipient | Manager | [4] |
Date of Grant | 12-Jul | [1],[4] |
Stock options outstanding (in shares) | 1,265,000 | [4] |
Options Exercisable (in shares) | 1,234,783 | [4] |
Weighted Average Exercise Price (in dollars per share) | $7.34 | [3],[4] |
Intrinsic Value | 9.5 | [4] |
January 2013 [Member] | Manager [Member] | Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Recipient | Manager | [4] |
Date of Grant | 13-Jan | [1],[4] |
Stock options outstanding (in shares) | 2,875,000 | [4] |
Options Exercisable (in shares) | 2,491,665 | [4] |
Weighted Average Exercise Price (in dollars per share) | $10.24 | [3],[4] |
Intrinsic Value | 11.9 | [4] |
February 2013 [Member] | Manager [Member] | Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Recipient | Manager | [4] |
Date of Grant | 13-Feb | [1],[4] |
Stock options outstanding (in shares) | 1,150,000 | [4] |
Options Exercisable (in shares) | 958,332 | [4] |
Weighted Average Exercise Price (in dollars per share) | $11.48 | [3],[4] |
Intrinsic Value | 3.4 | [4] |
April 2014 [Member] | Manager [Member] | Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Recipient | Manager | [4] |
Date of Grant | 14-Apr | [1],[4] |
Stock options outstanding (in shares) | 1,437,500 | [4] |
Options Exercisable (in shares) | 527,083 | [4] |
Weighted Average Exercise Price (in dollars per share) | $12.20 | [3],[4] |
Intrinsic Value | $1.50 | [4] |
[1] | Options expire on the tenth anniversary from date of grant. | |
[2] | Exercised by employees of Fortress, subsequent to their assignment, or by directors. The options exercised had an intrinsic value of $4.5 million. | |
[3] | The strike prices are subject to adjustment in connection with return of capital dividends. | |
[4] | The Manager assigned certain of its options to Fortress’s employees as follows: Date of Grant Range of StrikePrices Total UnexercisedInception to Date2004 - 2007 $29.92 to $33.80 90,5602012 $6.82 to $7.34 600,0002013 $10.24 to $11.48 1,100,4972014 $12.20 258,750Total 2,049,807 |
EQUITY_AND_EARNINGS_PER_SHARE_4
EQUITY AND EARNINGS PER SHARE - Summary of Outstanding Options - Period End (Footnote) (Details) (USD $) | 3 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2015 |
Equity and Earnings Per Share [Abstract] | |
Intrinsic value of options exercised | $4.50 |
EQUITY_AND_EARNINGS_PER_SHARE_5
EQUITY AND EARNINGS PER SHARE - Summary of Outstanding Options - Options Assigned (Details) (USD $) | 3 Months Ended |
Mar. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Total Unexercised Inception to Date (in shares) | 10,572,094 |
Options Granted in 2004 to 2007 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Total Unexercised Inception to Date (in shares) | 90,560 |
Options Granted in 2004 to 2007 [Member] | Lower Range [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Date of Grant | 2004 |
Strike Price (in dollars per share) | $29.92 |
Options Granted in 2004 to 2007 [Member] | Upper Range [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Date of Grant | 2007 |
Strike Price (in dollars per share) | $33.80 |
Options Granted in 2012 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Date of Grant | 2012 |
Total Unexercised Inception to Date (in shares) | 600,000 |
Options Granted in 2012 [Member] | Lower Range [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Strike Price (in dollars per share) | $6.82 |
Options Granted in 2012 [Member] | Upper Range [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Strike Price (in dollars per share) | $7.34 |
Options Granted in 2013 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Date of Grant | 2013 |
Total Unexercised Inception to Date (in shares) | 1,100,497 |
Options Granted in 2013 [Member] | Lower Range [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Strike Price (in dollars per share) | $10.24 |
Options Granted in 2013 [Member] | Upper Range [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Strike Price (in dollars per share) | $11.48 |
Options Granted in 2014 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Date of Grant | 2014 |
Strike Price (in dollars per share) | $12.20 |
Total Unexercised Inception to Date (in shares) | 258,750 |
Options Assigned [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Total Unexercised Inception to Date (in shares) | 2,049,807 |
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES - Narrative (Details) | 0 Months Ended | 3 Months Ended |
Feb. 13, 2015 | Mar. 20, 2015 | |
lawsuit | lawsuit | |
Putative Class Action Lawsuits [Member] | ||
Loss Contingencies [Line Items] | ||
Number of claims | 3 | |
Shareholder Derivative Actions [Member] | ||
Loss Contingencies [Line Items] | ||
Number of claims | 2 |
TRANSACTIONS_WITH_AFFILIATES_A2
TRANSACTIONS WITH AFFILIATES AND AFFILIATED ENTITIES - Schedule of Affiliate Transactions (Details) (USD $) | 3 Months Ended | ||||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | ||
Related Party Transaction [Line Items] | |||||
Due to Affiliate, Total | $6,465 | $57,424 | |||
Management fees | 5,126 | 4,486 | |||
Incentive compensation | 3,693 | 3,338 | |||
FIG LLC [Member] | |||||
Related Party Transaction [Line Items] | |||||
Management fees | 1,709 | 1,710 | |||
Incentive compensation | 3,693 | 54,334 | |||
Expense reimbursements and other | 1,063 | 1,380 | |||
Due to Affiliate, Total | 6,465 | 57,424 | |||
Management fees | 5,126 | 4,486 | |||
Incentive compensation | 3,693 | 3,338 | |||
Expense reimbursements | 125 | [1] | 125 | [1] | |
Total payments to affiliate | $8,944 | $7,949 | |||
[1] | Included in General and Administrative Expenses in the Condensed Consolidated Statements of Income. |
TRANSACTIONS_WITH_AFFILIATES_A3
TRANSACTIONS WITH AFFILIATES AND AFFILIATED ENTITIES - Narrative (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | 15-May-13 | |
Related Party Transaction [Line Items] | ||
Face amount of debt | 5,338,807,000 | |
FIG LLC [Member] | ||
Related Party Transaction [Line Items] | ||
Management fee rate (percent) | 1.50% | |
Incentive compensation percentage | 25.00% | |
Interest rate for incentive compensation | 10.00% | |
Nationstar [Member] | ||
Related Party Transaction [Line Items] | ||
Unpaid Principal Balance | 92,800,000,000 | |
Unpaid Balance of Real Estate Owned | 24,800,000 | |
Nationstar [Member] | Non-Agency RMBS [Member] | ||
Related Party Transaction [Line Items] | ||
Face amount of debt | 1,500,000,000 | |
Unpaid Principal Balance | 6,000,000,000 | |
Nationstar [Member] | Agency RMBS [Member] | ||
Related Party Transaction [Line Items] | ||
Face amount of debt | 88,300,000 | |
Nationstar [Member] | Non-Performing Loans [Member] | ||
Related Party Transaction [Line Items] | ||
Unpaid Principal Balance | 243,500,000 | |
Nationstar [Member] | Credit Concentration Risk [Member] | Investment Interest Income - Excess MSRs [Member] | ||
Related Party Transaction [Line Items] | ||
Percentage of UPB of loans underlying investments | 98.90% | |
Nationstar [Member] | Credit Concentration Risk [Member] | Investment Interest Income - Servicer Advances [Member] | ||
Related Party Transaction [Line Items] | ||
Percentage of UPB of loans underlying investments | 97.00% |
RECLASSIFICATION_FROM_ACCUMULA2
RECLASSIFICATION FROM ACCUMULATED OTHER COMPREHENSIVE INCOME INTO NET INCOME - Summary of Amounts Reclassified out of Accumulated Other Comprehensive Income into Net Income (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Gain on settlement of securities | ($14,767) | ($4,357) |
Other-than-temporary impairment (“OTTIâ€) on securities | 1,071 | 328 |
Total reclassifications | -41,798 | -56,865 |
Reclassification out of Accumulated Other Comprehensive Income [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Gain on settlement of securities | -24,697 | -4,492 |
Other-than-temporary impairment (“OTTIâ€) on securities | 1,071 | 328 |
Total reclassifications | ($23,626) | ($4,164) |
INCOME_TAXES_Schedule_of_Incom
INCOME TAXES - Schedule of Income Tax Expense (Benefit) (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Current: | ||
Federal | $736 | $217 |
State and Local | -1,156 | 70 |
Total Current Income Tax Expense (Benefit) | -420 | 287 |
Deferred: | ||
Federal | -1,323 | 0 |
State and Local | -1,684 | 0 |
Total Deferred Income Tax Expense (Benefit) | -3,007 | 0 |
Total Income Tax Expense (Benefit) | ($3,427) | $287 |
INCOME_TAXES_Narrative_Details
INCOME TAXES - Narrative (Details) (USD $) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | ||
Increase to income tax provision | $2,300,000 | |
Reserve for unrecognized tax benefits | 0 | |
Benefit to income tax provision | 2,300,000 | |
Net deferred tax liability | $13,414,000 | $15,114,000 |
RECENT_ACTIVITIES_Narrative_De
RECENT ACTIVITIES - Narrative (Details) (USD $) | 0 Months Ended | 3 Months Ended | 0 Months Ended | 1 Months Ended | 0 Months Ended | 1 Months Ended | 0 Months Ended | ||||||
Mar. 16, 2015 | Dec. 18, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Jan. 16, 2015 | Apr. 30, 2015 | Apr. 06, 2015 | 11-May-15 | 10-May-15 | Apr. 30, 2015 | Apr. 16, 2015 | Jan. 01, 2015 | Dec. 31, 2014 | |
Subsequent Event [Line Items] | |||||||||||||
Recovered existing servicer advances | $1,802,188,000 | $1,442,648,000 | |||||||||||
Notes payable outstanding decrease | 200,000,000 | ||||||||||||
Decrease in restricted cash | -1,093,000 | 1,269,000 | |||||||||||
Gain on settlement of securities | -14,767,000 | -4,357,000 | |||||||||||
Face amount of debt | 5,338,807,000 | ||||||||||||
Notional amount of derivatives | 32,400,000 | ||||||||||||
Dividend declared per share (in dollars per share) | $0.38 | $0.38 | $0.38 | $0.35 | |||||||||
Dividends | 53,700,000 | 53,700,000 | 53,745,000 | ||||||||||
Repayment of debt | 2,016,777,000 | 1,080,197,000 | |||||||||||
Common stock, par value (in dollars per share) | $0.01 | $0.01 | |||||||||||
Amount retained | 28,325,000 | 29,418,000 | |||||||||||
Non-Agency RMBS [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Face amount of securities purchased | 257,800,000 | ||||||||||||
Face amount of securities sold | 441,100,000 | ||||||||||||
Proceeds from sale of real estate securities | 389,700,000 | ||||||||||||
Servicer Advance Joint Venture [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Notes payable outstanding decrease | 2,700,000,000 | ||||||||||||
Excess MSRs [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Total servicer advances funded | 23,800,000 | ||||||||||||
Unpaid Principal Balance | 8,400,000,000 | ||||||||||||
Excess MSRs [Member] | Freddie Mac [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Percentage of Excess MSRs acquired | 33.30% | ||||||||||||
Excess MSRs [Member] | SLS [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Percentage of Excess MSRs acquired | 50.00% | ||||||||||||
Subsequent Event [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Net proceeds from issuance of common stock in public offering | 436,100,000 | ||||||||||||
Options granted to purchase number of shares (in shares) | 5,750,000 | ||||||||||||
Fair value of options granted to purchase shares | 8,900,000 | ||||||||||||
Fair value assumption, risk free rate | 2.02% | ||||||||||||
Fair value assumption, dividend yield | 6.71% | ||||||||||||
Fair value assumption, volatility | 24.04% | ||||||||||||
Fair value assumption term | 10 years | ||||||||||||
Subsequent Event [Member] | Common Stock [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Common stock issued in public offering (in shares) | 29,213,020 | ||||||||||||
Public offering share price (in dollars per share) | $15.25 | $15.25 | |||||||||||
Subsequent Event [Member] | Common Stock [Member] | Executive Officer [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Common stock issued in public offering (in shares) | 250,000 | ||||||||||||
Subsequent Event [Member] | HLSS [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Share price (in dollars per share) | $18.25 | ||||||||||||
Cash paid to acquire business | 1,007,000,000 | ||||||||||||
Shares issued to acquire business | 28,286,980 | ||||||||||||
Common stock, par value (in dollars per share) | $0.01 | ||||||||||||
Acquisition related costs incurred | 17,800,000 | ||||||||||||
Subsequent Event [Member] | Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Number of interest rate swap agreements | 2 | ||||||||||||
Notional amount of derivatives | 500,000,000 | ||||||||||||
Subsequent Event [Member] | Non-Agency RMBS [Member] | Repurchase Agreements [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Face amount of debt | 190,000,000 | ||||||||||||
Subsequent Event [Member] | Secured Corporate Note, April 2017 Maturity [Member] | Secured Corporate Loan [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Face amount of debt | 219,400,000 | ||||||||||||
Basis spread on variable rate | 5.25% | ||||||||||||
Subsequent Event [Member] | Secured Corporate Note, April 2017 Maturity, Adjusted May 2016 [Member] | Secured Corporate Loan [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Basis spread on variable rate | 7.25% | ||||||||||||
Subsequent Event [Member] | Non-Agency RMBS [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Face amount of securities purchased | 73,300,000 | ||||||||||||
Purchase of real estate securities financed with repurchase agreements | 58,600,000 | ||||||||||||
Face amount of securities sold | 374,400,000 | ||||||||||||
Amortized cost basis of securities sold | 391,000,000 | ||||||||||||
Proceeds from sale of real estate securities | 394,600,000 | ||||||||||||
Gain on settlement of securities | -3,600,000 | ||||||||||||
Face amount of instrument with extended maturity date | 1,300,000,000 | ||||||||||||
Subsequent Event [Member] | Servicer Advance Joint Venture [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Total servicer advances funded | 363,400,000 | ||||||||||||
Recovered existing servicer advances | 552,000,000 | ||||||||||||
Notes payable outstanding decrease | 170,000,000 | ||||||||||||
Decrease in restricted cash | 500,000 | ||||||||||||
Subsequent Event [Member] | HLSS [Member] | HLSS [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Share price (in dollars per share) | $0.70 | ||||||||||||
Common stock, par value (in dollars per share) | $0.01 | ||||||||||||
Amount retained | 50,000,000 | ||||||||||||
Percentage of HLSS's issued and outstanding shares | 10.00% | ||||||||||||
Subsequent Event [Member] | Credit Suisse First Boston Mortgage Capital, LLC [Member] | Secured Corporate Loan [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Repayment of debt | 100,000,000 | ||||||||||||
Subsequent Event [Member] | Barclays [Member] | Secured Corporate Loan, April 2016 Maturity [Member] | Secured Corporate Loan [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Face amount of debt | 165,000,000 | ||||||||||||
Subsequent Event [Member] | Barclays [Member] | Secured Corporate Loan, April 2016 Maturity [Member] | Secured Corporate Loan [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Variable interest rate spread | 5.00% | ||||||||||||
Subsequent Event [Member] | Barclays [Member] | Secured Corporate Loan, April 2016 Maturity, Adjusted July 2015 [Member] | Secured Corporate Loan [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Variable interest rate spread | 8.00% | ||||||||||||
Subsequent Event [Member] | Nationstar [Member] | Servicer Advance Joint Venture [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Nationstar payment made as contractual incentive fee | 5,500,000 | ||||||||||||
Subsequent Event [Member] | SLS [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Total servicer advances funded | 41,000,000 | ||||||||||||
Recovered existing servicer advances | 54,000,000 | ||||||||||||
Notes payable outstanding decrease | 11,400,000 | ||||||||||||
Decrease in restricted cash | 0 | ||||||||||||
Subsequent Event [Member] | Excess MSRs [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Total servicer advances funded | 3,500,000 | 2,600,000 | |||||||||||
Unpaid Principal Balance | 1,600,000,000 | 1,600,000,000 | 8,400,000,000 | ||||||||||
Subsequent Event [Member] | Excess MSRs [Member] | Freddie Mac [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Percentage of Excess MSRs acquired | 33.30% | 33.30% | 33.30% | ||||||||||
Subsequent Event [Member] | Performing Loans [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Unpaid principal balance of loans | 268,700,000 | ||||||||||||
Net proceeds from sale of loans | 282,200,000 | ||||||||||||
Subsequent Event [Member] | Non-Performing Loans [Member] | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Unpaid principal balance of loans | 22,100,000 | ||||||||||||
Net proceeds from sale of loans | $19,500,000 |
RECENT_ACTIVITIES_Summary_of_U
RECENT ACTIVITIES - Summary of Unaudited Pro Forma Combined Interest Income and Income (Loss) Before Income Taxes (Details) (HLSS [Member], USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
HLSS [Member] | ||
Subsequent Event [Line Items] | ||
Interest income | $165,055 | $176,989 |
Income (Loss) Before Income Taxes | $71,465 | $103,683 |