Document_And_Entity_Informatio
Document And Entity Information | 9 Months Ended | |
Sep. 30, 2014 | Oct. 27, 2014 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'Ocwen Financial Corporation | ' |
Entity Central Index Key | '0000873860 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Sep-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Amendment Flag | 'false | ' |
Entity Common Stock, Shares Outstanding | ' | 125,814,811 |
UNAUDITED_CONSOLIDATED_BALANCE
UNAUDITED CONSOLIDATED BALANCE SHEETS (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Assets | ' | ' |
Cash | $299,163 | $178,512 |
Mortgage servicing rights ($101,948 and $116,029 carried at fair value) | 1,958,766 | 2,069,381 |
Advances | 987,286 | 890,832 |
Match funded advances | 2,359,579 | 2,552,383 |
Loans held for sale ($335,950 and $503,753 carried at fair value) | 407,887 | 566,660 |
Loans held for investment - reverse mortgages, at fair value | 1,315,324 | 618,018 |
Goodwill | 420,201 | 420,201 |
Receivables, net | 245,817 | 152,516 |
Deferred tax assets, net | 79,470 | 115,571 |
Premises and equipment, net | 44,907 | 53,786 |
Other assets | 237,240 | 309,143 |
Total assets | 8,355,640 | 7,927,003 |
Liabilities | ' | ' |
Match funded liabilities | 2,035,639 | 2,364,814 |
Financing liabilities ($1,854,949 and $1,249,380 carried at fair value) | 2,057,490 | 1,266,973 |
Other secured borrowings | 1,666,427 | 1,777,669 |
Senior unsecured notes | 350,000 | 0 |
Other liabilities | 631,641 | 644,595 |
Total liabilities | 6,741,197 | 6,054,051 |
Commitments and Contingencies (Note 22) | ' | ' |
Mezzanine Equity | ' | ' |
Series A Perpetual Convertible Preferred stock, $.01 par value; 200,000 shares authorized; 62,000 shares issued and outstanding at December 31, 2013 | 0 | 60,361 |
Ocwen Financial Corporation (Ocwen) stockholders’ equity | ' | ' |
Common stock, $.01 par value; 200,000,000 shares authorized; 127,467,805 and 135,176,271 shares issued and outstanding at September 30, 2014 and December 31, 2013, respectively | 1,275 | 1,352 |
Additional paid-in capital | 567,025 | 818,427 |
Retained earnings | 1,052,236 | 1,002,963 |
Accumulated other comprehensive loss, net of income taxes | -8,784 | -10,151 |
Total Ocwen stockholders’ equity | 1,611,752 | 1,812,591 |
Non-controlling interest in subsidiaries | 2,691 | 0 |
Total equity | 1,614,443 | 1,812,591 |
Total liabilities, mezzanine equity and equity | $8,355,640 | $7,927,003 |
UNAUDITED_CONSOLIDATED_BALANCE1
UNAUDITED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
CONSOLIDATED BALANCE SHEETS [Abstract] | ' | ' |
Mortgage servicing rights, fair value | $101,948 | $116,029 |
Loans held for sale, fair value | 335,950 | 503,753 |
Financing liabilities, fair value | $1,854,949 | $1,249,380 |
Convertible preferred stock, Series A, par value (in USD per share) | $0.01 | $0.01 |
Convertible preferred stock, Series A, shares authorized (in shares) | 200,000 | 200,000 |
Convertible preferred stock, Series A, shares issued (in shares) | 0 | 62,000 |
Convertible preferred stock, Series A, shares outstanding (in shares) | 0 | 62,000 |
Common stock, par value (in USD per share) | $0.01 | $0.01 |
Common stock, shares authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock, shares issued (in shares) | 127,467,805 | 135,176,271 |
Common stock, shares outstanding (in shares) | 127,467,805 | 135,176,271 |
UNAUDITED_CONSOLIDATED_STATEME
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 3 Months Ended | 9 Months Ended | ||||||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | ||||
Revenue | ' | ' | ' | ' | ||||
Servicing and subservicing fees | $465,964 | $483,267 | $1,448,096 | $1,333,392 | ||||
Gain on loans held for sale, net | 27,218 | 28,262 | 110,041 | 72,912 | ||||
Other revenues | 20,516 | 19,711 | 59,896 | 76,014 | ||||
Total revenue | 513,698 | 531,240 | 1,618,033 | 1,482,318 | ||||
Operating expenses | ' | ' | ' | ' | ||||
Compensation and benefits | 99,879 | 118,054 | 316,118 | 330,679 | ||||
Amortization of mortgage servicing rights | 60,783 | 79,183 | 186,075 | 197,435 | ||||
Servicing and origination | 49,739 | 34,236 | 129,473 | 89,740 | ||||
Technology and communications | 44,261 | 38,809 | 121,234 | 102,698 | ||||
Professional services | 160,704 | 19,090 | 212,745 | 99,228 | ||||
Occupancy and equipment | 24,697 | 30,786 | 82,504 | 74,631 | ||||
Other operating expenses | 14,976 | 26,102 | 101,547 | 66,007 | ||||
Total operating expenses | 455,039 | 346,260 | 1,149,696 | 960,418 | ||||
Income from operations | 58,659 | 184,980 | 468,337 | 521,900 | ||||
Other income (expense) | ' | ' | ' | ' | ||||
Interest expense | -133,049 | -116,885 | -409,129 | -319,564 | ||||
Gain (loss) on debt redemption | 0 | 1,282 | 2,609 | -12,556 | ||||
Other, net | 2,124 | 68 | 14,797 | 9,115 | ||||
Total other expense, net | -130,925 | -115,535 | -391,723 | -323,005 | ||||
Income (loss) before income taxes | -72,266 | 69,445 | 76,614 | 198,895 | ||||
Income tax expense (benefit) | 2,992 | 8,873 | 24,374 | 23,752 | ||||
Net income (loss) | -75,258 | 60,572 | 52,240 | 175,143 | ||||
Net income attributable to non-controlling interests | -123 | 0 | -165 | 0 | ||||
Net income (loss) attributable to Ocwen stockholders | -75,381 | 60,572 | 52,075 | 175,143 | ||||
Preferred stock dividends | 0 | -1,446 | -1,163 | -4,450 | ||||
Deemed dividends related to beneficial conversion feature of preferred stock | -808 | -4,401 | -1,639 | -6,573 | ||||
Net income (loss) attributable to Ocwen common stockholders | ($76,189) | $54,725 | $49,273 | $164,120 | ||||
Earnings (loss) per share attributable to Ocwen common stockholders | ' | ' | ' | ' | ||||
Basic (in USD per share) | ($0.58) | $0.40 | $0.37 | $1.21 | ||||
Diluted (in USD per share) | ($0.58) | $0.39 | $0.36 | $1.17 | ||||
Weighted average common shares outstanding | ' | ' | ' | ' | ||||
Basic (in shares) | 130,551,197 | 135,787,834 | 133,318,381 | 135,705,892 | ||||
Diluted (in shares) | 130,551,197 | [1] | 140,057,195 | [1] | 136,881,326 | [1] | 139,747,490 | [1] |
[1] | For the three months ended September 30, 2014, we have excluded the effect of the Preferred Shares, stock options and common stock awards from the computation of diluted EPS because of the anti-dilutive effect of our reported net loss. |
UNAUDITED_CONSOLIDATED_STATEME1
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (USD $) | 3 Months Ended | 9 Months Ended | ||||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | ||||
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) [Abstract] | ' | ' | ' | ' | ||||
Net income (loss) | ($75,258) | $60,572 | $52,240 | $175,143 | ||||
Other comprehensive income (loss), net of income taxes: | ' | ' | ' | ' | ||||
Change in deferred loss on cash flow hedges arising during the year | 0 | [1] | 0 | [1] | 0 | [1] | -7,537 | [1] |
Reclassification adjustment for losses on cash flow hedges included in net income | 384 | [2] | 4,714 | [2] | 1,362 | [2] | 6,198 | [2] |
Net change in deferred loss on cash flow hedges | 384 | 4,714 | 1,362 | -1,339 | ||||
Other | 2 | 31 | 5 | 711 | ||||
Total other comprehensive income (loss), net of income taxes | 386 | 4,745 | 1,367 | -628 | ||||
Comprehensive income (loss) | -74,872 | 65,317 | 53,607 | 174,515 | ||||
Comprehensive income attributable to non-controlling interests | -121 | 0 | -165 | 0 | ||||
Comprehensive income (loss) attributable to Ocwen stockholders | ($74,993) | $65,317 | $53,442 | $174,515 | ||||
[1] | Net of tax benefit of $4.8 million for the nine months ended September 30, 2013. | |||||||
[2] | Net of tax expense of $3.1 million for the three months ended September 30, 2013 and $0.2 million and $3.9 million for the nine months ended September 30, 2014 and 2013, respectively. These losses are reclassified to Other, net in the unaudited Consolidated Statements of Operations. See Note 15 – Derivative Financial Instruments and Hedging Activities for additional information. |
UNAUDITED_CONSOLIDATED_STATEME2
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) (USD $) | 3 Months Ended | 9 Months Ended | |
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) [Abstract] | ' | ' | ' |
Income tax benefit | ' | ' | $4.80 |
Income tax expense | ($3.10) | ($0.20) | ($3.90) |
UNAUDITED_CONSOLIDATED_STATEME3
UNAUDITED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (USD $) | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Noncontrolling Interest [Member] |
In Thousands, except Share data, unless otherwise specified | ||||||
Beginning Balance at Dec. 31, 2012 | $1,611,422 | $1,356 | $911,942 | $704,565 | ($6,441) | ' |
Beginning Balance (in shares) at Dec. 31, 2012 | ' | 135,637,932 | ' | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | ' | ' |
Net income | 175,143 | ' | ' | 175,143 | ' | ' |
Preferred stock dividends | -4,450 | ' | ' | -4,450 | ' | ' |
Deemed dividends related to beneficial conversion feature of preferred stock | -6,573 | ' | ' | -6,573 | ' | ' |
Conversion of preferred stock | 100,000 | 31 | 99,969 | ' | ' | ' |
Conversion of preferred stock (in shares) | ' | 3,145,640 | ' | ' | ' | ' |
Repurchase of common stock | -157,880 | -31 | -157,849 | ' | ' | ' |
Repurchase of common stock (in shares) | ' | -3,145,640 | ' | ' | ' | ' |
Exercise of common stock options | -186 | 2 | -188 | ' | ' | ' |
Exercise of common stock options (in shares) | ' | 172,969 | ' | ' | ' | ' |
Equity-based compensation and other | 10,849 | ' | 10,849 | ' | ' | ' |
Equity-based compensation (in shares) | ' | 12,031 | ' | ' | ' | ' |
Other comprehensive income (loss), net of income taxes | -628 | ' | ' | ' | -628 | ' |
Ending Balance at Sep. 30, 2013 | 1,727,697 | 1,358 | 864,723 | 868,685 | -7,069 | 0 |
Ending Balance (in shares) at Sep. 30, 2013 | ' | 135,822,932 | ' | ' | ' | ' |
Beginning Balance at Dec. 31, 2013 | 1,812,591 | 1,352 | 818,427 | 1,002,963 | -10,151 | 0 |
Beginning Balance (in shares) at Dec. 31, 2013 | 135,176,271 | 135,176,271 | ' | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | ' | ' |
Net income | 52,240 | ' | ' | 52,075 | ' | 165 |
Preferred stock dividends | -1,163 | ' | ' | -1,163 | ' | ' |
Deemed dividends related to beneficial conversion feature of preferred stock | -1,639 | ' | ' | -1,639 | ' | ' |
Conversion of preferred stock | 62,000 | 20 | 61,980 | ' | ' | ' |
Conversion of preferred stock (in shares) | ' | 1,950,296 | ' | ' | ' | ' |
Repurchase of common stock | -325,609 | -99 | -325,510 | ' | ' | ' |
Repurchase of common stock (in shares) | -7,970,353 | -9,920,649 | ' | ' | ' | ' |
Exercise of common stock options | 1,038 | 2 | 1,036 | ' | ' | ' |
Exercise of common stock options (in shares) | ' | 244,000 | ' | ' | ' | ' |
Equity-based compensation and other | 11,092 | ' | 11,092 | ' | ' | ' |
Equity-based compensation (in shares) | ' | 17,887 | ' | ' | ' | ' |
Non-controlling interest in connection with the acquisition of a controlling interest in Ocwen Structured Investments, LLC | 2,526 | ' | ' | ' | ' | 2,526 |
Other comprehensive income (loss), net of income taxes | 1,367 | ' | ' | ' | 1,367 | ' |
Ending Balance at Sep. 30, 2014 | $1,614,443 | $1,275 | $567,025 | $1,052,236 | ($8,784) | $2,691 |
Ending Balance (in shares) at Sep. 30, 2014 | 127,467,805 | 127,467,805 | ' | ' | ' | ' |
UNAUDITED_CONSOLIDATED_STATEME4
UNAUDITED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Parenthetical) (USD $) | 9 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Statement of Stockholders' Equity [Abstract] | ' | ' |
Preferred stock dividends (in USD per share) | $18.75 | $27.92 |
UNAUDITED_CONSOLIDATED_STATEME5
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 9 Months Ended | 19 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | |
ResCap [Member] | ||||
Cash flows from operating activities | ' | ' | ' | |
Net income | $52,240 | $175,143 | ' | |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' | ' | |
Amortization of mortgage servicing rights | 186,075 | 197,435 | ' | |
Depreciation | 16,601 | 17,153 | ' | |
Provision for bad debts | 49,583 | 22,386 | ' | |
Gain on sale of loans | -110,041 | -72,912 | ' | |
Realized and unrealized losses on derivative financial instruments | 1,955 | 12,896 | ' | |
(Gain) loss on extinguishment of debt | -2,609 | 12,556 | ' | |
Loss (gain) on valuation of mortgage servicing rights, at fair value | 13,147 | -11,725 | ' | |
Decrease (increase) in deferred tax assets, net | 35,884 | -2,393 | ' | |
Origination and purchase of loans held for sale | -6,007,152 | -7,072,260 | ' | |
Proceeds from sale and collections of loans held for sale | 6,013,059 | 7,006,883 | ' | |
Changes in assets and liabilities: | ' | ' | ' | |
Decrease in advances and match funded advances | 236,688 | 424,008 | ' | |
(Increase) decrease in receivables and other assets, net | -11,806 | 265,554 | ' | |
(Decrease) increase in other liabilities | 46,243 | 27,783 | ' | |
Other, net | 39,148 | 1,723 | ' | |
Net cash provided by operating activities | 559,015 | 1,004,230 | ' | |
Cash flows from investing activities | ' | ' | ' | |
Distributions of capital from unconsolidated entities | 6,572 | 1,300 | ' | |
Purchase of mortgage servicing rights, net | -19,395 | -676,750 | ' | |
Acquisition of advances in connection with the purchase of mortgage servicing rights | -84,373 | -445,478 | ' | |
Acquisition of advances in connection with the purchase of loans | -60,482 | 0 | ' | |
Proceeds from sale of advances and match funded advances | 0 | 3,492,489 | ' | |
Net proceeds from sale of diversified fee-based businesses to Altisource Portfolio Solutions, SA | 0 | 215,700 | ' | |
Proceeds from sale of mortgage servicing rights | 287 | 21,511 | ' | |
Origination of loans held for investment – reverse mortgages | -565,670 | -274,081 | ' | |
Principal payments received on loans held for investment - reverse mortgages | 56,193 | 2,164 | ' | |
Additions to premises and equipment | -7,716 | -24,475 | ' | |
Other | 4,270 | 2,947 | ' | |
Net cash (used in) provided by investing activities | -732,368 | 50,037 | ' | |
Cash flows from financing activities | ' | ' | ' | |
Repayment of match funded liabilities | -329,175 | -2,169,732 | ' | |
Proceeds from other secured borrowings | 4,352,495 | 7,935,374 | ' | |
Repayments of other secured borrowings | -4,532,029 | -7,166,050 | ' | |
Proceeds from issuance of senior unsecured notes | 350,000 | 0 | ' | |
Payment of debt issuance costs | -6,835 | -25,547 | ' | |
Proceeds from sale of mortgage servicing rights accounted for as a financing | 123,551 | 404,509 | ' | |
Proceeds from sale of loans accounted for as a financing | 572,031 | 272,652 | ' | |
Proceeds from sale of advances accounted for as a financing | 88,095 | 0 | ' | |
Repurchase of common stock | -325,609 | -157,880 | ' | |
Payment of preferred stock dividends | -1,163 | -4,534 | ' | |
Other | 2,643 | -5,703 | ' | |
Net cash provided by (used in) financing activities | 294,004 | -916,911 | ' | |
Net increase in cash | 120,651 | 137,356 | ' | |
Cash at beginning of year | 178,512 | 220,130 | ' | |
Cash at end of period | 299,163 | 357,486 | ' | |
Supplemental non-cash investing and financing activities | ' | ' | ' | |
Conversion of Series A preferred stock to common stock | 62,000 | 100,000 | ' | |
Fair value of assets acquired | ' | ' | ' | |
Fair value of assets acquired, total | ' | ' | ' | [1] |
Fair value of liabilities assumed | ' | ' | ' | |
Amount due to seller | ' | ' | ' | [1],[2] |
Cash paid | ' | ' | $174,600 | |
[1] | See Note 3 – Business Acquisitions for information regarding the acquisitions of Ocwen Structured Investments, LLC and Correspondent One S.A. during the three months ended March 31, 2014 and 2013, respectively. | |||
[2] | Amount due to seller includes $54.2 million paid in 2014 for certain mortgage servicing rights and related servicing advances which we were obligated to acquire that were not settled as part of the initial closing. |
UNAUDITED_CONSOLIDATED_STATEME6
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) (USD $) | 9 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2014 |
Purchase of mortgage servicing rights, net | $19,395 |
ResCap [Member] | ' |
Purchase of mortgage servicing rights, net | $54,200 |
Description_of_Business_and_Ba
Description of Business and Basis of Presentation | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | |||||||
Description of Business, Basis of Presentation and Summary of Significant Accounting Policies | ' | |||||||
Note 1 – Description of Business and Basis of Presentation | ||||||||
Organization | ||||||||
Ocwen Financial Corporation (NYSE: OCN) (Ocwen, we, us and our) is a financial services holding company which, through its subsidiaries, is engaged in the servicing and origination of forward and reverse mortgage loans. Ocwen is headquartered in Atlanta, Georgia with offices throughout the United States (U.S.) and in the United States Virgin Islands (USVI) with support operations in India, the Philippines and Uruguay. Ocwen is a Florida corporation organized in February 1988. | ||||||||
Ocwen owns all of the common stock of its primary operating subsidiary, Ocwen Mortgage Servicing, Inc. (OMS), and directly or indirectly owns all of the outstanding stock of its other primary operating subsidiaries: Ocwen Loan Servicing, LLC (OLS), Ocwen Financial Solutions Private Limited, Homeward Residential, Inc. (Homeward), and Liberty Home Equity Solutions, Inc. (Liberty). | ||||||||
In 2013, we completed acquisitions of mortgage servicing rights (MSRs) and servicing advances from, among others, OneWest Bank, FSB (OneWest MSR Transaction) and Ally Bank, a wholly-owned subsidiary of Ally Financial Inc. (Ally), the indirect parent of Residential Capital, LLC (ResCap) (Ally MSR Transaction), and acquisitions of servicing and origination platforms, including Liberty Home Equity Solutions, Inc. (Liberty) through a stock purchase agreement (Liberty Acquisition) and certain assets and operations of ResCap pursuant to a plan under Chapter 11 of the Bankruptcy Code (ResCap Acquisition). See Note 3 – Business Acquisitions and Note 8 – Mortgage Servicing for additional information. | ||||||||
Basis of Presentation | ||||||||
The accompanying unaudited consolidated financial statements have been prepared in conformity with the instructions of the Securities and Exchange Commission (SEC) to Form 10-Q and SEC Regulation S-X, Article 10, Rule 10-01 for interim financial statements. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America (GAAP) for complete financial statements. In our opinion, the accompanying unaudited consolidated financial statements contain all adjustments, consisting only of normal recurring accruals, necessary for a fair presentation. The results of operations and other data for the three and nine months ended September 30, 2014 are not necessarily indicative of the results that may be expected for any other interim period or for the year ending December 31, 2014. The unaudited consolidated financial statements presented herein should be read in conjunction with the audited consolidated financial statements and related notes thereto included in Amendment 1 to our Annual Report on Form 10-K for the year ended December 31, 2013. | ||||||||
Reclassifications | ||||||||
Within the Assets section of the Consolidated Balance sheet at December 31, 2013, we reclassified Debt service accounts of $129.9 million to Other assets to conform to the current year presentation. | ||||||||
Certain insignificant amounts in the unaudited Consolidated Statements of Cash Flows for the nine months ended September 30, 2013 have been reclassified to conform to the current year presentation. These reclassifications had no impact on our consolidated cash flows from operating, investing or financing activities. | ||||||||
Use of Estimates and Assumptions | ||||||||
The preparation of financial statements in conformity with GAAP requires that management make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, the reported amounts of revenues and expenses during the reporting period and the related disclosures in the accompanying notes. Such estimates and assumptions include, but are not limited to, those that relate to fair value measurements, the provision for potential losses that may arise from litigation proceedings, representation and warranty and other indemnification obligations and the valuation of goodwill. In developing estimates and assumptions, management uses all available information; however, actual results could materially differ because of uncertainties associated with estimating the amounts, timing and likelihood of possible outcomes. | ||||||||
Change in Accounting Estimate | ||||||||
For servicing assets or liabilities that we account for using the amortization method, we amortize the balances in proportion to, and over the period of, estimated net servicing income (if servicing revenues exceed servicing costs) or net servicing loss (if servicing costs exceed servicing revenues). We determine estimated net servicing income using the estimated future balance of the underlying mortgage loan portfolio, which, absent new purchases, declines over time from prepayments and scheduled loan amortization. We adjust MSR amortization prospectively in response to changes in estimated projections of future cash flows. As a result of the significant growth and change in composition of our servicing portfolio, we determined that the estimated net servicing income has increased, primarily as a result of lower actual prepayment speeds. We accounted for this change in MSR amortization as a change in an accounting estimate beginning January 1, 2014. This change had the effect of reducing amortization expense and increasing both net income and earnings per share in our unaudited Consolidated Statements of Operations for the three and nine months ended September 30, 2014 as follows: | ||||||||
Three Months | Nine Months | |||||||
Reduction in Amortization of mortgage servicing rights | $ | (21,309 | ) | $ | (69,244 | ) | ||
Increase in Net income attributable to Ocwen common stockholders | $ | 14,920 | $ | 48,485 | ||||
Increase in Earnings per share attributable to Ocwen common stockholders: | ||||||||
Basic | $ | 0.11 | $ | 0.36 | ||||
Diluted | $ | 0.11 | $ | 0.35 | ||||
Recently Issued Accounting Standards | ||||||||
Accounting for Investments in Qualified Affordable Housing Projects (ASU 2014-01) | ||||||||
In January 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-01. The amendments in this ASU permit an entity to make an accounting policy election to account for investments in qualified affordable housing projects using the proportional amortization method, if certain conditions are met. Under the proportional amortization method, an entity amortizes the initial cost of the investment in proportion to the tax credits and other tax benefits received and while recognizing the net investment performance in the statement of operations as a component of income tax expense (benefit). | ||||||||
ASU 2014-01 will be effective for us on January 1, 2015 with early adoption permitted. We are currently evaluating the effect of adopting this standard effective January 1, 2015, but we do not anticipate that our adoption will have a material impact on our consolidated financial condition or results of operations. | ||||||||
Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure (ASU 2014-04) | ||||||||
In January 2014, the FASB issued ASU 2014-04. This ASU clarifies when an in substance repossession or foreclosure occurs such that the loan receivable should be derecognized and the real estate property recognized. An in substance repossession or foreclosure occurs upon either (1) the creditor obtaining legal title to the residential real estate property upon completion of a foreclosure or (2) the borrower conveying all interest in the residential real estate property to the creditor to satisfy that loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. | ||||||||
ASU 2014-04 requires interim and annual disclosure of both (1) the amount of foreclosed residential real estate property held by the creditor and (2) the recorded investment in consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure according to local requirements of the applicable jurisdiction. | ||||||||
ASU 2014-04 will be effective for us on January 1, 2015 with early adoption permitted. An entity can elect to adopt the amendments using either a modified retrospective transition method or a prospective transition method. We are currently evaluating the effect of adopting this standard effective January 1, 2015, but we do not anticipate that our adoption will have a material impact on our consolidated financial condition or results of operations. | ||||||||
Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity (ASU 2014-08) | ||||||||
In April 2014, the FASB issued ASU 2014-08. ASU 2014-08 changes the criteria for reporting discontinued operations. Under this ASU, a discontinued operation is defined as a disposal of a component or group of components that is disposed of or is classified as held for sale and represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results. A strategic shift could include a disposal of (i) a major geographical area of operations, (ii) a major line of business, (iii) a major equity method investment, or (iv) other major parts of an entity. A business activity that upon acquisition qualifies as held for sale will also be a discontinued operation. The new standard no longer precludes presentation as a discontinued operation if (i) there are operations and cash flows of the component that have not been eliminated from the reporting entity’s ongoing operations, or (ii) there is significant continuing involvement with a component after its disposal. | ||||||||
New disclosures under this ASU include the requirement to present in the statement of cash flows or disclose in a note either (i) total operating and investing cash flows for discontinued operations, or (ii) depreciation, amortization, capital expenditures, and significant operating and investing noncash items related to discontinued operations. Assets and liabilities of a discontinued operation that are classified as held for sale or disposed of in the current period must be reclassified for the comparative periods presented in the balance sheet. | ||||||||
ASU 2014-08 will be effective for us on January 1, 2015. The guidance applies prospectively to new disposals and new classifications of disposal groups as held for sale after the effective date. We are currently evaluating the effect of adopting this standard effective January 1, 2015, but we do not anticipate that our adoption will have a material impact on our consolidated financial condition or results of operations. | ||||||||
Revenue from Contracts with Customers (ASU 2014-09) | ||||||||
In May 2014, the FASB issued ASU 2014-09 to clarify the principles for recognizing revenue and to develop a common revenue standard. Under this new standard, an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. An entity should recognize revenue through the following five-step process: | ||||||||
Step 1: Identify the contract(s) with a customer. | ||||||||
Step 2: Identify the performance obligations in the contract. | ||||||||
Step 3: Determine the transaction price. | ||||||||
Step 4: Allocate the transaction price to the performance obligations in the contract. | ||||||||
Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. | ||||||||
This standard will also require enhanced disclosures. Qualitative and quantitative information is required regarding (i) contracts with customers-including revenue and impairments recognized, disaggregation of revenue, and information about contract balances and performance obligations, (ii) significant judgments and changes in judgments-determining the timing of satisfaction of performance obligations and determining the transaction price and amounts allocated to performance obligations and (iii) assets recognized from the costs to obtain or fulfill a contract. | ||||||||
ASU 2014-09 will be effective for us on January 1, 2017. Early application is not permitted. An entity should apply the amendments in this ASU either retrospectively to each prior reporting period presented or retrospectively with the cumulative effect recognized at the date of initial application. | ||||||||
The guidance in this standard does not apply to financial instruments and other contractual rights or obligations within the scope of ASC 860, Transfers and Servicing. We are currently evaluating the effect of adopting this standard. | ||||||||
Repurchase-to-Maturity Transactions, Repurchase Financings and Disclosures (ASU 2014-11) | ||||||||
In June 2014, the FASB issued ASU 2014-11. The amendments in this ASU require changes in the accounting for repurchase-to-maturity transactions and repurchase to financing arrangements. A repurchase-to-maturity transaction (repurchase agreement that matures at the same time as the transferred financial asset) will now be accounted for as a secured borrowing. For a repurchase financing arrangement (a type of repurchase agreement), a transfer of a financial asset executed contemporaneously with a repurchase agreement with the same counterparty will be accounted for separately, which will result in secured borrowing accounting for the repurchase agreement. Transferors will no longer apply the “linked” accounting model. | ||||||||
The amendments in this ASU also include enhanced disclosure requirements. An entity will be required to disclose information about certain transactions accounted for as a sale in which the transferor retains substantially all of the exposure to the economic return on the transferred financial assets through an agreement with the same counterparty. An entity also will be required to disclose information about repurchase agreements, securities lending transactions and repurchase-to-maturity transactions that are accounted for as secured borrowings. | ||||||||
The accounting changes in ASU 2014-11 will be effective for us on January 1, 2015. The disclosure requirements for certain transactions accounted for as a sale is required to be presented for interim and annual periods beginning January 1, 2015, and the disclosure for repurchase agreements, securities lending transactions, and repurchase-to-maturity transactions accounted for as secured borrowings is required to be presented for annual periods beginning January 1, 2015, and for interim periods beginning after April 1, 2015. Early application for a public business entity is prohibited. We are currently evaluating the effect of adopting this standard, but we do not anticipate that our adoption will have a material impact on our consolidated financial condition or results of operations. | ||||||||
Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (ASU 2014-12) | ||||||||
In June 2014, the FASB issued ASU 2014-12 to codify a final consensus reached by the EITF at its March 2014 meeting that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition rather than a condition that affects the grant-date fair value. | ||||||||
The provisions of ASU 2014-12 will be effective for us on January 1, 2015 with early adoption permitted. Entities may apply the amendments in this ASU either (a) prospectively to all awards granted or modified after the effective date or (b) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. We are currently evaluating the effect of adopting this standard effective January 1, 2015. We currently do not have any share-based payment awards outstanding that contain performance targets, and therefore we anticipate that our adoption will not have an impact on our consolidated financial condition or results of operations. | ||||||||
Measuring the Financial Assets and the Financial Liabilities of a Consolidated Collateralized Financing Entity (ASU 2014-13) | ||||||||
In August 2014, the FASB issued ASU 2014-013. When a reporting entity elects the measurement alternative included in this ASU for a consolidated collateralized financing entity, the reporting entity should measure both the financial assets and the financial liabilities of that collateralized financing entity in its consolidated financial statements using the more observable of the fair value of the financial assets and the fair value of the financial liabilities. A collateralized financing entity is a variable interest entity with no more than nominal equity that holds financial assets and issues beneficial interests in those financial assets; the beneficial interests have contractual recourse only to the related assets of the collateralized financing entity and are classified as financial liabilities. | ||||||||
ASU 2014-13 will be effective for us on January 1, 2016, with early adoption permitted at the beginning of an annual period. An entity can elect to adopt the amendments using either a modified retrospective approach or retrospectively to all relevant prior periods. We are currently evaluating the effect of adopting this standard. | ||||||||
Classification of Certain Government-Guaranteed Mortgage Loans upon Foreclosure (ASU 2014-14) | ||||||||
In August 2014, the FASB issued ASU 2014-014. The amendments in this ASU require that a mortgage loan be derecognized and that a separate other receivable be recognized upon foreclosure if the following conditions are met: | ||||||||
1 | The loan has a government guarantee that is not separable from the loan before foreclosure. | |||||||
2 | At the time of foreclosure, the creditor has the intent to convey the real estate property to the guarantor and make a claim on the guarantee, and the creditor has the ability to recover under that claim. | |||||||
3 | At the time of foreclosure, any amount of the claim that is determined on the basis of the fair value of the real estate is fixed. | |||||||
Upon foreclosure, the separate other receivable should be measured based on the amount of the loan balance (principal and interest) expected to be recovered from the guarantor. | ||||||||
ASU 2014-14 will be effective for us on January 1, 2015. An entity should adopt the amendments using either a prospective transition method or a modified retrospective transition method. We are currently evaluating the effect of adopting this standard. |
Restatement_of_Previously_Issu
Restatement of Previously Issued Consolidated Financial Statements | 9 Months Ended | |||||||||||
Sep. 30, 2014 | ||||||||||||
Accounting Changes and Error Corrections [Abstract] | ' | |||||||||||
Restatement of Previously Issued Consolidated Financial Statements | ' | |||||||||||
Note 1A — Restatement of Previously Issued Consolidated Financial Statements | ||||||||||||
Subsequent to the issuance of our original Form 10-K for the year ended December 31, 2013, and our original Form 10-Q for the quarter ended March 31, 2014, we determined there was an error in the accounting for a financing liability related to the Rights to MSRs sold to Home Loan Servicing Solutions, Ltd. and its wholly-owned subsidiary, HLSS Holdings, LLC (collectively HLSS). The error relates to the subsequent accounting for the financing liability at fair value and does not impact the initial accounting for the sale of Rights to MSRs to HLSS. As a result, the financial amounts noted below have been restated from amounts previously reported. | ||||||||||||
The following tables summarize the effect of these restatements on our previously reported amounts. | ||||||||||||
Consolidated Statement of Operations for the Three Months Ended September 30, 2013 | ||||||||||||
As Reported | Restatement | As Restated | ||||||||||
Interest expense | $ | (110,055 | ) | $ | (6,830 | ) | $ | (116,885 | ) | |||
Total other expense, net | (108,705 | ) | (6,830 | ) | (115,535 | ) | ||||||
Income before income taxes | 76,275 | (6,830 | ) | 69,445 | ||||||||
Income tax expense | 9,273 | (400 | ) | 8,873 | ||||||||
Net income | 67,002 | (6,430 | ) | 60,572 | ||||||||
Net income attributable to Ocwen common stockholders | 61,155 | (6,430 | ) | 54,725 | ||||||||
Earnings per share attributable to Ocwen common stockholders | ||||||||||||
Basic | $ | 0.45 | $ | (0.05 | ) | $ | 0.4 | |||||
Diluted | $ | 0.44 | $ | (0.05 | ) | $ | 0.39 | |||||
Consolidated Statement of Operations for the Nine Months Ended September 30, 2013 | ||||||||||||
As Reported | Restatement | As Restated | ||||||||||
Interest expense | $ | (303,339 | ) | $ | (16,225 | ) | $ | (319,564 | ) | |||
Total other expense, net | (306,780 | ) | (16,225 | ) | (323,005 | ) | ||||||
Income before income taxes | 215,120 | (16,225 | ) | 198,895 | ||||||||
Income tax expense | 26,250 | (2,498 | ) | 23,752 | ||||||||
Net income | 188,870 | (13,727 | ) | 175,143 | ||||||||
Net income attributable to Ocwen common stockholders | 177,847 | (13,727 | ) | 164,120 | ||||||||
Earnings per share attributable to Ocwen common stockholders | ||||||||||||
Basic | $ | 1.31 | $ | (0.10 | ) | $ | 1.21 | |||||
Diluted | $ | 1.27 | $ | (0.10 | ) | $ | 1.17 | |||||
Consolidated Statement of Comprehensive Income for the Three Months Ended September 30, 2013 | ||||||||||||
As Reported | Restatement | As Restated | ||||||||||
Net income | $ | 67,002 | $ | (6,430 | ) | $ | 60,572 | |||||
Comprehensive income | 71,747 | (6,430 | ) | 65,317 | ||||||||
Consolidated Statement of Comprehensive Income for the Nine Months Ended September 30, 2013 | ||||||||||||
As Reported | Restatement | As Restated | ||||||||||
Net income | $ | 188,870 | $ | (13,727 | ) | $ | 175,143 | |||||
Comprehensive income | 188,242 | (13,727 | ) | 174,515 | ||||||||
Consolidated Statement of Changes in Equity for the Nine Months Ended September 30, 2013 | ||||||||||||
As Reported | Restatement | As Restated | ||||||||||
Net income | $ | 188,870 | $ | (13,727 | ) | $ | 175,143 | |||||
Consolidated Statement of Cash Flows for the Nine Months Ended September 30, 2013 | ||||||||||||
As Reported | Restatement | As Restated | ||||||||||
Net income | $ | 188,870 | $ | (13,727 | ) | $ | 175,143 | |||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||
Decrease (increase) in deferred tax assets, net | 105 | (2,498 | ) | (2,393 | ) | |||||||
Net cash provided by operating activities | 1,020,455 | (16,225 | ) | 1,004,230 | ||||||||
Repayments of other secured borrowings | (7,182,275 | ) | 16,225 | (7,166,050 | ) | |||||||
Net cash used in financing activities | (933,136 | ) | 16,225 | (916,911 | ) | |||||||
Securitization_and_Variable_In
Securitization and Variable Interest Entities | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Transfers and Servicing [Abstract] | ' | |||||||||||||||
Securitizations and Variable Interest Entities | ' | |||||||||||||||
Note 2 – Securitizations and Variable Interest Entities | ||||||||||||||||
We securitize, sell and service forward and reverse residential mortgage loans and regularly transfer financial assets in connection with asset-backed financing arrangements. We have aggregated these securitizations and asset-backed financing arrangements into two groups: (1) securitizations of residential mortgage loans and (2) financings of advances on loans serviced for others. | ||||||||||||||||
We have determined that the special purpose entities (SPEs) created in connection with our match funded advance financing facilities are variable interest entities (VIEs) of which we are the primary beneficiary. | ||||||||||||||||
Securitizations of Residential Mortgage Loans | ||||||||||||||||
Currently, we securitize forward and reverse residential mortgage loans involving the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac) (collectively the GSEs) and loans insured by the Federal Housing Authority (FHA) or Department of Veterans Affairs (VA). We retain the right to service these loans and receive servicing fees based upon the securitized loan balances and certain ancillary fees, all of which are reported in Servicing and subservicing fees on the unaudited Consolidated Statements of Operations. | ||||||||||||||||
Transfers of Forward Loans | ||||||||||||||||
We sell or securitize forward loans that we originate or that we purchase from third parties, generally in the form of mortgage-backed securities guaranteed by the GSEs or the Government National Mortgage Association (Ginnie Mae). Securitization usually occurs within 30 days of loan closing or purchase. We retain servicing rights associated with the transferred loans and receive a servicing fee for services provided. We act only as a fiduciary and do not have a variable interest in the securitization trusts. As a result, we account for these transactions as sales upon transfer. | ||||||||||||||||
We report the gain or loss on the transfer of the loans held for sale in Gain on loans held for sale, net in the unaudited Consolidated Statements of Operations along with changes in fair value of the loans and the gain or loss on the related derivatives. See Note 15 – Derivative Financial Instruments and Hedging Activities for information on these derivative financial instruments. We include all changes in loans held for sale and related derivative balances in operating activities in the unaudited Consolidated Statements of Cash Flows. | ||||||||||||||||
The following table presents a summary of cash flows received from and paid to securitization trusts related to transfers accounted for as sales that were outstanding during the three and nine months ended September 30: | ||||||||||||||||
Three Months | Nine Months | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Proceeds received from securitizations | $ | 1,369,468 | $ | 1,776,309 | $ | 4,346,991 | $ | 6,240,459 | ||||||||
Servicing fees collected | 10,840 | 6,317 | 25,174 | 13,125 | ||||||||||||
Purchases of previously transferred assets, net of claims reimbursed | 2,237 | — | 2,237 | — | ||||||||||||
$ | 1,382,545 | $ | 1,782,626 | $ | 4,374,402 | $ | 6,253,584 | |||||||||
In connection with these transfers, we retained MSRs of $10.7 million and $32.1 million during the three and nine months ended September 30, 2014, respectively, and $16.3 million and $63.2 million during the three and nine months ended September 30, 2013, respectively. We initially record the MSRs at fair value and subsequently account for them at amortized cost. See Note 8 – Mortgage Servicing for information relating to MSRs. | ||||||||||||||||
Certain obligations arise from agreements associated with our transfers of loans. Under these agreements, we may be obligated to repurchase the loans, or otherwise indemnify or reimburse the investor or insurer for losses incurred due to material breach of contractual representations and warranties. See Note 12 – Other Liabilities for further information. | ||||||||||||||||
The following table presents the carrying amounts of our assets that relate to our continuing involvement with forward loans that we have transferred with servicing rights retained as well as our maximum exposure to loss including the unpaid principal balance (UPB) of the transferred loans at the dates indicated: | ||||||||||||||||
September 30, 2014 | December 31, 2013 | |||||||||||||||
Carrying value of assets: | ||||||||||||||||
Mortgage servicing rights, at amortized cost | $ | 84,397 | $ | 44,615 | ||||||||||||
Mortgage servicing rights, at fair value | 2,965 | 3,075 | ||||||||||||||
Advances and match funded advances | 10,153 | 15,888 | ||||||||||||||
Unpaid principal balance of loans transferred (1) | 8,816,416 | 5,641,277 | ||||||||||||||
Maximum exposure to loss | $ | 8,913,931 | $ | 5,704,855 | ||||||||||||
-1 | The UPB of the loans transferred is the maximum exposure to loss under our standard representations and warranties obligations. | |||||||||||||||
At September 30, 2014 and December 31, 2013, 4.4% and 2.6%, respectively, of the transferred residential loans that we service were 30 days or more past due. During the three and nine months ended September 30, 2014, there were no charge-offs, net of recoveries, associated with these transferred loans. | ||||||||||||||||
Transfers of Reverse Mortgages | ||||||||||||||||
We are an approved issuer of Ginnie Mae Home Equity Conversion Mortgage-Backed Securities (HMBS) that are guaranteed by Ginnie Mae. We originate Home Equity Conversion Mortgages (HECMs, or reverse mortgages) that are insured by the FHA. We then pool the loans into HMBS that we sell into the secondary market with servicing rights retained. We have determined that loan transfers in the HMBS program do not meet the definition of a participating interest because of the servicing requirements in the product that require the issuer/servicer to absorb some level of interest rate risk, cash flow timing risk and incidental credit risk. As a result, the transfers of the HECMs do not qualify for sale accounting, and we, therefore, account for these transfers as financings. Under this accounting treatment, the HECMs are classified as Loans held for investment - reverse mortgages, at fair value, on our unaudited Consolidated Balance Sheets. We record the proceeds from the transfer of assets as secured borrowings (HMBS-related borrowings) in Financing liabilities and recognize no gain or loss on the transfer. Holders of participating interests in the HMBS have no recourse against the assets of Ocwen, except for standard representations and warranties and our contractual obligation to service the HECMs and the HMBS. | ||||||||||||||||
We have elected to measure the HECMS and HMBS-related borrowings at fair value. The changes in fair value of the HECMs and HMBS-related borrowings are included in Other revenues in our unaudited Consolidated Statements of Operations. Included in net fair value gains on the HECMs and related HMBS borrowings are the interest income that we expect to be collected on the HECMs and the interest expense that we expect to be paid on the HMBS-related borrowings. We report originations and collections of HECMs in investing activities in the unaudited Consolidated Statements of Cash Flows. We report net fair value gains on HECMs and the related HMBS borrowings as an adjustment to the net cash provided by or used in operating activities in the unaudited Consolidated Statements of Cash Flows. Proceeds from securitizations of HECMs and payments on HMBS-related borrowings are included in financing activities in the unaudited Consolidated Statements of Cash Flows. | ||||||||||||||||
At September 30, 2014 and December 31, 2013, we had HMBS-related borrowings of $1.2 billion and $615.6 million and HECMs pledged as collateral to the pools of $1.3 billion and $618.0 million, respectively. See Note 4 – Fair Value for a reconciliation of the changes in fair value of HECMs and HMBS-related borrowings. | ||||||||||||||||
Financings of Advances on Loans Serviced for Others | ||||||||||||||||
Match funded advances on loans serviced for others result from our transfers of residential loan servicing advances to SPEs in exchange for cash. We consolidate these SPEs because Ocwen is the primary beneficiary of the SPE. These SPEs issue debt supported by collections on the transferred advances. | ||||||||||||||||
We make the transfers to these SPEs under the terms of our advance financing facility agreements. We classify the transferred advances on our unaudited Consolidated Balance Sheets as Match funded advances and the related liabilities as Match funded liabilities. The SPEs use collections of the pledged advances to repay principal and interest and to pay the expenses of the SPE. Holders of the debt issued by these entities can look only to the assets of the SPE for satisfaction of the debt and have no recourse against Ocwen. However, Ocwen and OLS have guaranteed the payment of the obligations under the securitization documents of one of the entities. The maximum amount payable under the guarantee is limited to 10% of the notes outstanding at the end of the facility’s revolving period in December 2014. The entity to which this guarantee applies had $5.0 million of notes outstanding at September 30, 2014. The assets and liabilities of the advance financing SPEs are comprised solely of Match funded advances, Debt service accounts, Match funded liabilities and amounts due to affiliates. Amounts due to affiliates are eliminated in consolidation in our unaudited Consolidated Balance Sheets. | ||||||||||||||||
See Note 7 – Match Funded Advances, Note 10 – Other Assets and Note 11 – Borrowings for additional information. |
Business_Acquisitions
Business Acquisitions | 9 Months Ended | ||||||||||||
Sep. 30, 2014 | |||||||||||||
Business Combinations [Abstract] | ' | ||||||||||||
Business Acquisitions | ' | ||||||||||||
Note 3 – Business Acquisitions | |||||||||||||
We account for business acquisitions using the acquisition method which requires, among other things, that the assets acquired and liabilities assumed be recognized at their fair values as of the acquisition date. The initial allocation of the purchase price is considered preliminary and therefore subject to change until the end of the measurement period which can extend up to one year from the acquisition date. Goodwill is calculated as the excess of the consideration transferred over the net assets recognized and represents the expected revenue and cost synergies of the combined business. Measurement period adjustments are applied retrospectively to the period of acquisition. | |||||||||||||
The purchase price allocations provided below for our business acquisitions are based on the estimated fair value of the acquired receivables, loans, advances, MSRs and the assumed debt in a manner consistent with the methodology described in Note 4 – Fair Value. Premises and equipment were initially valued based on the “in-use” valuation premise, where the fair value of an asset is based on the highest and best use of the asset that would provide maximum value to market participants principally through its use with other assets as a group. Other assets and liabilities expected to have a short life were valued at the face value of the specific assets and liabilities purchased, including receivables, prepaid expenses, accounts payable and accrued expenses. | |||||||||||||
The unaudited pro forma consolidated results presented below for the ResCap Acquisition are not indicative of what Ocwen’s consolidated net earnings would have been had we completed the acquisition on the date indicated because of differences in servicing practices and cost structure between Ocwen and ResCap. In addition, the unaudited pro forma consolidated results do not purport to project our combined future results nor do they reflect the expected realization of any cost savings associated with the acquisition. | |||||||||||||
The acquisition of Liberty was treated as stock purchases for U.S. tax purposes. The ResCap Acquisition was treated as an asset acquisition for U.S. tax purposes. We expect the opening tax basis for the acquired assets and liabilities to be the fair values as shown in the purchase price allocation table below. We expect MSRs and goodwill to be treated as intangible assets acquired in connection with the purchase of a trade or business and, as such, amortized over 15 years for tax purposes. | |||||||||||||
Purchase Price Allocation | |||||||||||||
The following table summarizes the fair values of assets acquired and liabilities assumed as part of the ResCap Acquisition: | |||||||||||||
Purchase Price Allocation | 15-Feb-13 | Adjustments | Final | ||||||||||
MSRs (1) | $ | 393,891 | $ | 7,423 | $ | 401,314 | |||||||
Advances and match funded advances (1) | 1,622,348 | 164,061 | 1,786,409 | ||||||||||
Deferred tax assets | — | — | — | ||||||||||
Premises and equipment | 22,398 | (5,975 | ) | 16,423 | |||||||||
Receivables and other assets | 2,989 | — | 2,989 | ||||||||||
Other liabilities: | |||||||||||||
Liability for indemnification obligations | (49,500 | ) | — | (49,500 | ) | ||||||||
Other | (24,840 | ) | (285 | ) | (25,125 | ) | |||||||
Total identifiable net assets | 1,967,286 | 165,224 | 2,132,510 | ||||||||||
Goodwill | 204,743 | 6,676 | 211,419 | ||||||||||
Total consideration | $ | 2,172,029 | $ | 171,900 | $ | 2,343,929 | |||||||
-1 | As of the acquisition date, the purchase of certain MSRs from ResCap was not complete pending the receipt of certain consents and court approvals. Subsequent to the acquisition, we obtained the required consents and approvals for a portion of these MSRs and paid an additional purchase price of $174.6 million to acquire the MSRs and related advances, including $54.2 million in 2014. The purchase price allocation has been revised to include the resulting adjustments to MSRs, advances and goodwill. | ||||||||||||
ResCap Acquisition | |||||||||||||
We completed the ResCap Acquisition on February 15, 2013. We acquired MSRs related to conventional (i.e., conforming to the underwriting standards of Fannie Mae or Freddie Mac; collectively referred to as Agency loans), government insured (loans insured by FHA or VA) and non-Agency residential forward mortgage loans (commonly referred to as non-prime, subprime or private-label loans) with a UPB of $111.2 billion and master servicing agreements with a UPB of $44.9 billion. The ResCap Acquisition included advances and elements of the servicing platform related to the acquired MSRs, as well as certain diversified fee-based business operations that included recovery, title and closing services. We also assumed subservicing contracts with a UPB of $27.0 billion. Under the terms of the ResCap Acquisition, we were obligated to acquire certain servicing rights and subservicing agreements that were not settled as part of the initial closing on February 15, 2013 as a result of objections raised in connection with the sale. We purchased these MSRs and assumed the subservicing contracts from ResCap when such consents and approvals were obtained. We completed subsequent settlements and purchased additional MSRs, as objections were resolved. | |||||||||||||
To finance the ResCap Acquisition, we deployed $840.0 million from the proceeds of a new $1.3 billion senior secured term loan (SSTL) facility and borrowed an additional $1.2 billion pursuant to two new servicing advance facilities and one existing facility. We settled the subsequent closings with cash. Ocwen assumed certain limited liabilities as part of the transaction, including certain employee liabilities and certain business payables outstanding at the closing date. Under the agreement with ResCap, Ocwen generally did not assume any contingent obligations, including pending or threatened litigation, financial obligations in connection with any settlements, orders or similar agreements entered into by ResCap or obligations in connection with any representations or warranties associated with loans previously sold by ResCap except for litigation that may arise in the ordinary course of servicing mortgage loans relating to servicing agreements assumed by Ocwen. Ocwen assumed all liabilities related to servicing loans that are guaranteed by Ginnie Mae, whether arising prior to or after the closing date. | |||||||||||||
Post-Acquisition Results of Operations | |||||||||||||
The following table presents the revenue and earnings of the ResCap operations that are included in our unaudited Consolidated Statements of Operations for the three and nine months ended September 30, 2013 (from the acquisition date of February 15, 2013): | |||||||||||||
Three Months | Nine Months | ||||||||||||
Revenues | $ | 212,164 | $ | 508,589 | |||||||||
Net income | $ | 8,230 | $ | 81,362 | |||||||||
Pro Forma Results of Operations | |||||||||||||
The following table presents unaudited supplemental pro forma information for Ocwen for the nine months ended September 30, 2013 as if the ResCap Acquisition occurred on January 1, 2012. Pro forma adjustments include: | |||||||||||||
• | conforming servicing revenues to the revenue recognition policies followed by Ocwen; | ||||||||||||
• | conforming the accounting for MSRs to the valuation and amortization policies of Ocwen; | ||||||||||||
• | adjusting interest expense to eliminate the pre-acquisition interest expense of ResCap and to recognize interest expense as if the acquisition-related debt of Ocwen had been outstanding at January 1, 2012; and | ||||||||||||
• | reporting acquisition-related charges for professional services as if they had been incurred in 2012 rather than 2013. | ||||||||||||
Revenues | $ | 1,530,055 | |||||||||||
Net income | $ | 205,062 | |||||||||||
Other Acquisitions | |||||||||||||
Correspondent One S.A. (Correspondent One) | |||||||||||||
On March 31, 2013, we increased our ownership in Correspondent One, an entity formed with Altisource Portfolio Solutions, SA (Altisource) in March 2011, from 49% to 100%. Correspondent One facilitated the purchase of conventional and government insured residential mortgages from approved mortgage originators and resold the mortgages to secondary market investors. We acquired the shares of Correspondent One held by Altisource (49% interest) for $12.6 million and acquired the remaining shares held by an unrelated entity for $0.9 million. We accounted for this transaction as an acquisition and recognized the assets acquired and liabilities assumed at their fair values as of the acquisition date. The acquired net assets were $26.4 million and consisted primarily of cash ($23.0 million) and residential mortgage loans ($1.1 million). We remeasured our previously held investment, which we accounted for using the equity method, at fair value and recognized a loss of $0.4 million. We did not recognize goodwill in connection with this acquisition. Correspondent One is not material to our financial condition, results of operations or cash flows. | |||||||||||||
Liberty | |||||||||||||
On April 1, 2013, we completed the Liberty Acquisition for $22.0 million in cash. In addition, and as part of the closing, Ocwen repaid Liberty’s $9.1 million existing outstanding debt to the sellers. Liberty is engaged in the origination, purchase, sale and securitization of reverse mortgage loans, both retail and wholesale. We acquired Liberty’s reverse mortgage origination platform, including reverse mortgage loans with a UPB of $55.2 million. The acquired net assets were $31.1 million and consisted primarily of residential reverse mortgage loans ($60.0 million), receivables ($11.2 million), loans held for investment ($10.3 million) and cash ($4.6 million) less amounts due under warehouse facilities ($46.3 million) and HMBS-related borrowings ($10.2 million). We recognized $3.0 million of goodwill in connection with this acquisition. The acquisition of Liberty did not have a material impact on our financial condition, results of operations or cash flows. | |||||||||||||
Ocwen Structured Investments, LLC (OSI) | |||||||||||||
On January 31, 2014, we increased our ownership in OSI from 26.00% to 87.35%. OSI invests primarily in residential MSRs and the related lower tranches and residuals of mortgage-backed securities. We acquired the additional interest in OSI for $11.0 million. We accounted for this transaction as an acquisition and recognized 100% of the assets acquired and liabilities assumed at their fair values as of the acquisition date. We recognized in equity a noncontrolling interest at its proportionate 12.65% share of the net assets acquired. The acquired net assets were $20.0 million and consisted primarily of MSRs ($9.0 million), mortgage-backed securities ($7.7 million) and cash ($3.2 million). The acquisition of OSI did not have a material impact on our financial condition, results of operations or cash flows. | |||||||||||||
Facility Closure Costs | |||||||||||||
We have incurred employee termination benefits, primarily consisting of severance and Worker Adjustment and Retraining Notification Act compensation, lease termination costs for the closure of leased facilities and other contract termination costs in connection with our business acquisitions. The following table provides a reconciliation of the beginning and ending liability balances for these termination costs for the nine months ended September 30, 2014: | |||||||||||||
Employee termination benefits | Lease and other contract termination costs | Total | |||||||||||
Liability balance as at December 31, 2013 | $ | 4,816 | $ | 7,432 | $ | 12,248 | |||||||
Additions charged to operations (1) | 14,748 | 2,813 | 17,561 | ||||||||||
Amortization of discount | — | 115 | 115 | ||||||||||
Payments | (17,215 | ) | (2,928 | ) | (20,143 | ) | |||||||
Liability balance as at September 30, 2014 (2) | $ | 2,349 | $ | 7,432 | $ | 9,781 | |||||||
-1 | Of the additions charged to operations during the period, $14.4 million was recognized in the Servicing segment, $(0.1) million was recognized in the Lending segment and the remaining $3.3 million was recognized in the Corporate Items and Other segment. Charges related to employee termination benefits, lease termination costs and other contract termination costs are reported in Compensation and benefits expense, Occupancy and equipment expense and Other operating expenses, respectively, in the unaudited Consolidated Statements of Operations. The liabilities are included in Other liabilities in the unaudited Consolidated Balance Sheet. | ||||||||||||
-2 | We expect the remaining liability for employee termination benefits at September 30, 2014 to be settled in late 2014 or early 2015. |
Fair_Value
Fair Value | 9 Months Ended | |||||||||||||||||||||||
Sep. 30, 2014 | ||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||||||||||
Fair Value | ' | |||||||||||||||||||||||
Note 4 – Fair Value | ||||||||||||||||||||||||
Fair value is estimated based on a hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs. Observable inputs are inputs that reflect the assumptions that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs are inputs that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The fair value hierarchy prioritizes the inputs to valuation techniques into three broad levels whereby the highest priority is given to Level 1 inputs and the lowest to Level 3 inputs. | ||||||||||||||||||||||||
Level 1: | Quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity can access at the measurement date. | |||||||||||||||||||||||
Level 2: | Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. | |||||||||||||||||||||||
Level 3: | Unobservable inputs for the asset or liability. | |||||||||||||||||||||||
We classify assets in their entirety based on the lowest level of input that is significant to the fair value measurement. | ||||||||||||||||||||||||
The carrying amounts and the estimated fair values of our financial instruments and our nonfinancial assets measured at fair value on a recurring or non-recurring basis are as follows at the dates indicated: | ||||||||||||||||||||||||
September 30, 2014 | December 31, 2013 | |||||||||||||||||||||||
Level | Carrying Value | Fair Value | Carrying Value | Fair Value | ||||||||||||||||||||
Financial assets: | ||||||||||||||||||||||||
Loans held for sale: | ||||||||||||||||||||||||
Loans held for sale, at fair value (a) | 2 | $ | 335,950 | $ | 335,950 | $ | 503,753 | $ | 503,753 | |||||||||||||||
Loans held for sale, at lower of cost or fair value (b) | 3 | 71,937 | 71,937 | 62,907 | 62,907 | |||||||||||||||||||
Total Loans held for sale | $ | 407,887 | $ | 407,887 | $ | 566,660 | $ | 566,660 | ||||||||||||||||
Loans held for investment - Reverse mortgages, at fair value (a) | 3 | $ | 1,315,324 | $ | 1,315,324 | $ | 618,018 | $ | 618,018 | |||||||||||||||
Advances and match funded advances (c) | 3 | 3,346,865 | 3,346,865 | 3,443,215 | 3,443,215 | |||||||||||||||||||
Receivables, net (c) | 3 | 245,817 | 245,817 | 152,516 | 152,516 | |||||||||||||||||||
Financial liabilities: | ||||||||||||||||||||||||
Match funded liabilities (c) | 3 | $ | 2,035,639 | $ | 2,035,639 | $ | 2,364,814 | $ | 2,364,814 | |||||||||||||||
Financing liabilities: | ||||||||||||||||||||||||
HMBS-related borrowings, at fair value (a) | 3 | $ | 1,236,094 | $ | 1,236,094 | $ | 615,576 | $ | 615,576 | |||||||||||||||
Financing liability - MSRs pledged (a) | 3 | 618,855 | 618,855 | 633,804 | 633,804 | |||||||||||||||||||
Other (c) | 3 | 202,541 | 206,261 | 17,593 | 17,593 | |||||||||||||||||||
Total Financing liabilities | $ | 2,057,490 | $ | 2,061,210 | $ | 1,266,973 | $ | 1,266,973 | ||||||||||||||||
Other secured borrowings: | ||||||||||||||||||||||||
Senior secured term loan (c) | 3 | $ | 1,276,142 | $ | 1,259,601 | $ | 1,284,901 | $ | 1,270,108 | |||||||||||||||
Other (c) | 3 | 390,285 | 390,285 | 492,768 | 492,768 | |||||||||||||||||||
Total Other secured borrowings | $ | 1,666,427 | $ | 1,649,886 | $ | 1,777,669 | $ | 1,762,876 | ||||||||||||||||
Senior unsecured notes | 2 | $ | 350,000 | $ | 338,625 | $ | — | $ | — | |||||||||||||||
Derivative financial instruments (a): | ||||||||||||||||||||||||
IRLCs | 2 | $ | 6,117 | $ | 6,117 | $ | 8,433 | $ | 8,433 | |||||||||||||||
Forward MBS trades | 1 | (1,089 | ) | (1,089 | ) | 6,905 | 6,905 | |||||||||||||||||
Interest rate caps | 3 | 91 | 91 | 442 | 442 | |||||||||||||||||||
MSRs: | ||||||||||||||||||||||||
MSRs, at fair value (a) | 3 | $ | 101,948 | $ | 101,948 | $ | 116,029 | $ | 116,029 | |||||||||||||||
MSRs, at amortized cost (c) | 3 | 1,856,818 | 2,364,393 | 1,953,352 | 2,441,719 | |||||||||||||||||||
Total MSRs | $ | 1,958,766 | $ | 2,466,341 | $ | 2,069,381 | $ | 2,557,748 | ||||||||||||||||
(a) | Measured at fair value on a recurring basis. | |||||||||||||||||||||||
(b) | Measured at fair value on a non-recurring basis. | |||||||||||||||||||||||
(c) | Disclosed, but not carried, at fair value. | |||||||||||||||||||||||
The following tables present a reconciliation of the changes in fair value of Level 3 assets and liabilities that we measure at fair value on a recurring basis for the three and nine months ended September 30. The information presented for 2013 has been revised to include Financing liability - MSRs pledged in conformity with the 2014 presentation of Level 3 assets and liabilities. | ||||||||||||||||||||||||
Loans Held for Investment - Reverse Mortgages | Financing Liability - MSRs Pledged | HMBS-Related Borrowings | Derivative Financial Instruments, net | MSRs | Total | |||||||||||||||||||
Three months ended September 30, 2014 | ||||||||||||||||||||||||
Fair value at July 1, 2014 | $ | 1,107,626 | $ | (629,579 | ) | $ | (1,033,712 | ) | $ | 97 | $ | 104,220 | $ | (451,348 | ) | |||||||||
Purchases, issuances, sales and settlements: | ||||||||||||||||||||||||
Purchases | — | — | — | — | — | — | ||||||||||||||||||
Issuances | 208,566 | — | (190,452 | ) | — | — | 18,114 | |||||||||||||||||
Sales | — | — | — | — | — | — | ||||||||||||||||||
Settlements (1) | (27,592 | ) | 10,724 | 12,690 | — | (934 | ) | (5,112 | ) | |||||||||||||||
180,974 | 10,724 | (177,762 | ) | — | (934 | ) | 13,002 | |||||||||||||||||
Total realized and unrealized gains and (losses): | ||||||||||||||||||||||||
Included in earnings | 26,724 | — | (24,620 | ) | (6 | ) | (1,338 | ) | 760 | |||||||||||||||
Included in Other comprehensive income (loss) | — | — | — | — | — | — | ||||||||||||||||||
26,724 | — | (24,620 | ) | (6 | ) | (1,338 | ) | 760 | ||||||||||||||||
Transfers in and / or out of Level 3 | — | — | — | — | — | — | ||||||||||||||||||
Fair value at September 30, 2014 | $ | 1,315,324 | $ | (618,855 | ) | $ | (1,236,094 | ) | $ | 91 | $ | 101,948 | $ | (437,586 | ) | |||||||||
Loans Held for Investment - Reverse Mortgages | Financing Liability - MSRs Pledged | HMBS-Related Borrowings | Derivative Financial Instruments, net | MSRs | Total | |||||||||||||||||||
Three months ended September 30, 2013 | ||||||||||||||||||||||||
Fair value at July 1, 2013 | $ | 76,649 | $ | (437,734 | ) | $ | (73,641 | ) | $ | 176 | $ | 97,163 | $ | (337,387 | ) | |||||||||
Purchases, issuances, sales and settlements: | ||||||||||||||||||||||||
Purchases | — | — | — | — | — | — | ||||||||||||||||||
Issuances | 211,052 | (239,851 | ) | (206,714 | ) | — | — | (235,513 | ) | |||||||||||||||
Sales | — | — | — | — | — | |||||||||||||||||||
Settlements | (1,293 | ) | 17,764 | 1,021 | (176 | ) | — | 17,316 | ||||||||||||||||
209,759 | (222,087 | ) | (205,693 | ) | (176 | ) | — | (218,197 | ) | |||||||||||||||
Total realized and unrealized gains and (losses): | ||||||||||||||||||||||||
Included in earnings | 4,445 | — | (4,942 | ) | — | (225 | ) | (722 | ) | |||||||||||||||
Included in Other comprehensive income (loss) | — | — | — | — | — | — | ||||||||||||||||||
4,445 | — | (4,942 | ) | — | (225 | ) | (722 | ) | ||||||||||||||||
Transfers in and / or out of Level 3 | — | — | — | — | — | — | ||||||||||||||||||
Fair value at September 30, 2013 | $ | 290,853 | $ | (659,821 | ) | $ | (284,276 | ) | $ | — | $ | 96,938 | $ | (556,306 | ) | |||||||||
Loans Held for Investment - Reverse Mortgages | Financing Liability - MSRs Pledged | HMBS-Related Borrowings | Derivative Financial Instruments, net | MSRs | Total | |||||||||||||||||||
Nine months ended September 30, 2014 | ||||||||||||||||||||||||
Fair value at January 1, 2014 | $ | 618,018 | $ | (633,804 | ) | $ | (615,576 | ) | $ | 442 | $ | 116,029 | $ | (514,891 | ) | |||||||||
Purchases, issuances, sales and settlements: | ||||||||||||||||||||||||
Purchases | — | — | — | 23 | — | 23 | ||||||||||||||||||
Issuances | 565,670 | — | (572,031 | ) | — | — | (6,361 | ) | ||||||||||||||||
Transfer from loans held for sale, at fair value | 110,874 | — | — | — | — | 110,874 | ||||||||||||||||||
Sales | — | — | — | — | — | — | ||||||||||||||||||
Settlements (1) | (56,193 | ) | 14,949 | 25,725 | — | (934 | ) | (16,453 | ) | |||||||||||||||
620,351 | 14,949 | (546,306 | ) | 23 | (934 | ) | 88,083 | |||||||||||||||||
Total realized and unrealized gains and (losses): (2) | ||||||||||||||||||||||||
Included in earnings | 76,955 | — | (74,212 | ) | (374 | ) | (13,147 | ) | (10,778 | ) | ||||||||||||||
Included in Other comprehensive income (loss) | — | — | — | — | — | — | ||||||||||||||||||
76,955 | — | (74,212 | ) | (374 | ) | (13,147 | ) | (10,778 | ) | |||||||||||||||
Transfers in and / or out of Level 3 | — | — | — | — | — | — | ||||||||||||||||||
Fair value at September 30, 2014 | $ | 1,315,324 | $ | (618,855 | ) | $ | (1,236,094 | ) | $ | 91 | $ | 101,948 | $ | (437,586 | ) | |||||||||
Loans Held for Investment - Reverse Mortgages | Financing Liability - MSRs Pledged | HMBS-Related Borrowings | Derivative Financial Instruments, net | MSRs | Total | |||||||||||||||||||
Nine months ended September 30, 2013 | ||||||||||||||||||||||||
Fair value at January 1, 2013 | $ | — | $ | (303,705 | ) | $ | — | $ | (10,668 | ) | $ | 85,213 | $ | (229,160 | ) | |||||||||
Purchases, issuances, sales and settlements: | ||||||||||||||||||||||||
Purchases | 10,251 | — | (10,179 | ) | — | — | 72 | |||||||||||||||||
Issuances | 274,081 | (388,473 | ) | (272,652 | ) | — | — | (387,044 | ) | |||||||||||||||
Sales | — | — | — | 24,156 | — | 24,156 | ||||||||||||||||||
Settlements | (2,164 | ) | 32,357 | 1,888 | (1,242 | ) | — | 30,839 | ||||||||||||||||
282,168 | (356,116 | ) | (280,943 | ) | 22,914 | — | (331,977 | ) | ||||||||||||||||
Total realized and unrealized gains and (losses): | ||||||||||||||||||||||||
Included in earnings | 8,685 | — | (3,333 | ) | 117 | 11,725 | 17,194 | |||||||||||||||||
Included in Other comprehensive income (loss) | — | — | — | (12,363 | ) | — | (12,363 | ) | ||||||||||||||||
8,685 | — | (3,333 | ) | (12,246 | ) | 11,725 | 4,831 | |||||||||||||||||
Transfers in and / or out of Level 3 | — | — | — | — | — | — | ||||||||||||||||||
Fair value at September 30, 2013 | $ | 290,853 | $ | (659,821 | ) | $ | (284,276 | ) | $ | — | $ | 96,938 | $ | (556,306 | ) | |||||||||
-1 | In the event of a transfer of servicing to another party related to Rights to MSRs sold to HLSS, we are required to reimburse HLSS at predetermined contractual rates for the loss of servicing revenues. Settlements for Financing liability - MSRs pledged for the three and nine months ended September 30, 2014 includes $2.0 million of such reimbursements. | |||||||||||||||||||||||
-2 | Total losses attributable to derivative financial instruments still held at September 30, 2014 were $0.4 million for the nine months ended September 30, 2014. | |||||||||||||||||||||||
The methodologies that we use and key assumptions that we make to estimate the fair value of instruments and other assets and liabilities measured at fair value on a recurring or non-recurring basis and those disclosed, but not carried, at fair value are described below: | ||||||||||||||||||||||||
Loans Held for Sale | ||||||||||||||||||||||||
We originate and purchase residential forward and reverse mortgage loans that we intend to sell to the GSEs. We also own residential mortgage loans that are not eligible to be sold to the GSEs due to delinquency or other factors. Residential forward and reverse mortgage loans that we intend to sell to the GSEs are carried at fair value as a result of a fair value election. Such loans are subject to changes in fair value due to fluctuations in interest rates from the closing date through the date of the sale of the loan into the secondary market. These loans are classified within Level 2 of the valuation hierarchy because the primary component of the price is obtained from observable values of mortgage forwards for loans of similar terms and characteristics. We have the ability to access this market, and it is the market into which conventional and government insured mortgage loans are typically sold. | ||||||||||||||||||||||||
We repurchase certain loans from Ginnie Mae guaranteed securitizations in connection with loan modifications and loan resolution activity as part of our servicing obligations. These are classified as loans held for sale at the lower of cost or fair value, in the case of modified loans, as we expect to redeliver (sell) the loans to new Ginnie Mae guaranteed securitizations. The fair value of these loans is estimated using published forward Ginnie Mae prices. Loans repurchased in connection with loan resolution activities are modified or otherwise remediated through loss mitigation activities or are reclassified to receivables. Because these loans are insured or guaranteed by the FHA or VA, the fair value of these loans represents the net recovery value taking into consideration the insured or guaranteed claim. | ||||||||||||||||||||||||
For all other loans held for sale, which we report at the lower of cost or fair value, market illiquidity has reduced the availability of observable pricing data. When we enter into an agreement to sell a loan or pool of loans to an investor at a set price, we value the loan or loans at the commitment price. We base the fair value of uncommitted loans on the expected future cash flows discounted at a rate commensurate with the risk of the estimated cash flows. | ||||||||||||||||||||||||
Loans Held for Investment – Reverse Mortgages | ||||||||||||||||||||||||
We have elected to measure these loans at fair value. For transferred reverse mortgage loans that do not qualify as sales for accounting purposes, we base the fair value on the expected future cash flows discounted over the expected life of the loans at a rate commensurate with the risk of the estimated cash flows. Significant assumptions include expected prepayment and delinquency rates and cumulative loss curves. The discount rate assumption for these assets is primarily based on an assessment of current market yields on newly originated reverse mortgage loans, expected duration of the asset and current market interest rates. | ||||||||||||||||||||||||
The more significant assumptions used in the September 30, 2014 valuation include: | ||||||||||||||||||||||||
• | Life in years ranging from 6.64 to 10.75 (weighted average of 6.99); | |||||||||||||||||||||||
• | Conditional repayment rate ranging from 4.82% to 53.75% (weighted average of 19.28%); and | |||||||||||||||||||||||
• | Discount rate of 3.20%. | |||||||||||||||||||||||
Significant increases or decreases in any of these assumptions in isolation could result in a significantly lower or higher fair value, respectively. The effects of changes in the assumptions used to value the loans held for investment are largely offset by the effects of changes in the assumptions used to value the HMBS-Related Borrowings that are associated with these loans. | ||||||||||||||||||||||||
Mortgage Servicing Rights | ||||||||||||||||||||||||
Amortized Cost MSRs | ||||||||||||||||||||||||
We estimate the fair value of MSRs carried at amortized cost using a combination of internal models and data provided by third-party valuation experts. The most significant assumptions used in our internal valuation are the speed at which mortgages prepay and delinquency experience. Other assumptions typically used in the internal valuation are: | ||||||||||||||||||||||||
• | Cost of servicing | • | Interest rate used for computing float earnings | |||||||||||||||||||||
• | Discount rate | • | Compensating interest expense | |||||||||||||||||||||
• | Interest rate used for computing the cost of financing servicing advances | • | Collection rate of other ancillary fees | |||||||||||||||||||||
The significant components of the estimated future cash inflows for MSRs include servicing fees, late fees, float earnings and other ancillary fees. Significant cash outflows include the cost of servicing, the cost of financing servicing advances and compensating interest payments. | ||||||||||||||||||||||||
Our models calculate the present value of expected future cash flows utilizing assumptions that we believe are used by market participants. We derive prepayment speeds and delinquency assumptions from historical experience adjusted for prevailing market conditions. We utilize a discount rate provided by third-party valuation experts, and we consider external market-based assumptions in determining the interest rate for the cost of financing advances, the interest rate for float earnings and the cost of servicing. | ||||||||||||||||||||||||
Third-party valuation experts generally utilize: (a) transactions involving instruments with similar collateral and risk profiles, adjusted as necessary based on specific characteristics of the asset or liability being valued; and/or (b) industry-standard modeling, such as a discounted cash flow model, in arriving at their estimate of fair value. The prices provided by the valuation experts reflect their observations and assumptions related to market activity, including risk premiums and liquidity adjustments. The models and related assumptions used by the valuation experts are owned and managed by them and, in many cases, the significant inputs used in the valuation techniques are not reasonably available to us. However, we have an understanding of the processes and assumptions used to develop the prices based on our ongoing due diligence, which includes regular discussions with the valuation experts. We believe that the procedures executed by the valuation experts, combined with our internal verification and analytical procedures, provide assurance that the prices used in our unaudited consolidated financial statements comply with the accounting guidance for fair value measurements and disclosures and reflect the assumptions that a market participant would use. | ||||||||||||||||||||||||
The more significant assumptions used in the September 30, 2014 valuation of our MSRs carried at amortized cost include: | ||||||||||||||||||||||||
• | Prepayment speeds ranging from 9.87% to 16.82% (weighted average of 14.16%) depending on loan type; | |||||||||||||||||||||||
• | Delinquency rates ranging from 6.77% to 24.32% (weighted average of 18.96%) depending on loan type; | |||||||||||||||||||||||
• | Interest rate of 1-month LIBOR plus a range of 0.00% to 3.50% for computing the cost of financing servicing advances; | |||||||||||||||||||||||
• | Interest rate of 1-month LIBOR for computing float earnings; and | |||||||||||||||||||||||
• | Discount rates ranging from 9.23% to 16.74% (weighted average of 12.01%). | |||||||||||||||||||||||
We perform an impairment analysis based on the difference between the carrying amount and fair value after grouping the underlying loans into the applicable strata. In response to the significant change in the composition of our MSR portfolio as a result of recent acquisitions, our strata are defined as conventional, government insured and non-Agency (i.e. all private label primary and master serviced loans). | ||||||||||||||||||||||||
Fair Value MSRs | ||||||||||||||||||||||||
MSRs carried at fair value are classified within Level 3 of the valuation hierarchy due to the use of third party valuation expert pricing without adjustment. The fair value of these MSRs is within the range of prices provided by the valuation experts; however, a change in the valuation inputs utilized by the valuation expert or a change in the best point price in the range might result in a significantly higher or lower fair value measurement. | ||||||||||||||||||||||||
The key assumptions (generally unobservable inputs) used in the valuation of these MSRs include: | ||||||||||||||||||||||||
• | Mortgage prepayment speeds; | |||||||||||||||||||||||
• | Delinquency rates; and | |||||||||||||||||||||||
• | Discount rates. | |||||||||||||||||||||||
The primary assumptions used in the September 30, 2014 valuation include an 8.55% weighted average constant prepayment rate and a discount rate equal to 1-Month LIBOR plus 9.01%. | ||||||||||||||||||||||||
Advances | ||||||||||||||||||||||||
We value advances at their net realizable value, which generally approximates fair value, because advances have no stated maturity, are generally realized within a relatively short period of time and do not bear interest. | ||||||||||||||||||||||||
Receivables | ||||||||||||||||||||||||
The carrying value of receivables generally approximates fair value because of the relatively short period of time between their origination and realization. | ||||||||||||||||||||||||
Borrowings | ||||||||||||||||||||||||
Match Funded Liabilities | ||||||||||||||||||||||||
For match funded liabilities that bear interest at a rate that is adjusted regularly based on a market index, the carrying value approximates fair value. For match funded liabilities that bear interest at a fixed rate, we determine fair value by discounting the future principal and interest repayments at a market rate commensurate with the risk of the estimated cash flows. We estimate principal repayments of match funded liabilities during the amortization period based on our historical advance collection rates and taking into consideration any plans to refinance the notes. At September 30, 2014, the interest on all borrowings under match funded facilities was based on a variable rate adjusted regularly using a market index, and therefore, the carrying value approximates fair value. | ||||||||||||||||||||||||
HMBS-Related Borrowings | ||||||||||||||||||||||||
We have elected to measure these borrowings at fair value. We recognize the proceeds from the transfer of reverse mortgages as a secured borrowing that we account for at fair value. These borrowings are not actively traded and therefore quoted market prices are not available. We determine fair value by discounting the future principal and interest repayments over the estimated life of the borrowing at a market rate commensurate with the risk of the estimated cash flows. Significant assumptions include prepayments, discount rate and borrower mortality rates for reverse mortgages. The discount rate assumption for these liabilities is based on an assessment of current market yields for newly issued HMBS, expected duration and current market interest rates. | ||||||||||||||||||||||||
The more significant assumptions used in the September 30, 2014 valuation include: | ||||||||||||||||||||||||
• | Life in years ranging from 4.97 to 10.75 (weighted average of 5.65); | |||||||||||||||||||||||
• | Conditional repayment rate ranging from 4.82% to 53.75% (weighted average of 19.28%); and | |||||||||||||||||||||||
• | Discount rate of 2.44%. | |||||||||||||||||||||||
Significant increases or decreases in any of these assumptions in isolation would result in a significantly higher or lower fair value. | ||||||||||||||||||||||||
Financing Liabilities | ||||||||||||||||||||||||
MSRs Pledged | ||||||||||||||||||||||||
We periodically sell rights to receive servicing fees, excluding ancillary income, with respect to certain MSRs (Rights to MSRs) and the related servicing advances to HLSS in transactions we refer to as the HLSS Transactions. Because we have retained legal title to the MSRs, the sales of Rights to MSRs are accounted for as financings. We initially establish the value of the Financing Liability - MSRs Pledged based on the price at which the Rights to MSRs are sold to HLSS. Thereafter, the carrying value of the Financing Liability - MSRs pledged is adjusted to fair value at each reporting date. | ||||||||||||||||||||||||
Secured Notes | ||||||||||||||||||||||||
We issued Ocwen Asset Servicing Income Series (OASIS), Series 2014-1 Notes secured by Ocwen-owned MSRs relating to Freddie Mac mortgages. We accounted for this transaction as a financing. We determine the fair value based on bid prices provided by third parties involved in the issuance and placement of the notes. | ||||||||||||||||||||||||
Other Secured Borrowings | ||||||||||||||||||||||||
The carrying value of secured borrowings that bear interest at a rate that is adjusted regularly based on a market index approximates fair value. For other secured borrowings that bear interest at a fixed rate, we determine fair value by discounting the future principal and interest repayments at a market rate commensurate with the risk of the estimated cash flows. For the SSTL, we used a discount rate of 5.71% and the repayment schedule specified in the loan agreement to determine fair value at September 30, 2014. | ||||||||||||||||||||||||
Senior Unsecured Notes | ||||||||||||||||||||||||
We base the fair value on quoted prices in markets with limited trading activity. | ||||||||||||||||||||||||
Derivative Financial Instruments | ||||||||||||||||||||||||
Interest rate lock commitments (IRLCs) represent an agreement to purchase loans from a third-party originator or an agreement to extend credit to a mortgage applicant (locked pipeline), whereby the interest rate is set prior to funding. IRLCs are classified within Level 2 of the valuation hierarchy as the primary component of the price is obtained from observable values of mortgage forwards for loans of similar terms and characteristics. Fair value amounts of IRLCs are adjusted for expected “fallout” (locked pipeline loans not expected to close) using models that consider cumulative historical fallout rates and other factors. | ||||||||||||||||||||||||
We enter into forward mortgage-backed securities (MBS) trades to provide an economic hedge against changes in fair value of residential forward and reverse mortgage loans held for sale that we carry at fair value. Forward MBS trades are primarily used to fix the forward sales price that will be realized upon the sale of mortgage loans into the secondary market. Forward contracts are actively traded in the market, and we obtain unadjusted market quotes for these derivatives, thus they are classified within Level 1 of the valuation hierarchy. | ||||||||||||||||||||||||
In addition, we may use interest rate caps to minimize future interest rate exposures on variable rate debt issued on servicing advance facilities from increases in one-month LIBOR interest rates. The fair value for interest rate caps is based on counterparty market prices and adjusted for counterparty credit risk. | ||||||||||||||||||||||||
See Note 15 – Derivative Financial Instruments and Hedging Activities for additional information regarding derivative financial instruments. |
Loans_Held_for_Sale
Loans Held for Sale | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Receivables [Abstract] | ' | |||||||||||||||
Loans Held for Sale | ' | |||||||||||||||
Note 5 – Loans Held for Sale | ||||||||||||||||
Loans Held for Sale - Fair Value | ||||||||||||||||
Loans held for sale, at fair value, represent residential forward and reverse mortgage loans originated or purchased and held until sold to secondary market investors, such as GSEs or other third parties. The following table summarizes the activity in the balance of Loans held for sale, at fair value, during the nine months ended September 30: | ||||||||||||||||
2014 | 2013 | |||||||||||||||
Beginning balance | $ | 503,753 | $ | 426,480 | ||||||||||||
Originations and purchases | 3,923,870 | 5,988,501 | ||||||||||||||
Proceeds from sales | (4,010,644 | ) | (6,033,785 | ) | ||||||||||||
Transfers to loans held for investment - reverse mortgages | (110,874 | ) | — | |||||||||||||
Gain (loss) on sale of loans | 39,486 | (46,962 | ) | |||||||||||||
Other | (9,641 | ) | 868 | |||||||||||||
Ending balance | $ | 335,950 | $ | 335,102 | ||||||||||||
At September 30, 2014, Loans held for sale, at fair value with a UPB of $311.8 million were pledged to secure warehouse lines of credit in our Lending segment. See Note 11 – Borrowings for additional information. | ||||||||||||||||
Loans Held for Sale - Lower of Cost or Fair Value | ||||||||||||||||
Loans held for sale, at lower of cost or fair value, include residential loans that we do not intend to hold to maturity. The following table summarizes the activity in the balance of Loans held for sale, at lower of cost or fair value, during the nine months ended September 30: | ||||||||||||||||
2014 | 2013 | |||||||||||||||
Beginning balance | $ | 62,907 | $ | 82,866 | ||||||||||||
Purchases | 2,083,282 | 1,144,853 | ||||||||||||||
Proceeds from sales | (1,744,273 | ) | (654,916 | ) | ||||||||||||
Principal payments | (248,552 | ) | (317,528 | ) | ||||||||||||
Transfers to accounts receivable | (96,257 | ) | (190,185 | ) | ||||||||||||
Transfers to real estate owned | (4,575 | ) | (2,838 | ) | ||||||||||||
Gain on sale of loans | 32,471 | 20,336 | ||||||||||||||
Increase in valuation allowance | (16,282 | ) | (6,510 | ) | ||||||||||||
Other | 3,216 | 10,675 | ||||||||||||||
Ending balance | $ | 71,937 | $ | 86,753 | ||||||||||||
The balances at September 30, 2014 and September 30, 2013 are net of valuation allowances of $47.0 million and $27.0 million, respectively. At September 30, 2014, Loans held for sale, at lower of cost or fair value with a UPB of $21.1 million were pledged to secure a warehouse line of credit in our Servicing segment. See Note 11 – Borrowings for additional information. | ||||||||||||||||
The balances at September 30, 2014 and September 30, 2013 include $24.1 million and $60.8 million, respectively, of loans that we were required to repurchase from Ginnie Mae guaranteed securitizations as part of our servicing obligations. Repurchased loans are modified or otherwise remediated through loss mitigation activities or are reclassified to receivables. | ||||||||||||||||
On March 3, 2014, we purchased delinquent FHA-insured loans with a UPB of $549.4 million out of Ginnie Mae guaranteed securitizations under the terms of a conditional repurchase option whereby as servicer we have the right, but not the obligation, to repurchase delinquent loans at par plus delinquent interest (the Ginnie Mae early buy-out (EBO) program). Immediately after their purchase, we sold the loans (the Ginnie Mae EBO Loans) and related advances to HLSS Mortgage for $612.3 million ($556.6 million for the Ginnie Mae EBO Loans and $55.7 million for the related servicing advances). We recognized a gain of $7.2 million on the sale of the loans. | ||||||||||||||||
On May 1, 2014, we purchased a second group of delinquent FHA-insured loans with a UPB of $451.0 million through the Ginnie Mae EBO program for $479.6 million, including delinquent interest. On May 2, 2014, we sold the Ginnie Mae EBO Loans to an unrelated third party for $462.5 million and recognized a gain of $1.3 million, including the value assigned to the retained MSRs. Separately, we sold $20.2 million of the advances related to these loans to HLSS SEZ LP. | ||||||||||||||||
The sales of advances to HLSS Mortgage and to HLSS SEZ LP did not qualify for sales treatment and were accounted for as a financing. See Note 11 – Borrowings for additional information. We refer to the purchase and sale of the Ginnie Mae EBO Loans and the sale of the related advances to HLSS Mortgage and HLSS SEZ LP as the Ginnie Mae EBO Transactions. | ||||||||||||||||
Gain on Loans Held for Sale, Net | ||||||||||||||||
The following table summarizes the activity in Gain on loans held for sale, net, during the three and nine months ended September 30: | ||||||||||||||||
Three Months | Nine Months | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Gain on sales of loans | $ | 42,185 | $ | 4,622 | $ | 145,455 | $ | 36,156 | ||||||||
Change in fair value of IRLCs | (4,188 | ) | 18,912 | (2,315 | ) | 5,918 | ||||||||||
Change in fair value of loans held for sale | (9,348 | ) | 14,362 | (97 | ) | 1,452 | ||||||||||
Gain (loss) on economic hedge instruments | (1,145 | ) | (9,408 | ) | (32,183 | ) | 30,989 | |||||||||
Other | (286 | ) | (226 | ) | (819 | ) | (1,603 | ) | ||||||||
$ | 27,218 | $ | 28,262 | $ | 110,041 | $ | 72,912 | |||||||||
Gains on loans held for sale, net include $10.7 million and $16.3 million for the three months ended September 30, 2014 and 2013, respectively, and $32.1 million and $63.2 million for the nine months ended September 30, 2014 and 2013, respectively, representing the value assigned to MSRs retained on transfers of forward loans. | ||||||||||||||||
Also included in Gains on loans held for sale, net are gains of $9.9 million and $50.6 million recorded during the three and nine months ended September 30, 2014, respectively, on sales of repurchased Ginnie Mae loans which are carried at the lower of cost or fair value. For the three and nine months ended September 30, 2013, gains on sales of repurchased Ginnie Mae loans were $4.3 million and $20.5 million, respectively. | ||||||||||||||||
Fair value gains recognized in connection with sales of reverse mortgages into Ginnie Mae guaranteed securitizations are also included in Gains on loans held for sale, net and amounted to $20.4 million and $51.4 million for the three and nine months ended September 30, 2014, respectively. Fair value gains for the three and nine months ended September 30, 2013 were $14.5 million and $20.6 million, respectively. |
Advances
Advances | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Advances [Abstract] | ' | |||||||
Advances | ' | |||||||
Note 6 – Advances | ||||||||
Advances, net, representing payments made on behalf of borrowers or on foreclosed properties, consisted of the following at the dates indicated: | ||||||||
September 30, 2014 | December 31, 2013 | |||||||
Servicing: | ||||||||
Principal and interest | $ | 198,540 | $ | 141,307 | ||||
Taxes and insurance | 443,255 | 477,039 | ||||||
Foreclosures, bankruptcy and other (1) | 340,882 | 268,053 | ||||||
982,677 | 886,399 | |||||||
Corporate Items and Other | 4,609 | 4,433 | ||||||
$ | 987,286 | $ | 890,832 | |||||
-1 | The balances at September 30, 2014 and December 31, 2013 are net of an allowance for losses of $48.4 million and $38.4 million, respectively. | |||||||
The following table summarizes the activity in advances for the nine months ended September 30: | ||||||||
2014 | 2013 | |||||||
Beginning balance | $ | 890,832 | $ | 184,463 | ||||
Acquisitions (1) | 99,318 | 708,415 | ||||||
Transfers to match funded advances | (10,156 | ) | (131,197 | ) | ||||
Sales of advances to HLSS (2) | — | (61,673 | ) | |||||
New advances, net of collections and other | 7,292 | 244,923 | ||||||
Ending balance | $ | 987,286 | $ | 944,931 | ||||
-1 | Servicing advances acquired through business acquisitions and asset acquisitions, primarily in connection with the acquisition of MSRs. See Note 3 – Business Acquisitions, Note 5 – Loans Held for Sale and Note 8 – Mortgage Servicing for additional information. | |||||||
-2 | We periodically sell Rights to MSRs and the related servicing advances to HLSS. The related advance sales generally meet the requirements for sale accounting and are derecognized from our financial statements at the time of the sale. In connection with the Ginnie Mae EBO Transactions completed during 2014, we transferred advances related to certain FHA-insured mortgage loans to HLSS Mortgage and HLSS SEZ LP in transactions which did not qualify as sales for accounting purposes. See Note 4 – Fair Value and Note 5 – Loans Held for Sale for additional information. |
Match_Funded_Advances
Match Funded Advances | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Transfers and Servicing [Abstract] | ' | |||||||
Match Funded Advances | ' | |||||||
Note 7 – Match Funded Advances | ||||||||
Match funded advances on residential loans we service for others are comprised of the following at the dates indicated: | ||||||||
September 30, 2014 | December 31, 2013 | |||||||
Principal and interest | $ | 1,360,568 | $ | 1,497,649 | ||||
Taxes and insurance | 788,612 | 830,113 | ||||||
Foreclosures, bankruptcy, real estate and other | 210,399 | 224,621 | ||||||
$ | 2,359,579 | $ | 2,552,383 | |||||
The following table summarizes the activity in match funded advances for the nine months ended September 30: | ||||||||
2014 | 2013 | |||||||
Beginning balance | $ | 2,552,383 | $ | 3,049,244 | ||||
Acquisitions (1) | 85,521 | 1,448,371 | ||||||
Transfers from advances | 10,156 | 131,197 | ||||||
Sales of advances to HLSS (2) | — | (3,428,234 | ) | |||||
Collections, net of new advances and other | (288,481 | ) | (666,853 | ) | ||||
Ending balance | $ | 2,359,579 | $ | 533,725 | ||||
-1 | Servicing advances acquired in connection with the acquisitions of MSRs through business acquisitions and asset acquisitions. See Note 3 – Business Acquisitions and Note 8 – Mortgage Servicing for additional information. | |||||||
-2 | See Note 6 – Advances for additional information. |
Mortgage_Servicing
Mortgage Servicing | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Transfers and Servicing [Abstract] | ' | |||||||||||||||
Mortgage Servicing | ' | |||||||||||||||
Note 8 – Mortgage Servicing | ||||||||||||||||
Mortgage Servicing Rights – Amortization Method | ||||||||||||||||
The following tables summarize the activity in the carrying value of amortization method servicing assets for the nine months ended September 30. Amortization of mortgage servicing rights is reported net of the amortization of servicing liabilities and includes the amount of charges we recognized to increase servicing liability obligations, if any. | ||||||||||||||||
2014 | 2013 | |||||||||||||||
Beginning balance | $ | 1,953,352 | $ | 678,937 | ||||||||||||
Additions recognized in connection with business acquisitions: | ||||||||||||||||
OSI (1) | 9,008 | — | ||||||||||||||
ResCap Acquisition (1) | 11,370 | 391,853 | ||||||||||||||
Liberty Acquisition (1) | — | 2,532 | ||||||||||||||
Additions recognized in connection with asset acquisitions: | ||||||||||||||||
Ally MSR Transaction | — | 683,787 | ||||||||||||||
OneWest MSR Transaction (2) | 1,516 | 127,047 | ||||||||||||||
Greenpoint MSR Transaction (3) | 3,690 | — | ||||||||||||||
Other | 14,132 | 3,003 | ||||||||||||||
Additions recognized on the sale of mortgage loans | 50,480 | 63,154 | ||||||||||||||
Sales | (137 | ) | (17,523 | ) | ||||||||||||
Servicing transfers and adjustments | (518 | ) | 2,052 | |||||||||||||
Amortization | (186,075 | ) | (197,899 | ) | ||||||||||||
Ending balance | $ | 1,856,818 | $ | 1,736,943 | ||||||||||||
Estimated fair value at end of period | $ | 2,364,393 | $ | 2,532,239 | ||||||||||||
-1 | See Note 3 – Business Acquisitions for additional information regarding MSRs recognized in connection with business acquisitions. | |||||||||||||||
-2 | The acquired MSRs in 2014 relate to mortgage loans with a UPB of $1.1 billion and related servicing advances of $34.3 million acquired in the final closing of the OneWest MSR Transaction. The OneWest MSR Transaction closed in stages, and the majority of loans were boarded onto our primary servicing platform as of December 31, 2013. As of September 30, 2013, we had acquired MSRs of $127.0 million with a UPB of $30.5 billion and related servicing advance receivables of $371.6 million. | |||||||||||||||
-3 | The acquired MSRs relate to mortgage loans with a UPB of $948.9 million and related servicing advances of $47.6 million. | |||||||||||||||
We have sold certain Rights to MSRs as part of the HLSS Transactions which did not qualify as sales for accounting purposes. In addition, on February 26, 2014, we issued $123.6 million of OASIS Series 2014-1 Notes secured by Ocwen-owned MSRs relating to Freddie Mac mortgages of $11.8 billion UPB. We account for these transactions as financings. See Note 11 – Borrowings for additional information. | ||||||||||||||||
Mortgage Servicing Rights—Fair Value Measurement Method | ||||||||||||||||
This portfolio comprises servicing rights for which we elected the fair value option and includes Agency forward residential mortgage loans for which we previously hedged the related market risks. | ||||||||||||||||
The following table summarizes the activity related to fair value servicing assets for the nine months ended September 30: | ||||||||||||||||
2014 | 2013 | |||||||||||||||
Beginning balance | $ | 116,029 | $ | 85,213 | ||||||||||||
Servicing transfers | (934 | ) | — | |||||||||||||
Changes in fair value (1): | ||||||||||||||||
Changes in assumptions | (12,217 | ) | 19,800 | |||||||||||||
Realization of cash flows and other changes | (930 | ) | (8,075 | ) | ||||||||||||
Ending balance | $ | 101,948 | $ | 96,938 | ||||||||||||
-1 | Changes in fair value are recognized in Servicing and origination expense in the unaudited Consolidated Statements of Operations. | |||||||||||||||
Because the mortgages underlying these MSRs permit the borrowers to prepay the loans, the value of the MSRs generally tends to diminish in periods of declining interest rates (as prepayments increase) and increase in periods of rising interest rates (as prepayments decrease). The following table summarizes the estimated change in the value of the MSRs that we carry at fair value as of September 30, 2014 given hypothetical instantaneous parallel shifts in the yield curve: | ||||||||||||||||
Adverse change in fair value | ||||||||||||||||
10% | 20% | |||||||||||||||
Weighted average prepayment speeds | $ | (8,245 | ) | $ | (16,137 | ) | ||||||||||
Discount rate (Option-adjusted spread) | $ | (4,100 | ) | $ | (7,905 | ) | ||||||||||
The sensitivity analysis measures the potential impact on fair values based on hypothetical changes (increases and decreases) in interest rates. | ||||||||||||||||
Portfolio of Assets Serviced | ||||||||||||||||
The following table presents the composition of our primary servicing and subservicing portfolios by type of property serviced as measured by UPB. The servicing portfolio represents loans for which we own the MSRs while subservicing represents all other loans. The UPB of assets serviced for others are not included on our unaudited Consolidated Balance Sheets. | ||||||||||||||||
Residential | Commercial | Total | ||||||||||||||
UPB at September 30, 2014 | ||||||||||||||||
Servicing (1) | $ | 360,919,248 | $ | — | $ | 360,919,248 | ||||||||||
Subservicing | 50,360,366 | 216,111 | 50,576,477 | |||||||||||||
$ | 411,279,614 | $ | 216,111 | $ | 411,495,725 | |||||||||||
UPB at December 31, 2013 | ||||||||||||||||
Servicing (1) | $ | 397,546,635 | $ | — | $ | 397,546,635 | ||||||||||
Subservicing | 67,104,697 | 400,502 | 67,505,199 | |||||||||||||
$ | 464,651,332 | $ | 400,502 | $ | 465,051,834 | |||||||||||
UPB at September 30, 2013 | ||||||||||||||||
Servicing (1) | $ | 362,792,312 | $ | — | $ | 362,792,312 | ||||||||||
Subservicing | 72,027,114 | 495,312 | 72,522,426 | |||||||||||||
$ | 434,819,426 | $ | 495,312 | $ | 435,314,738 | |||||||||||
-1 | Includes primary servicing UPB of $160.8 billion, $175.1 billion and $177.1 billion at September 30, 2014, December 31, 2013 and September 30, 2013, respectively, for which the Rights to MSRs have been sold to HLSS. | |||||||||||||||
Residential assets serviced includes foreclosed real estate. Residential assets serviced also includes small-balance commercial assets with a UPB of $2.4 billion, $2.6 billion and $2.5 billion at September 30, 2014, December 31, 2013 and September 30, 2013, respectively, that are managed using the REALServicing® platform. Commercial assets consist of large-balance foreclosed real estate. | ||||||||||||||||
A significant portion of our non-Agency servicing portfolio servicing agreements contain provisions whereby we could be terminated as servicer without compensation upon the failure of the serviced loans to meet certain portfolio delinquency or cumulative loss thresholds or in the event we fail to maintain required servicer ratings, among other provisions. As a result of the economic downturn of recent years, the portfolio delinquency and/or cumulative loss threshold provisions have been breached by many private-label securitizations in our non-Agency servicing portfolio. Terminations as servicer as a result of a breach of any of these provisions have been minimal. In the event we were terminated as servicer and the Rights to MSRs were sold to HLSS, we would be obligated to compensate HLSS. | ||||||||||||||||
Servicing Revenue | ||||||||||||||||
The following table presents the components of servicing and subservicing fees for the three and nine months ended September 30: | ||||||||||||||||
Three Months | Nine Months | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Loan servicing and subservicing fees: | ||||||||||||||||
Servicing | $ | 331,794 | $ | 335,884 | $ | 1,039,033 | $ | 887,500 | ||||||||
Subservicing | 30,926 | 35,286 | 95,509 | 115,437 | ||||||||||||
362,720 | 371,170 | 1,134,542 | 1,002,937 | |||||||||||||
Home Affordable Modification Program (HAMP) fees | 37,644 | 40,213 | 111,000 | 118,412 | ||||||||||||
Late charges | 27,634 | 30,445 | 97,002 | 85,930 | ||||||||||||
Loan collection fees | 8,655 | 8,387 | 25,573 | 22,524 | ||||||||||||
Custodial accounts (float earnings) | 1,831 | 743 | 5,235 | 4,533 | ||||||||||||
Other | 27,480 | 32,309 | 74,744 | 99,056 | ||||||||||||
$ | 465,964 | $ | 483,267 | $ | 1,448,096 | $ | 1,333,392 | |||||||||
Float balances (balances in custodial accounts, which represent collections of principal and interest that we receive from borrowers, are held in escrow by an unaffiliated bank and are excluded from our balance sheet) amounted to $3.7 billion and $3.5 billion at September 30, 2014 and September 30, 2013, respectively. |
Receivables
Receivables | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Receivables [Abstract] | ' | |||||||
Receivables | ' | |||||||
Note 9 – Receivables | ||||||||
Receivables consisted of the following at the dates indicated: | ||||||||
30-Sep-14 | 31-Dec-13 | |||||||
Servicing: | ||||||||
Government-insured loan claims (1) | $ | 60,236 | $ | 54,012 | ||||
Due from custodial accounts | 33,553 | 2,943 | ||||||
Reimbursable expenses | 21,575 | 35,933 | ||||||
Other servicing receivables | 26,673 | 31,649 | ||||||
142,037 | 124,537 | |||||||
Income taxes receivable | 56,174 | 6,369 | ||||||
Due from related parties (2) | 30,075 | 14,553 | ||||||
Other receivables (3) | 44,040 | 24,579 | ||||||
272,326 | 170,038 | |||||||
Allowance for losses (1) | (26,509 | ) | (17,522 | ) | ||||
$ | 245,817 | $ | 152,516 | |||||
-1 | The total allowance for losses at September 30, 2014 and December 31, 2013 includes $26.4 million and $17.4 million, respectively, related to receivables of our Servicing business. Allowance for losses related to defaulted FHA or VA insured loans repurchased from Ginnie Mae guaranteed securitizations (government-insured loan claims) at September 30, 2014 and December 31, 2013 were $17.4 million and $14.0 million, respectively. | |||||||
-2 | See Note 20 – Related Party Transactions for additional information. | |||||||
-3 | The balance at September 30, 2014 and December 31, 2013 includes $28.3 million and $13.6 million, respectively, related to losses expected to be indemnified under the terms of the merger agreement entered into in connection with the acquisition of Homeward. See Note 20 – Related Party Transactions for additional information regarding this receivable. |
Other_Assets
Other Assets | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Other Assets [Abstract] | ' | |||||||
Other Assets | ' | |||||||
Note 10 – Other Assets | ||||||||
Other assets consisted of the following at the dates indicated: | ||||||||
September 30, 2014 | December 31, 2013 | |||||||
Debt service accounts (1) | $ | 100,003 | $ | 129,897 | ||||
Prepaid lender fees and debt issuance costs, net | 31,200 | 31,481 | ||||||
Purchase price deposit (2) | 25,000 | 10,000 | ||||||
Prepaid income taxes | 25,142 | 20,585 | ||||||
Prepaid expenses | 12,095 | 16,132 | ||||||
Derivatives, at fair value (3) | 6,169 | 15,494 | ||||||
Contingent assets - ResCap Acquisition (4) | — | 51,932 | ||||||
Investment in unconsolidated entities (5) | — | 11,771 | ||||||
Other | 37,631 | 21,851 | ||||||
$ | 237,240 | $ | 309,143 | |||||
-1 | Under our advance funding facilities, we are contractually required to remit collections on pledged advances to the trustee within two days of receipt. The collected funds are not applied to reduce the related match funded debt until the payment dates specified in the indenture. The balances also include amounts that have been set aside from the proceeds of our match funded advance facilities and certain of our warehouse facilities to provide for possible shortfalls in the funds available to pay certain expenses and interest. The funds related to match funded facilities are held in interest earning accounts in the name of the SPE created in connection with the facility. | |||||||
-2 | The balance at December 31, 2013 represents an initial cash deposit that we made in connection with the agreement we entered into on December 20, 2013 to acquire MSRs and related advances from Wells Fargo Bank, N.A. This deposit, along with an additional deposit of $15.0 million that we made in January 2014, is being held in an escrow account pending the transaction closing. See Note 22 – Commitments and Contingencies for additional information on this transaction. | |||||||
-3 | See Note 15 – Derivative Financial Instruments and Hedging Activities for additional information. | |||||||
-4 | As disclosed in Note 3 – Business Acquisitions, the purchase of certain MSRs and related advances from ResCap was not complete on the date of acquisition pending the receipt of certain consents and court approvals. We recorded a contingent asset effective on the date of the acquisition until we subsequently obtained the required consents and approvals for the MSRs and paid the additional purchase price. | |||||||
-5 | The balance at December 31, 2013 includes an investment of $5.1 million in OSI and an investment of $6.6 million in PowerLink Settlement Services, LP and related entities. As disclosed in Note 3 – Business Acquisitions, we increased our ownership in OSI from 26.00% to 87.35% on January 31, 2014. Effective on that date, we began including the accounts of OSI in our consolidated financial statements and eliminated our current investment in consolidation. In June 2014, we received proceeds from the dissolution of PowerLink Settlement Services, LP equal to our investment. |
Borrowings
Borrowings | 9 Months Ended | ||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||
Debt Disclosure [Abstract] | ' | ||||||||||||||||||
Borrowings | ' | ||||||||||||||||||
Note 11 – Borrowings | |||||||||||||||||||
Match Funded Liabilities | |||||||||||||||||||
Match funded liabilities are comprised of the following at the dates indicated: | |||||||||||||||||||
Borrowing Type | Interest Rate | Maturity (1) | Amortization Date (1) | Available Borrowing Capacity (2) | September 30, 2014 | December 31, 2013 | |||||||||||||
Advance Receivable Backed Notes Series 2012-ADV1 (3) | 1ML (4) + 175 bps | Jun. 2017 | Jun. 2015 | $ | 130,753 | $ | 344,247 | $ | 417,388 | ||||||||||
Advance Receivable Backed | 1ML + 300 bps | Dec. 2015 | Dec. 2014 | 44,987 | 5,013 | 33,211 | |||||||||||||
Note | |||||||||||||||||||
2012-Homeward Agency Advance Funding Trust | Cost of Funds + 300 bps | Apr. 2014 | Apr. 2014 | — | — | 21,019 | |||||||||||||
2012-1 (5) | |||||||||||||||||||
Advance Receivables Backed Notes, Series 2013-VF1, | 1ML + 175 bps (7)(11) | Oct. 2044 | Oct. 2014 | 156,812 | 843,188 | 1,494,628 | |||||||||||||
Class A (6) | |||||||||||||||||||
Advance Receivables Backed Notes, Series 2013-VF2, | 1ML + 167 bps (8)(11) | Oct. 2044 | Oct. 2014 | 75,693 | 408,019 | 385,645 | |||||||||||||
Class A (6) | |||||||||||||||||||
Advance Receivables Backed Notes, Series 2013-VF2, | 1ML + 425 bps (9)(11) | Oct. 2044 | Oct. 2014 | 2,711 | 13,577 | 12,923 | |||||||||||||
Class B (6) | |||||||||||||||||||
Advance Receivables Backed Notes - Series 2014-VF3, Class A (10) | 1ML + 175 bps (10)(11) | Oct. 2044 | Oct. 2014 | 78,405 | 421,595 | — | |||||||||||||
$ | 489,361 | $ | 2,035,639 | $ | 2,364,814 | ||||||||||||||
Weighted average interest rate | 1.91 | % | 2.08 | % | |||||||||||||||
-1 | The amortization date of our facilities is the date on which the revolving period ends under each advance facility note and repayment of the outstanding balance must begin if the note is not renewed or extended. The maturity date is the date on which all outstanding balances must be repaid. In two advance facilities, there are multiple notes outstanding. For each note, after the amortization date, all collections that represent the repayment of advances pledged to the facility must be applied to reduce the balance of the note outstanding, and any new advances are ineligible to be financed. | ||||||||||||||||||
-2 | Borrowing capacity is available to us provided that we have additional eligible collateral to pledge. Collateral may only be pledged to one facility. At September 30, 2014, only $51.2 million of the available borrowing capacity could be used based on the amount of eligible collateral that had been pledged. | ||||||||||||||||||
-3 | On October 28, 2014, the maximum borrowing capacity under this facility was reduced to $450.0 million and will further decline to $400.0 million in February 2015. | ||||||||||||||||||
-4 | 1-Month LIBOR (1ML) was 0.16% and 0.17% at September 30, 2014 and December 31, 2013, respectively. | ||||||||||||||||||
-5 | Advance facility assumed as part of the acquisition of Homeward. This facility was terminated on April 16, 2014, and the advances pledged to the facility were transferred to another facility. | ||||||||||||||||||
-6 | These notes were issued in connection with the OneWest MSR Transaction. On February 3, 2014, the maximum borrowing capacity on the 2013-VF2 notes was increased by $100.0 million to a total of $500.0 million. On March 17, 2014, the maximum borrowing capacity under the 2013-VF1 note declined by $500.0 million to a total of $1.0 billion. On October 1, 2014, the VF1 note was fully repaid. The maximum borrowing capacity of the VF2, Class A notes was increased to $564.0 million, and the maximum borrowing capacity of the VF2, Class B notes was increased to $36.0 million. In addition, the amortization date of the VF2 Class A and B notes was extended to October 15, 2015, and the maturity date was extended to October 15, 2045. Finally, a new series, the Series 2014-VF4 note, was issued with a maximum borrowing capacity of $600.0 million, an amortization date of October 15, 2015 and a maturity date of October 15, 2045. The interest margin on this new series of notes was set to 175 bps through July 14, 2015, to 200 bps on July 15, 2015, to 212 bps on August 15, 2015 and to 250 bps on September 15, 2015. | ||||||||||||||||||
-7 | The interest margin on these notes increased to 200 bps on July 15, 2014, to 225 bps on August 15, 2014 and 250 bps on September 15, 2014. | ||||||||||||||||||
-8 | The interest margin on these notes increased to 191 bps on July 15, 2014, to 215 bps on August 15, 2014 and 238 bps on September 15, 2014. Effective October 1, 2014, the interest margin on these notes was set to 167 bps through July 14, 2015, to 191 bps on July 15, 2015, to 215 bps on August 15, 2015 and to 239 bps on September 15, 2015. | ||||||||||||||||||
-9 | The interest margin on these notes increased to 486 bps on July 15, 2014, to 546 bps on August 15, 2014 and 607 bps on September 15, 2014. Effective October 1, 2014, the interest margin on these notes was set to 300 bps through July 14, 2015, to 343 bps on July 15, 2015, to 386 bps on August 15, 2015 and to 429 bps on September 15, 2015. | ||||||||||||||||||
-10 | This note was issued on March 17, 2014 with a maximum borrowing capacity of $500.0 million. The interest margin on this note increased to 200 bps on July 15, 2014, to 225 bps on August 15, 2014 and 250 bps on September 15, 2014. On October 1, 2014, the maximum borrowing capacity of the note was increased to $600.0 million, the amortization date was extended to October 15, 2015 and the maturity date was extended to October 15, 2045. The interest margin was set to 175 bps through July 14, 2015, to 200 bps on July 15, 2015, to 225 bps on August 15, 2015 and to 250 bps on September 15, 2015. | ||||||||||||||||||
-11 | On July 15, 2014, the lenders agreed to waive the increase in interest margin scheduled for July 15, 2014. On August 15, 2014, the lenders also agreed to waive the increases in interest margin that were scheduled for August 15, 2014 and September 15, 2014. | ||||||||||||||||||
Financing Liabilities | |||||||||||||||||||
Financing liabilities are comprised of the following at the dates indicated: | |||||||||||||||||||
Borrowings | Collateral | Interest Rate | Maturity | September 30, 2014 | December 31, 2013 | ||||||||||||||
Servicing: | |||||||||||||||||||
Financing liability – MSRs pledged | MSRs | -1 | -1 | $ | 618,855 | $ | 633,804 | ||||||||||||
Secured Notes, Ocwen Asset Servicing Income Series, Series 2014-1 (2) | MSRs | -2 | Feb. 2028 | 115,039 | — | ||||||||||||||
Financing Liability – Advances Pledged (3) | Advances on loans | -3 | -3 | 87,502 | — | ||||||||||||||
821,396 | 633,804 | ||||||||||||||||||
Lending: | |||||||||||||||||||
Financing liability - MSRs pledged (4) | MSRs | -4 | -4 | — | 17,593 | ||||||||||||||
HMBS-related borrowings (5) | Loans held for investment (LHFI) | 1ML + 245 bps | -5 | 1,236,094 | 615,576 | ||||||||||||||
1,236,094 | 633,169 | ||||||||||||||||||
$ | 2,057,490 | $ | 1,266,973 | ||||||||||||||||
-1 | The HLSS Transaction financing liabilities have no contractual maturity. The balance of the liability is adjusted each reporting period to its fair value based on the present value of the estimated future cash flows underlying the related MSRs. As discussed in Note 1A — Restatement of Previously Issued Consolidated Financial Statements, we are restating our previously reported consolidated operating results for the three and nine months ended September 30, 2013 to correct an error in the accounting applicable to the financing liabilities in connection with Rights to MSRs sold to HLSS. | ||||||||||||||||||
-2 | OASIS noteholders are entitled to receive a monthly payment amount equal to the sum of: a) the designated servicing fee amount (21 basis points of the UPB of the reference pool of Freddie Mac mortgages); b) any termination payment amounts; c) any excess refinance amounts; and d) the note redemption amounts, each as defined in the indenture supplement for the notes. The notes have a final stated maturity of February 2028. We accounted for this transaction as a financing. Monthly amortization of the liability is estimated using the proportion of monthly projected service fees on the underlying MSRs as a percentage of lifetime projected fees, adjusted for the term of the security. | ||||||||||||||||||
-3 | Certain advances were sold to HLSS Mortgage and HLSS SEZ LP on March 4, 2014 and May 2, 2014, respectively. These sales of advances did not qualify for sales accounting treatment and were accounted for as a financing. See Note 5 – Loans Held for Sale for additional information. | ||||||||||||||||||
-4 | Sales of MSRs to a third party accounted for as a financing. The financing liability was being amortized using the interest method with the servicing income that was remitted to the purchaser representing payments of principal and interest. In April 2014, we derecognized the remaining liability related to this MSR sale. During 2014, we recognized a gain of $2.6 million on the extinguishment of the financing liability. | ||||||||||||||||||
-5 | Represents amounts due to the holders of beneficial interests in Ginnie Mae guaranteed HMBS. The beneficial interests have no maturity dates, and the borrowings mature as the related loans are repaid. See Note 2 – Securitizations and Variable Interest Entities for additional information. | ||||||||||||||||||
Other Secured Borrowings | |||||||||||||||||||
Other secured borrowings are comprised of the following at the dates indicated: | |||||||||||||||||||
Borrowings | Collateral | Interest Rate | Maturity | Available Borrowing Capacity | September 30, 2014 | December 31, 2013 | |||||||||||||
Servicing: | |||||||||||||||||||
SSTL (1) | -1 | 1-Month Euro-dollar rate + 375 bps with a Eurodollar floor of 125 bps (1) | Feb. 2018 | $ | — | $ | 1,280,500 | $ | 1,290,250 | ||||||||||
Promissory note (2) | MSRs | 1ML + 350 bps | May-17 | — | — | 15,529 | |||||||||||||
Repurchase agreement (3) | Loans held for sale (LHFS) | 1ML + 200 - 345 bps | Jun. 2015 | 27,338 | 22,662 | 17,507 | |||||||||||||
27,338 | 1,303,162 | 1,323,286 | |||||||||||||||||
Lending: | |||||||||||||||||||
Master repurchase agreement (4) | LHFS | 1ML + 175 bps | Apr. 2015 | 17,199 | 132,801 | 105,659 | |||||||||||||
Participation agreement (5) | LHFS | N/A | May-15 | — | 54,369 | 81,268 | |||||||||||||
Master repurchase agreement (6) | LHFS | 1ML + 175 - 275 bps | Oct. 2014 | 10,645 | 64,355 | 91,990 | |||||||||||||
Master repurchase agreement (7) | LHFS | 1ML + 175 - 200 bps | Nov. 2014 | 99,527 | 50,473 | 89,836 | |||||||||||||
Master repurchase agreement (8) | LHFI | 1ML + 275bps | Oct. 2014 | 858 | 36,642 | 51,975 | |||||||||||||
Mortgage warehouse agreement (9) | LHFI | 1ML + 275 bps; floor of 350 bps | May-15 | 35,695 | 24,305 | 34,292 | |||||||||||||
163,924 | 362,945 | 455,020 | |||||||||||||||||
Corporate Items and Other: | |||||||||||||||||||
Securities sold under an agreement to repurchase (10) | Ocwen Real Estate Asset Liquidating Trust 2007-1 Notes | Class A-2 notes: 1ML + 200 bps; Class A-3 notes: 1ML + 300 bps | Monthly | — | 4,678 | 4,712 | |||||||||||||
191,262 | 1,670,785 | 1,783,018 | |||||||||||||||||
Discount (1) | — | (4,358 | ) | (5,349 | ) | ||||||||||||||
$ | 191,262 | $ | 1,666,427 | $ | 1,777,669 | ||||||||||||||
Weighted average interest rate | 4.94 | % | 4.86 | % | |||||||||||||||
-1 | This facility had an initial balance of $1.3 billion and was issued with an original issue discount of $6.5 million that we are amortizing over the term of the loan. We are required to repay the principal amount of the borrowings in consecutive quarterly installments of $3.3 million. In addition, we are generally required to use the net cash proceeds (as defined) from any asset sale (as defined) to repay loan principal, subject to a 270-day reinvestment provision (or, in the case of a sale of MSRs, related servicing advances or other related assets to HLSS, we have a 180-day reinvestment provision and the net cash proceeds must be invested in MSRs or related assets, such as advances). We are also required to make mandatory prepayments in certain circumstances based on our corporate leverage ratio (as defined) if we have positive consolidated excess cash flow (as defined) in any fiscal year. The borrowings are secured by a first priority security interest in substantially all of the assets of Ocwen. Borrowings bear interest, at the election of Ocwen, at a rate per annum equal to either (a) the base rate [the greatest of (i) the prime rate in effect on such day, (ii) the federal funds rate in effect on such day plus 0.50% and (iii) the one-month Eurodollar rate (1-Month LIBOR)], plus a margin of 2.75% and a base rate floor of 2.25% or (b) the one month Eurodollar rate, plus a margin of 3.75% with a one month Eurodollar floor of 1.25%. To date, we have elected option (b) to determine the interest rate. | ||||||||||||||||||
-2 | This note was repaid in full on February 28, 2014. | ||||||||||||||||||
-3 | Under this repurchase agreement, the lender provides financing on a committed basis for $50.0 million and, at the discretion of the lender, on an uncommitted basis for an additional $50.0 million. | ||||||||||||||||||
-4 | Under this repurchase agreement, the lender provides financing on a committed basis for $150.0 million and, at the discretion of the lender, on an uncommitted basis for an additional $150.0 million. | ||||||||||||||||||
-5 | Under this participation agreement, the lender provides financing on an uncommitted basis for $50.0 million to $100.0 million at the discretion of the lender. The participation agreement allows the lender to acquire a 100% beneficial interest in the underlying mortgage loans. The transaction does not qualify for sale accounting treatment and is accounted for as a secured borrowing. The lender earns the stated interest rate of the underlying mortgage loans while the loans are financed under the participation agreement. | ||||||||||||||||||
-6 | Under this repurchase agreement, the lender provides financing on a committed basis for $75.0 million and, at the discretion of the lender, on an uncommitted basis for an additional $75.0 million. On September 2, 2014, the maturity date of this facility was extended to October 2, 2014. On October 2, 2014, the maturity date was further extended to September 1, 2015. | ||||||||||||||||||
-7 | Under this repurchase agreement, the lender provides financing on a committed basis for $150.0 million and, at the discretion of the lender, on an uncommitted basis for an additional $300.0 million. On October 24, 2014, this facility was repaid in full and terminated. | ||||||||||||||||||
-8 | On September 2, 2014, the maturity date of this facility was extended to October 2, 2014, and the maximum borrowing capacity was reduced to $37.5 million on a committed basis plus an additional $37.5 million on an uncommitted basis at the discretion of the lender. On October 1, 2014, the maturity date was extended to October 31, 2014. Effective October 31, 2014, the maturity date was further extended to November 14, 2014. | ||||||||||||||||||
-9 | In August 2014, the maturity date of this facility was extended to May 28, 2015. | ||||||||||||||||||
-10 | Represents repurchase agreement for Class A-2 and A-3 notes issued by Ocwen Real Estate Asset Liquidating Trust 2007-1 which have a current face value of $22.4 million at September 30, 2014. This agreement has no stated credit limit and lending is determined for each transaction based on the acceptability of the securities presented as collateral. | ||||||||||||||||||
Senior Unsecured Notes | |||||||||||||||||||
On May 12, 2014, Ocwen completed the issuance and sale of $350.0 million of its 6.625% Senior Notes due 2019 (the Senior Unsecured Notes) in a private offering. We received net proceeds of $343.3 million from the sale of the Senior Unsecured Notes after deducting underwriting fees and offering expenses. The Senior Unsecured Notes are general senior unsecured obligations of Ocwen and will mature on May 15, 2019. Interest is payable semi-annually on May 15th and November 15th. The Senior Unsecured Notes are not guaranteed by any of Ocwen’s subsidiaries. | |||||||||||||||||||
At any time prior to May 15, 2016, Ocwen may redeem all or a part of the Senior Unsecured Notes, upon not less than 30 nor more than 60 days’ notice, at a redemption price equal to 100.0% of the principal amount of the Senior Unsecured Notes redeemed, plus the Applicable Premium as defined in the related indenture agreement (the Indenture), plus accrued and unpaid interest and Additional Interest as defined in the Indenture, if any, on the Senior Unsecured Notes redeemed. The Additional Premium on a Note is the greater of 1% of the principal amount of the Note or the redemption price at May 15, 2016 plus all interest due from the redemption date through May 15, 2016, less the principal amount of the Note. Additional Interest is earned by the Senior Unsecured Notes if the deadline for exchange or registration of the Senior Unsecured Notes is not met and ranges from an initial 0.25% to a maximum 1.0%. | |||||||||||||||||||
On or after May 15, 2016, Ocwen may redeem all or a part of the Senior Unsecured Notes, upon not less than 30 nor more than 60 days’ notice, at the redemption prices (expressed as percentages of principal amount) specified in the Indenture plus accrued and unpaid interest and Additional Interest, if any. The redemption prices during the twelve-month periods beginning on May 15th of each year are as follows: | |||||||||||||||||||
Year | Redemption Price | ||||||||||||||||||
2016 | 104.97% | ||||||||||||||||||
2017 | 103.31% | ||||||||||||||||||
2018 and thereafter | 100.00% | ||||||||||||||||||
At any time prior to May 15, 2016, Ocwen may, at its option, use the net cash proceeds of one or more Equity Offerings as defined in the Indenture to redeem up to 35% of the principal amount of all Senior Unsecured Notes issued at a redemption price equal to 106.625% of the principal amount of the Senior Unsecured Notes redeemed plus accrued and unpaid interest and Additional Interest, if any, provided that: (i) at least 65% of the principal amount of all Senior Unsecured Notes issued under the Indenture remains outstanding immediately after any such redemption; and (ii) Ocwen makes such redemption not more than 120 days after the consummation of any such Equity Offering. | |||||||||||||||||||
Upon the occurrence of a change of control as defined in the Indenture, Ocwen is required to make an offer to the holders of the Senior Unsecured Notes to repurchase the Senior Unsecured Notes at a purchase price equal to 101.0% of the principal amount of the Senior Unsecured Notes purchased plus accrued and unpaid interest and Additional Interest, if any. Each holder will have the right to require that the Ocwen purchase all or a portion of the holder’s Senior Unsecured Notes pursuant to the offer. | |||||||||||||||||||
The Indenture contains various covenants that could, unless certain conditions are met, limit or restrict the ability of Ocwen and its subsidiaries to engage in specified types of transactions. Among other things, these covenants could potentially limit or restrict the ability of Ocwen and its subsidiaries to: | |||||||||||||||||||
• | incur additional debt or issue preferred stock; | ||||||||||||||||||
• | pay dividends or make distributions on or purchase equity interests of Ocwen; | ||||||||||||||||||
• | repurchase or redeem debt that is subordinate to the Senior Unsecured Notes prior to maturity; | ||||||||||||||||||
• | make investments or other restricted payments; | ||||||||||||||||||
• | create liens on assets to secure debt of Ocwen or any guarantor of the Senior Unsecured Notes; | ||||||||||||||||||
• | sell or transfer assets; | ||||||||||||||||||
• | enter into transactions with “affiliates” (any entity that controls, is controlled by or is under common control with Ocwen or certain of its subsidiaries); and | ||||||||||||||||||
• | enter into mergers, consolidations, or sales of all or substantially all of Ocwen’s assets. | ||||||||||||||||||
Many of the restrictive covenants will be suspended if the Senior Unsecured Notes achieve an investment grade rating from both Moody’s Investors Service, Inc. (Moody’s) and Standard & Poor’s Ratings Services (S&P) and no default or event of default, as specified in the Indenture, has occurred and is continuing. However, covenants that are suspended as a result of achieving these ratings will again apply if Moody’s or S&P withdraws its investment grade rating or downgrades the rating assigned to the Senior Unsecured Notes below an investment grade rating. | |||||||||||||||||||
Ocwen contemporaneously entered into a Registration Rights Agreement under which it agreed for the benefit of the initial purchasers of the Senior Unsecured Notes to use commercially reasonable efforts to file a registration statement and to have the registration statement become effective on or prior to 270 days after the closing of the offering. The registration statement would relate to a registered offer to exchange the Senior Unsecured Notes for other notes (referred to as the exchange notes) that would be issued by Ocwen, would be registered with the SEC and would have substantially identical terms as the Senior Unsecured Notes. If Ocwen is not able to effect the exchange offer, it will instead use commercially reasonable efforts to file and cause to become effective a shelf registration statement relating to resales of the Senior Unsecured Notes. | |||||||||||||||||||
In connection with our issuance of the Senior Unsecured Notes, we incurred certain costs that we capitalized and are amortizing over the period from the date of issuance to May 15, 2019. The unamortized balance of these issuance costs was $6.1 million at September 30, 2014. | |||||||||||||||||||
Covenants | |||||||||||||||||||
Match funded liabilities and other secured borrowings are collateralized by specific assets. Under the terms of these borrowing agreements, we are subject to various qualitative and quantitative covenants. Collectively, these covenants include: | |||||||||||||||||||
• | Specified net worth requirements; | ||||||||||||||||||
• | Restrictions on future indebtedness; and | ||||||||||||||||||
• | Monitoring and reporting of various specified transactions or events, including specific reporting on defined events affecting collateral underlying certain borrowing agreements. | ||||||||||||||||||
Financial covenants in our borrowing agreements require that we maintain consolidated tangible net worth, the most restrictive of which is $630.0 million plus 65% of quarterly net income, without adjustment for quarterly net losses, beginning with the three months ended December 31, 2012. The required consolidated tangible net worth in connection with this agreement was $957.1 million at September 30, 2014. Should we fail to be in compliance with these requirements, remedies include but are not limited to, at the option of the facility provider, termination of further funding, acceleration of outstanding obligations, enforcement of liens against the assets securing or otherwise supporting the agreement, and other legal remedies. Our lenders can waive their contractual rights in the event of a default. Our borrowing agreements generally include cross default provisions such that a default under one agreement could trigger defaults under other agreements. We believe that we are in compliance with all of our qualitative and quantitative covenants at the date of these financial statements. |
Other_Liabilities
Other Liabilities | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Other Liabilities Disclosure [Abstract] | ' | |||||||
Other Liabilities | ' | |||||||
Note 12 – Other Liabilities | ||||||||
Other liabilities were comprised of the following at the dates indicated: | ||||||||
September 30, 2014 | December 31, 2013 | |||||||
Liability for indemnification obligations (1) | $ | 143,836 | $ | 192,716 | ||||
Accrued expenses (2) | 227,309 | 108,870 | ||||||
Payable to loan servicing and subservicing investors | 83,778 | 33,501 | ||||||
Due to related parties (3) | 60,235 | 77,997 | ||||||
Liability for selected tax items | 30,627 | 27,273 | ||||||
Checks held for escheat | 19,880 | 24,392 | ||||||
Liability for certain foreclosure matters (4) | — | 66,948 | ||||||
Additional purchase price due seller - ResCap Acquisition (5) | — | 54,220 | ||||||
Other | 65,976 | 58,678 | ||||||
$ | 631,641 | $ | 644,595 | |||||
-1 | See Note 22 – Commitments and Contingencies for additional information. | |||||||
-2 | Accrued expenses at September 30, 2014 includes $100.0 million related to certain regulatory contingencies. See Note 22 – Commitments and Contingencies for additional information. | |||||||
-3 | See Note 20 – Related Party Transactions for additional information. | |||||||
-4 | This liability was settled in May 2014. See Note 22 – Commitments and Contingencies for additional information regarding the National Mortgage Settlement. | |||||||
-5 | See Note 3 – Business Acquisitions for additional information. |
Mezzanine_Equity
Mezzanine Equity | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Temporary Equity Disclosure [Abstract] | ' | |||||||
Mezzanine Equity | ' | |||||||
Note 13 – Mezzanine Equity | ||||||||
On July 14, 2014, holders of our Series A Perpetual Convertible Preferred Stock (the Preferred Shares) elected to convert the remaining 62,000 shares into 1,950,296 shares of common stock. | ||||||||
The following table summarizes the activity in mezzanine equity for the nine months ended September 30: | ||||||||
2014 | 2013 | |||||||
Beginning balance | $ | 60,361 | $ | 153,372 | ||||
Conversion of Preferred Shares | (62,000 | ) | (100,000 | ) | ||||
Accretion of beneficial conversion feature discount (Deemed dividend) (1) | 1,639 | 6,573 | ||||||
Ending balance | $ | — | $ | 59,945 | ||||
-1 | Accretion includes an accelerated write-off of the unamortized discount of $0.8 million and $3.5 million related to the conversion of Preferred Shares during 2014 and 2013, respectively. |
Equity
Equity | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Equity [Abstract] | ' | |||||||
Equity | ' | |||||||
Note 14 – Equity | ||||||||
Common Stock | ||||||||
On July 14, 2014, Ocwen paid $72.3 million to repurchase from the holders of our Preferred Shares all 1,950,296 shares of Ocwen common stock that were issued upon their election to convert the remaining 62,000 Preferred Shares into shares of Ocwen common stock. | ||||||||
On October 31, 2013, we announced that Ocwen’s Board of Directors had authorized a share repurchase program for an aggregate of up to $500.0 million of Ocwen’s issued and outstanding shares of common stock. Repurchases may be made in open market transactions at prevailing market prices or in privately negotiated transactions. Unless we amend the share repurchase program or repurchase the full $500.0 million amount by an earlier date, the share repurchase program will continue through July 2016. No assurances can be given as to the amount of shares, if any, that we may repurchase in any given period. The repurchase of shares issued in connection with the conversion of our Series A Perpetual Convertible Preferred Stock (the Preferred Shares) is not considered to be part of this repurchase program and, therefore, does not count against the $500.0 million aggregate value limit. During the nine months ended September 30, 2014, we completed the repurchase of 7,970,353 shares of common stock in the open market under this program for a total purchase price of $253.4 million. To date through September 30, 2014, we have completed the repurchase of 9,096,060 total shares of common stock under this program for an aggregate purchase price of $313.4 million. See Note 23 – Subsequent Events for information regarding repurchases completed subsequent to September 30, 2014. | ||||||||
Accumulated Other Comprehensive Loss | ||||||||
The components of accumulated other comprehensive loss (AOCL), net of income taxes, were as follows at the dates indicated: | ||||||||
September 30, 2014 | December 31, 2013 | |||||||
Unrealized losses on cash flow hedges | $ | 8,663 | $ | 10,026 | ||||
Other | 121 | 125 | ||||||
$ | 8,784 | $ | 10,151 | |||||
See Note 15 – Derivative Financial Instruments and Hedging Activities for the changes in the components of AOCL for the nine months ended September 30, 2014 and 2013. |
Derivative_Financial_Instrumen
Derivative Financial Instruments and Hedging Activities | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ||||||||||||||||
Derivative Financial Instruments and Hedging Activities | ' | ||||||||||||||||
Note 15 – Derivative Financial Instruments and Hedging Activities | |||||||||||||||||
Because many of our current derivative agreements are not exchange-traded, we are exposed to credit loss in the event of nonperformance by the counterparty to the agreements. We control this risk through credit monitoring procedures including financial analysis, dollar limits and other monitoring procedures. The notional amount of our contracts does not represent our exposure to credit loss. | |||||||||||||||||
The following table summarizes the changes in the notional balances of our holdings of derivatives during the nine months ended September 30, 2014: | |||||||||||||||||
IRLCs | Forward MBS Trades | Interest Rate Caps | |||||||||||||||
Beginning notional balance | $ | 751,436 | $ | 950,648 | $ | 1,868,000 | |||||||||||
Additions | 3,795,311 | 6,951,828 | 100,000 | ||||||||||||||
Amortization | 94,571 | — | (490,000 | ) | |||||||||||||
Maturities | (3,298,265 | ) | (3,379,589 | ) | — | ||||||||||||
Terminations | (876,254 | ) | (3,762,592 | ) | — | ||||||||||||
Ending notional balance | $ | 466,799 | $ | 760,295 | $ | 1,478,000 | |||||||||||
Fair value of derivative assets (liabilities) at: | |||||||||||||||||
September 30, 2014 | $ | 6,117 | $ | (1,089 | ) | $ | 91 | ||||||||||
December 31, 2013 | $ | 8,433 | $ | 6,905 | $ | 442 | |||||||||||
Maturity | Nov. 2014 - Jan. 2014 | Nov. 2014 - Dec. 2014 | Nov. 2016 | ||||||||||||||
Foreign Currency Exchange Rate Risk Management | |||||||||||||||||
We periodically enter into foreign exchange forward contracts to hedge against the effect of changes in the value of the India Rupee on amounts payable to our India subsidiaries. Our operations in Uruguay and the Philippines also expose us to foreign currency exchange rate risk, but we currently consider this risk to be insignificant. | |||||||||||||||||
Interest Rate Management | |||||||||||||||||
Match Funded Liabilities | |||||||||||||||||
We terminated our interest rate swaps on May 31, 2013 primarily because the custodial account float balances, which earn a variable rate of interest, are well in excess of variable rate borrowings under advance facilities. The earnings on these deposits reduce our exposure to changes in interest rates. As required by certain of our advance financing arrangements, we have purchased interest rate caps to minimize future interest rate exposure from increases in one-month LIBOR interest rates. | |||||||||||||||||
Loans Held for Sale, at Fair Value | |||||||||||||||||
The mortgage loans held for sale which we carry at fair value are subject to interest rate and price risk from the loan funding date until the date the loan is sold into the secondary market. Generally, the fair value of a loan will decline in value when interest rates increase and will rise in value when interest rates decrease. To mitigate this risk, we enter into forward MBS trades to provide an economic hedge against those changes in fair value on mortgage loans held for sale. Forward MBS trades are primarily used to fix the forward sales price that will be realized upon the sale of mortgage loans into the secondary market. | |||||||||||||||||
Interest Rate Lock Commitments | |||||||||||||||||
Outstanding IRLCs are subject to interest rate risk and related price risk during the period from the date of the commitment through the loan funding date or expiration date. The borrower is not obligated to obtain the loan, thus we are subject to fallout risk related to IRLCs, which is realized if approved borrowers choose not to close on the loans within the terms of the IRLCs. Our interest rate exposure on these derivative loan commitments is hedged with freestanding derivatives such as forward contracts. We enter into forward contracts with respect to fixed rate loan commitments. | |||||||||||||||||
MSRs, at Fair Value | |||||||||||||||||
Effective April 1, 2013, we terminated our hedging program for fair value MSRs. Prior to the termination, we used economic hedges including interest rate swaps, U.S. Treasury futures and forward contracts to minimize the effects of loss in value of these MSRs associated with increased prepayment activity that generally results from declining interest rates. | |||||||||||||||||
The following summarizes our open derivative positions at September 30, 2014 and the gains (losses) on all derivatives used in each of the identified hedging programs for the year to date period then ended. None of the derivatives was designated as a hedge for accounting purposes at September 30, 2014: | |||||||||||||||||
Purpose | Expiration Date | Notional Amount | Fair Value (1) | Gains / (Losses) | Consolidated Statements of Operations Caption | ||||||||||||
Hedge the effect of changes in interest rates on interest expense on borrowings | |||||||||||||||||
Interest rate caps | |||||||||||||||||
Hedge the effect of changes in 1ML on advance funding facilities | Nov. 2016 | $ | 1,478,000 | $ | 91 | $ | (374 | ) | Other, net | ||||||||
Interest rate risk of mortgage loans held for sale and of IRLCs | |||||||||||||||||
Forward MBS trades | Nov. 2014 - Dec. 2014 | 760,295 | (1,089 | ) | (32,183 | ) | Gain on loans held for sale, net | ||||||||||
IRLCs | Nov. 2014 - Jan. 2014 | 466,799 | 6,117 | (2,315 | ) | Gain on loans held for sale, net | |||||||||||
Total derivatives | $ | 5,119 | $ | (34,872 | ) | ||||||||||||
-1 | Derivatives are reported at fair value in Receivables, Other assets and Other liabilities on our unaudited Consolidated Balance Sheet. | ||||||||||||||||
Included in AOCL at September 30, 2014 and September 30, 2013, respectively, were $9.2 million and $12.2 million of deferred unrealized losses, before taxes of $0.5 million and $4.5 million, respectively, on interest rate swaps that we designated as cash flow hedges. Changes in AOCL during the nine months ended September 30 were as follows: | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Beginning balance | $ | 10,151 | $ | 6,441 | |||||||||||||
Additional net losses on cash flow hedges | — | 12,363 | |||||||||||||||
Ineffectiveness of cash flow hedges reclassified to earnings | — | (657 | ) | ||||||||||||||
Losses on terminated hedging relationships amortized to earnings | (1,579 | ) | (9,434 | ) | |||||||||||||
Net increase (decrease) in accumulated losses on cash flow hedges | (1,579 | ) | 2,272 | ||||||||||||||
Decrease (increase) in deferred taxes on accumulated losses on cash flow hedges | 217 | (933 | ) | ||||||||||||||
(Decrease) increase in accumulated losses on cash flow hedges, net of taxes | (1,362 | ) | 1,339 | ||||||||||||||
Other, net of taxes | (5 | ) | (711 | ) | |||||||||||||
Ending balance | $ | 8,784 | $ | 7,069 | |||||||||||||
Projected amortization of deferred unrealized losses from AOCL to earnings during the coming twelve months is $1.6 million. | |||||||||||||||||
Other income (expense), net, includes the following related to derivative financial instruments for the three and nine months ended September 30: | |||||||||||||||||
Three Months | Nine Months | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Losses on economic hedges | $ | (6 | ) | $ | (103 | ) | $ | (374 | ) | $ | (3,822 | ) | |||||
Ineffectiveness of cash flow hedges | — | — | — | (657 | ) | ||||||||||||
Write-off of losses in AOCL for a discontinued hedge relationship | (408 | ) | (7,780 | ) | (1,580 | ) | (9,434 | ) | |||||||||
$ | (414 | ) | $ | (7,883 | ) | $ | (1,954 | ) | $ | (13,913 | ) | ||||||
Interest_Expense
Interest Expense | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Other Income and Expenses [Abstract] | ' | |||||||||||||||
Interest Expense | ' | |||||||||||||||
Note 16 – Interest Expense | ||||||||||||||||
The following table presents the components of interest expense for the three and nine months ended September 30: | ||||||||||||||||
Three months | Nine Months | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Financing liabilities (1) (2) | $ | 88,246 | $ | 81,192 | $ | 281,930 | $ | 185,116 | ||||||||
Other secured borrowings | 20,790 | 21,608 | 62,359 | 60,211 | ||||||||||||
Match funded liabilities | 15,097 | 10,775 | 46,762 | 65,774 | ||||||||||||
Senior unsecured notes | 6,141 | — | 9,466 | — | ||||||||||||
Other | 2,775 | 3,310 | 8,612 | 8,463 | ||||||||||||
$ | 133,049 | $ | 116,885 | $ | 409,129 | $ | 319,564 | |||||||||
-1 | Includes interest expense related to financing liabilities recorded in connection with the HLSS Transactions as indicated in the table below. As discussed in Note 1A — Restatement of Previously Issued Consolidated Financial Statements, we are restating our previously reported consolidated operating results for the three and nine months ended September 30, 2013 to correct an error in the accounting applicable to the financing liabilities in connection with Rights to MSRs sold to HLSS. | |||||||||||||||
Three months | Nine Months | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Servicing fees collected on behalf of HLSS | $ | 177,113 | $ | 200,838 | $ | 553,423 | $ | 431,795 | ||||||||
Less: Subservicing fee retained by Ocwen | 83,550 | 102,040 | 266,514 | 214,587 | ||||||||||||
Net servicing fees remitted to HLSS | 93,563 | 98,798 | 286,909 | 217,208 | ||||||||||||
Less: Reduction in financing liability | 8,736 | 17,764 | 12,960 | 32,357 | ||||||||||||
Interest expense on HLSS financing liability | $ | 84,827 | $ | 81,034 | $ | 273,949 | $ | 184,851 | ||||||||
-2 | Interest expense that we expect to be paid on the HMBS-related borrowings is included with net fair value gains in Other revenues. See Note 2 – Securitizations and Variable Interest Entities for additional information. |
Income_Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2014 | |
Income Tax Disclosure [Abstract] | ' |
Income Taxes | ' |
Note 17 – Income Taxes | |
Our effective tax rate for the nine months ended September 30, 2014 and 2013 was 31.8% and 11.9%, respectively. The increase in our effective tax rate is due primarily to changes in the jurisdictional mix of income and expenses. Ocwen avails itself of certain tax benefits in the USVI and other international jurisdictions, which produce a favorable effect on our effective tax rate. To the extent that our pre-tax earnings are weighted more heavily in these lower tax rate jurisdictions, our effective tax rate decreases. If a greater proportion of our pre-tax earnings are earned in higher tax rate jurisdictions, our effective tax rate increases. | |
As of September 30, 2014 and December 31, 2013, we had approximately $35.1 million and $23.7 million, respectively, of unrecognized tax benefits, all of which if recognized would affect the effective tax rate. We accrue interest and penalties related to unrecognized tax benefits in our provision for income taxes. At September 30, 2014 and December 31, 2013, we had accrued interest and penalties related to unrecognized tax benefits of $5.5 million and $3.6 million, respectively. | |
It is reasonably possible that there could be a change in the amount of our unrecognized tax benefits within the next 12 months due to activities of the Internal Revenue Service or other taxing authorities, including proposed assessments of additional tax, possible settlement of audit issues, or the expiration of applicable statutes of limitations. The range of the possible change in unrecognized tax benefits within the next 12 months cannot be reasonably estimated at September 30, 2014. However, we do not expect that change to have a material impact on our financial position or results of operations. | |
Our major jurisdiction tax years that remain subject to examination are our U.S. federal tax return for the years ended December 31, 2008 through the present and our India corporate tax returns for the years ended March 31, 2004 through the present. Our U.S. consolidated federal tax return for the years ended December 31, 2008, 2009 and 2010 are currently under examination. In addition, the U.S. federal tax return filed by our USVI subsidiary for the year ended December 31, 2012 is currently under examination. |
Basic_and_Diluted_Earnings_Los
Basic and Diluted Earnings (Loss) per Share | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Earnings Per Share [Abstract] | ' | |||||||||||||||
Basic and Diluted Earnings (Loss) per Share | ' | |||||||||||||||
Note 18 – Basic and Diluted Earnings (Loss) per Share | ||||||||||||||||
Basic EPS excludes common stock equivalents and is calculated by dividing net income attributable to Ocwen common stockholders by the weighted average number of common shares outstanding during the year. We calculate diluted EPS by dividing net income attributable to Ocwen, as adjusted to add back preferred stock dividends, by the weighted average number of common shares outstanding including the potential dilutive common shares related to outstanding stock options, restricted stock awards and the Preferred Shares. | ||||||||||||||||
The following is a reconciliation of the calculation of basic EPS to diluted EPS for the three and nine months ended September 30: | ||||||||||||||||
Three Months | Nine Months | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Basic EPS: | ||||||||||||||||
Net income (loss) attributable to Ocwen common stockholders | $ | (76,189 | ) | $ | 54,725 | $ | 49,273 | $ | 164,120 | |||||||
Weighted average shares of common stock | 130,551,197 | 135,787,834 | 133,318,381 | 135,705,892 | ||||||||||||
Basic EPS | $ | (0.58 | ) | $ | 0.4 | $ | 0.37 | $ | 1.21 | |||||||
Diluted EPS (1): | ||||||||||||||||
Net income (loss) attributable to Ocwen common stockholders | $ | (76,189 | ) | $ | 54,725 | $ | 49,273 | $ | 164,120 | |||||||
Preferred stock dividends (1) (2) | — | — | — | — | ||||||||||||
Adjusted net income (loss) attributable to Ocwen | $ | (76,189 | ) | $ | 54,725 | $ | 49,273 | $ | 164,120 | |||||||
Weighted average shares of common stock | 130,551,197 | 135,787,834 | 133,318,381 | 135,705,892 | ||||||||||||
Effect of dilutive elements (1): | ||||||||||||||||
Preferred Shares (1) (2) | — | — | — | — | ||||||||||||
Stock options | — | 4,263,965 | 3,558,689 | 4,030,297 | ||||||||||||
Common stock awards | — | 5,396 | 4,256 | 11,301 | ||||||||||||
Dilutive weighted average shares of common stock | 130,551,197 | 140,057,195 | 136,881,326 | 139,747,490 | ||||||||||||
Diluted EPS | $ | (0.58 | ) | $ | 0.39 | $ | 0.36 | $ | 1.17 | |||||||
Stock options excluded from the computation of diluted EPS: | ||||||||||||||||
Anti-dilutive (3) | 91,250 | — | 47,083 | — | ||||||||||||
Market-based (4) | 295,000 | 547,500 | 295,000 | 547,500 | ||||||||||||
-1 | For the three months ended September 30, 2014, we have excluded the effect of the Preferred Shares, stock options and common stock awards from the computation of diluted EPS because of the anti-dilutive effect of our reported net loss. | |||||||||||||||
-2 | The effect of our Preferred Shares on diluted EPS is computed using the if-converted method. For purposes of computing diluted EPS, we assume the conversion of the Preferred Shares into shares of common stock unless the effect is anti-dilutive. Conversion of the Preferred Shares has not been assumed for the nine months ended September 30, 2014 and the three and nine months ended September 30, 2013 because the effect would have been antidilutive. | |||||||||||||||
-3 | These options were anti-dilutive because their exercise price was greater than the average market price of our stock. | |||||||||||||||
-4 | Shares that are issuable upon the achievement of certain performance criteria related to Ocwen’s stock price and an annualized rate of return to investors. |
Business_Segment_Reporting
Business Segment Reporting | 9 Months Ended | |||||||||||||||||||
Sep. 30, 2014 | ||||||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||||||
Business Segment Reporting | ' | |||||||||||||||||||
Note 19 – Business Segment Reporting | ||||||||||||||||||||
Our business segments reflect the internal reporting that we use to evaluate operating performance of services and to assess the allocation of our resources. A brief description of our current business segments is as follows: | ||||||||||||||||||||
Servicing. This segment is primarily comprised of our core residential servicing business. We provide residential and commercial mortgage loan servicing, special servicing and asset management services. We earn fees for providing these services to owners of the mortgage loans and foreclosed real estate. In most cases, we provide these services either because we purchased the MSRs from the owner of the mortgage, retained the MSRs on the sale of residential mortgage loans or because we entered into a subservicing or special servicing agreement with the entity that owns the MSR. Our residential servicing portfolio includes conventional, government insured and non-Agency loans. Non-Agency loans include subprime loans which represent residential loans that generally did not qualify under GSE guidelines or have subsequently become delinquent. | ||||||||||||||||||||
Lending. The Lending segment is focused on originating and purchasing conventional and government insured residential forward and reverse mortgage loans mainly through our correspondent lending arrangements, broker relationships and directly with mortgage customers. The loans are typically sold shortly after origination into a liquid market on a servicing retained basis. | ||||||||||||||||||||
Corporate Items and Other. Corporate Items and Other includes revenues and expenses that are not directly related to other reportable segments, business activities that are individually insignificant, interest income on short-term investments of cash, interest expense on corporate debt and certain corporate expenses. Business activities that are not considered to be of continuing significance include subprime loans held for sale (at lower of cost or fair value), investments in unconsolidated entities and affordable housing investment activities. Corporate Items and Other also included the diversified fee-based businesses that we acquired as part of the acquisitions of Homeward and ResCap and subsequently sold to Altisource on March 29, 2013 and April 12, 2013, respectively. | ||||||||||||||||||||
We allocate interest income and expense to each business segment for funds raised or for funding of investments made, including interest earned on cash balances and short-term investments and interest incurred on corporate debt. We also allocate expenses generated by corporate support services to each business segment. | ||||||||||||||||||||
Financial information for our segments is as follows: | ||||||||||||||||||||
Servicing | Lending | Corporate Items and Other | Corporate Eliminations | Business Segments Consolidated | ||||||||||||||||
Results of Operations | ||||||||||||||||||||
Three months ended September 30, 2014 | ||||||||||||||||||||
Revenue | $ | 485,303 | $ | 26,877 | $ | 1,557 | $ | (39 | ) | $ | 513,698 | |||||||||
Operating expenses (1) | 313,964 | 22,632 | 118,482 | (39 | ) | 455,039 | ||||||||||||||
Income (loss) from operations | 171,339 | 4,245 | (116,925 | ) | — | 58,659 | ||||||||||||||
Other income (expense): | ||||||||||||||||||||
Interest income | 903 | 4,825 | 865 | — | 6,593 | |||||||||||||||
Interest expense | (124,106 | ) | (2,601 | ) | (6,342 | ) | — | (133,049 | ) | |||||||||||
Other | (3,618 | ) | 139 | (990 | ) | — | (4,469 | ) | ||||||||||||
Other income (expense), net | (126,821 | ) | 2,363 | (6,467 | ) | — | (130,925 | ) | ||||||||||||
Income (loss) before income taxes | $ | 44,518 | $ | 6,608 | $ | (123,392 | ) | $ | — | $ | (72,266 | ) | ||||||||
Three months ended September 30, 2013 | ||||||||||||||||||||
Revenue | $ | 496,302 | $ | 33,539 | $ | 1,801 | $ | (402 | ) | $ | 531,240 | |||||||||
Operating expenses (1) | 305,654 | 29,504 | 11,143 | (41 | ) | 346,260 | ||||||||||||||
Income (loss) from operations | 190,648 | 4,035 | (9,342 | ) | (361 | ) | 184,980 | |||||||||||||
Other income (expense): | ||||||||||||||||||||
Interest income | 859 | 3,066 | 1,454 | — | 5,379 | |||||||||||||||
Interest expense (2) | (113,678 | ) | (3,279 | ) | 72 | — | (116,885 | ) | ||||||||||||
Other | (6,631 | ) | 1,843 | 398 | 361 | (4,029 | ) | |||||||||||||
Other income (expense), net | (119,450 | ) | 1,630 | 1,924 | 361 | (115,535 | ) | |||||||||||||
Income (loss) before income taxes | $ | 71,198 | $ | 5,665 | $ | (7,418 | ) | $ | — | $ | 69,445 | |||||||||
Servicing | Lending | Corporate Items and Other | Corporate Eliminations | Business Segments Consolidated | ||||||||||||||||
Nine months ended September 30, 2014 | ||||||||||||||||||||
Revenue | $ | 1,526,606 | $ | 86,811 | $ | 4,734 | $ | (118 | ) | $ | 1,618,033 | |||||||||
Operating expenses (1) | 919,998 | 81,261 | 148,555 | (118 | ) | 1,149,696 | ||||||||||||||
Income (loss) from operations | 606,608 | 5,550 | (143,821 | ) | — | 468,337 | ||||||||||||||
Other income (expense): | ||||||||||||||||||||
Interest income | 1,805 | 13,117 | 2,550 | — | 17,472 | |||||||||||||||
Interest expense | (391,122 | ) | (8,271 | ) | (9,736 | ) | — | (409,129 | ) | |||||||||||
Other | (4,622 | ) | 3,846 | 710 | — | (66 | ) | |||||||||||||
Other income (expense), net | (393,939 | ) | 8,692 | (6,476 | ) | — | (391,723 | ) | ||||||||||||
Income (loss) before income taxes | $ | 212,669 | $ | 14,242 | $ | (150,297 | ) | $ | — | $ | 76,614 | |||||||||
Nine months ended September 30, 2013 | ||||||||||||||||||||
Revenue | $ | 1,381,872 | $ | 81,180 | $ | 19,758 | $ | (492 | ) | $ | 1,482,318 | |||||||||
Operating expenses (1) | 795,645 | 69,543 | 95,361 | (131 | ) | 960,418 | ||||||||||||||
Income (loss) from operations | 586,227 | 11,637 | (75,603 | ) | (361 | ) | 521,900 | |||||||||||||
Other income (expense): | ||||||||||||||||||||
Interest income | 1,382 | 12,432 | 3,516 | — | 17,330 | |||||||||||||||
Interest expense (2) | (309,606 | ) | (10,108 | ) | 150 | — | (319,564 | ) | ||||||||||||
Other | (30,961 | ) | 6,852 | 2,977 | 361 | (20,771 | ) | |||||||||||||
Other income (expense), net | (339,185 | ) | 9,176 | 6,643 | 361 | (323,005 | ) | |||||||||||||
Income (loss) before income taxes | $ | 247,042 | $ | 20,813 | $ | (68,960 | ) | $ | — | $ | 198,895 | |||||||||
Servicing | Lending | Corporate Items and Other | Corporate Eliminations | Business Segments Consolidated | ||||||||||||||||
Total Assets | ||||||||||||||||||||
September 30, 2014 | $ | 6,059,359 | $ | 1,706,964 | $ | 589,317 | $ | — | $ | 8,355,640 | ||||||||||
December 31, 2013 | $ | 6,295,976 | $ | 1,195,812 | $ | 435,215 | $ | — | $ | 7,927,003 | ||||||||||
September 30, 2013 | $ | 4,086,378 | $ | 704,641 | $ | 609,236 | $ | — | $ | 5,400,255 | ||||||||||
-1 | Depreciation and amortization expense are as follows: | |||||||||||||||||||
Servicing | Lending | Corporate Items and Other | Business Segments Consolidated | |||||||||||||||||
For the three months ended September 30, 2014 | ||||||||||||||||||||
Depreciation expense | $ | 2,636 | $ | 98 | $ | 3,022 | $ | 5,756 | ||||||||||||
Amortization of mortgage servicing rights | 60,689 | 94 | — | 60,783 | ||||||||||||||||
Amortization of debt discount | 331 | — | 344 | 675 | ||||||||||||||||
Amortization of debt issuance costs | 1,114 | — | — | 1,114 | ||||||||||||||||
For the three months ended September 30, 2013 | ||||||||||||||||||||
Depreciation expense | $ | 3,589 | $ | 135 | $ | 2,973 | $ | 6,697 | ||||||||||||
Amortization of mortgage servicing rights | 79,035 | 148 | — | 79,183 | ||||||||||||||||
Amortization of debt discount | 330 | — | — | 330 | ||||||||||||||||
Amortization of debt issuance costs | 1,178 | — | — | 1,178 | ||||||||||||||||
For the nine months ended September 30, 2014 | ||||||||||||||||||||
Depreciation expense | $ | 8,099 | $ | 235 | $ | 8,267 | $ | 16,601 | ||||||||||||
Amortization of mortgage servicing rights | 185,263 | 613 | 199 | 186,075 | ||||||||||||||||
Amortization of debt discount | 991 | — | 513 | 1,504 | ||||||||||||||||
Amortization of debt issuance costs | 3,241 | — | — | 3,241 | ||||||||||||||||
For the nine months ended September 30, 2013 | ||||||||||||||||||||
Depreciation expense | $ | 9,968 | $ | 209 | $ | 6,976 | $ | 17,153 | ||||||||||||
Amortization of mortgage servicing rights | 197,287 | 148 | — | 197,435 | ||||||||||||||||
Amortization of debt discount | 1,082 | — | — | 1,082 | ||||||||||||||||
Amortization of debt issuance costs | 3,264 | — | — | 3,264 | ||||||||||||||||
-2 | Includes interest expense related to financing liabilities recorded in connection with the HLSS Transactions. As discussed in Note 1A — Restatement of Previously Issued Consolidated Financial Statements, we are restating our previously reported consolidated operating results for the three and nine months ended September 30, 2013 to correct an error in the accounting applicable to the financing liabilities in connection with Rights to MSRs sold to HLSS. |
Related_Party_Transactions
Related Party Transactions | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Related Party Transactions [Abstract] | ' | |||||||||||||||
Related Party Transactions | ' | |||||||||||||||
Note 20 – Related Party Transactions | ||||||||||||||||
Ocwen’s Executive Chairman of the Board of Directors, William C. Erbey, also serves as Chairman of the Board of Altisource, HLSS, Altisource Residential Corporation (Residential) and Altisource Asset Management Corporation (AAMC). As a result, he has obligations to Ocwen as well as to Altisource, HLSS, Residential and AAMC. As of September 30, 2014, Mr. Erbey owned or controlled approximately 14% of the common stock of Ocwen, approximately 29% of the common stock of Altisource, approximately 1% of the common stock of HLSS, approximately 28% of the common stock of AAMC and approximately 4% of the common stock of Residential. At September 30, 2014, Mr. Erbey also held 3,620,498 options to purchase Ocwen common stock, of which 3,220,498 were exercisable. On April 22, 2014, Mr. Erbey surrendered 1,000,000 of his options to purchase Ocwen common stock. During the second quarter of 2014, Ocwen recognized the remaining $5.4 million of previously unrecognized compensation expense associated with these options as of the date of surrender. At September 30, 2014, Mr. Erbey held 873,501 options to purchase Altisource common stock and 87,350 options to purchase AAMC common stock, all of which were exercisable. | ||||||||||||||||
Our business is currently dependent on many of the services and products provided by Altisource under various long-term contracts, including the Services Agreements, Technology Products Services Agreements, Intellectual Property Agreements and the Data Center and Disaster Recovery Services Agreements. Under the Services Agreements, Altisource provides various business process outsourcing services. Under the Technology Products Services Agreements and the Data Center and Disaster Recovery Services Agreements, Altisource provides technology products and support services. In addition, we have entered into (i) Support Services Agreements pursuant to which we and Altisource provide administrative and corporate services to each other and (ii) a Data Access and Services Agreement pursuant to which we make available to Altisource certain data from our servicing portfolio in exchange for a per asset fee. The revenues and expenses related to our agreements with Altisource for the three and nine months ended September 30, 2014 and 2013 are set forth in the table below. | ||||||||||||||||
Services provided by Altisource under the Services Agreements with Ocwen are generally charged to the borrower and/or loan investor. Accordingly, such services, while derived from our loan servicing portfolio, are not reported as expenses by Ocwen. These services include residential property valuation, residential property preservation and inspection services, title services and real estate sales services. We believe the rates charged for these services are market rates as they are materially consistent with one or more of the following: the rates Ocwen pays to or observes from other service providers and the fees we believe Altisource charges to other customers for comparable services. | ||||||||||||||||
Ocwen and HLSS provide each other certain professional services including valuation analysis of potential MSR acquisitions, treasury management services and other similar services, licensing and regulatory compliance support services, risk management services and other similar services under a Professional Services Agreement. | ||||||||||||||||
We have also entered into a long-term servicing and a support services agreement with Residential and AAMC, respectively. | ||||||||||||||||
The following table summarizes revenues and expenses related to our agreements with Altisource, HLSS, AAMC and Residential (and, as applicable, their subsidiaries) for the three and nine months ended September 30 and net amounts receivable or payable at the dates indicated: | ||||||||||||||||
Three Months | Nine Months | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Revenues and Expenses: | ||||||||||||||||
Altisource: | ||||||||||||||||
Revenues | $ | 10,716 | $ | 5,185 | $ | 30,007 | $ | 15,390 | ||||||||
Expenses | 27,099 | 13,153 | 70,577 | 36,650 | ||||||||||||
HLSS: | ||||||||||||||||
Revenues | $ | 84 | $ | 20 | $ | 458 | $ | 172 | ||||||||
Expenses | 345 | 386 | 1,590 | 1,615 | ||||||||||||
AAMC | ||||||||||||||||
Revenues | $ | 251 | $ | — | $ | 952 | $ | — | ||||||||
Residential | ||||||||||||||||
Revenues | $ | 4,618 | $ | 493 | $ | 12,141 | $ | 606 | ||||||||
September 30, 2014 | December 31, 2013 | |||||||||||||||
Net Receivable (Payable) | ||||||||||||||||
Altisource | $ | (12,626 | ) | $ | (3,843 | ) | ||||||||||
HLSS | (17,812 | ) | (59,505 | ) | ||||||||||||
AAMC | 278 | 943 | ||||||||||||||
Residential | — | 50 | ||||||||||||||
$ | (30,160 | ) | $ | (62,355 | ) | |||||||||||
As disclosed in Note 4 – Fair Value, Ocwen has sold to HLSS certain Rights to MSRs and related servicing advances. During the nine months ended September 30, 2013, we completed HLSS Transactions relating to Rights to MSRs for $109.8 billion of UPB and received $388.5 million from the sale of Rights to MSRs and $3.5 billion from the sale of the related advances. We did not complete any sales of Rights to MSRs to HLSS during the nine months ended September 30, 2014. If and when legal ownership of the MSRs is transferred to HLSS, OLS will subservice the MSRs pursuant to a subservicing agreement, as amended, with HLSS. | ||||||||||||||||
On March 3, 2014, in the first Ginnie Mae EBO Transaction, Ocwen sold Ginnie Mae EBO Loans and transferred the related servicing advances to HLSS Mortgage for $612.3 million. On May 2, 2014, in connection with the second Ginnie Mae EBO Transaction, we transferred $20.2 million of advances to HLSS SEZ LP. The transfer of advances in both transactions did not qualify as sales for accounting purposes. See Note 5 – Loans Held for Sale for additional information. | ||||||||||||||||
On June 26, 2014, we entered into a servicing agreement with HLSS Mortgage LP under which we agreed to service mortgage loans with a UPB of approximately $396.9 million as of that date. On July 31, 2014, mortgage loans with a UPB of $92.9 million were added under this agreement. | ||||||||||||||||
On July 14, 2014, holders of our Preferred Shares elected to convert the remaining shares into shares of common stock. On the same date, Ocwen repurchased all of the converted shares of common stock. The Preferred Shares were originally issued to certain private equity funds managed by WL Ross & Co. LLC (the Funds) as partial consideration in the acquisition of Homeward. Mr. Wilbur L. Ross, Jr. is the Chairman and Chief Executive Officer of WL Ross & Co. LLC and Invesco Private Capital, Inc. and the managing member of El Vedado, LLC, each of which directly or indirectly controls or manages the Funds. Mr. Ross has been a director of Ocwen since March 2013. See Note 13 – Mezzanine Equity and Note 14 – Equity for additional information. | ||||||||||||||||
In accordance with the terms of the Homeward merger agreement, we are entitled to assert retained liabilities claims on or before September 26, 2014, inclusive of reasonable liabilities in excess of the retained liabilities acquired and subject to certain additional procedures as set forth in the merger agreement. The aggregate amount of the indemnification recovery is limited to a maximum of $75.0 million. We have recorded receivables of $28.3 million and $13.6 million at September 30, 2014 and December 31, 2013, respectively, related to losses expected to be indemnified through retained liabilities claims. |
Regulatory_Requirements
Regulatory Requirements | 9 Months Ended |
Sep. 30, 2014 | |
Brokers and Dealers [Abstract] | ' |
Regulatory Requirements | ' |
Note 21 – Regulatory Requirements | |
Regulation | |
Our business is subject to extensive regulation by federal, state and local governmental authorities, including the Consumer Financial Protection Bureau (CFPB), the Federal Trade Commission (FTC), the SEC and various state agencies that license, audit and conduct examinations of our mortgage servicing, origination and collection activities. From time to time, we also receive requests from federal, state and local agencies for records, documents and information relating to our policies, procedures and practices regarding our mortgage servicing, origination and collection activities. In addition, the GSEs and their conservator, the Federal Housing Finance Authority (FHFA), Ginnie Mae, various investors, non-Agency securitization trustees and others also subject us to periodic reviews and audits. | |
As a result of the current regulatory environment, we have faced and expect to continue to face increased regulatory and public scrutiny as well as stricter and more comprehensive regulation of our business. We continue to work diligently to assess and understand the implications of the regulatory environment in which we operate and the regulatory changes that we are facing. We devote substantial resources to regulatory compliance, while, at the same time, striving to meet the needs and expectations of our customers and clients. Our failure to comply with applicable federal, state and local consumer protection laws could lead to (i) loss of our licenses and approvals to engage in our servicing and lending businesses, (ii) governmental investigations and enforcement actions, (iii) administrative fines and penalties and litigation, (iv) civil and criminal liability, including class action lawsuits, (v) inability to raise capital and (vi) inability to execute on our business strategy, including our growth plans. | |
We must comply with a number of federal, state and local consumer protection laws including, among others, the Gramm-Leach-Bliley Act, the Fair Debt Collection Practices Act, the Real Estate Settlement Procedures Act (RESPA), the Truth in Lending Act (TILA), the Fair Credit Reporting Act, the Servicemembers Civil Relief Act, the Homeowners Protection Act, the Federal Trade Commission Act and, more recently, the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) and state foreclosure laws. These statutes apply to loan origination, debt collection, use of credit reports, safeguarding of non-public personally identifiable information about our customers, foreclosure and claims handling, investment of and interest payments on escrow balances and escrow payment features, and mandate certain disclosures and notices to borrowers. These requirements can and do change as statutes and regulations are enacted, promulgated, amended, interpreted and enforced. The recent trend among federal, state and local lawmakers and regulators has been toward increasing laws, regulations and investigative proceedings with regard to residential real estate lenders and servicers. | |
We expect to continue to incur substantial ongoing operational and system costs in order to comply with these laws and regulations. Furthermore, there may be additional federal or state laws enacted that place additional obligations on servicers and originators of residential mortgage loans. | |
There are a number of foreign laws and regulations that are applicable to our operations in India, Uruguay and the Philippines, including acts that govern licensing, employment, safety, taxes, insurance and the laws and regulations that govern the creation, continuation and the winding up of companies as well as the relationships between shareholders, our corporate entities, the public and the government in these countries. Non-compliance with the laws and regulations of India, Uruguay or the Philippines could result in (i) restrictions on our operations in these counties, (ii) fines, penalties or sanctions or (iii) reputational damage. | |
Capital Requirements | |
Our OLS, Homeward, Liberty and OMS subsidiaries are licensed to originate and/or service forward and reverse mortgage loans in the jurisdictions in which they operate. The licensed entities are subject to minimum net worth requirements in connection with these licenses. These minimum net worth requirements are unique to each state and type of license. Failure to meet these minimum capital requirements can result in the initiation of certain mandatory actions by federal, state, and foreign agencies that could have a material effect on our results of operations and financial condition. The most restrictive of these requirements is based on the outstanding UPB of our owned and subserviced portfolio and was $753.1 million at September 30, 2014. Our licensed subsidiaries were in compliance with all of their capital requirements at September 30, 2014. | |
Homeward, OLS and Liberty are also parties to seller/servicer agreements with one or more of the GSEs, FHA, VA and Ginnie Mae. These seller/servicer agreements contain financial covenants that include capital requirements related to tangible net worth, as defined in each agreement, as well as extensive requirements regarding servicing, selling and other matters. To the extent that these requirements are not met, the counterparty may, at its option, utilize a variety of remedies ranging from sanctions or suspension to termination of the seller/servicer agreements, which would prohibit future originations or securitizations of forward or reverse mortgage loans or being an approved seller/servicer. We were in compliance with these net worth requirements at September 30, 2014. |
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||
Commitments and Contingencies | ' | |||||||
Note 22 – Commitments and Contingencies | ||||||||
When we become aware of a matter involving uncertainty for which we may incur a loss, we assess the likelihood of any loss. If a loss contingency is probable and the amount of the loss can be reasonably estimated, we record an accrual for the loss. In such cases, there may be an exposure to potential loss in excess of the amount accrued. Where a loss is not probable but is reasonably possible or where a loss in excess of the amount accrued is reasonably possible, we disclose an estimate of the amount of the loss or range of possible losses for the claim if a reasonable estimate can be made, unless the amount of such reasonably possible loss is not material to our financial position, results of operations or cash flows. If a reasonable estimate of loss cannot be made, we do not accrue for any loss or disclose any estimate of exposure to potential loss. An assessment regarding the ultimate outcome of any such matter involves judgments about future events, actions and circumstances that are inherently uncertain. The actual outcome could differ materially. Where we have retained external legal counsel or other professional advisors, such advisors assist us in making such assessments. | ||||||||
Litigation Contingencies | ||||||||
In the ordinary course of business, we are routinely a defendant in, or a party or potential party to, many threatened and pending legal proceedings, including proceedings brought on behalf of various classes of claimants. These proceedings are generally based on alleged violations of federal, state and local laws and regulations governing our mortgage servicing and lending activities, including wrongful foreclosure and eviction actions, allegations of wrongdoing in connection with lender-placed insurance arrangements, claims relating to our pre-foreclosure property preservation activities and claims related to our payment and other processing operations. In some of these proceedings, claims for substantial monetary damages are asserted against us. In our opinion, the resolution of the vast majority of these proceedings will not have a material effect on our financial condition, results of operations or cash flows. | ||||||||
In view of the inherent difficulty of predicting the outcome of any threatened or pending legal proceedings, particularly where the claimants seek very large or indeterminate damages or where the matters present novel legal theories or involve a large number of parties, we generally cannot predict what the eventual outcome of such proceedings will be, what the timing of the ultimate resolution will be, or what the eventual loss, if any, will be. | ||||||||
Where we determine that a loss contingency is probable in connection with a pending or threatened legal proceeding and the amount of our losses can be reasonably estimated, we record an accrual for the losses. Excluding expenses of internal or external legal counsel, we have accrued $19.1 million as of September 30, 2014 for losses relating to threatened and pending litigation pertaining to our mortgage servicing practices that we believe are probable and reasonably estimable based on current information regarding these matters. Where we determine that a loss is not probable but is reasonably possible or where a loss in excess of the amount accrued is reasonably possible, we disclose an estimate of the amount of the loss or range of possible losses for the claim if a reasonable estimate can be made, unless the amount of such reasonably possible loss is not material to our financial position, results of operations or cash flows. It is possible that we will incur losses relating to threatened and pending litigation pertaining to our mortgage servicing practices that materially exceed the amount accrued. We cannot currently estimate the amount, if any, of reasonably possible losses above amounts that have been recorded at September 30, 2014. | ||||||||
Following our announcement on August 12, 2014 that we intended to restate our financial statements for the fiscal year ended December 31, 2013 and the quarter ended March 31, 2014, and amend our Annual Report on Form 10-K for the fiscal year ended December 31, 2013 and our Quarterly Report on Form 10-Q for the quarter ended March 31, 2014, putative securities fraud class action lawsuits have been filed against Ocwen and certain of its officers and directors regarding such restatements and amendments. Ocwen and the other defendants intend to vigorously defend such lawsuits. Additional lawsuits may be filed and, at this time, Ocwen is unable to predict the outcome of these lawsuits, the possible loss or range of loss, if any, associated with the resolution of these lawsuits or any potential impact they may have on us or our operations. If our efforts to defend these lawsuits are not successful, our business, financial condition and results of operations could be adversely affected. | ||||||||
In several recent court actions, mortgage loan sellers against whom repurchase claims have been asserted based on alleged breaches of representations and warranties are defending on various grounds including the expiration of statutes of limitation, lack of notice and opportunity to cure, and vitiation of the obligation to repurchase as a result of foreclosure or charge off of the loan. Ocwen has entered into tolling agreements with respect to its role as servicer for a very small number of securitizations and may enter into additional tolling agreements in the future. Other court actions have been filed recently against certain RMBS trustees alleging that the trustees breached their contractual and statutory duties by, among other things, failing to require the loan servicers to abide by the servicers’ obligations and by failing to declare that certain servicing events of default under the applicable contracts allegedly occurred. | ||||||||
Ocwen is a party in certain of these actions, is the servicer for certain securitizations involved in other such actions, and is the servicer for other securitizations as to which actions have been threatened by certificate holders. We intend to vigorously defend ourselves in lawsuits to which we have been named a party. Should Ocwen be made a party to other similar actions or should Ocwen be asked to indemnify any parties to such actions, we may need to defend allegations that we failed to service loans in accordance with applicable agreements and that such failures prejudiced the rights of repurchase claimants against loan sellers or otherwise diminished the value of the trust collateral. We believe that any such allegations would be without merit and, if necessary, would vigorously defend against them. At this time, we are unable to predict the ultimate outcome of these lawsuits, the possible loss or range of loss, if any, associated with the resolution of these lawsuits or any potential impact they may have on us or our operations. If, however, we were required to compensate claimants for losses related to the alleged loan servicing breaches, then our business, financial condition and results of operations could be adversely affected. | ||||||||
Regulatory Contingencies | ||||||||
We are subject to a number of pending federal and state regulatory investigations, examinations, inquiries, requests for information and other actions, including those discussed below. | ||||||||
In December 2012, we entered into a Consent Order with the New York Department of Financial Services (NY DFS) in which we agreed to the appointment of a Monitor to oversee our compliance with an Agreement on Servicing Practices. The Monitor began its work in 2013, and we continue to cooperate with the Monitor. We devote substantial resources to regulatory compliance, and we incur, and expect to continue to incur, significant ongoing costs with respect to compliance in connection with the Agreement on Servicing Practices and the work of the Monitor. In early February 2014, the NY DFS requested that Ocwen put an indefinite hold on an acquisition from Wells Fargo Bank, N.A. of MSRs and related servicing advances relating to a portfolio of approximately 184,000 loans with a UPB of approximately $39.0 billion. The NY DFS expressed an interest in evaluating further our ability to manage additional servicing. We have agreed to place the transaction on indefinite hold. The NY DFS has also inquired about certain other aspects of our business, including certain aspects of our business dealings with Altisource, HLSS, AAMC and Residential, the interests of our directors and executive officers in these companies, an online auction business owned by Altisource, the role of Altisource in certain lender-placed insurance arrangements, the provisions contained in releases we use in connection with litigation settlements and certain erroneously dated borrower correspondence that we sent. We are cooperating with the NY DFS on these matters. | ||||||||
As noted above, an assessment regarding the ultimate outcome of these matters involves judgments about future events, actions and circumstances that are inherently uncertain. If we determine that a loss contingency is probable and the amount of our losses can be reasonably estimated, we record an accrual for the losses. We accrued $100.0 million as of September 30, 2014 for losses that we believe are probable and reasonably estimable based on current information regarding these matters, although we have not reached any agreement with the NY DFS on any of the outstanding matters and cannot predict whether or when we may reach such a resolution. It is possible that we could incur losses that materially exceed this amount. We cannot currently estimate the amount, if any, of reasonably possible losses above amounts that have been recorded at September 30, 2014. | ||||||||
Actions taken by the NY DFS, if any, regarding these matters could have a material impact on our business, reputation, financial condition, liquidity and results of operations. | ||||||||
On December 19, 2013, we reached an agreement, which was subject to court approval, involving the CFPB and various state attorneys general and other state agencies that regulate the mortgage servicing industry (Regulators). In February 2014, the United States District Court for the District of Columbia entered a Consent Order memorializing the settlement (the Ocwen National Mortgage Settlement). The settlement has four key elements: | ||||||||
• | A commitment by Ocwen to service loans in accordance with specified servicing guidelines and to be subject to oversight by an independent national monitor for three years. Ocwen was previously subject to substantially the same guidelines and oversight with respect to the portion of its servicing portfolio acquired from ResCap in early 2013, and those loans will also be subject to these provisions. | |||||||
• | A payment of $127.3 million, which includes a fixed amount for administrative expenses, to a consumer relief fund to be disbursed by an independent administrator to eligible borrowers. In May 2014, Ocwen satisfied this obligation with regard to the consumer relief fund. Pursuant to indemnification and loss sharing provisions of applicable acquisition documents, the former owners of certain servicing portfolios previously acquired by Ocwen are responsible for approximately $60.4 million of that sum, of which $49.0 million has already been paid to Ocwen. | |||||||
• | A commitment by Ocwen to continue its principal forgiveness modification programs to delinquent and underwater borrowers, including underwater borrowers at imminent risk of default, in an aggregate amount of at least $2.0 billion over three years. These and all of Ocwen’s other loan modifications are designed to be sustainable for homeowners while providing a net present value for loan investors that is superior to that of foreclosure. Principal forgiveness as part of a loan modification is determined on a case-by-case basis in accordance with the applicable servicing agreement. Principal forgiveness does not involve an expense to Ocwen other than the operating expense incurred in arranging the modification, which is part of Ocwen’s role as loan servicer. | |||||||
• | Ocwen and the former owners of certain of the acquired servicing portfolios received from the Regulators comprehensive releases, subject to certain exceptions, from liability with respect to residential mortgage servicing, modification and foreclosure practices. | |||||||
On April 28, 2014, we received a letter from the staff of the New York Regional Office of the SEC (the Staff) informing us that it was conducting an investigation relating to Ocwen and making a request for voluntary production of documents and information relating to the April 22, 2014 surrender of certain options to purchase our common stock by Mr. Erbey, our Executive Chairman, including the 2007 Equity Incentive Plan and the related option grant and surrender documents. On June 12, 2014, we received a subpoena from the SEC requesting production of various documents relating to our business dealings with Altisource, HLSS, AAMC and Residential and the interests of our directors and executive officers in these companies. Following the above-described announcement on August 12, 2014 that we intended to amend our Annual Report on Form 10-K for the fiscal year ended December 31, 2013 and our Quarterly Report on Form 10-Q for the quarter ended March 31, 2014, received an additional subpoena in relation to such amendments. We are cooperating with the Staff on these matters. | ||||||||
One or more of the foregoing regulatory actions or our failure to comply with the commitments we have made with respect to such regulatory actions or other regulatory actions in the future against us of a similar or different nature could cause us to incur fines, penalties, settlement costs, damages, legal fees or other charges in material amounts or could impose additional requirements or restrictions on our activities. Any of these occurrences could increase our operating expenses and reduce our revenues, hamper our ability to grow or otherwise materially and adversely affect our business, reputation, financial condition and results of operations. | ||||||||
In addition to these matters, Ocwen receives periodic inquires, both formal and informal in nature, from various federal and state agencies, including those made as part of regulatory oversight of our mortgage servicing, origination and collection activities. Such ongoing inquiries, including those into servicer foreclosure processes, could result in additional actions by state or federal governmental bodies, regulators or the courts with respect to our mortgage servicing, origination and collection activities and could result in an extension of foreclosure timelines, which may be applicable generally to the servicing industry or to us in particular. In addition, one of our match funded advance facilities contains provisions that limit the eligibility of advances to be financed based on the length of time that advances are outstanding, which, if such provisions applied, could adversely affect liquidity by reducing our average effective advance rate. Increases in the amount of advances and the length of time to recover advances, fines or increases in operating expenses, and decreases in the advance rate and availability of financing for advances could result in increased borrowings, reduced cash and higher interest expense which could negatively impact our liquidity and profitability. | ||||||||
Loan Repurchase Obligations and Other Contingencies | ||||||||
We have exposure to representation, warranty and indemnification obligations because of our lending, sales and securitization activities and our acquisitions to the extent we assume one or more of these obligations and in connection with our servicing practices. In connection with our lending, sales and securitization activities, our exposure primarily relates to representations and warranties concerning the proper origination and insurance of the loans. In connection with our servicing practices, claims may be made against us by contractual counterparties, such as trustees, master servicers and insurers, or by other third parties. At September 30, 2014 and 2013, we had provided or assumed representation and warranty obligations in connection with $83.4 billion and $89.4 billion of UPB, respectively, covering both forward and reverse mortgage loans. At September 30, 2014, we had outstanding representation and warranty repurchase demands of $108.2 million UPB (578 loans). At September 30, 2013, the outstanding UPB of representation and warranty repurchase demands was $113.0 million (534 loans). We review each demand and monitor through resolution, primarily through rescission, loan repurchase or make-whole payment. | ||||||||
The following table presents the changes in our liability for representation and warranty obligations, compensatory fees for foreclosures that may ultimately exceed investor timelines and related indemnification obligations for the nine months ended September 30, 2014 and 2013: | ||||||||
2014 | 2013 | |||||||
Beginning balance | $ | 192,716 | $ | 38,140 | ||||
Provision for representation and warranty obligations | 5,076 | 18,116 | ||||||
New production reserves | 820 | 1,055 | ||||||
Obligations assumed in connection with MSR and servicing business acquisitions | — | 189,742 | ||||||
Charge-offs and other (1) | (54,776 | ) | (40,979 | ) | ||||
Ending balance | $ | 143,836 | $ | 206,074 | ||||
-1 | Includes principal and interest losses realized in connection with repurchased loans, make-whole, indemnification and fee payments and settlements net of recoveries, if any. | |||||||
We believe that it is reasonably possible that losses beyond amounts currently recorded for potential representation and warranty obligations and other claims described above could occur, and such losses could have an adverse impact on our results of operations, financial condition or cash flows. However, based on currently available information, we are unable to estimate a range of reasonably possible losses above amounts that have been recorded at September 30, 2014. |
Subsequent_Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2014 | |
Subsequent Events [Abstract] | ' |
Subsequent Events | ' |
Note 23 – Subsequent Events | |
During the period October 1, 2014 through October 30, 2014, we completed the repurchase of 1,988,673 shares of Ocwen common stock in the open market for a total purchase price of $47.0 million. |
Description_of_Business_and_Ba1
Description of Business and Basis of Presentation (Policies) | 9 Months Ended | |
Sep. 30, 2014 | ||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | |
Basis of Presentation | ' | |
Basis of Presentation | ||
The accompanying unaudited consolidated financial statements have been prepared in conformity with the instructions of the Securities and Exchange Commission (SEC) to Form 10-Q and SEC Regulation S-X, Article 10, Rule 10-01 for interim financial statements. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America (GAAP) for complete financial statements. In our opinion, the accompanying unaudited consolidated financial statements contain all adjustments, consisting only of normal recurring accruals, necessary for a fair presentation. The results of operations and other data for the three and nine months ended September 30, 2014 are not necessarily indicative of the results that may be expected for any other interim period or for the year ending December 31, 2014. The unaudited consolidated financial statements presented herein should be read in conjunction with the audited consolidated financial statements and related notes thereto included in Amendment 1 to our Annual Report on Form 10-K for the year ended December 31, 2013. | ||
Reclassifications | ' | |
Reclassifications | ||
Within the Assets section of the Consolidated Balance sheet at December 31, 2013, we reclassified Debt service accounts of $129.9 million to Other assets to conform to the current year presentation. | ||
Certain insignificant amounts in the unaudited Consolidated Statements of Cash Flows for the nine months ended September 30, 2013 have been reclassified to conform to the current year presentation. These reclassifications had no impact on our consolidated cash flows from operating, investing or financing activities. | ||
Use of Estimates and Assumptions | ' | |
Use of Estimates and Assumptions | ||
The preparation of financial statements in conformity with GAAP requires that management make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, the reported amounts of revenues and expenses during the reporting period and the related disclosures in the accompanying notes. Such estimates and assumptions include, but are not limited to, those that relate to fair value measurements, the provision for potential losses that may arise from litigation proceedings, representation and warranty and other indemnification obligations and the valuation of goodwill. In developing estimates and assumptions, management uses all available information; however, actual results could materially differ because of uncertainties associated with estimating the amounts, timing and likelihood of possible outcomes. | ||
Recent Accounting Pronouncements | ' | |
Recently Issued Accounting Standards | ||
Accounting for Investments in Qualified Affordable Housing Projects (ASU 2014-01) | ||
In January 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-01. The amendments in this ASU permit an entity to make an accounting policy election to account for investments in qualified affordable housing projects using the proportional amortization method, if certain conditions are met. Under the proportional amortization method, an entity amortizes the initial cost of the investment in proportion to the tax credits and other tax benefits received and while recognizing the net investment performance in the statement of operations as a component of income tax expense (benefit). | ||
ASU 2014-01 will be effective for us on January 1, 2015 with early adoption permitted. We are currently evaluating the effect of adopting this standard effective January 1, 2015, but we do not anticipate that our adoption will have a material impact on our consolidated financial condition or results of operations. | ||
Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure (ASU 2014-04) | ||
In January 2014, the FASB issued ASU 2014-04. This ASU clarifies when an in substance repossession or foreclosure occurs such that the loan receivable should be derecognized and the real estate property recognized. An in substance repossession or foreclosure occurs upon either (1) the creditor obtaining legal title to the residential real estate property upon completion of a foreclosure or (2) the borrower conveying all interest in the residential real estate property to the creditor to satisfy that loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. | ||
ASU 2014-04 requires interim and annual disclosure of both (1) the amount of foreclosed residential real estate property held by the creditor and (2) the recorded investment in consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure according to local requirements of the applicable jurisdiction. | ||
ASU 2014-04 will be effective for us on January 1, 2015 with early adoption permitted. An entity can elect to adopt the amendments using either a modified retrospective transition method or a prospective transition method. We are currently evaluating the effect of adopting this standard effective January 1, 2015, but we do not anticipate that our adoption will have a material impact on our consolidated financial condition or results of operations. | ||
Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity (ASU 2014-08) | ||
In April 2014, the FASB issued ASU 2014-08. ASU 2014-08 changes the criteria for reporting discontinued operations. Under this ASU, a discontinued operation is defined as a disposal of a component or group of components that is disposed of or is classified as held for sale and represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results. A strategic shift could include a disposal of (i) a major geographical area of operations, (ii) a major line of business, (iii) a major equity method investment, or (iv) other major parts of an entity. A business activity that upon acquisition qualifies as held for sale will also be a discontinued operation. The new standard no longer precludes presentation as a discontinued operation if (i) there are operations and cash flows of the component that have not been eliminated from the reporting entity’s ongoing operations, or (ii) there is significant continuing involvement with a component after its disposal. | ||
New disclosures under this ASU include the requirement to present in the statement of cash flows or disclose in a note either (i) total operating and investing cash flows for discontinued operations, or (ii) depreciation, amortization, capital expenditures, and significant operating and investing noncash items related to discontinued operations. Assets and liabilities of a discontinued operation that are classified as held for sale or disposed of in the current period must be reclassified for the comparative periods presented in the balance sheet. | ||
ASU 2014-08 will be effective for us on January 1, 2015. The guidance applies prospectively to new disposals and new classifications of disposal groups as held for sale after the effective date. We are currently evaluating the effect of adopting this standard effective January 1, 2015, but we do not anticipate that our adoption will have a material impact on our consolidated financial condition or results of operations. | ||
Revenue from Contracts with Customers (ASU 2014-09) | ||
In May 2014, the FASB issued ASU 2014-09 to clarify the principles for recognizing revenue and to develop a common revenue standard. Under this new standard, an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. An entity should recognize revenue through the following five-step process: | ||
Step 1: Identify the contract(s) with a customer. | ||
Step 2: Identify the performance obligations in the contract. | ||
Step 3: Determine the transaction price. | ||
Step 4: Allocate the transaction price to the performance obligations in the contract. | ||
Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. | ||
This standard will also require enhanced disclosures. Qualitative and quantitative information is required regarding (i) contracts with customers-including revenue and impairments recognized, disaggregation of revenue, and information about contract balances and performance obligations, (ii) significant judgments and changes in judgments-determining the timing of satisfaction of performance obligations and determining the transaction price and amounts allocated to performance obligations and (iii) assets recognized from the costs to obtain or fulfill a contract. | ||
ASU 2014-09 will be effective for us on January 1, 2017. Early application is not permitted. An entity should apply the amendments in this ASU either retrospectively to each prior reporting period presented or retrospectively with the cumulative effect recognized at the date of initial application. | ||
The guidance in this standard does not apply to financial instruments and other contractual rights or obligations within the scope of ASC 860, Transfers and Servicing. We are currently evaluating the effect of adopting this standard. | ||
Repurchase-to-Maturity Transactions, Repurchase Financings and Disclosures (ASU 2014-11) | ||
In June 2014, the FASB issued ASU 2014-11. The amendments in this ASU require changes in the accounting for repurchase-to-maturity transactions and repurchase to financing arrangements. A repurchase-to-maturity transaction (repurchase agreement that matures at the same time as the transferred financial asset) will now be accounted for as a secured borrowing. For a repurchase financing arrangement (a type of repurchase agreement), a transfer of a financial asset executed contemporaneously with a repurchase agreement with the same counterparty will be accounted for separately, which will result in secured borrowing accounting for the repurchase agreement. Transferors will no longer apply the “linked” accounting model. | ||
The amendments in this ASU also include enhanced disclosure requirements. An entity will be required to disclose information about certain transactions accounted for as a sale in which the transferor retains substantially all of the exposure to the economic return on the transferred financial assets through an agreement with the same counterparty. An entity also will be required to disclose information about repurchase agreements, securities lending transactions and repurchase-to-maturity transactions that are accounted for as secured borrowings. | ||
The accounting changes in ASU 2014-11 will be effective for us on January 1, 2015. The disclosure requirements for certain transactions accounted for as a sale is required to be presented for interim and annual periods beginning January 1, 2015, and the disclosure for repurchase agreements, securities lending transactions, and repurchase-to-maturity transactions accounted for as secured borrowings is required to be presented for annual periods beginning January 1, 2015, and for interim periods beginning after April 1, 2015. Early application for a public business entity is prohibited. We are currently evaluating the effect of adopting this standard, but we do not anticipate that our adoption will have a material impact on our consolidated financial condition or results of operations. | ||
Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (ASU 2014-12) | ||
In June 2014, the FASB issued ASU 2014-12 to codify a final consensus reached by the EITF at its March 2014 meeting that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition rather than a condition that affects the grant-date fair value. | ||
The provisions of ASU 2014-12 will be effective for us on January 1, 2015 with early adoption permitted. Entities may apply the amendments in this ASU either (a) prospectively to all awards granted or modified after the effective date or (b) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. We are currently evaluating the effect of adopting this standard effective January 1, 2015. We currently do not have any share-based payment awards outstanding that contain performance targets, and therefore we anticipate that our adoption will not have an impact on our consolidated financial condition or results of operations. | ||
Measuring the Financial Assets and the Financial Liabilities of a Consolidated Collateralized Financing Entity (ASU 2014-13) | ||
In August 2014, the FASB issued ASU 2014-013. When a reporting entity elects the measurement alternative included in this ASU for a consolidated collateralized financing entity, the reporting entity should measure both the financial assets and the financial liabilities of that collateralized financing entity in its consolidated financial statements using the more observable of the fair value of the financial assets and the fair value of the financial liabilities. A collateralized financing entity is a variable interest entity with no more than nominal equity that holds financial assets and issues beneficial interests in those financial assets; the beneficial interests have contractual recourse only to the related assets of the collateralized financing entity and are classified as financial liabilities. | ||
ASU 2014-13 will be effective for us on January 1, 2016, with early adoption permitted at the beginning of an annual period. An entity can elect to adopt the amendments using either a modified retrospective approach or retrospectively to all relevant prior periods. We are currently evaluating the effect of adopting this standard. | ||
Classification of Certain Government-Guaranteed Mortgage Loans upon Foreclosure (ASU 2014-14) | ||
In August 2014, the FASB issued ASU 2014-014. The amendments in this ASU require that a mortgage loan be derecognized and that a separate other receivable be recognized upon foreclosure if the following conditions are met: | ||
1 | The loan has a government guarantee that is not separable from the loan before foreclosure. | |
2 | At the time of foreclosure, the creditor has the intent to convey the real estate property to the guarantor and make a claim on the guarantee, and the creditor has the ability to recover under that claim. | |
3 | At the time of foreclosure, any amount of the claim that is determined on the basis of the fair value of the real estate is fixed. | |
Upon foreclosure, the separate other receivable should be measured based on the amount of the loan balance (principal and interest) expected to be recovered from the guarantor. | ||
ASU 2014-14 will be effective for us on January 1, 2015. An entity should adopt the amendments using either a prospective transition method or a modified retrospective transition method. We are currently evaluating the effect of adopting this standard. |
Description_of_Business_and_Ba2
Description of Business and Basis of Presentation (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | |||||||
Schedule of Change in Accounting Estimate | ' | |||||||
This change had the effect of reducing amortization expense and increasing both net income and earnings per share in our unaudited Consolidated Statements of Operations for the three and nine months ended September 30, 2014 as follows: | ||||||||
Three Months | Nine Months | |||||||
Reduction in Amortization of mortgage servicing rights | $ | (21,309 | ) | $ | (69,244 | ) | ||
Increase in Net income attributable to Ocwen common stockholders | $ | 14,920 | $ | 48,485 | ||||
Increase in Earnings per share attributable to Ocwen common stockholders: | ||||||||
Basic | $ | 0.11 | $ | 0.36 | ||||
Diluted | $ | 0.11 | $ | 0.35 | ||||
Restatement_of_Previously_Issu1
Restatement of Previously Issued Consolidated Financial Statements (Tables) | 9 Months Ended | |||||||||||
Sep. 30, 2014 | ||||||||||||
Accounting Changes and Error Corrections [Abstract] | ' | |||||||||||
Schedule of Effects of Restatement | ' | |||||||||||
The following tables summarize the effect of these restatements on our previously reported amounts. | ||||||||||||
Consolidated Statement of Operations for the Three Months Ended September 30, 2013 | ||||||||||||
As Reported | Restatement | As Restated | ||||||||||
Interest expense | $ | (110,055 | ) | $ | (6,830 | ) | $ | (116,885 | ) | |||
Total other expense, net | (108,705 | ) | (6,830 | ) | (115,535 | ) | ||||||
Income before income taxes | 76,275 | (6,830 | ) | 69,445 | ||||||||
Income tax expense | 9,273 | (400 | ) | 8,873 | ||||||||
Net income | 67,002 | (6,430 | ) | 60,572 | ||||||||
Net income attributable to Ocwen common stockholders | 61,155 | (6,430 | ) | 54,725 | ||||||||
Earnings per share attributable to Ocwen common stockholders | ||||||||||||
Basic | $ | 0.45 | $ | (0.05 | ) | $ | 0.4 | |||||
Diluted | $ | 0.44 | $ | (0.05 | ) | $ | 0.39 | |||||
Consolidated Statement of Operations for the Nine Months Ended September 30, 2013 | ||||||||||||
As Reported | Restatement | As Restated | ||||||||||
Interest expense | $ | (303,339 | ) | $ | (16,225 | ) | $ | (319,564 | ) | |||
Total other expense, net | (306,780 | ) | (16,225 | ) | (323,005 | ) | ||||||
Income before income taxes | 215,120 | (16,225 | ) | 198,895 | ||||||||
Income tax expense | 26,250 | (2,498 | ) | 23,752 | ||||||||
Net income | 188,870 | (13,727 | ) | 175,143 | ||||||||
Net income attributable to Ocwen common stockholders | 177,847 | (13,727 | ) | 164,120 | ||||||||
Earnings per share attributable to Ocwen common stockholders | ||||||||||||
Basic | $ | 1.31 | $ | (0.10 | ) | $ | 1.21 | |||||
Diluted | $ | 1.27 | $ | (0.10 | ) | $ | 1.17 | |||||
Consolidated Statement of Comprehensive Income for the Three Months Ended September 30, 2013 | ||||||||||||
As Reported | Restatement | As Restated | ||||||||||
Net income | $ | 67,002 | $ | (6,430 | ) | $ | 60,572 | |||||
Comprehensive income | 71,747 | (6,430 | ) | 65,317 | ||||||||
Consolidated Statement of Comprehensive Income for the Nine Months Ended September 30, 2013 | ||||||||||||
As Reported | Restatement | As Restated | ||||||||||
Net income | $ | 188,870 | $ | (13,727 | ) | $ | 175,143 | |||||
Comprehensive income | 188,242 | (13,727 | ) | 174,515 | ||||||||
Consolidated Statement of Changes in Equity for the Nine Months Ended September 30, 2013 | ||||||||||||
As Reported | Restatement | As Restated | ||||||||||
Net income | $ | 188,870 | $ | (13,727 | ) | $ | 175,143 | |||||
Consolidated Statement of Cash Flows for the Nine Months Ended September 30, 2013 | ||||||||||||
As Reported | Restatement | As Restated | ||||||||||
Net income | $ | 188,870 | $ | (13,727 | ) | $ | 175,143 | |||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||
Decrease (increase) in deferred tax assets, net | 105 | (2,498 | ) | (2,393 | ) | |||||||
Net cash provided by operating activities | 1,020,455 | (16,225 | ) | 1,004,230 | ||||||||
Repayments of other secured borrowings | (7,182,275 | ) | 16,225 | (7,166,050 | ) | |||||||
Net cash used in financing activities | (933,136 | ) | 16,225 | (916,911 | ) | |||||||
Securitization_and_Variable_In1
Securitization and Variable Interest Entities (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Transfers and Servicing [Abstract] | ' | |||||||||||||||
Schedule of Cash Flows Related to Transfers Accounted for as Sales | ' | |||||||||||||||
The following table presents a summary of cash flows received from and paid to securitization trusts related to transfers accounted for as sales that were outstanding during the three and nine months ended September 30: | ||||||||||||||||
Three Months | Nine Months | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Proceeds received from securitizations | $ | 1,369,468 | $ | 1,776,309 | $ | 4,346,991 | $ | 6,240,459 | ||||||||
Servicing fees collected | 10,840 | 6,317 | 25,174 | 13,125 | ||||||||||||
Purchases of previously transferred assets, net of claims reimbursed | 2,237 | — | 2,237 | — | ||||||||||||
$ | 1,382,545 | $ | 1,782,626 | $ | 4,374,402 | $ | 6,253,584 | |||||||||
Schedule of Assets That Relate to Continuing Involvement with Transferred Financial Assets with Servicing Rights and Maximum Exposure to Loss Including the Unpaid Principal Balance | ' | |||||||||||||||
The following table presents the carrying amounts of our assets that relate to our continuing involvement with forward loans that we have transferred with servicing rights retained as well as our maximum exposure to loss including the unpaid principal balance (UPB) of the transferred loans at the dates indicated: | ||||||||||||||||
September 30, 2014 | December 31, 2013 | |||||||||||||||
Carrying value of assets: | ||||||||||||||||
Mortgage servicing rights, at amortized cost | $ | 84,397 | $ | 44,615 | ||||||||||||
Mortgage servicing rights, at fair value | 2,965 | 3,075 | ||||||||||||||
Advances and match funded advances | 10,153 | 15,888 | ||||||||||||||
Unpaid principal balance of loans transferred (1) | 8,816,416 | 5,641,277 | ||||||||||||||
Maximum exposure to loss | $ | 8,913,931 | $ | 5,704,855 | ||||||||||||
-1 | The UPB of the loans transferred is the maximum exposure to loss under our standard representations and warranties obligations. |
Business_Acquisitions_Tables
Business Acquisitions (Tables) | 9 Months Ended | ||||||||||||
Sep. 30, 2014 | |||||||||||||
Business Acquisition [Line Items] | ' | ||||||||||||
Schedule of Purchase Price Allocation | ' | ||||||||||||
The following table summarizes the fair values of assets acquired and liabilities assumed as part of the ResCap Acquisition: | |||||||||||||
Purchase Price Allocation | 15-Feb-13 | Adjustments | Final | ||||||||||
MSRs (1) | $ | 393,891 | $ | 7,423 | $ | 401,314 | |||||||
Advances and match funded advances (1) | 1,622,348 | 164,061 | 1,786,409 | ||||||||||
Deferred tax assets | — | — | — | ||||||||||
Premises and equipment | 22,398 | (5,975 | ) | 16,423 | |||||||||
Receivables and other assets | 2,989 | — | 2,989 | ||||||||||
Other liabilities: | |||||||||||||
Liability for indemnification obligations | (49,500 | ) | — | (49,500 | ) | ||||||||
Other | (24,840 | ) | (285 | ) | (25,125 | ) | |||||||
Total identifiable net assets | 1,967,286 | 165,224 | 2,132,510 | ||||||||||
Goodwill | 204,743 | 6,676 | 211,419 | ||||||||||
Total consideration | $ | 2,172,029 | $ | 171,900 | $ | 2,343,929 | |||||||
-1 | As of the acquisition date, the purchase of certain MSRs from ResCap was not complete pending the receipt of certain consents and court approvals. Subsequent to the acquisition, we obtained the required consents and approvals for a portion of these MSRs and paid an additional purchase price of $174.6 million to acquire the MSRs and related advances, including $54.2 million in 2014. The purchase price allocation has been revised to include the resulting adjustments to MSRs, advances and goodwill. | ||||||||||||
Schedule of Restructuring Reserve Liability | ' | ||||||||||||
The following table provides a reconciliation of the beginning and ending liability balances for these termination costs for the nine months ended September 30, 2014: | |||||||||||||
Employee termination benefits | Lease and other contract termination costs | Total | |||||||||||
Liability balance as at December 31, 2013 | $ | 4,816 | $ | 7,432 | $ | 12,248 | |||||||
Additions charged to operations (1) | 14,748 | 2,813 | 17,561 | ||||||||||
Amortization of discount | — | 115 | 115 | ||||||||||
Payments | (17,215 | ) | (2,928 | ) | (20,143 | ) | |||||||
Liability balance as at September 30, 2014 (2) | $ | 2,349 | $ | 7,432 | $ | 9,781 | |||||||
-1 | Of the additions charged to operations during the period, $14.4 million was recognized in the Servicing segment, $(0.1) million was recognized in the Lending segment and the remaining $3.3 million was recognized in the Corporate Items and Other segment. Charges related to employee termination benefits, lease termination costs and other contract termination costs are reported in Compensation and benefits expense, Occupancy and equipment expense and Other operating expenses, respectively, in the unaudited Consolidated Statements of Operations. The liabilities are included in Other liabilities in the unaudited Consolidated Balance Sheet. | ||||||||||||
-2 | We expect the remaining liability for employee termination benefits at September 30, 2014 to be settled in late 2014 or early 2015. | ||||||||||||
ResCap [Member] | ' | ||||||||||||
Business Acquisition [Line Items] | ' | ||||||||||||
Post-Acquisition Results of Operations | ' | ||||||||||||
The following table presents the revenue and earnings of the ResCap operations that are included in our unaudited Consolidated Statements of Operations for the three and nine months ended September 30, 2013 (from the acquisition date of February 15, 2013): | |||||||||||||
Three Months | Nine Months | ||||||||||||
Revenues | $ | 212,164 | $ | 508,589 | |||||||||
Net income | $ | 8,230 | $ | 81,362 | |||||||||
Pro Forma Results of Operations | ' | ||||||||||||
The following table presents unaudited supplemental pro forma information for Ocwen for the nine months ended September 30, 2013 as if the ResCap Acquisition occurred on January 1, 2012. Pro forma adjustments include: | |||||||||||||
• | conforming servicing revenues to the revenue recognition policies followed by Ocwen; | ||||||||||||
• | conforming the accounting for MSRs to the valuation and amortization policies of Ocwen; | ||||||||||||
• | adjusting interest expense to eliminate the pre-acquisition interest expense of ResCap and to recognize interest expense as if the acquisition-related debt of Ocwen had been outstanding at January 1, 2012; and | ||||||||||||
• | reporting acquisition-related charges for professional services as if they had been incurred in 2012 rather than 2013. | ||||||||||||
Revenues | $ | 1,530,055 | |||||||||||
Net income | $ | 205,062 | |||||||||||
Fair_Value_Tables
Fair Value (Tables) | 9 Months Ended | |||||||||||||||||||||||
Sep. 30, 2014 | ||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||||||||||
Schedule of Fair Value Assets and Liabilities | ' | |||||||||||||||||||||||
The carrying amounts and the estimated fair values of our financial instruments and our nonfinancial assets measured at fair value on a recurring or non-recurring basis are as follows at the dates indicated: | ||||||||||||||||||||||||
September 30, 2014 | December 31, 2013 | |||||||||||||||||||||||
Level | Carrying Value | Fair Value | Carrying Value | Fair Value | ||||||||||||||||||||
Financial assets: | ||||||||||||||||||||||||
Loans held for sale: | ||||||||||||||||||||||||
Loans held for sale, at fair value (a) | 2 | $ | 335,950 | $ | 335,950 | $ | 503,753 | $ | 503,753 | |||||||||||||||
Loans held for sale, at lower of cost or fair value (b) | 3 | 71,937 | 71,937 | 62,907 | 62,907 | |||||||||||||||||||
Total Loans held for sale | $ | 407,887 | $ | 407,887 | $ | 566,660 | $ | 566,660 | ||||||||||||||||
Loans held for investment - Reverse mortgages, at fair value (a) | 3 | $ | 1,315,324 | $ | 1,315,324 | $ | 618,018 | $ | 618,018 | |||||||||||||||
Advances and match funded advances (c) | 3 | 3,346,865 | 3,346,865 | 3,443,215 | 3,443,215 | |||||||||||||||||||
Receivables, net (c) | 3 | 245,817 | 245,817 | 152,516 | 152,516 | |||||||||||||||||||
Financial liabilities: | ||||||||||||||||||||||||
Match funded liabilities (c) | 3 | $ | 2,035,639 | $ | 2,035,639 | $ | 2,364,814 | $ | 2,364,814 | |||||||||||||||
Financing liabilities: | ||||||||||||||||||||||||
HMBS-related borrowings, at fair value (a) | 3 | $ | 1,236,094 | $ | 1,236,094 | $ | 615,576 | $ | 615,576 | |||||||||||||||
Financing liability - MSRs pledged (a) | 3 | 618,855 | 618,855 | 633,804 | 633,804 | |||||||||||||||||||
Other (c) | 3 | 202,541 | 206,261 | 17,593 | 17,593 | |||||||||||||||||||
Total Financing liabilities | $ | 2,057,490 | $ | 2,061,210 | $ | 1,266,973 | $ | 1,266,973 | ||||||||||||||||
Other secured borrowings: | ||||||||||||||||||||||||
Senior secured term loan (c) | 3 | $ | 1,276,142 | $ | 1,259,601 | $ | 1,284,901 | $ | 1,270,108 | |||||||||||||||
Other (c) | 3 | 390,285 | 390,285 | 492,768 | 492,768 | |||||||||||||||||||
Total Other secured borrowings | $ | 1,666,427 | $ | 1,649,886 | $ | 1,777,669 | $ | 1,762,876 | ||||||||||||||||
Senior unsecured notes | 2 | $ | 350,000 | $ | 338,625 | $ | — | $ | — | |||||||||||||||
Derivative financial instruments (a): | ||||||||||||||||||||||||
IRLCs | 2 | $ | 6,117 | $ | 6,117 | $ | 8,433 | $ | 8,433 | |||||||||||||||
Forward MBS trades | 1 | (1,089 | ) | (1,089 | ) | 6,905 | 6,905 | |||||||||||||||||
Interest rate caps | 3 | 91 | 91 | 442 | 442 | |||||||||||||||||||
MSRs: | ||||||||||||||||||||||||
MSRs, at fair value (a) | 3 | $ | 101,948 | $ | 101,948 | $ | 116,029 | $ | 116,029 | |||||||||||||||
MSRs, at amortized cost (c) | 3 | 1,856,818 | 2,364,393 | 1,953,352 | 2,441,719 | |||||||||||||||||||
Total MSRs | $ | 1,958,766 | $ | 2,466,341 | $ | 2,069,381 | $ | 2,557,748 | ||||||||||||||||
(a) | Measured at fair value on a recurring basis. | |||||||||||||||||||||||
(b) | Measured at fair value on a non-recurring basis. | |||||||||||||||||||||||
(c) | Disclosed, but not carried, at fair value. | |||||||||||||||||||||||
Reconciliation of Level 3 Assets | ' | |||||||||||||||||||||||
The following tables present a reconciliation of the changes in fair value of Level 3 assets and liabilities that we measure at fair value on a recurring basis for the three and nine months ended September 30. The information presented for 2013 has been revised to include Financing liability - MSRs pledged in conformity with the 2014 presentation of Level 3 assets and liabilities. | ||||||||||||||||||||||||
Loans Held for Investment - Reverse Mortgages | Financing Liability - MSRs Pledged | HMBS-Related Borrowings | Derivative Financial Instruments, net | MSRs | Total | |||||||||||||||||||
Three months ended September 30, 2014 | ||||||||||||||||||||||||
Fair value at July 1, 2014 | $ | 1,107,626 | $ | (629,579 | ) | $ | (1,033,712 | ) | $ | 97 | $ | 104,220 | $ | (451,348 | ) | |||||||||
Purchases, issuances, sales and settlements: | ||||||||||||||||||||||||
Purchases | — | — | — | — | — | — | ||||||||||||||||||
Issuances | 208,566 | — | (190,452 | ) | — | — | 18,114 | |||||||||||||||||
Sales | — | — | — | — | — | — | ||||||||||||||||||
Settlements (1) | (27,592 | ) | 10,724 | 12,690 | — | (934 | ) | (5,112 | ) | |||||||||||||||
180,974 | 10,724 | (177,762 | ) | — | (934 | ) | 13,002 | |||||||||||||||||
Total realized and unrealized gains and (losses): | ||||||||||||||||||||||||
Included in earnings | 26,724 | — | (24,620 | ) | (6 | ) | (1,338 | ) | 760 | |||||||||||||||
Included in Other comprehensive income (loss) | — | — | — | — | — | — | ||||||||||||||||||
26,724 | — | (24,620 | ) | (6 | ) | (1,338 | ) | 760 | ||||||||||||||||
Transfers in and / or out of Level 3 | — | — | — | — | — | — | ||||||||||||||||||
Fair value at September 30, 2014 | $ | 1,315,324 | $ | (618,855 | ) | $ | (1,236,094 | ) | $ | 91 | $ | 101,948 | $ | (437,586 | ) | |||||||||
Loans Held for Investment - Reverse Mortgages | Financing Liability - MSRs Pledged | HMBS-Related Borrowings | Derivative Financial Instruments, net | MSRs | Total | |||||||||||||||||||
Three months ended September 30, 2013 | ||||||||||||||||||||||||
Fair value at July 1, 2013 | $ | 76,649 | $ | (437,734 | ) | $ | (73,641 | ) | $ | 176 | $ | 97,163 | $ | (337,387 | ) | |||||||||
Purchases, issuances, sales and settlements: | ||||||||||||||||||||||||
Purchases | — | — | — | — | — | — | ||||||||||||||||||
Issuances | 211,052 | (239,851 | ) | (206,714 | ) | — | — | (235,513 | ) | |||||||||||||||
Sales | — | — | — | — | — | |||||||||||||||||||
Settlements | (1,293 | ) | 17,764 | 1,021 | (176 | ) | — | 17,316 | ||||||||||||||||
209,759 | (222,087 | ) | (205,693 | ) | (176 | ) | — | (218,197 | ) | |||||||||||||||
Total realized and unrealized gains and (losses): | ||||||||||||||||||||||||
Included in earnings | 4,445 | — | (4,942 | ) | — | (225 | ) | (722 | ) | |||||||||||||||
Included in Other comprehensive income (loss) | — | — | — | — | — | — | ||||||||||||||||||
4,445 | — | (4,942 | ) | — | (225 | ) | (722 | ) | ||||||||||||||||
Transfers in and / or out of Level 3 | — | — | — | — | — | — | ||||||||||||||||||
Fair value at September 30, 2013 | $ | 290,853 | $ | (659,821 | ) | $ | (284,276 | ) | $ | — | $ | 96,938 | $ | (556,306 | ) | |||||||||
Loans Held for Investment - Reverse Mortgages | Financing Liability - MSRs Pledged | HMBS-Related Borrowings | Derivative Financial Instruments, net | MSRs | Total | |||||||||||||||||||
Nine months ended September 30, 2014 | ||||||||||||||||||||||||
Fair value at January 1, 2014 | $ | 618,018 | $ | (633,804 | ) | $ | (615,576 | ) | $ | 442 | $ | 116,029 | $ | (514,891 | ) | |||||||||
Purchases, issuances, sales and settlements: | ||||||||||||||||||||||||
Purchases | — | — | — | 23 | — | 23 | ||||||||||||||||||
Issuances | 565,670 | — | (572,031 | ) | — | — | (6,361 | ) | ||||||||||||||||
Transfer from loans held for sale, at fair value | 110,874 | — | — | — | — | 110,874 | ||||||||||||||||||
Sales | — | — | — | — | — | — | ||||||||||||||||||
Settlements (1) | (56,193 | ) | 14,949 | 25,725 | — | (934 | ) | (16,453 | ) | |||||||||||||||
620,351 | 14,949 | (546,306 | ) | 23 | (934 | ) | 88,083 | |||||||||||||||||
Total realized and unrealized gains and (losses): (2) | ||||||||||||||||||||||||
Included in earnings | 76,955 | — | (74,212 | ) | (374 | ) | (13,147 | ) | (10,778 | ) | ||||||||||||||
Included in Other comprehensive income (loss) | — | — | — | — | — | — | ||||||||||||||||||
76,955 | — | (74,212 | ) | (374 | ) | (13,147 | ) | (10,778 | ) | |||||||||||||||
Transfers in and / or out of Level 3 | — | — | — | — | — | — | ||||||||||||||||||
Fair value at September 30, 2014 | $ | 1,315,324 | $ | (618,855 | ) | $ | (1,236,094 | ) | $ | 91 | $ | 101,948 | $ | (437,586 | ) | |||||||||
Loans Held for Investment - Reverse Mortgages | Financing Liability - MSRs Pledged | HMBS-Related Borrowings | Derivative Financial Instruments, net | MSRs | Total | |||||||||||||||||||
Nine months ended September 30, 2013 | ||||||||||||||||||||||||
Fair value at January 1, 2013 | $ | — | $ | (303,705 | ) | $ | — | $ | (10,668 | ) | $ | 85,213 | $ | (229,160 | ) | |||||||||
Purchases, issuances, sales and settlements: | ||||||||||||||||||||||||
Purchases | 10,251 | — | (10,179 | ) | — | — | 72 | |||||||||||||||||
Issuances | 274,081 | (388,473 | ) | (272,652 | ) | — | — | (387,044 | ) | |||||||||||||||
Sales | — | — | — | 24,156 | — | 24,156 | ||||||||||||||||||
Settlements | (2,164 | ) | 32,357 | 1,888 | (1,242 | ) | — | 30,839 | ||||||||||||||||
282,168 | (356,116 | ) | (280,943 | ) | 22,914 | — | (331,977 | ) | ||||||||||||||||
Total realized and unrealized gains and (losses): | ||||||||||||||||||||||||
Included in earnings | 8,685 | — | (3,333 | ) | 117 | 11,725 | 17,194 | |||||||||||||||||
Included in Other comprehensive income (loss) | — | — | — | (12,363 | ) | — | (12,363 | ) | ||||||||||||||||
8,685 | — | (3,333 | ) | (12,246 | ) | 11,725 | 4,831 | |||||||||||||||||
Transfers in and / or out of Level 3 | — | — | — | — | — | — | ||||||||||||||||||
Fair value at September 30, 2013 | $ | 290,853 | $ | (659,821 | ) | $ | (284,276 | ) | $ | — | $ | 96,938 | $ | (556,306 | ) | |||||||||
-1 | In the event of a transfer of servicing to another party related to Rights to MSRs sold to HLSS, we are required to reimburse HLSS at predetermined contractual rates for the loss of servicing revenues. Settlements for Financing liability - MSRs pledged for the three and nine months ended September 30, 2014 includes $2.0 million of such reimbursements. | |||||||||||||||||||||||
-2 | Total losses attributable to derivative financial instruments still held at September 30, 2014 were $0.4 million for the nine months ended September 30, 2014. | |||||||||||||||||||||||
Schedule of Assumptions for Fair Value | ' | |||||||||||||||||||||||
Other assumptions typically used in the internal valuation are: | ||||||||||||||||||||||||
• | Cost of servicing | • | Interest rate used for computing float earnings | |||||||||||||||||||||
• | Discount rate | • | Compensating interest expense | |||||||||||||||||||||
• | Interest rate used for computing the cost of financing servicing advances | • | Collection rate of other ancillary fees |
Loans_Held_for_Sale_Tables
Loans Held for Sale (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Receivables [Abstract] | ' | |||||||||||||||
Schedule of Loans Held for Sale Fair Value | ' | |||||||||||||||
The following table summarizes the activity in the balance of Loans held for sale, at fair value, during the nine months ended September 30: | ||||||||||||||||
2014 | 2013 | |||||||||||||||
Beginning balance | $ | 503,753 | $ | 426,480 | ||||||||||||
Originations and purchases | 3,923,870 | 5,988,501 | ||||||||||||||
Proceeds from sales | (4,010,644 | ) | (6,033,785 | ) | ||||||||||||
Transfers to loans held for investment - reverse mortgages | (110,874 | ) | — | |||||||||||||
Gain (loss) on sale of loans | 39,486 | (46,962 | ) | |||||||||||||
Other | (9,641 | ) | 868 | |||||||||||||
Ending balance | $ | 335,950 | $ | 335,102 | ||||||||||||
Schedule of Loans Held For Sale At Lower Cost Or Fair Value, Activity | ' | |||||||||||||||
The following table summarizes the activity in the balance of Loans held for sale, at lower of cost or fair value, during the nine months ended September 30: | ||||||||||||||||
2014 | 2013 | |||||||||||||||
Beginning balance | $ | 62,907 | $ | 82,866 | ||||||||||||
Purchases | 2,083,282 | 1,144,853 | ||||||||||||||
Proceeds from sales | (1,744,273 | ) | (654,916 | ) | ||||||||||||
Principal payments | (248,552 | ) | (317,528 | ) | ||||||||||||
Transfers to accounts receivable | (96,257 | ) | (190,185 | ) | ||||||||||||
Transfers to real estate owned | (4,575 | ) | (2,838 | ) | ||||||||||||
Gain on sale of loans | 32,471 | 20,336 | ||||||||||||||
Increase in valuation allowance | (16,282 | ) | (6,510 | ) | ||||||||||||
Other | 3,216 | 10,675 | ||||||||||||||
Ending balance | $ | 71,937 | $ | 86,753 | ||||||||||||
Schedule of Gains on Loans Held for Sale | ' | |||||||||||||||
The following table summarizes the activity in Gain on loans held for sale, net, during the three and nine months ended September 30: | ||||||||||||||||
Three Months | Nine Months | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Gain on sales of loans | $ | 42,185 | $ | 4,622 | $ | 145,455 | $ | 36,156 | ||||||||
Change in fair value of IRLCs | (4,188 | ) | 18,912 | (2,315 | ) | 5,918 | ||||||||||
Change in fair value of loans held for sale | (9,348 | ) | 14,362 | (97 | ) | 1,452 | ||||||||||
Gain (loss) on economic hedge instruments | (1,145 | ) | (9,408 | ) | (32,183 | ) | 30,989 | |||||||||
Other | (286 | ) | (226 | ) | (819 | ) | (1,603 | ) | ||||||||
$ | 27,218 | $ | 28,262 | $ | 110,041 | $ | 72,912 | |||||||||
Advances_Tables
Advances (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Advances [Abstract] | ' | |||||||
Schedule of Advance Payments by Financial Institution on Foreclosed Properties | ' | |||||||
Advances, net, representing payments made on behalf of borrowers or on foreclosed properties, consisted of the following at the dates indicated: | ||||||||
September 30, 2014 | December 31, 2013 | |||||||
Servicing: | ||||||||
Principal and interest | $ | 198,540 | $ | 141,307 | ||||
Taxes and insurance | 443,255 | 477,039 | ||||||
Foreclosures, bankruptcy and other (1) | 340,882 | 268,053 | ||||||
982,677 | 886,399 | |||||||
Corporate Items and Other | 4,609 | 4,433 | ||||||
$ | 987,286 | $ | 890,832 | |||||
-1 | The balances at September 30, 2014 and December 31, 2013 are net of an allowance for losses of $48.4 million and $38.4 million, respectively. | |||||||
Match funded advances on residential loans we service for others are comprised of the following at the dates indicated: | ||||||||
September 30, 2014 | December 31, 2013 | |||||||
Principal and interest | $ | 1,360,568 | $ | 1,497,649 | ||||
Taxes and insurance | 788,612 | 830,113 | ||||||
Foreclosures, bankruptcy, real estate and other | 210,399 | 224,621 | ||||||
$ | 2,359,579 | $ | 2,552,383 | |||||
Schedule of Activity in Advances | ' | |||||||
The following table summarizes the activity in advances for the nine months ended September 30: | ||||||||
2014 | 2013 | |||||||
Beginning balance | $ | 890,832 | $ | 184,463 | ||||
Acquisitions (1) | 99,318 | 708,415 | ||||||
Transfers to match funded advances | (10,156 | ) | (131,197 | ) | ||||
Sales of advances to HLSS (2) | — | (61,673 | ) | |||||
New advances, net of collections and other | 7,292 | 244,923 | ||||||
Ending balance | $ | 987,286 | $ | 944,931 | ||||
-1 | Servicing advances acquired through business acquisitions and asset acquisitions, primarily in connection with the acquisition of MSRs. See Note 3 – Business Acquisitions, Note 5 – Loans Held for Sale and Note 8 – Mortgage Servicing for additional information. | |||||||
-2 | We periodically sell Rights to MSRs and the related servicing advances to HLSS. The related advance sales generally meet the requirements for sale accounting and are derecognized from our financial statements at the time of the sale. In connection with the Ginnie Mae EBO Transactions completed during 2014, we transferred advances related to certain FHA-insured mortgage loans to HLSS Mortgage and HLSS SEZ LP in transactions which did not qualify as sales for accounting purposes. See Note 4 – Fair Value and Note 5 – Loans Held for Sale for additional information. |
Match_Funded_Advances_Tables
Match Funded Advances (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Transfers and Servicing [Abstract] | ' | |||||||
Schedule of Advance Payments by Financial Institution on Foreclosed Properties | ' | |||||||
Advances, net, representing payments made on behalf of borrowers or on foreclosed properties, consisted of the following at the dates indicated: | ||||||||
September 30, 2014 | December 31, 2013 | |||||||
Servicing: | ||||||||
Principal and interest | $ | 198,540 | $ | 141,307 | ||||
Taxes and insurance | 443,255 | 477,039 | ||||||
Foreclosures, bankruptcy and other (1) | 340,882 | 268,053 | ||||||
982,677 | 886,399 | |||||||
Corporate Items and Other | 4,609 | 4,433 | ||||||
$ | 987,286 | $ | 890,832 | |||||
-1 | The balances at September 30, 2014 and December 31, 2013 are net of an allowance for losses of $48.4 million and $38.4 million, respectively. | |||||||
Match funded advances on residential loans we service for others are comprised of the following at the dates indicated: | ||||||||
September 30, 2014 | December 31, 2013 | |||||||
Principal and interest | $ | 1,360,568 | $ | 1,497,649 | ||||
Taxes and insurance | 788,612 | 830,113 | ||||||
Foreclosures, bankruptcy, real estate and other | 210,399 | 224,621 | ||||||
$ | 2,359,579 | $ | 2,552,383 | |||||
Schedule of Activity In Match Funded Advances | ' | |||||||
The following table summarizes the activity in match funded advances for the nine months ended September 30: | ||||||||
2014 | 2013 | |||||||
Beginning balance | $ | 2,552,383 | $ | 3,049,244 | ||||
Acquisitions (1) | 85,521 | 1,448,371 | ||||||
Transfers from advances | 10,156 | 131,197 | ||||||
Sales of advances to HLSS (2) | — | (3,428,234 | ) | |||||
Collections, net of new advances and other | (288,481 | ) | (666,853 | ) | ||||
Ending balance | $ | 2,359,579 | $ | 533,725 | ||||
-1 | Servicing advances acquired in connection with the acquisitions of MSRs through business acquisitions and asset acquisitions. See Note 3 – Business Acquisitions and Note 8 – Mortgage Servicing for additional information. | |||||||
-2 | See Note 6 – Advances for additional information. |
Mortgage_Servicing_Tables
Mortgage Servicing (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Transfers and Servicing [Abstract] | ' | |||||||||||||||
Schedule of Activity Related to MSRs - Amortization Method | ' | |||||||||||||||
The following tables summarize the activity in the carrying value of amortization method servicing assets for the nine months ended September 30. Amortization of mortgage servicing rights is reported net of the amortization of servicing liabilities and includes the amount of charges we recognized to increase servicing liability obligations, if any. | ||||||||||||||||
2014 | 2013 | |||||||||||||||
Beginning balance | $ | 1,953,352 | $ | 678,937 | ||||||||||||
Additions recognized in connection with business acquisitions: | ||||||||||||||||
OSI (1) | 9,008 | — | ||||||||||||||
ResCap Acquisition (1) | 11,370 | 391,853 | ||||||||||||||
Liberty Acquisition (1) | — | 2,532 | ||||||||||||||
Additions recognized in connection with asset acquisitions: | ||||||||||||||||
Ally MSR Transaction | — | 683,787 | ||||||||||||||
OneWest MSR Transaction (2) | 1,516 | 127,047 | ||||||||||||||
Greenpoint MSR Transaction (3) | 3,690 | — | ||||||||||||||
Other | 14,132 | 3,003 | ||||||||||||||
Additions recognized on the sale of mortgage loans | 50,480 | 63,154 | ||||||||||||||
Sales | (137 | ) | (17,523 | ) | ||||||||||||
Servicing transfers and adjustments | (518 | ) | 2,052 | |||||||||||||
Amortization | (186,075 | ) | (197,899 | ) | ||||||||||||
Ending balance | $ | 1,856,818 | $ | 1,736,943 | ||||||||||||
Estimated fair value at end of period | $ | 2,364,393 | $ | 2,532,239 | ||||||||||||
-1 | See Note 3 – Business Acquisitions for additional information regarding MSRs recognized in connection with business acquisitions. | |||||||||||||||
-2 | The acquired MSRs in 2014 relate to mortgage loans with a UPB of $1.1 billion and related servicing advances of $34.3 million acquired in the final closing of the OneWest MSR Transaction. The OneWest MSR Transaction closed in stages, and the majority of loans were boarded onto our primary servicing platform as of December 31, 2013. As of September 30, 2013, we had acquired MSRs of $127.0 million with a UPB of $30.5 billion and related servicing advance receivables of $371.6 million. | |||||||||||||||
-3 | The acquired MSRs relate to mortgage loans with a UPB of $948.9 million and related servicing advances of $47.6 million. | |||||||||||||||
Schedule of Activity Related to MSRs - Fair Value Measurement Method | ' | |||||||||||||||
The following table summarizes the activity related to fair value servicing assets for the nine months ended September 30: | ||||||||||||||||
2014 | 2013 | |||||||||||||||
Beginning balance | $ | 116,029 | $ | 85,213 | ||||||||||||
Servicing transfers | (934 | ) | — | |||||||||||||
Changes in fair value (1): | ||||||||||||||||
Changes in assumptions | (12,217 | ) | 19,800 | |||||||||||||
Realization of cash flows and other changes | (930 | ) | (8,075 | ) | ||||||||||||
Ending balance | $ | 101,948 | $ | 96,938 | ||||||||||||
-1 | Changes in fair value are recognized in Servicing and origination expense in the unaudited Consolidated Statements of Operations. | |||||||||||||||
Schedule of Estimated Change in the Fair Value of MSRs | ' | |||||||||||||||
The following table summarizes the estimated change in the value of the MSRs that we carry at fair value as of September 30, 2014 given hypothetical instantaneous parallel shifts in the yield curve: | ||||||||||||||||
Adverse change in fair value | ||||||||||||||||
10% | 20% | |||||||||||||||
Weighted average prepayment speeds | $ | (8,245 | ) | $ | (16,137 | ) | ||||||||||
Discount rate (Option-adjusted spread) | $ | (4,100 | ) | $ | (7,905 | ) | ||||||||||
Schedule of Composition of Servicing and Subservicing Portfolios by Type of Property Serviced | ' | |||||||||||||||
The following table presents the composition of our primary servicing and subservicing portfolios by type of property serviced as measured by UPB. The servicing portfolio represents loans for which we own the MSRs while subservicing represents all other loans. The UPB of assets serviced for others are not included on our unaudited Consolidated Balance Sheets. | ||||||||||||||||
Residential | Commercial | Total | ||||||||||||||
UPB at September 30, 2014 | ||||||||||||||||
Servicing (1) | $ | 360,919,248 | $ | — | $ | 360,919,248 | ||||||||||
Subservicing | 50,360,366 | 216,111 | 50,576,477 | |||||||||||||
$ | 411,279,614 | $ | 216,111 | $ | 411,495,725 | |||||||||||
UPB at December 31, 2013 | ||||||||||||||||
Servicing (1) | $ | 397,546,635 | $ | — | $ | 397,546,635 | ||||||||||
Subservicing | 67,104,697 | 400,502 | 67,505,199 | |||||||||||||
$ | 464,651,332 | $ | 400,502 | $ | 465,051,834 | |||||||||||
UPB at September 30, 2013 | ||||||||||||||||
Servicing (1) | $ | 362,792,312 | $ | — | $ | 362,792,312 | ||||||||||
Subservicing | 72,027,114 | 495,312 | 72,522,426 | |||||||||||||
$ | 434,819,426 | $ | 495,312 | $ | 435,314,738 | |||||||||||
-1 | Includes primary servicing UPB of $160.8 billion, $175.1 billion and $177.1 billion at September 30, 2014, December 31, 2013 and September 30, 2013, respectively, for which the Rights to MSRs have been sold to HLSS. | |||||||||||||||
Schedule of Components of Servicing and Subservicing Fees | ' | |||||||||||||||
The following table presents the components of servicing and subservicing fees for the three and nine months ended September 30: | ||||||||||||||||
Three Months | Nine Months | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Loan servicing and subservicing fees: | ||||||||||||||||
Servicing | $ | 331,794 | $ | 335,884 | $ | 1,039,033 | $ | 887,500 | ||||||||
Subservicing | 30,926 | 35,286 | 95,509 | 115,437 | ||||||||||||
362,720 | 371,170 | 1,134,542 | 1,002,937 | |||||||||||||
Home Affordable Modification Program (HAMP) fees | 37,644 | 40,213 | 111,000 | 118,412 | ||||||||||||
Late charges | 27,634 | 30,445 | 97,002 | 85,930 | ||||||||||||
Loan collection fees | 8,655 | 8,387 | 25,573 | 22,524 | ||||||||||||
Custodial accounts (float earnings) | 1,831 | 743 | 5,235 | 4,533 | ||||||||||||
Other | 27,480 | 32,309 | 74,744 | 99,056 | ||||||||||||
$ | 465,964 | $ | 483,267 | $ | 1,448,096 | $ | 1,333,392 | |||||||||
Receivables_Tables
Receivables (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Receivables [Abstract] | ' | |||||||
Schedule of Receivables | ' | |||||||
Receivables consisted of the following at the dates indicated: | ||||||||
30-Sep-14 | 31-Dec-13 | |||||||
Servicing: | ||||||||
Government-insured loan claims (1) | $ | 60,236 | $ | 54,012 | ||||
Due from custodial accounts | 33,553 | 2,943 | ||||||
Reimbursable expenses | 21,575 | 35,933 | ||||||
Other servicing receivables | 26,673 | 31,649 | ||||||
142,037 | 124,537 | |||||||
Income taxes receivable | 56,174 | 6,369 | ||||||
Due from related parties (2) | 30,075 | 14,553 | ||||||
Other receivables (3) | 44,040 | 24,579 | ||||||
272,326 | 170,038 | |||||||
Allowance for losses (1) | (26,509 | ) | (17,522 | ) | ||||
$ | 245,817 | $ | 152,516 | |||||
-1 | The total allowance for losses at September 30, 2014 and December 31, 2013 includes $26.4 million and $17.4 million, respectively, related to receivables of our Servicing business. Allowance for losses related to defaulted FHA or VA insured loans repurchased from Ginnie Mae guaranteed securitizations (government-insured loan claims) at September 30, 2014 and December 31, 2013 were $17.4 million and $14.0 million, respectively. | |||||||
-2 | See Note 20 – Related Party Transactions for additional information. | |||||||
-3 | The balance at September 30, 2014 and December 31, 2013 includes $28.3 million and $13.6 million, respectively, related to losses expected to be indemnified under the terms of the merger agreement entered into in connection with the acquisition of Homeward. See Note 20 – Related Party Transactions for additional information regarding this receivable. |
Other_Assets_Tables
Other Assets (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Other Assets [Abstract] | ' | |||||||
Schedule of Other Assets | ' | |||||||
Other assets consisted of the following at the dates indicated: | ||||||||
September 30, 2014 | December 31, 2013 | |||||||
Debt service accounts (1) | $ | 100,003 | $ | 129,897 | ||||
Prepaid lender fees and debt issuance costs, net | 31,200 | 31,481 | ||||||
Purchase price deposit (2) | 25,000 | 10,000 | ||||||
Prepaid income taxes | 25,142 | 20,585 | ||||||
Prepaid expenses | 12,095 | 16,132 | ||||||
Derivatives, at fair value (3) | 6,169 | 15,494 | ||||||
Contingent assets - ResCap Acquisition (4) | — | 51,932 | ||||||
Investment in unconsolidated entities (5) | — | 11,771 | ||||||
Other | 37,631 | 21,851 | ||||||
$ | 237,240 | $ | 309,143 | |||||
-1 | Under our advance funding facilities, we are contractually required to remit collections on pledged advances to the trustee within two days of receipt. The collected funds are not applied to reduce the related match funded debt until the payment dates specified in the indenture. The balances also include amounts that have been set aside from the proceeds of our match funded advance facilities and certain of our warehouse facilities to provide for possible shortfalls in the funds available to pay certain expenses and interest. The funds related to match funded facilities are held in interest earning accounts in the name of the SPE created in connection with the facility. | |||||||
-2 | The balance at December 31, 2013 represents an initial cash deposit that we made in connection with the agreement we entered into on December 20, 2013 to acquire MSRs and related advances from Wells Fargo Bank, N.A. This deposit, along with an additional deposit of $15.0 million that we made in January 2014, is being held in an escrow account pending the transaction closing. See Note 22 – Commitments and Contingencies for additional information on this transaction. | |||||||
-3 | See Note 15 – Derivative Financial Instruments and Hedging Activities for additional information. | |||||||
-4 | As disclosed in Note 3 – Business Acquisitions, the purchase of certain MSRs and related advances from ResCap was not complete on the date of acquisition pending the receipt of certain consents and court approvals. We recorded a contingent asset effective on the date of the acquisition until we subsequently obtained the required consents and approvals for the MSRs and paid the additional purchase price. | |||||||
-5 | The balance at December 31, 2013 includes an investment of $5.1 million in OSI and an investment of $6.6 million in PowerLink Settlement Services, LP and related entities. As disclosed in Note 3 – Business Acquisitions, we increased our ownership in OSI from 26.00% to 87.35% on January 31, 2014. Effective on that date, we began including the accounts of OSI in our consolidated financial statements and eliminated our current investment in consolidation. In June 2014, we received proceeds from the dissolution of PowerLink Settlement Services, LP equal to our investment. |
Borrowings_Tables
Borrowings (Tables) | 9 Months Ended | ||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||
Debt Disclosure [Abstract] | ' | ||||||||||||||||||
Schedule of Match Funded Liabilities | ' | ||||||||||||||||||
Match funded liabilities are comprised of the following at the dates indicated: | |||||||||||||||||||
Borrowing Type | Interest Rate | Maturity (1) | Amortization Date (1) | Available Borrowing Capacity (2) | September 30, 2014 | December 31, 2013 | |||||||||||||
Advance Receivable Backed Notes Series 2012-ADV1 (3) | 1ML (4) + 175 bps | Jun. 2017 | Jun. 2015 | $ | 130,753 | $ | 344,247 | $ | 417,388 | ||||||||||
Advance Receivable Backed | 1ML + 300 bps | Dec. 2015 | Dec. 2014 | 44,987 | 5,013 | 33,211 | |||||||||||||
Note | |||||||||||||||||||
2012-Homeward Agency Advance Funding Trust | Cost of Funds + 300 bps | Apr. 2014 | Apr. 2014 | — | — | 21,019 | |||||||||||||
2012-1 (5) | |||||||||||||||||||
Advance Receivables Backed Notes, Series 2013-VF1, | 1ML + 175 bps (7)(11) | Oct. 2044 | Oct. 2014 | 156,812 | 843,188 | 1,494,628 | |||||||||||||
Class A (6) | |||||||||||||||||||
Advance Receivables Backed Notes, Series 2013-VF2, | 1ML + 167 bps (8)(11) | Oct. 2044 | Oct. 2014 | 75,693 | 408,019 | 385,645 | |||||||||||||
Class A (6) | |||||||||||||||||||
Advance Receivables Backed Notes, Series 2013-VF2, | 1ML + 425 bps (9)(11) | Oct. 2044 | Oct. 2014 | 2,711 | 13,577 | 12,923 | |||||||||||||
Class B (6) | |||||||||||||||||||
Advance Receivables Backed Notes - Series 2014-VF3, Class A (10) | 1ML + 175 bps (10)(11) | Oct. 2044 | Oct. 2014 | 78,405 | 421,595 | — | |||||||||||||
$ | 489,361 | $ | 2,035,639 | $ | 2,364,814 | ||||||||||||||
Weighted average interest rate | 1.91 | % | 2.08 | % | |||||||||||||||
-1 | The amortization date of our facilities is the date on which the revolving period ends under each advance facility note and repayment of the outstanding balance must begin if the note is not renewed or extended. The maturity date is the date on which all outstanding balances must be repaid. In two advance facilities, there are multiple notes outstanding. For each note, after the amortization date, all collections that represent the repayment of advances pledged to the facility must be applied to reduce the balance of the note outstanding, and any new advances are ineligible to be financed. | ||||||||||||||||||
-2 | Borrowing capacity is available to us provided that we have additional eligible collateral to pledge. Collateral may only be pledged to one facility. At September 30, 2014, only $51.2 million of the available borrowing capacity could be used based on the amount of eligible collateral that had been pledged. | ||||||||||||||||||
-3 | On October 28, 2014, the maximum borrowing capacity under this facility was reduced to $450.0 million and will further decline to $400.0 million in February 2015. | ||||||||||||||||||
-4 | 1-Month LIBOR (1ML) was 0.16% and 0.17% at September 30, 2014 and December 31, 2013, respectively. | ||||||||||||||||||
-5 | Advance facility assumed as part of the acquisition of Homeward. This facility was terminated on April 16, 2014, and the advances pledged to the facility were transferred to another facility. | ||||||||||||||||||
-6 | These notes were issued in connection with the OneWest MSR Transaction. On February 3, 2014, the maximum borrowing capacity on the 2013-VF2 notes was increased by $100.0 million to a total of $500.0 million. On March 17, 2014, the maximum borrowing capacity under the 2013-VF1 note declined by $500.0 million to a total of $1.0 billion. On October 1, 2014, the VF1 note was fully repaid. The maximum borrowing capacity of the VF2, Class A notes was increased to $564.0 million, and the maximum borrowing capacity of the VF2, Class B notes was increased to $36.0 million. In addition, the amortization date of the VF2 Class A and B notes was extended to October 15, 2015, and the maturity date was extended to October 15, 2045. Finally, a new series, the Series 2014-VF4 note, was issued with a maximum borrowing capacity of $600.0 million, an amortization date of October 15, 2015 and a maturity date of October 15, 2045. The interest margin on this new series of notes was set to 175 bps through July 14, 2015, to 200 bps on July 15, 2015, to 212 bps on August 15, 2015 and to 250 bps on September 15, 2015. | ||||||||||||||||||
-7 | The interest margin on these notes increased to 200 bps on July 15, 2014, to 225 bps on August 15, 2014 and 250 bps on September 15, 2014. | ||||||||||||||||||
-8 | The interest margin on these notes increased to 191 bps on July 15, 2014, to 215 bps on August 15, 2014 and 238 bps on September 15, 2014. Effective October 1, 2014, the interest margin on these notes was set to 167 bps through July 14, 2015, to 191 bps on July 15, 2015, to 215 bps on August 15, 2015 and to 239 bps on September 15, 2015. | ||||||||||||||||||
-9 | The interest margin on these notes increased to 486 bps on July 15, 2014, to 546 bps on August 15, 2014 and 607 bps on September 15, 2014. Effective October 1, 2014, the interest margin on these notes was set to 300 bps through July 14, 2015, to 343 bps on July 15, 2015, to 386 bps on August 15, 2015 and to 429 bps on September 15, 2015. | ||||||||||||||||||
-10 | This note was issued on March 17, 2014 with a maximum borrowing capacity of $500.0 million. The interest margin on this note increased to 200 bps on July 15, 2014, to 225 bps on August 15, 2014 and 250 bps on September 15, 2014. On October 1, 2014, the maximum borrowing capacity of the note was increased to $600.0 million, the amortization date was extended to October 15, 2015 and the maturity date was extended to October 15, 2045. The interest margin was set to 175 bps through July 14, 2015, to 200 bps on July 15, 2015, to 225 bps on August 15, 2015 and to 250 bps on September 15, 2015. | ||||||||||||||||||
-11 | On July 15, 2014, the lenders agreed to waive the increase in interest margin scheduled for July 15, 2014. On August 15, 2014, the lenders also agreed to waive the increases in interest margin that were scheduled for August 15, 2014 and September 15, 2014. | ||||||||||||||||||
Schedule of Financing Liabilities | ' | ||||||||||||||||||
Financing liabilities are comprised of the following at the dates indicated: | |||||||||||||||||||
Borrowings | Collateral | Interest Rate | Maturity | September 30, 2014 | December 31, 2013 | ||||||||||||||
Servicing: | |||||||||||||||||||
Financing liability – MSRs pledged | MSRs | -1 | -1 | $ | 618,855 | $ | 633,804 | ||||||||||||
Secured Notes, Ocwen Asset Servicing Income Series, Series 2014-1 (2) | MSRs | -2 | Feb. 2028 | 115,039 | — | ||||||||||||||
Financing Liability – Advances Pledged (3) | Advances on loans | -3 | -3 | 87,502 | — | ||||||||||||||
821,396 | 633,804 | ||||||||||||||||||
Lending: | |||||||||||||||||||
Financing liability - MSRs pledged (4) | MSRs | -4 | -4 | — | 17,593 | ||||||||||||||
HMBS-related borrowings (5) | Loans held for investment (LHFI) | 1ML + 245 bps | -5 | 1,236,094 | 615,576 | ||||||||||||||
1,236,094 | 633,169 | ||||||||||||||||||
$ | 2,057,490 | $ | 1,266,973 | ||||||||||||||||
-1 | The HLSS Transaction financing liabilities have no contractual maturity. The balance of the liability is adjusted each reporting period to its fair value based on the present value of the estimated future cash flows underlying the related MSRs. As discussed in Note 1A — Restatement of Previously Issued Consolidated Financial Statements, we are restating our previously reported consolidated operating results for the three and nine months ended September 30, 2013 to correct an error in the accounting applicable to the financing liabilities in connection with Rights to MSRs sold to HLSS. | ||||||||||||||||||
-2 | OASIS noteholders are entitled to receive a monthly payment amount equal to the sum of: a) the designated servicing fee amount (21 basis points of the UPB of the reference pool of Freddie Mac mortgages); b) any termination payment amounts; c) any excess refinance amounts; and d) the note redemption amounts, each as defined in the indenture supplement for the notes. The notes have a final stated maturity of February 2028. We accounted for this transaction as a financing. Monthly amortization of the liability is estimated using the proportion of monthly projected service fees on the underlying MSRs as a percentage of lifetime projected fees, adjusted for the term of the security. | ||||||||||||||||||
-3 | Certain advances were sold to HLSS Mortgage and HLSS SEZ LP on March 4, 2014 and May 2, 2014, respectively. These sales of advances did not qualify for sales accounting treatment and were accounted for as a financing. See Note 5 – Loans Held for Sale for additional information. | ||||||||||||||||||
-4 | Sales of MSRs to a third party accounted for as a financing. The financing liability was being amortized using the interest method with the servicing income that was remitted to the purchaser representing payments of principal and interest. In April 2014, we derecognized the remaining liability related to this MSR sale. During 2014, we recognized a gain of $2.6 million on the extinguishment of the financing liability. | ||||||||||||||||||
-5 | Represents amounts due to the holders of beneficial interests in Ginnie Mae guaranteed HMBS. The beneficial interests have no maturity dates, and the borrowings mature as the related loans are repaid. See Note 2 – Securitizations and Variable Interest Entities for additional information. | ||||||||||||||||||
Schedule of Other Secured Borrowings | ' | ||||||||||||||||||
Other secured borrowings are comprised of the following at the dates indicated: | |||||||||||||||||||
Borrowings | Collateral | Interest Rate | Maturity | Available Borrowing Capacity | September 30, 2014 | December 31, 2013 | |||||||||||||
Servicing: | |||||||||||||||||||
SSTL (1) | -1 | 1-Month Euro-dollar rate + 375 bps with a Eurodollar floor of 125 bps (1) | Feb. 2018 | $ | — | $ | 1,280,500 | $ | 1,290,250 | ||||||||||
Promissory note (2) | MSRs | 1ML + 350 bps | May-17 | — | — | 15,529 | |||||||||||||
Repurchase agreement (3) | Loans held for sale (LHFS) | 1ML + 200 - 345 bps | Jun. 2015 | 27,338 | 22,662 | 17,507 | |||||||||||||
27,338 | 1,303,162 | 1,323,286 | |||||||||||||||||
Lending: | |||||||||||||||||||
Master repurchase agreement (4) | LHFS | 1ML + 175 bps | Apr. 2015 | 17,199 | 132,801 | 105,659 | |||||||||||||
Participation agreement (5) | LHFS | N/A | May-15 | — | 54,369 | 81,268 | |||||||||||||
Master repurchase agreement (6) | LHFS | 1ML + 175 - 275 bps | Oct. 2014 | 10,645 | 64,355 | 91,990 | |||||||||||||
Master repurchase agreement (7) | LHFS | 1ML + 175 - 200 bps | Nov. 2014 | 99,527 | 50,473 | 89,836 | |||||||||||||
Master repurchase agreement (8) | LHFI | 1ML + 275bps | Oct. 2014 | 858 | 36,642 | 51,975 | |||||||||||||
Mortgage warehouse agreement (9) | LHFI | 1ML + 275 bps; floor of 350 bps | May-15 | 35,695 | 24,305 | 34,292 | |||||||||||||
163,924 | 362,945 | 455,020 | |||||||||||||||||
Corporate Items and Other: | |||||||||||||||||||
Securities sold under an agreement to repurchase (10) | Ocwen Real Estate Asset Liquidating Trust 2007-1 Notes | Class A-2 notes: 1ML + 200 bps; Class A-3 notes: 1ML + 300 bps | Monthly | — | 4,678 | 4,712 | |||||||||||||
191,262 | 1,670,785 | 1,783,018 | |||||||||||||||||
Discount (1) | — | (4,358 | ) | (5,349 | ) | ||||||||||||||
$ | 191,262 | $ | 1,666,427 | $ | 1,777,669 | ||||||||||||||
Weighted average interest rate | 4.94 | % | 4.86 | % | |||||||||||||||
-1 | This facility had an initial balance of $1.3 billion and was issued with an original issue discount of $6.5 million that we are amortizing over the term of the loan. We are required to repay the principal amount of the borrowings in consecutive quarterly installments of $3.3 million. In addition, we are generally required to use the net cash proceeds (as defined) from any asset sale (as defined) to repay loan principal, subject to a 270-day reinvestment provision (or, in the case of a sale of MSRs, related servicing advances or other related assets to HLSS, we have a 180-day reinvestment provision and the net cash proceeds must be invested in MSRs or related assets, such as advances). We are also required to make mandatory prepayments in certain circumstances based on our corporate leverage ratio (as defined) if we have positive consolidated excess cash flow (as defined) in any fiscal year. The borrowings are secured by a first priority security interest in substantially all of the assets of Ocwen. Borrowings bear interest, at the election of Ocwen, at a rate per annum equal to either (a) the base rate [the greatest of (i) the prime rate in effect on such day, (ii) the federal funds rate in effect on such day plus 0.50% and (iii) the one-month Eurodollar rate (1-Month LIBOR)], plus a margin of 2.75% and a base rate floor of 2.25% or (b) the one month Eurodollar rate, plus a margin of 3.75% with a one month Eurodollar floor of 1.25%. To date, we have elected option (b) to determine the interest rate. | ||||||||||||||||||
-2 | This note was repaid in full on February 28, 2014. | ||||||||||||||||||
-3 | Under this repurchase agreement, the lender provides financing on a committed basis for $50.0 million and, at the discretion of the lender, on an uncommitted basis for an additional $50.0 million. | ||||||||||||||||||
-4 | Under this repurchase agreement, the lender provides financing on a committed basis for $150.0 million and, at the discretion of the lender, on an uncommitted basis for an additional $150.0 million. | ||||||||||||||||||
-5 | Under this participation agreement, the lender provides financing on an uncommitted basis for $50.0 million to $100.0 million at the discretion of the lender. The participation agreement allows the lender to acquire a 100% beneficial interest in the underlying mortgage loans. The transaction does not qualify for sale accounting treatment and is accounted for as a secured borrowing. The lender earns the stated interest rate of the underlying mortgage loans while the loans are financed under the participation agreement. | ||||||||||||||||||
-6 | Under this repurchase agreement, the lender provides financing on a committed basis for $75.0 million and, at the discretion of the lender, on an uncommitted basis for an additional $75.0 million. On September 2, 2014, the maturity date of this facility was extended to October 2, 2014. On October 2, 2014, the maturity date was further extended to September 1, 2015. | ||||||||||||||||||
-7 | Under this repurchase agreement, the lender provides financing on a committed basis for $150.0 million and, at the discretion of the lender, on an uncommitted basis for an additional $300.0 million. On October 24, 2014, this facility was repaid in full and terminated. | ||||||||||||||||||
-8 | On September 2, 2014, the maturity date of this facility was extended to October 2, 2014, and the maximum borrowing capacity was reduced to $37.5 million on a committed basis plus an additional $37.5 million on an uncommitted basis at the discretion of the lender. On October 1, 2014, the maturity date was extended to October 31, 2014. Effective October 31, 2014, the maturity date was further extended to November 14, 2014. | ||||||||||||||||||
-9 | In August 2014, the maturity date of this facility was extended to May 28, 2015. | ||||||||||||||||||
-10 | Represents repurchase agreement for Class A-2 and A-3 notes issued by Ocwen Real Estate Asset Liquidating Trust 2007-1 which have a current face value of $22.4 million at September 30, 2014. This agreement has no stated credit limit and lending is determined for each transaction based on the acceptability of the securities presented as collateral. | ||||||||||||||||||
Debt Instrument Redemption | ' | ||||||||||||||||||
The redemption prices during the twelve-month periods beginning on May 15th of each year are as follows: | |||||||||||||||||||
Year | Redemption Price | ||||||||||||||||||
2016 | 104.97% | ||||||||||||||||||
2017 | 103.31% | ||||||||||||||||||
2018 and thereafter | 100.00% |
Other_Liabilities_Tables
Other Liabilities (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Other Liabilities Disclosure [Abstract] | ' | |||||||
Schedule of Other Liabilities | ' | |||||||
Other liabilities were comprised of the following at the dates indicated: | ||||||||
September 30, 2014 | December 31, 2013 | |||||||
Liability for indemnification obligations (1) | $ | 143,836 | $ | 192,716 | ||||
Accrued expenses (2) | 227,309 | 108,870 | ||||||
Payable to loan servicing and subservicing investors | 83,778 | 33,501 | ||||||
Due to related parties (3) | 60,235 | 77,997 | ||||||
Liability for selected tax items | 30,627 | 27,273 | ||||||
Checks held for escheat | 19,880 | 24,392 | ||||||
Liability for certain foreclosure matters (4) | — | 66,948 | ||||||
Additional purchase price due seller - ResCap Acquisition (5) | — | 54,220 | ||||||
Other | 65,976 | 58,678 | ||||||
$ | 631,641 | $ | 644,595 | |||||
-1 | See Note 22 – Commitments and Contingencies for additional information. | |||||||
-2 | Accrued expenses at September 30, 2014 includes $100.0 million related to certain regulatory contingencies. See Note 22 – Commitments and Contingencies for additional information. | |||||||
-3 | See Note 20 – Related Party Transactions for additional information. | |||||||
-4 | This liability was settled in May 2014. See Note 22 – Commitments and Contingencies for additional information regarding the National Mortgage Settlement. | |||||||
-5 | See Note 3 – Business Acquisitions for additional information. |
Mezzanine_Equity_Tables
Mezzanine Equity (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Temporary Equity Disclosure [Abstract] | ' | |||||||
Summary of Activity in Mezzanine Equity | ' | |||||||
The following table summarizes the activity in mezzanine equity for the nine months ended September 30: | ||||||||
2014 | 2013 | |||||||
Beginning balance | $ | 60,361 | $ | 153,372 | ||||
Conversion of Preferred Shares | (62,000 | ) | (100,000 | ) | ||||
Accretion of beneficial conversion feature discount (Deemed dividend) (1) | 1,639 | 6,573 | ||||||
Ending balance | $ | — | $ | 59,945 | ||||
-1 | Accretion includes an accelerated write-off of the unamortized discount of $0.8 million and $3.5 million related to the conversion of Preferred Shares during 2014 and 2013, respectively. |
Equity_Tables
Equity (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Equity [Abstract] | ' | |||||||
Schedule of Accumulated Other Comprehensive Loss (AOCL), Net of Income Taxes | ' | |||||||
The components of accumulated other comprehensive loss (AOCL), net of income taxes, were as follows at the dates indicated: | ||||||||
September 30, 2014 | December 31, 2013 | |||||||
Unrealized losses on cash flow hedges | $ | 8,663 | $ | 10,026 | ||||
Other | 121 | 125 | ||||||
$ | 8,784 | $ | 10,151 | |||||
Derivative_Financial_Instrumen1
Derivative Financial Instruments and Hedging Activities (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ||||||||||||||||
Schedule of Changes in Notional Balance of Holdings of Derivatives | ' | ||||||||||||||||
The following table summarizes the changes in the notional balances of our holdings of derivatives during the nine months ended September 30, 2014: | |||||||||||||||||
IRLCs | Forward MBS Trades | Interest Rate Caps | |||||||||||||||
Beginning notional balance | $ | 751,436 | $ | 950,648 | $ | 1,868,000 | |||||||||||
Additions | 3,795,311 | 6,951,828 | 100,000 | ||||||||||||||
Amortization | 94,571 | — | (490,000 | ) | |||||||||||||
Maturities | (3,298,265 | ) | (3,379,589 | ) | — | ||||||||||||
Terminations | (876,254 | ) | (3,762,592 | ) | — | ||||||||||||
Ending notional balance | $ | 466,799 | $ | 760,295 | $ | 1,478,000 | |||||||||||
Fair value of derivative assets (liabilities) at: | |||||||||||||||||
September 30, 2014 | $ | 6,117 | $ | (1,089 | ) | $ | 91 | ||||||||||
December 31, 2013 | $ | 8,433 | $ | 6,905 | $ | 442 | |||||||||||
Maturity | Nov. 2014 - Jan. 2014 | Nov. 2014 - Dec. 2014 | Nov. 2016 | ||||||||||||||
Schedule of Gains (Losses) on Derivatives | ' | ||||||||||||||||
The following summarizes our open derivative positions at September 30, 2014 and the gains (losses) on all derivatives used in each of the identified hedging programs for the year to date period then ended. None of the derivatives was designated as a hedge for accounting purposes at September 30, 2014: | |||||||||||||||||
Purpose | Expiration Date | Notional Amount | Fair Value (1) | Gains / (Losses) | Consolidated Statements of Operations Caption | ||||||||||||
Hedge the effect of changes in interest rates on interest expense on borrowings | |||||||||||||||||
Interest rate caps | |||||||||||||||||
Hedge the effect of changes in 1ML on advance funding facilities | Nov. 2016 | $ | 1,478,000 | $ | 91 | $ | (374 | ) | Other, net | ||||||||
Interest rate risk of mortgage loans held for sale and of IRLCs | |||||||||||||||||
Forward MBS trades | Nov. 2014 - Dec. 2014 | 760,295 | (1,089 | ) | (32,183 | ) | Gain on loans held for sale, net | ||||||||||
IRLCs | Nov. 2014 - Jan. 2014 | 466,799 | 6,117 | (2,315 | ) | Gain on loans held for sale, net | |||||||||||
Total derivatives | $ | 5,119 | $ | (34,872 | ) | ||||||||||||
-1 | Derivatives are reported at fair value in Receivables, Other assets and Other liabilities on our unaudited Consolidated Balance Sheet. | ||||||||||||||||
Schedule of Changes in the Losses on Cash Flow Hedges Included in AOCL | ' | ||||||||||||||||
Changes in AOCL during the nine months ended September 30 were as follows: | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Beginning balance | $ | 10,151 | $ | 6,441 | |||||||||||||
Additional net losses on cash flow hedges | — | 12,363 | |||||||||||||||
Ineffectiveness of cash flow hedges reclassified to earnings | — | (657 | ) | ||||||||||||||
Losses on terminated hedging relationships amortized to earnings | (1,579 | ) | (9,434 | ) | |||||||||||||
Net increase (decrease) in accumulated losses on cash flow hedges | (1,579 | ) | 2,272 | ||||||||||||||
Decrease (increase) in deferred taxes on accumulated losses on cash flow hedges | 217 | (933 | ) | ||||||||||||||
(Decrease) increase in accumulated losses on cash flow hedges, net of taxes | (1,362 | ) | 1,339 | ||||||||||||||
Other, net of taxes | (5 | ) | (711 | ) | |||||||||||||
Ending balance | $ | 8,784 | $ | 7,069 | |||||||||||||
Schedule of Statements of Operations Related to Derivative Financial Instruments | ' | ||||||||||||||||
Other income (expense), net, includes the following related to derivative financial instruments for the three and nine months ended September 30: | |||||||||||||||||
Three Months | Nine Months | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Losses on economic hedges | $ | (6 | ) | $ | (103 | ) | $ | (374 | ) | $ | (3,822 | ) | |||||
Ineffectiveness of cash flow hedges | — | — | — | (657 | ) | ||||||||||||
Write-off of losses in AOCL for a discontinued hedge relationship | (408 | ) | (7,780 | ) | (1,580 | ) | (9,434 | ) | |||||||||
$ | (414 | ) | $ | (7,883 | ) | $ | (1,954 | ) | $ | (13,913 | ) | ||||||
Interest_Expense_Tables
Interest Expense (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Other Income and Expenses [Abstract] | ' | |||||||||||||||
Schedule of Components of Interest Expense | ' | |||||||||||||||
The following table presents the components of interest expense for the three and nine months ended September 30: | ||||||||||||||||
Three months | Nine Months | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Financing liabilities (1) (2) | $ | 88,246 | $ | 81,192 | $ | 281,930 | $ | 185,116 | ||||||||
Other secured borrowings | 20,790 | 21,608 | 62,359 | 60,211 | ||||||||||||
Match funded liabilities | 15,097 | 10,775 | 46,762 | 65,774 | ||||||||||||
Senior unsecured notes | 6,141 | — | 9,466 | — | ||||||||||||
Other | 2,775 | 3,310 | 8,612 | 8,463 | ||||||||||||
$ | 133,049 | $ | 116,885 | $ | 409,129 | $ | 319,564 | |||||||||
-1 | Includes interest expense related to financing liabilities recorded in connection with the HLSS Transactions as indicated in the table below. As discussed in Note 1A — Restatement of Previously Issued Consolidated Financial Statements, we are restating our previously reported consolidated operating results for the three and nine months ended September 30, 2013 to correct an error in the accounting applicable to the financing liabilities in connection with Rights to MSRs sold to HLSS. | |||||||||||||||
Three months | Nine Months | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Servicing fees collected on behalf of HLSS | $ | 177,113 | $ | 200,838 | $ | 553,423 | $ | 431,795 | ||||||||
Less: Subservicing fee retained by Ocwen | 83,550 | 102,040 | 266,514 | 214,587 | ||||||||||||
Net servicing fees remitted to HLSS | 93,563 | 98,798 | 286,909 | 217,208 | ||||||||||||
Less: Reduction in financing liability | 8,736 | 17,764 | 12,960 | 32,357 | ||||||||||||
Interest expense on HLSS financing liability | $ | 84,827 | $ | 81,034 | $ | 273,949 | $ | 184,851 | ||||||||
-2 | Interest expense that we expect to be paid on the HMBS-related borrowings is included with net fair value gains in Other revenues. See Note 2 – Securitizations and Variable Interest Entities for additional information. | |||||||||||||||
Schedule of Related Party Interest Expense | ' | |||||||||||||||
Three months | Nine Months | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Servicing fees collected on behalf of HLSS | $ | 177,113 | $ | 200,838 | $ | 553,423 | $ | 431,795 | ||||||||
Less: Subservicing fee retained by Ocwen | 83,550 | 102,040 | 266,514 | 214,587 | ||||||||||||
Net servicing fees remitted to HLSS | 93,563 | 98,798 | 286,909 | 217,208 | ||||||||||||
Less: Reduction in financing liability | 8,736 | 17,764 | 12,960 | 32,357 | ||||||||||||
Interest expense on HLSS financing liability | $ | 84,827 | $ | 81,034 | $ | 273,949 | $ | 184,851 | ||||||||
Basic_and_Diluted_Earnings_Los1
Basic and Diluted Earnings (Loss) per Share (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Earnings Per Share [Abstract] | ' | |||||||||||||||
Schedule of Basic EPS to Diluted EPS | ' | |||||||||||||||
The following is a reconciliation of the calculation of basic EPS to diluted EPS for the three and nine months ended September 30: | ||||||||||||||||
Three Months | Nine Months | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Basic EPS: | ||||||||||||||||
Net income (loss) attributable to Ocwen common stockholders | $ | (76,189 | ) | $ | 54,725 | $ | 49,273 | $ | 164,120 | |||||||
Weighted average shares of common stock | 130,551,197 | 135,787,834 | 133,318,381 | 135,705,892 | ||||||||||||
Basic EPS | $ | (0.58 | ) | $ | 0.4 | $ | 0.37 | $ | 1.21 | |||||||
Diluted EPS (1): | ||||||||||||||||
Net income (loss) attributable to Ocwen common stockholders | $ | (76,189 | ) | $ | 54,725 | $ | 49,273 | $ | 164,120 | |||||||
Preferred stock dividends (1) (2) | — | — | — | — | ||||||||||||
Adjusted net income (loss) attributable to Ocwen | $ | (76,189 | ) | $ | 54,725 | $ | 49,273 | $ | 164,120 | |||||||
Weighted average shares of common stock | 130,551,197 | 135,787,834 | 133,318,381 | 135,705,892 | ||||||||||||
Effect of dilutive elements (1): | ||||||||||||||||
Preferred Shares (1) (2) | — | — | — | — | ||||||||||||
Stock options | — | 4,263,965 | 3,558,689 | 4,030,297 | ||||||||||||
Common stock awards | — | 5,396 | 4,256 | 11,301 | ||||||||||||
Dilutive weighted average shares of common stock | 130,551,197 | 140,057,195 | 136,881,326 | 139,747,490 | ||||||||||||
Diluted EPS | $ | (0.58 | ) | $ | 0.39 | $ | 0.36 | $ | 1.17 | |||||||
Stock options excluded from the computation of diluted EPS: | ||||||||||||||||
Anti-dilutive (3) | 91,250 | — | 47,083 | — | ||||||||||||
Market-based (4) | 295,000 | 547,500 | 295,000 | 547,500 | ||||||||||||
-1 | For the three months ended September 30, 2014, we have excluded the effect of the Preferred Shares, stock options and common stock awards from the computation of diluted EPS because of the anti-dilutive effect of our reported net loss. | |||||||||||||||
-2 | The effect of our Preferred Shares on diluted EPS is computed using the if-converted method. For purposes of computing diluted EPS, we assume the conversion of the Preferred Shares into shares of common stock unless the effect is anti-dilutive. Conversion of the Preferred Shares has not been assumed for the nine months ended September 30, 2014 and the three and nine months ended September 30, 2013 because the effect would have been antidilutive. | |||||||||||||||
-3 | These options were anti-dilutive because their exercise price was greater than the average market price of our stock. | |||||||||||||||
-4 | Shares that are issuable upon the achievement of certain performance criteria related to Ocwen’s stock price and an annualized rate of return to investors. |
Business_Segment_Reporting_Tab
Business Segment Reporting (Tables) | 9 Months Ended | |||||||||||||||||||
Sep. 30, 2014 | ||||||||||||||||||||
Segment Reporting Information [Line Items] | ' | |||||||||||||||||||
Schedule of Segment Reporting Information | ' | |||||||||||||||||||
Financial information for our segments is as follows: | ||||||||||||||||||||
Servicing | Lending | Corporate Items and Other | Corporate Eliminations | Business Segments Consolidated | ||||||||||||||||
Results of Operations | ||||||||||||||||||||
Three months ended September 30, 2014 | ||||||||||||||||||||
Revenue | $ | 485,303 | $ | 26,877 | $ | 1,557 | $ | (39 | ) | $ | 513,698 | |||||||||
Operating expenses (1) | 313,964 | 22,632 | 118,482 | (39 | ) | 455,039 | ||||||||||||||
Income (loss) from operations | 171,339 | 4,245 | (116,925 | ) | — | 58,659 | ||||||||||||||
Other income (expense): | ||||||||||||||||||||
Interest income | 903 | 4,825 | 865 | — | 6,593 | |||||||||||||||
Interest expense | (124,106 | ) | (2,601 | ) | (6,342 | ) | — | (133,049 | ) | |||||||||||
Other | (3,618 | ) | 139 | (990 | ) | — | (4,469 | ) | ||||||||||||
Other income (expense), net | (126,821 | ) | 2,363 | (6,467 | ) | — | (130,925 | ) | ||||||||||||
Income (loss) before income taxes | $ | 44,518 | $ | 6,608 | $ | (123,392 | ) | $ | — | $ | (72,266 | ) | ||||||||
Three months ended September 30, 2013 | ||||||||||||||||||||
Revenue | $ | 496,302 | $ | 33,539 | $ | 1,801 | $ | (402 | ) | $ | 531,240 | |||||||||
Operating expenses (1) | 305,654 | 29,504 | 11,143 | (41 | ) | 346,260 | ||||||||||||||
Income (loss) from operations | 190,648 | 4,035 | (9,342 | ) | (361 | ) | 184,980 | |||||||||||||
Other income (expense): | ||||||||||||||||||||
Interest income | 859 | 3,066 | 1,454 | — | 5,379 | |||||||||||||||
Interest expense (2) | (113,678 | ) | (3,279 | ) | 72 | — | (116,885 | ) | ||||||||||||
Other | (6,631 | ) | 1,843 | 398 | 361 | (4,029 | ) | |||||||||||||
Other income (expense), net | (119,450 | ) | 1,630 | 1,924 | 361 | (115,535 | ) | |||||||||||||
Income (loss) before income taxes | $ | 71,198 | $ | 5,665 | $ | (7,418 | ) | $ | — | $ | 69,445 | |||||||||
Servicing | Lending | Corporate Items and Other | Corporate Eliminations | Business Segments Consolidated | ||||||||||||||||
Nine months ended September 30, 2014 | ||||||||||||||||||||
Revenue | $ | 1,526,606 | $ | 86,811 | $ | 4,734 | $ | (118 | ) | $ | 1,618,033 | |||||||||
Operating expenses (1) | 919,998 | 81,261 | 148,555 | (118 | ) | 1,149,696 | ||||||||||||||
Income (loss) from operations | 606,608 | 5,550 | (143,821 | ) | — | 468,337 | ||||||||||||||
Other income (expense): | ||||||||||||||||||||
Interest income | 1,805 | 13,117 | 2,550 | — | 17,472 | |||||||||||||||
Interest expense | (391,122 | ) | (8,271 | ) | (9,736 | ) | — | (409,129 | ) | |||||||||||
Other | (4,622 | ) | 3,846 | 710 | — | (66 | ) | |||||||||||||
Other income (expense), net | (393,939 | ) | 8,692 | (6,476 | ) | — | (391,723 | ) | ||||||||||||
Income (loss) before income taxes | $ | 212,669 | $ | 14,242 | $ | (150,297 | ) | $ | — | $ | 76,614 | |||||||||
Nine months ended September 30, 2013 | ||||||||||||||||||||
Revenue | $ | 1,381,872 | $ | 81,180 | $ | 19,758 | $ | (492 | ) | $ | 1,482,318 | |||||||||
Operating expenses (1) | 795,645 | 69,543 | 95,361 | (131 | ) | 960,418 | ||||||||||||||
Income (loss) from operations | 586,227 | 11,637 | (75,603 | ) | (361 | ) | 521,900 | |||||||||||||
Other income (expense): | ||||||||||||||||||||
Interest income | 1,382 | 12,432 | 3,516 | — | 17,330 | |||||||||||||||
Interest expense (2) | (309,606 | ) | (10,108 | ) | 150 | — | (319,564 | ) | ||||||||||||
Other | (30,961 | ) | 6,852 | 2,977 | 361 | (20,771 | ) | |||||||||||||
Other income (expense), net | (339,185 | ) | 9,176 | 6,643 | 361 | (323,005 | ) | |||||||||||||
Income (loss) before income taxes | $ | 247,042 | $ | 20,813 | $ | (68,960 | ) | $ | — | $ | 198,895 | |||||||||
Servicing | Lending | Corporate Items and Other | Corporate Eliminations | Business Segments Consolidated | ||||||||||||||||
Total Assets | ||||||||||||||||||||
September 30, 2014 | $ | 6,059,359 | $ | 1,706,964 | $ | 589,317 | $ | — | $ | 8,355,640 | ||||||||||
December 31, 2013 | $ | 6,295,976 | $ | 1,195,812 | $ | 435,215 | $ | — | $ | 7,927,003 | ||||||||||
September 30, 2013 | $ | 4,086,378 | $ | 704,641 | $ | 609,236 | $ | — | $ | 5,400,255 | ||||||||||
-1 | Depreciation and amortization expense are as follows: | |||||||||||||||||||
Servicing | Lending | Corporate Items and Other | Business Segments Consolidated | |||||||||||||||||
For the three months ended September 30, 2014 | ||||||||||||||||||||
Depreciation expense | $ | 2,636 | $ | 98 | $ | 3,022 | $ | 5,756 | ||||||||||||
Amortization of mortgage servicing rights | 60,689 | 94 | — | 60,783 | ||||||||||||||||
Amortization of debt discount | 331 | — | 344 | 675 | ||||||||||||||||
Amortization of debt issuance costs | 1,114 | — | — | 1,114 | ||||||||||||||||
For the three months ended September 30, 2013 | ||||||||||||||||||||
Depreciation expense | $ | 3,589 | $ | 135 | $ | 2,973 | $ | 6,697 | ||||||||||||
Amortization of mortgage servicing rights | 79,035 | 148 | — | 79,183 | ||||||||||||||||
Amortization of debt discount | 330 | — | — | 330 | ||||||||||||||||
Amortization of debt issuance costs | 1,178 | — | — | 1,178 | ||||||||||||||||
For the nine months ended September 30, 2014 | ||||||||||||||||||||
Depreciation expense | $ | 8,099 | $ | 235 | $ | 8,267 | $ | 16,601 | ||||||||||||
Amortization of mortgage servicing rights | 185,263 | 613 | 199 | 186,075 | ||||||||||||||||
Amortization of debt discount | 991 | — | 513 | 1,504 | ||||||||||||||||
Amortization of debt issuance costs | 3,241 | — | — | 3,241 | ||||||||||||||||
For the nine months ended September 30, 2013 | ||||||||||||||||||||
Depreciation expense | $ | 9,968 | $ | 209 | $ | 6,976 | $ | 17,153 | ||||||||||||
Amortization of mortgage servicing rights | 197,287 | 148 | — | 197,435 | ||||||||||||||||
Amortization of debt discount | 1,082 | — | — | 1,082 | ||||||||||||||||
Amortization of debt issuance costs | 3,264 | — | — | 3,264 | ||||||||||||||||
-2 | Includes interest expense related to financing liabilities recorded in connection with the HLSS Transactions. As discussed in Note 1A — Restatement of Previously Issued Consolidated Financial Statements, we are restating our previously reported consolidated operating results for the three and nine months ended September 30, 2013 to correct an error in the accounting applicable to the financing liabilities in connection with Rights to MSRs sold to HLSS. | |||||||||||||||||||
Depreciation and Amortization [Member] | ' | |||||||||||||||||||
Segment Reporting Information [Line Items] | ' | |||||||||||||||||||
Schedule of Segment Reporting Information | ' | |||||||||||||||||||
Depreciation and amortization expense are as follows: | ||||||||||||||||||||
Servicing | Lending | Corporate Items and Other | Business Segments Consolidated | |||||||||||||||||
For the three months ended September 30, 2014 | ||||||||||||||||||||
Depreciation expense | $ | 2,636 | $ | 98 | $ | 3,022 | $ | 5,756 | ||||||||||||
Amortization of mortgage servicing rights | 60,689 | 94 | — | 60,783 | ||||||||||||||||
Amortization of debt discount | 331 | — | 344 | 675 | ||||||||||||||||
Amortization of debt issuance costs | 1,114 | — | — | 1,114 | ||||||||||||||||
For the three months ended September 30, 2013 | ||||||||||||||||||||
Depreciation expense | $ | 3,589 | $ | 135 | $ | 2,973 | $ | 6,697 | ||||||||||||
Amortization of mortgage servicing rights | 79,035 | 148 | — | 79,183 | ||||||||||||||||
Amortization of debt discount | 330 | — | — | 330 | ||||||||||||||||
Amortization of debt issuance costs | 1,178 | — | — | 1,178 | ||||||||||||||||
For the nine months ended September 30, 2014 | ||||||||||||||||||||
Depreciation expense | $ | 8,099 | $ | 235 | $ | 8,267 | $ | 16,601 | ||||||||||||
Amortization of mortgage servicing rights | 185,263 | 613 | 199 | 186,075 | ||||||||||||||||
Amortization of debt discount | 991 | — | 513 | 1,504 | ||||||||||||||||
Amortization of debt issuance costs | 3,241 | — | — | 3,241 | ||||||||||||||||
For the nine months ended September 30, 2013 | ||||||||||||||||||||
Depreciation expense | $ | 9,968 | $ | 209 | $ | 6,976 | $ | 17,153 | ||||||||||||
Amortization of mortgage servicing rights | 197,287 | 148 | — | 197,435 | ||||||||||||||||
Amortization of debt discount | 1,082 | — | — | 1,082 | ||||||||||||||||
Amortization of debt issuance costs | 3,264 | — | — | 3,264 | ||||||||||||||||
Related_Party_Transactions_Tab
Related Party Transactions (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Related Party Transactions [Abstract] | ' | |||||||||||||||
Schedule of Revenues and Expenses Related to Various Service Agreements | ' | |||||||||||||||
The following table summarizes revenues and expenses related to our agreements with Altisource, HLSS, AAMC and Residential (and, as applicable, their subsidiaries) for the three and nine months ended September 30 and net amounts receivable or payable at the dates indicated: | ||||||||||||||||
Three Months | Nine Months | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Revenues and Expenses: | ||||||||||||||||
Altisource: | ||||||||||||||||
Revenues | $ | 10,716 | $ | 5,185 | $ | 30,007 | $ | 15,390 | ||||||||
Expenses | 27,099 | 13,153 | 70,577 | 36,650 | ||||||||||||
HLSS: | ||||||||||||||||
Revenues | $ | 84 | $ | 20 | $ | 458 | $ | 172 | ||||||||
Expenses | 345 | 386 | 1,590 | 1,615 | ||||||||||||
AAMC | ||||||||||||||||
Revenues | $ | 251 | $ | — | $ | 952 | $ | — | ||||||||
Residential | ||||||||||||||||
Revenues | $ | 4,618 | $ | 493 | $ | 12,141 | $ | 606 | ||||||||
Schedule of Amounts Receivable or Payable | ' | |||||||||||||||
September 30, 2014 | December 31, 2013 | |||||||||||||||
Net Receivable (Payable) | ||||||||||||||||
Altisource | $ | (12,626 | ) | $ | (3,843 | ) | ||||||||||
HLSS | (17,812 | ) | (59,505 | ) | ||||||||||||
AAMC | 278 | 943 | ||||||||||||||
Residential | — | 50 | ||||||||||||||
$ | (30,160 | ) | $ | (62,355 | ) |
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||
Schedule of Indemnification Obligations | ' | |||||||
The following table presents the changes in our liability for representation and warranty obligations, compensatory fees for foreclosures that may ultimately exceed investor timelines and related indemnification obligations for the nine months ended September 30, 2014 and 2013: | ||||||||
2014 | 2013 | |||||||
Beginning balance | $ | 192,716 | $ | 38,140 | ||||
Provision for representation and warranty obligations | 5,076 | 18,116 | ||||||
New production reserves | 820 | 1,055 | ||||||
Obligations assumed in connection with MSR and servicing business acquisitions | — | 189,742 | ||||||
Charge-offs and other (1) | (54,776 | ) | (40,979 | ) | ||||
Ending balance | $ | 143,836 | $ | 206,074 | ||||
-1 | Includes principal and interest losses realized in connection with repurchased loans, make-whole, indemnification and fee payments and settlements net of recoveries, if any. |
Description_of_Business_and_Ba3
Description of Business and Basis of Presentation - Change in Accounting Estimate (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Change in Accounting Estimate [Line Items] | ' | ' | ' | ' |
Reduction in Amortization of mortgage servicing rights | ($60,783) | ($79,183) | ($186,075) | ($197,435) |
Net income attributable to Ocwen common stockholders | -76,189 | 54,725 | 49,273 | 164,120 |
Increase in Earnings per share attributable to Ocwen common stockholders: | ' | ' | ' | ' |
Basic (in USD per share) | ($0.58) | $0.40 | $0.37 | $1.21 |
Diluted (in USD per share) | ($0.58) | $0.39 | $0.36 | $1.17 |
MSR Amortization Change In Estimate [Member] | ' | ' | ' | ' |
Change in Accounting Estimate [Line Items] | ' | ' | ' | ' |
Reduction in Amortization of mortgage servicing rights | -21,309 | ' | -69,244 | ' |
Net income attributable to Ocwen common stockholders | $14,920 | ' | $48,485 | ' |
Increase in Earnings per share attributable to Ocwen common stockholders: | ' | ' | ' | ' |
Basic (in USD per share) | $0.11 | ' | $0.36 | ' |
Diluted (in USD per share) | $0.11 | ' | $0.35 | ' |
Description_of_Business_and_Ba4
Description of Business and Basis of Presentation - Narrative (Details) (Other Assets [Member], USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Dec. 31, 2013 |
Other Assets [Member] | ' |
Change in Accounting Estimate [Line Items] | ' |
Debt service accounts reclassified | $129.90 |
Restatement_of_Previously_Issu2
Restatement of Previously Issued Consolidated Financial Statements - Consolidated Statement of Operations Restated (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Interest expense | ($133,049) | ($116,885) | ($409,129) | ($319,564) |
Total other expense, net | -130,925 | -115,535 | -391,723 | -323,005 |
Income before income taxes | -72,266 | 69,445 | 76,614 | 198,895 |
Income tax expense (benefit) | 2,992 | 8,873 | 24,374 | 23,752 |
Net income (loss) | -75,258 | 60,572 | 52,240 | 175,143 |
Net income attributable to Ocwen common stockholders | -76,189 | 54,725 | 49,273 | 164,120 |
Earnings (loss) per share attributable to Ocwen common stockholders | ' | ' | ' | ' |
Basic (in USD per share) | ($0.58) | $0.40 | $0.37 | $1.21 |
Diluted (in USD per share) | ($0.58) | $0.39 | $0.36 | $1.17 |
As Reported [Member] | ' | ' | ' | ' |
Interest expense | ' | -110,055 | ' | -303,339 |
Total other expense, net | ' | -108,705 | ' | -306,780 |
Income before income taxes | ' | 76,275 | ' | 215,120 |
Income tax expense (benefit) | ' | 9,273 | ' | 26,250 |
Net income (loss) | ' | 67,002 | ' | 188,870 |
Net income attributable to Ocwen common stockholders | ' | 61,155 | ' | 177,847 |
Earnings (loss) per share attributable to Ocwen common stockholders | ' | ' | ' | ' |
Basic (in USD per share) | ' | $0.45 | ' | $1.31 |
Diluted (in USD per share) | ' | $0.44 | ' | $1.27 |
Restatement Adjustment [Member] | ' | ' | ' | ' |
Interest expense | ' | -6,830 | ' | -16,225 |
Total other expense, net | ' | -6,830 | ' | -16,225 |
Income before income taxes | ' | -6,830 | ' | -16,225 |
Income tax expense (benefit) | ' | -400 | ' | -2,498 |
Net income (loss) | ' | -6,430 | ' | -13,727 |
Net income attributable to Ocwen common stockholders | ' | ($6,430) | ' | ($13,727) |
Earnings (loss) per share attributable to Ocwen common stockholders | ' | ' | ' | ' |
Basic (in USD per share) | ' | ($0.05) | ' | ($0.10) |
Diluted (in USD per share) | ' | ($0.05) | ' | ($0.10) |
Restatement_of_Previously_Issu3
Restatement of Previously Issued Consolidated Financial Statements - Consolidated Statement of Comprehensive Income Restated (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Net income (loss) | ($75,258) | $60,572 | $52,240 | $175,143 |
Comprehensive income (loss) | -74,872 | 65,317 | 53,607 | 174,515 |
As Reported [Member] | ' | ' | ' | ' |
Net income (loss) | ' | 67,002 | ' | 188,870 |
Comprehensive income (loss) | ' | 71,747 | ' | 188,242 |
Restatement Adjustment [Member] | ' | ' | ' | ' |
Net income (loss) | ' | -6,430 | ' | -13,727 |
Comprehensive income (loss) | ' | ($6,430) | ' | ($13,727) |
Restatement_of_Previously_Issu4
Restatement of Previously Issued Consolidated Financial Statements - Consolidated Statement of Changes in Equity Restated (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Net income (loss) | ($75,258) | $60,572 | $52,240 | $175,143 |
As Reported [Member] | ' | ' | ' | ' |
Net income (loss) | ' | 67,002 | ' | 188,870 |
Restatement Adjustment [Member] | ' | ' | ' | ' |
Net income (loss) | ' | ($6,430) | ' | ($13,727) |
Restatement_of_Previously_Issu5
Restatement of Previously Issued Consolidated Financial Statements - Consolidated Statement of Cash Flows Restated (Details) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Net income (loss) | $52,240 | $175,143 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Decrease (increase) in deferred tax assets, net | 35,884 | -2,393 |
Net cash provided by operating activities | 559,015 | 1,004,230 |
Repayments of other secured borrowings | -4,532,029 | -7,166,050 |
Net cash used in financing activities | 294,004 | -916,911 |
As Reported [Member] | ' | ' |
Net income (loss) | ' | 188,870 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Decrease (increase) in deferred tax assets, net | ' | 105 |
Net cash provided by operating activities | ' | 1,020,455 |
Repayments of other secured borrowings | ' | -7,182,275 |
Net cash used in financing activities | ' | -933,136 |
Restatement Adjustment [Member] | ' | ' |
Net income (loss) | ' | -13,727 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Decrease (increase) in deferred tax assets, net | ' | -2,498 |
Net cash provided by operating activities | ' | -16,225 |
Repayments of other secured borrowings | ' | 16,225 |
Net cash used in financing activities | ' | $16,225 |
Securitization_and_Variable_In2
Securitization and Variable Interest Entities - Schedule of Cash Flows Related to Transfers Accounted for as Sales (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Transfers and Servicing [Abstract] | ' | ' | ' | ' |
Proceeds received from securitizations | $1,369,468 | $1,776,309 | $4,346,991 | $6,240,459 |
Servicing fees collected | 10,840 | 6,317 | 25,174 | 13,125 |
Purchases of previously transferred assets, net of claims reimbursed | 2,237 | 0 | 2,237 | 0 |
Cash flows received from and paid to securitization trusts, total | $1,382,545 | $1,782,626 | $4,374,402 | $6,253,584 |
Securitization_and_Variable_In3
Securitization and Variable Interest Entities - Schedule of Assets That Relate to Continuing Involvement with Transferred Financial Assets with Servicing Rights and Maximum Exposure to Loss Including the Unpaid Principal Balance (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Transfers and Servicing [Abstract] | ' | ' | ||
Mortgage servicing rights, at amortized cost | $84,397 | $44,615 | ||
Mortgage servicing rights, at fair value | 2,965 | 3,075 | ||
Advances and match funded advances | 10,153 | 15,888 | ||
Unpaid principal balance of loans transferred | 8,816,416 | [1] | 5,641,277 | [1] |
Maximum exposure to loss | $8,913,931 | $5,704,855 | ||
[1] | The UPB of the loans transferred is the maximum exposure to loss under our standard representations and warranties obligations. |
Securitization_and_Variable_In4
Securitization and Variable Interest Entities - Narrative (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | |||||||||
Sep. 30, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | |
Advance Receivable Backed Notes Series F [Member] | Advance Receivable Backed Notes Series F [Member] | Lending [Member] | Lending [Member] | HMBS - Related Borrowings [Member] | HMBS - Related Borrowings [Member] | Mortgage Servicing Rights - Amortized Costs [Member] | Mortgage Servicing Rights - Amortized Costs [Member] | Mortgage Servicing Rights - Amortized Costs [Member] | Mortgage Servicing Rights - Amortized Costs [Member] | Advance Receivable Backed Notes Series F [Member] | ||||
HECM [Member] | HECM [Member] | Maximum [Member] | ||||||||||||
Servicing Assets at Fair Value [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Average period to securitization | ' | '30 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquisitions | ' | ' | ' | ' | ' | ' | ' | ' | ' | $10,700,000 | $16,300,000 | $32,100,000 | $63,200,000 | ' |
Percentage of loan transferred through securitization 30 days or more past due | ' | 4.40% | 2.60% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Charge-offs, net of recoveries associated with transferred loans | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Secured borrowings | ' | ' | ' | ' | ' | ' | ' | 1,200,000,000 | 615,600,000 | ' | ' | ' | ' | ' |
Loans pledged as collateral | ' | ' | ' | ' | ' | 1,300,000,000 | 618,000,000 | ' | ' | ' | ' | ' | ' | ' |
Account payable under guarantee, percentage of notes outstanding | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% |
Transfers accounted for as secured borrowings, associated liabilities, carrying amount | $2,035,639,000 | $2,035,639,000 | $2,364,814,000 | $5,013,000 | $33,211,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business_Acquisitions_Purchase
Business Acquisitions - Purchase Price Allocation (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Feb. 15, 2013 | Feb. 15, 2013 | Feb. 15, 2013 | |||||
In Thousands, unless otherwise specified | ResCap [Member] | ResCap [Member] | ResCap [Member] | |||||||||
Initial Estimate [Member] | Adjustments [Member] | |||||||||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' | ' | |||||
MSRs | ' | ' | ' | ' | $401,314 | [1] | $393,891 | [1] | $7,423 | [1] | ||
Advances and match funded advances | ' | ' | ' | ' | 1,786,409 | [1] | 1,622,348 | [1] | 164,061 | [1] | ||
Deferred tax assets | ' | ' | ' | ' | 0 | 0 | 0 | |||||
Premises and equipment | ' | ' | ' | ' | 16,423 | 22,398 | -5,975 | |||||
Receivables and other assets | ' | ' | ' | ' | 2,989 | 2,989 | 0 | |||||
Other liabilities: | ' | ' | ' | ' | ' | ' | ' | |||||
Liability for indemnification obligations | -143,836 | [2] | -192,716 | [2] | -206,074 | -38,140 | -49,500 | -49,500 | 0 | |||
Other | ' | ' | ' | ' | -25,125 | -24,840 | -285 | |||||
Total identifiable net assets | ' | ' | ' | ' | 2,132,510 | 1,967,286 | 165,224 | |||||
Goodwill | 420,201 | 420,201 | ' | ' | 211,419 | 204,743 | 6,676 | |||||
Total consideration | ' | ' | ' | ' | $2,343,929 | $2,172,029 | $171,900 | |||||
[1] | As of the acquisition date, the purchase of certain MSRs from ResCap was not complete pending the receipt of certain consents and court approvals. Subsequent to the acquisition, we obtained the required consents and approvals for a portion of these MSRs and paid an additional purchase price of $174.6 million to acquire the MSRs and related advances, including $54.2 million in 2014. The purchase price allocation has been revised to include the resulting adjustments to MSRs, advances and goodwill. | |||||||||||
[2] | See Note 22 – Commitments and Contingencies for additional information. |
Business_Acquisitions_PostAcqu
Business Acquisitions - Post-Acquisition Results of Operations (Details) (ResCap [Member], USD $) | 3 Months Ended | 7 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2013 |
ResCap [Member] | ' | ' |
Business Acquisition [Line Items] | ' | ' |
Revenues | $212,164 | $508,589 |
Net income | $8,230 | $81,362 |
Business_Acquisitions_Pro_Form
Business Acquisitions - Pro Forma Results of Operations (Details) (ResCap [Member], USD $) | 9 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 |
ResCap [Member] | ' |
Business Acquisition [Line Items] | ' |
Revenues | $1,530,055 |
Net income | $205,062 |
Business_Acquisitions_Schedule
Business Acquisitions - Schedule of Restructuring Reserve Liability (Details) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | |
Employee termination benefits [Member] | ' | |
Restructuring Reserve [Roll Forward] | ' | |
Beginning balance | $4,816 | |
Additions charged to operations | 14,748 | [1] |
Amortization of discount | 0 | |
Payments | -17,215 | |
Ending balance | 2,349 | [2] |
Lease termination costs [Member] | ' | |
Restructuring Reserve [Roll Forward] | ' | |
Beginning balance | 7,432 | |
Additions charged to operations | 2,813 | [1] |
Amortization of discount | 115 | |
Payments | -2,928 | |
Ending balance | 7,432 | [2] |
Total [Member] | ' | |
Restructuring Reserve [Roll Forward] | ' | |
Beginning balance | 12,248 | |
Additions charged to operations | 17,561 | [1] |
Amortization of discount | 115 | |
Payments | -20,143 | |
Ending balance | $9,781 | [2] |
[1] | Of the additions charged to operations during the period, $14.4 million was recognized in the Servicing segment, $(0.1) million was recognized in the Lending segment and the remaining $3.3 million was recognized in the Corporate Items and Other segment. Charges related to employee termination benefits, lease termination costs and other contract termination costs are reported in Compensation and benefits expense, Occupancy and equipment expense and Other operating expenses, respectively, in the unaudited Consolidated Statements of Operations. The liabilities are included in Other liabilities in the unaudited Consolidated Balance Sheet. | |
[2] | We expect the remaining liability for employee termination benefits at September 30, 2014 to be settled in late 2014 or early 2015. |
Business_Acquisitions_Narrativ
Business Acquisitions - Narrative (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Feb. 15, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Feb. 15, 2013 | Feb. 15, 2013 | Feb. 15, 2013 | Feb. 15, 2013 | Feb. 15, 2013 | Mar. 31, 2013 | Mar. 31, 2013 | Mar. 31, 2013 | Mar. 31, 2013 | Mar. 30, 2013 | Apr. 01, 2013 | Apr. 01, 2013 | Jan. 31, 2014 | Jan. 31, 2014 | Jan. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | ||||
ResCap [Member] | ResCap [Member] | ResCap [Member] | ResCap [Member] | ResCap [Member] | ResCap [Member] | ResCap [Member] | ResCap [Member] | ResCap [Member] | ResCap [Member] | Correspondent One [Member] | Correspondent One [Member] | Correspondent One [Member] | Correspondent One [Member] | Correspondent One [Member] | Liberty Acquisition [Member] | Liberty Acquisition [Member] | OSI [Member] | OSI [Member] | OSI [Member] | Servicing [Member] | Lending [Member] | Corporate and Other [Member] | |||||||
loan | Senior Secured Term Loan [Member] | Mortgage Servicing Rights [Member] | Mortgage Servicing Rights [Member] | Subservice Mortgage Servicing Rights [Member] | Unrelated Party [Member] | Altisource [Member] | Altisource [Member] | ||||||||||||||||||||||
Freddie Mac and Ginnie Mae Loans [Member] | |||||||||||||||||||||||||||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Useful life of MSRs and goodwill | ' | ' | ' | '15 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Purchase price | ' | ' | ' | ' | [1] | $2,260,830,000 | [1] | $174,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $22,000,000 | ' | $11,000,000 | ' | ' | ' | ' | ' | ||
Contingent consideration | ' | ' | ' | 0 | [2] | ' | 0 | [2] | 54,220,000 | [2] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Unpaid principal balance assets acquired | ' | ' | ' | ' | ' | ' | ' | ' | ' | 44,900,000,000 | 111,200,000,000 | 27,000,000,000 | ' | ' | ' | ' | ' | ' | 55,200,000 | ' | ' | ' | ' | ' | ' | ||||
Debt instrument net additional capital deployed | ' | ' | ' | ' | ' | ' | ' | 840,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Face amount | ' | ' | ' | ' | ' | ' | ' | ' | 1,300,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Proceeds from Issuance of Debt | ' | ' | 1,200,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Number Of New Line Of Credit Facility | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Number Of Existing Line Of Credit Facility | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Percentage of voting interests acquired | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | 49.00% | ' | ' | ' | 87.35% | 26.00% | ' | ' | ' | ||||
Total consideration | ' | ' | ' | ' | ' | ' | ' | 2,343,929,000 | ' | ' | ' | ' | ' | ' | 900,000 | 12,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Recognized identifiable assets acquired and liabilities assumed, assets | ' | ' | ' | ' | [1] | 2,418,554,000 | [1] | ' | [1] | ' | ' | ' | ' | ' | ' | ' | 26,400,000 | ' | ' | ' | ' | 31,100,000 | ' | 20,000,000 | ' | ' | ' | ' | |
Cash | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 23,000,000 | ' | ' | ' | ' | 4,600,000 | ' | 3,200,000 | ' | ' | ' | ' | ||||
Recognized identifiable assets acquired and liabilities assumed, current assets, receivables | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,100,000 | ' | ' | ' | ' | 11,200,000 | ' | ' | ' | ' | ' | ' | ||||
Recognized loss on changes in fair value of investment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Repayment of outstanding debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9,100,000 | ' | ' | ' | ' | ' | ' | ' | ||||
Reverse mortgage acquired | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 60,000,000 | ' | ' | ' | ' | ' | ' | ||||
Recognized identifiable assets acquired and liabilities assumed, current assets, loans held for sale | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,300,000 | ' | ' | ' | ' | ' | ' | ||||
Purchase price allocation warehouse facilities | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -46,300,000 | ' | ' | ' | ' | ' | ' | ||||
Mortgage backed security borrowings | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -10,200,000 | ' | ' | ' | ' | ' | ' | ||||
Goodwill | 420,201,000 | 420,201,000 | ' | ' | ' | ' | ' | 211,419,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,000,000 | ' | ' | ' | ' | ' | ' | ||||
Recognized assets acquired and liabilities assumed | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ||||
Noncontrolling interest, ownership percentage by parent | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 12.65% | ' | ' | ' | ' | ||||
Recognized identifiable assets acquired and liabilities assumed, mortgage service rights | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9,000,000 | ' | ' | ' | ' | ||||
Recognized identifiable assets acquired and liabilities assumed, mortgage backed securities | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 7,700,000 | ' | ' | ' | ' | ||||
Additions charged to operations | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $14,400,000 | ($100,000) | $3,300,000 | ||||
[1] | See Note 3 – Business Acquisitions for information regarding the acquisitions of Ocwen Structured Investments, LLC and Correspondent One S.A. during the three months ended March 31, 2014 and 2013, respectively. | ||||||||||||||||||||||||||||
[2] | See Note 3 – Business Acquisitions for additional information. |
Fair_Value_Schedule_of_Fair_Va
Fair Value - Schedule of Fair Value Assets and Liabilities (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | ||
In Thousands, unless otherwise specified | ||||||
Loans held for sale: | ' | ' | ' | ' | ||
Loans held for sale, fair value | $335,950 | $503,753 | $335,102 | $426,480 | ||
Financing liabilities: | ' | ' | ' | ' | ||
HMBS-related borrowings, at fair value | 1,854,949 | 1,249,380 | ' | ' | ||
Carrying Value [Member] | ' | ' | ' | ' | ||
Loans held for sale: | ' | ' | ' | ' | ||
Loans held for sale, fair value | 407,887 | 566,660 | ' | ' | ||
Financing liabilities: | ' | ' | ' | ' | ||
Total Financing liabilities | 2,057,490 | 1,266,973 | ' | ' | ||
Other secured borrowings: | ' | ' | ' | ' | ||
Total Other secured borrowings | 1,666,427 | 1,777,669 | ' | ' | ||
MSRs: | ' | ' | ' | ' | ||
Total MSRs | 1,958,766 | 2,069,381 | ' | ' | ||
Carrying Value [Member] | Level 1 [Member] | Forward Mortgage Backed Securities Trades [Member] | ' | ' | ' | ' | ||
Derivative financial instruments: | ' | ' | ' | ' | ||
Derivative financial instruments | -1,089 | [1] | 6,905 | [1] | ' | ' |
Carrying Value [Member] | Level 2 [Member] | ' | ' | ' | ' | ||
Loans held for sale: | ' | ' | ' | ' | ||
Loans held for sale, fair value | 335,950 | [1] | 503,753 | [1] | ' | ' |
Other secured borrowings: | ' | ' | ' | ' | ||
Senior unsecured notes | 350,000 | 0 | ' | ' | ||
Carrying Value [Member] | Level 2 [Member] | Interest Rate Lock Commitments [Member] | ' | ' | ' | ' | ||
Derivative financial instruments: | ' | ' | ' | ' | ||
Derivative financial instruments | 6,117 | [1] | 8,433 | [1] | ' | ' |
Carrying Value [Member] | Level 3 [Member] | ' | ' | ' | ' | ||
Loans held for sale: | ' | ' | ' | ' | ||
Loans held for sale, at lower of cost or fair value | 71,937 | [2] | 62,907 | [2] | ' | ' |
Loans held for investment - Reverse mortgages, at fair value | 1,315,324 | [1] | 618,018 | [1] | ' | ' |
Advances and match funded advances | 3,346,865 | [3] | 3,443,215 | [3] | ' | ' |
Receivables, net | 245,817 | [3] | 152,516 | [3] | ' | ' |
Financial liabilities: | ' | ' | ' | ' | ||
Match Funded Liabilities | 2,035,639 | [3] | 2,364,814 | [3] | ' | ' |
Financing liabilities: | ' | ' | ' | ' | ||
HMBS-related borrowings, at fair value | 1,236,094 | [1] | 615,576 | [1] | ' | ' |
Financing liability - MSRs pledged | 618,855 | [1] | 633,804 | [1] | ' | ' |
Other | 202,541 | [3] | 17,593 | [3] | ' | ' |
Other secured borrowings: | ' | ' | ' | ' | ||
Senior secured term loan | 1,276,142 | [3] | 1,284,901 | [3] | ' | ' |
Other | 390,285 | [3] | 492,768 | [3] | ' | ' |
MSRs: | ' | ' | ' | ' | ||
MSRs, at fair value | 101,948 | [1] | 116,029 | [1] | ' | ' |
MSRs, at amortized cost | 1,856,818 | [3] | 1,953,352 | [3] | ' | ' |
Carrying Value [Member] | Level 3 [Member] | Interest Rate Cap [Member] | ' | ' | ' | ' | ||
Derivative financial instruments: | ' | ' | ' | ' | ||
Derivative financial instruments | 91 | [1] | 442 | [1] | ' | ' |
Fair Value [Member] | ' | ' | ' | ' | ||
Loans held for sale: | ' | ' | ' | ' | ||
Loans held for sale, fair value | 407,887 | 566,660 | ' | ' | ||
Financing liabilities: | ' | ' | ' | ' | ||
Total Financing liabilities | 2,061,210 | 1,266,973 | ' | ' | ||
Other secured borrowings: | ' | ' | ' | ' | ||
Total Other secured borrowings | 1,649,886 | 1,762,876 | ' | ' | ||
MSRs: | ' | ' | ' | ' | ||
Total MSRs | 2,466,341 | 2,557,748 | ' | ' | ||
Fair Value [Member] | Level 1 [Member] | Forward Mortgage Backed Securities Trades [Member] | ' | ' | ' | ' | ||
Derivative financial instruments: | ' | ' | ' | ' | ||
Derivative financial instruments | -1,089 | [1] | 6,905 | [1] | ' | ' |
Fair Value [Member] | Level 2 [Member] | ' | ' | ' | ' | ||
Loans held for sale: | ' | ' | ' | ' | ||
Loans held for sale, fair value | 335,950 | [1] | 503,753 | [1] | ' | ' |
Other secured borrowings: | ' | ' | ' | ' | ||
Senior unsecured notes | 338,625 | 0 | ' | ' | ||
Fair Value [Member] | Level 2 [Member] | Interest Rate Lock Commitments [Member] | ' | ' | ' | ' | ||
Derivative financial instruments: | ' | ' | ' | ' | ||
Derivative financial instruments | 6,117 | [1] | 8,433 | [1] | ' | ' |
Fair Value [Member] | Level 3 [Member] | ' | ' | ' | ' | ||
Loans held for sale: | ' | ' | ' | ' | ||
Loans held for sale, at lower of cost or fair value | 71,937 | [2] | 62,907 | [2] | ' | ' |
Loans held for investment - Reverse mortgages, at fair value | 1,315,324 | [1] | 618,018 | [1] | ' | ' |
Advances and match funded advances | 3,346,865 | [3] | 3,443,215 | [3] | ' | ' |
Receivables, net | 245,817 | [3] | 152,516 | [3] | ' | ' |
Financial liabilities: | ' | ' | ' | ' | ||
Match Funded Liabilities | 2,035,639 | [3] | 2,364,814 | [3] | ' | ' |
Financing liabilities: | ' | ' | ' | ' | ||
HMBS-related borrowings, at fair value | 1,236,094 | [1] | 615,576 | [1] | ' | ' |
Financing liability - MSRs pledged | 618,855 | [1] | 633,804 | [1] | ' | ' |
Other | 206,261 | [3] | 17,593 | [3] | ' | ' |
Other secured borrowings: | ' | ' | ' | ' | ||
Senior secured term loan | 1,259,601 | [3] | 1,270,108 | [3] | ' | ' |
Other | 390,285 | [3] | 492,768 | [3] | ' | ' |
MSRs: | ' | ' | ' | ' | ||
MSRs, at fair value | 101,948 | [1] | 116,029 | [1] | ' | ' |
MSRs, at amortized cost | 2,364,393 | [3] | 2,441,719 | [3] | ' | ' |
Fair Value [Member] | Level 3 [Member] | Interest Rate Cap [Member] | ' | ' | ' | ' | ||
Derivative financial instruments: | ' | ' | ' | ' | ||
Derivative financial instruments | $91 | [1] | $442 | [1] | ' | ' |
[1] | Measured at fair value on a recurring basis. | |||||
[2] | Measured at fair value on a non-recurring basis. | |||||
[3] | Disclosed, but not carried, at fair value. |
Fair_Value_Reconciliation_of_L
Fair Value - Reconciliation of Level 3 Assets (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | ||
Purchases, issuances, sales and settlements: | ' | ' | ' | ' | ||
Transfer from loans held for sale, at fair value | ' | ' | $110,874 | $0 | ||
Level 3 [Member] | ' | ' | ' | ' | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' | ' | ' | ' | ||
Beginning balance | -451,348 | -337,387 | -514,891 | -229,160 | ||
Purchases, issuances, sales and settlements: | ' | ' | ' | ' | ||
Purchases | 0 | 0 | 23 | 72 | ||
Issuances | 18,114 | -235,513 | -6,361 | -387,044 | ||
Transfer from loans held for sale, at fair value | ' | ' | 110,874 | ' | ||
Sales | 0 | 0 | 0 | 24,156 | ||
Settlements | -5,112 | [1] | 17,316 | -16,453 | [1] | 30,839 |
Purchases, issuances, sales and settlements, total | 13,002 | -218,197 | 88,083 | -331,977 | ||
Total realized and unrealized gains and (losses): | ' | ' | ' | ' | ||
Included in earnings | 760 | -722 | -10,778 | [2] | 17,194 | |
Included in Other comprehensive income (loss) | 0 | 0 | 0 | [2] | -12,363 | |
Total realized and unrealized gains and (losses) | 760 | -722 | -10,778 | [2] | 4,831 | |
Transfers in and / or out of Level 3 | 0 | ' | 0 | ' | ||
Ending balance | -437,586 | -556,306 | -437,586 | -556,306 | ||
Level 3 [Member] | Loans Held for Investment - Reverse Mortgages [Member] | ' | ' | ' | ' | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' | ' | ' | ' | ||
Beginning balance | 1,107,626 | 76,649 | 618,018 | 0 | ||
Purchases, issuances, sales and settlements: | ' | ' | ' | ' | ||
Purchases | 0 | 0 | 0 | 10,251 | ||
Issuances | 208,566 | 211,052 | 565,670 | 274,081 | ||
Transfer from loans held for sale, at fair value | ' | ' | 110,874 | ' | ||
Sales | 0 | 0 | 0 | 0 | ||
Settlements | -27,592 | [1] | -1,293 | -56,193 | [1] | -2,164 |
Purchases, issuances, sales and settlements, total | 180,974 | 209,759 | 620,351 | 282,168 | ||
Total realized and unrealized gains and (losses): | ' | ' | ' | ' | ||
Included in earnings | 26,724 | 4,445 | 76,955 | [2] | 8,685 | |
Included in Other comprehensive income (loss) | 0 | 0 | 0 | [2] | 0 | |
Total realized and unrealized gains and (losses) | 26,724 | 4,445 | 76,955 | [2] | 8,685 | |
Transfers in and / or out of Level 3 | 0 | 0 | 0 | 0 | ||
Ending balance | 1,315,324 | 290,853 | 1,315,324 | 290,853 | ||
Level 3 [Member] | Mortgage Servicing Rights [Member] | ' | ' | ' | ' | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' | ' | ' | ' | ||
Beginning balance | -629,579 | -437,734 | -633,804 | -303,705 | ||
Purchases, issuances, sales and settlements: | ' | ' | ' | ' | ||
Purchases | 0 | 0 | 0 | 0 | ||
Issuances | 0 | -239,851 | 0 | -388,473 | ||
Transfer from loans held for sale, at fair value | ' | ' | 0 | ' | ||
Sales | 0 | 0 | 0 | 0 | ||
Settlements | 10,724 | [1] | 17,764 | 14,949 | [1] | 32,357 |
Purchases, issuances, sales and settlements, total | 10,724 | -222,087 | 14,949 | -356,116 | ||
Total realized and unrealized gains and (losses): | ' | ' | ' | ' | ||
Included in earnings | 0 | 0 | 0 | [2] | 0 | |
Included in Other comprehensive income (loss) | 0 | 0 | 0 | [2] | 0 | |
Total realized and unrealized gains and (losses) | 0 | 0 | 0 | [2] | 0 | |
Transfers in and / or out of Level 3 | 0 | 0 | 0 | 0 | ||
Ending balance | -618,855 | -659,821 | -618,855 | -659,821 | ||
Level 3 [Member] | HMBS - Related Borrowings [Member] | ' | ' | ' | ' | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' | ' | ' | ' | ||
Beginning balance | -1,033,712 | -73,641 | -615,576 | 0 | ||
Purchases, issuances, sales and settlements: | ' | ' | ' | ' | ||
Purchases | 0 | 0 | 0 | -10,179 | ||
Issuances | -190,452 | -206,714 | -572,031 | -272,652 | ||
Transfer from loans held for sale, at fair value | ' | ' | 0 | ' | ||
Sales | 0 | 0 | 0 | 0 | ||
Settlements | 12,690 | [1] | 1,021 | 25,725 | [1] | 1,888 |
Purchases, issuances, sales and settlements, total | -177,762 | -205,693 | -546,306 | -280,943 | ||
Total realized and unrealized gains and (losses): | ' | ' | ' | ' | ||
Included in earnings | -24,620 | -4,942 | -74,212 | [2] | -3,333 | |
Included in Other comprehensive income (loss) | 0 | 0 | 0 | [2] | 0 | |
Total realized and unrealized gains and (losses) | -24,620 | -4,942 | -74,212 | [2] | -3,333 | |
Transfers in and / or out of Level 3 | 0 | 0 | 0 | 0 | ||
Ending balance | -1,236,094 | -284,276 | -1,236,094 | -284,276 | ||
Level 3 [Member] | Derivative Financial Instruments, Assets [Member] | ' | ' | ' | ' | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' | ' | ' | ' | ||
Beginning balance | 97 | 176 | 442 | -10,668 | ||
Purchases, issuances, sales and settlements: | ' | ' | ' | ' | ||
Purchases | 0 | 0 | 23 | 0 | ||
Issuances | 0 | 0 | 0 | 0 | ||
Transfer from loans held for sale, at fair value | ' | ' | 0 | ' | ||
Sales | 0 | ' | 0 | 24,156 | ||
Settlements | 0 | [1] | -176 | 0 | [1] | -1,242 |
Purchases, issuances, sales and settlements, total | 0 | -176 | 23 | 22,914 | ||
Total realized and unrealized gains and (losses): | ' | ' | ' | ' | ||
Included in earnings | -6 | 0 | -374 | [2] | 117 | |
Included in Other comprehensive income (loss) | 0 | 0 | 0 | [2] | -12,363 | |
Total realized and unrealized gains and (losses) | -6 | 0 | -374 | [2] | -12,246 | |
Transfers in and / or out of Level 3 | 0 | 0 | 0 | 0 | ||
Ending balance | 91 | 0 | 91 | 0 | ||
Level 3 [Member] | MSRS [Member] | ' | ' | ' | ' | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' | ' | ' | ' | ||
Beginning balance | 104,220 | 97,163 | 116,029 | 85,213 | ||
Purchases, issuances, sales and settlements: | ' | ' | ' | ' | ||
Purchases | 0 | 0 | 0 | 0 | ||
Issuances | 0 | 0 | 0 | 0 | ||
Transfer from loans held for sale, at fair value | ' | ' | 0 | ' | ||
Sales | 0 | 0 | 0 | 0 | ||
Settlements | -934 | [1] | 0 | -934 | [1] | 0 |
Purchases, issuances, sales and settlements, total | -934 | 0 | -934 | 0 | ||
Total realized and unrealized gains and (losses): | ' | ' | ' | ' | ||
Included in earnings | -1,338 | -225 | -13,147 | [2] | 11,725 | |
Included in Other comprehensive income (loss) | 0 | 0 | 0 | [2] | 0 | |
Total realized and unrealized gains and (losses) | -1,338 | -225 | -13,147 | [2] | 11,725 | |
Transfers in and / or out of Level 3 | 0 | ' | 0 | ' | ||
Ending balance | $101,948 | $96,938 | $101,948 | $96,938 | ||
[1] | In the event of a transfer of servicing to another party related to Rights to MSRs sold to HLSS, we are required to reimburse HLSS at predetermined contractual rates for the loss of servicing revenues. Settlements for Financing liability - MSRs pledged for the three and nine months ended September 30, 2014 includes $2.0 million of such reimbursements. | |||||
[2] | Total losses attributable to derivative financial instruments still held at September 30, 2014 were $0.4 million for the nine months ended September 30, 2014. |
Fair_Value_Narrative_Details
Fair Value - Narrative (Details) (USD $) | 9 Months Ended |
In Millions, unless otherwise specified | Sep. 30, 2014 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Gains (losses) attributable to derivatives | ($0.40) |
HMBS - Related Borrowings [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Life | '5 years 7 months 24 days |
Repayment rate | 19.28% |
Discount rate | 2.44% |
HMBS - Related Borrowings [Member] | Minimum [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Life | '4 years 11 months 19 days |
Repayment rate | 4.82% |
HMBS - Related Borrowings [Member] | Maximum [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Life | '10 years 9 months |
Repayment rate | 53.75% |
Borrowings [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Discount rate | 5.71% |
Loans Held for Investment - Reverse Mortgages [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Life | '6 years 11 months 27 days |
Repayment rate | 19.28% |
Discount rate | 3.20% |
Loans Held for Investment - Reverse Mortgages [Member] | Minimum [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Life | '6 years 7 months 21 days |
Repayment rate | 4.82% |
Loans Held for Investment - Reverse Mortgages [Member] | Maximum [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Life | '10 years 9 months |
Repayment rate | 53.75% |
Mortgage Servicing Rights [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Discount rate | 12.01% |
Prepayment rate | 14.16% |
Delinquency rate | 18.96% |
Mortgage Servicing Rights [Member] | Minimum [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Discount rate | 9.23% |
Prepayment rate | 9.87% |
Delinquency rate | 6.77% |
Fair value inputs basis spread on variable rate | 0.00% |
Mortgage Servicing Rights [Member] | Maximum [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Discount rate | 16.74% |
Prepayment rate | 16.82% |
Delinquency rate | 24.32% |
Fair value inputs basis spread on variable rate | 3.50% |
Fair Value Mortgage Servicing Rights [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Discount rate | 9.01% |
Prepayment rate | 8.55% |
HLSS [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Servicing Revenue, Reimbursement Payable | $2 |
Loans_Held_for_Sale_Fair_Value
Loans Held for Sale - Fair Value (Details) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Movement In Loans Held For Sale At Fair Value [Roll Forward] | ' | ' |
Beginning balance | $503,753 | $426,480 |
Originations and purchases | 3,923,870 | 5,988,501 |
Proceeds from sales | -4,010,644 | -6,033,785 |
Transfers to loans held for investment - reverse mortgages | -110,874 | 0 |
Gain (loss) on sale of loans | 39,486 | -46,962 |
Other | -9,641 | 868 |
Ending balance | $335,950 | $335,102 |
Loans_Held_for_Sale_Lower_of_C
Loans Held for Sale - Lower of Cost or Fair Value (Details) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Movement In Loans Held For Sale At Fair Value [Roll Forward] | ' | ' |
Beginning balance | $62,907 | $82,866 |
Purchases | 2,083,282 | 1,144,853 |
Proceeds from sales | -1,744,273 | -654,916 |
Principal payments | -248,552 | -317,528 |
Transfers to accounts receivable | -96,257 | -190,185 |
Transfers to real estate owned | -4,575 | -2,838 |
Gain on sale of loans | 32,471 | 20,336 |
Increase in valuation allowance | -16,282 | -6,510 |
Other | 3,216 | 10,675 |
Ending balance | $71,937 | $86,753 |
Loans_Held_for_Sale_Gain_Loss_
Loans Held for Sale - Gain (Loss) on Sale of Loans (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Receivables [Abstract] | ' | ' | ' | ' |
Gain on sales of loans | $42,185 | $4,622 | $145,455 | $36,156 |
Change in fair value of IRLCs | -4,188 | 18,912 | -2,315 | 5,918 |
Change in fair value of loans held for sale | -9,348 | 14,362 | -97 | 1,452 |
Gain (loss) on economic hedge instruments | -1,145 | -9,408 | -32,183 | 30,989 |
Other | -286 | -226 | -819 | -1,603 |
Gain on sale of loans held for investment | $27,218 | $28,262 | $110,041 | $72,912 |
Loans_Held_for_Sale_Narrative_
Loans Held for Sale - Narrative (Details) (USD $) | 0 Months Ended | 3 Months Ended | 9 Months Ended | 0 Months Ended | ||||||||||||||||
1-May-14 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | 1-May-14 | Mar. 03, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | Mar. 04, 2014 | Mar. 04, 2014 | Mar. 04, 2014 | 2-May-14 | 2-May-14 | |
Ginnie Mae [Member] | Ginnie Mae [Member] | Line of Credit [Member] | Line of Credit [Member] | Valuation Allowance for Loans Held for Sale [Member] | Valuation Allowance for Loans Held for Sale [Member] | HLSS [Member] | HLSS [Member] | HLSS [Member] | HLSS SEZ LP [Member] | Unrelated Party [Member] | ||||||||||
Lending [Member] | Servicing [Member] | FHA Buyout Loans [Member] | Servicing Advances [Member] | |||||||||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Collateral | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $311,800,000 | $21,100,000 | ' | ' | ' | ' | ' | ' | ' |
Valuation allowance | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 47,000,000 | 27,000,000 | ' | ' | ' | ' | ' |
Loans held for sale, at lower of cost or fair value | ' | 71,937,000 | 86,753,000 | 71,937,000 | 86,753,000 | ' | ' | 62,907,000 | 82,866,000 | 24,100,000 | 60,800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unpaid principal balance | ' | ' | ' | ' | ' | 451,000,000 | 549,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds from sale of loans held-for-sale | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 612,300,000 | 556,600,000 | 55,700,000 | 20,200,000 | 462,500,000 |
Gain on loans held for sale, net | ' | 27,218,000 | 28,262,000 | 110,041,000 | 72,912,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 7,200,000 | ' | ' | ' | 1,300,000 |
Payments to purchase loans held-for-sale | 479,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquisitions | ' | 10,700,000 | 16,300,000 | 32,100,000 | 63,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Loans restricted for securitization investors fair value | ' | 9,900,000 | 4,300,000 | 50,600,000 | 20,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gain on sales of reverse mortgage loans | ' | $20,400,000 | $14,500,000 | $51,400,000 | $20,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Advances_Schedule_of_Advance_P
Advances - Schedule of Advance Payments by Financial Institution on Foreclosed Properties (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | ||
In Thousands, unless otherwise specified | ||||||
Servicing: | ' | ' | ' | ' | ||
Advances | $987,286 | $890,832 | $944,931 | $184,463 | ||
Servicing, Principal and Interest [Member] | ' | ' | ' | ' | ||
Servicing: | ' | ' | ' | ' | ||
Advances | 198,540 | 141,307 | ' | ' | ||
Servicing, Taxes and Insurance [Member] | ' | ' | ' | ' | ||
Servicing: | ' | ' | ' | ' | ||
Advances | 443,255 | 477,039 | ' | ' | ||
Servicing, Foreclosures and Bankruptcy Costs [Member] | ' | ' | ' | ' | ||
Servicing: | ' | ' | ' | ' | ||
Advances | 340,882 | [1] | 268,053 | [1] | ' | ' |
Servicing [Member] | ' | ' | ' | ' | ||
Servicing: | ' | ' | ' | ' | ||
Advances | 982,677 | 886,399 | ' | ' | ||
Corporate Items and Other [Member] | ' | ' | ' | ' | ||
Servicing: | ' | ' | ' | ' | ||
Advances | $4,609 | $4,433 | ' | ' | ||
[1] | The balances at September 30, 2014 and December 31, 2013 are net of an allowance for losses of $48.4 million and $38.4 million, respectively. |
Advances_Schedule_of_Activity_
Advances - Schedule of Activity in Advances (Details) (USD $) | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | ||
Advances [Roll Forward] | ' | ' | ||
Beginning balance | $890,832 | $184,463 | ||
Acquisitions | 99,318 | [1] | 708,415 | [1] |
Transfers to match funded advances | -10,156 | -131,197 | ||
Sales of advances to HLSS | 0 | [2] | -61,673 | [2] |
New advances, net of collections and other | 7,292 | 244,923 | ||
Ending balance | $987,286 | $944,931 | ||
[1] | Servicing advances acquired through business acquisitions and asset acquisitions, primarily in connection with the acquisition of MSRs. See Note 3 – Business Acquisitions, Note 5 – Loans Held for Sale and Note 8 – Mortgage Servicing for additional information. | |||
[2] | We periodically sell Rights to MSRs and the related servicing advances to HLSS. The related advance sales generally meet the requirements for sale accounting and are derecognized from our financial statements at the time of the sale. In connection with the Ginnie Mae EBO Transactions completed during 2014, we transferred advances related to certain FHA-insured mortgage loans to HLSS Mortgage and HLSS SEZ LP in transactions which did not qualify as sales for accounting purposes. See Note 4 – Fair Value and Note 5 – Loans Held for Sale for additional information. |
Advances_Narrative_Details
Advances - Narrative (Details) (Servicing, Foreclosures and Bankruptcy Costs [Member], USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Servicing, Foreclosures and Bankruptcy Costs [Member] | ' | ' |
Advances On Behalf of Borrowers [Line Items] | ' | ' |
Allowance for losses on advances | $48.40 | $38.40 |
Match_Funded_Advances_Schedule
Match Funded Advances - Schedule of Advance Payments by Financial Institution on Foreclosed Properties (Details) (Residential Mortgage [Member], USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||||
Residential Mortgage [Member] | ' | ' | ' | ' |
Match Funded Advances [Line Items] | ' | ' | ' | ' |
Principal and interest | $1,360,568 | $1,497,649 | ' | ' |
Taxes and insurance | 788,612 | 830,113 | ' | ' |
Foreclosures, bankruptcy, real estate and other | 210,399 | 224,621 | ' | ' |
Match funded advances | $2,359,579 | $2,552,383 | $533,725 | $3,049,244 |
Match_Funded_Advances_Schedule1
Match Funded Advances - Schedule of Activity in Match Funded Advances (Details) (Residential Mortgage [Member], USD $) | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | ||
Residential Mortgage [Member] | ' | ' | ||
Match Funded Advances [Roll Forward] | ' | ' | ||
Beginning balance | $2,552,383 | $3,049,244 | ||
Acquisitions | 85,521 | [1] | 1,448,371 | [1] |
Transfers from advances | 10,156 | 131,197 | ||
Sales of advances to HLSS | 0 | [2] | -3,428,234 | [2] |
Collections, net of new advances and other | -288,481 | -666,853 | ||
Ending balance | $2,359,579 | $533,725 | ||
[1] | Servicing advances acquired in connection with the acquisitions of MSRs through business acquisitions and asset acquisitions. See Note 3 – Business Acquisitions and Note 8 – Mortgage Servicing for additional information. | |||
[2] | See Note 6 – Advances for additional information. |
Mortgage_Servicing_Schedule_of
Mortgage Servicing - Schedule of Activity Related to MSRs - Amortization Method (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | ||||||||||
In Thousands, unless otherwise specified | Total [Member] | Total [Member] | Total [Member] | Total [Member] | Total [Member] | Total [Member] | Total [Member] | Total [Member] | Total [Member] | Total [Member] | Total [Member] | Total [Member] | Total [Member] | Total [Member] | Total [Member] | Total [Member] | ||||||||||||
OSI [Member] | OSI [Member] | ResCap Acquisition [Member] | ResCap Acquisition [Member] | Liberty Home Equity Solutions, Inc. [Member] | Liberty Home Equity Solutions, Inc. [Member] | Ally MSR Transaction [Member] | Ally MSR Transaction [Member] | OneWest MSR Transaction [Member] | OneWest MSR Transaction [Member] | Greenpoint MSR Transaction [Member] | Greenpoint MSR Transaction [Member] | Other [Member] | Other [Member] | |||||||||||||||
Servicing Asset at Amortized Cost, Balance [Roll Forward] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||
Beginning balance | ' | ' | $1,953,352 | $678,937 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||
Additions recognized in connection with acquisitions | ' | ' | ' | ' | 9,008 | [1] | 0 | [1] | 11,370 | [1] | 391,853 | [1] | 0 | [1] | 2,532 | [1] | 0 | 683,787 | 1,516 | [2] | 127,047 | [2] | 3,690 | [3] | 0 | [3] | 14,132 | 3,003 |
Additions recognized on the sale of mortgage loans | ' | ' | 50,480 | 63,154 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||
Sales | ' | ' | -137 | -17,523 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||
Servicing transfers and adjustments | ' | ' | -518 | 2,052 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||
Amortization | ' | ' | -186,075 | -197,899 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||
Ending balance | ' | ' | 1,856,818 | 1,736,943 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||
Estimated fair value at end of period | $101,948 | $116,029 | $2,364,393 | $2,532,239 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||
[1] | See Note 3 – Business Acquisitions for additional information regarding MSRs recognized in connection with business acquisitions. | |||||||||||||||||||||||||||
[2] | The acquired MSRs in 2014 relate to mortgage loans with a UPB of $1.1 billion and related servicing advances of $34.3 million acquired in the final closing of the OneWest MSR Transaction. The OneWest MSR Transaction closed in stages, and the majority of loans were boarded onto our primary servicing platform as of December 31, 2013. As of September 30, 2013, we had acquired MSRs of $127.0 million with a UPB of $30.5 billion and related servicing advance receivables of $371.6 million. | |||||||||||||||||||||||||||
[3] | The acquired MSRs relate to mortgage loans with a UPB of $948.9 million and related servicing advances of $47.6 million. |
Mortgage_Servicing_Schedule_of1
Mortgage Servicing - Schedule of Activity Related to MSRs - Fair Value Method (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | ||
In Thousands, unless otherwise specified | Conventional [Member] | Conventional [Member] | ||||
Servicing Asset at Fair Value, Amount [Roll Forward] | ' | ' | ' | ' | ||
Beginning balance | $101,948 | $116,029 | $116,029 | $85,213 | ||
Servicing transfers | ' | ' | -934 | 0 | ||
Changes in fair value | ' | ' | ' | ' | ||
Changes in assumptions | ' | ' | -12,217 | [1] | 19,800 | [1] |
Realization of cash flows and other changes | ' | ' | -930 | [1] | -8,075 | [1] |
Ending balance | $101,948 | $116,029 | $101,948 | $96,938 | ||
[1] | Changes in fair value are recognized in Servicing and origination expense in the unaudited Consolidated Statements of Operations. |
Mortgage_Servicing_Schedule_of2
Mortgage Servicing - Schedule of Estimated Change in the Fair Value of Our MSRs (Details) (USD $) | Sep. 30, 2014 |
In Thousands, unless otherwise specified | |
Transfers and Servicing [Abstract] | ' |
Weighted average prepayment speeds, 10% | ($8,245) |
Weighted average prepayment speeds, 20% | -16,137 |
Discount rate (Option-adjusted spread), 10% | -4,100 |
Discount rate (Option-adjusted spread), 20% | ($7,905) |
Mortgage_Servicing_Schedule_of3
Mortgage Servicing - Schedule of Composition of Servicing and Subservicing Portfolios by Type of Property Serviced (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | |||
In Thousands, unless otherwise specified | ||||||
Residential Mortgage [Member] | ' | ' | ' | |||
Schedule of Servicing and Subservicing Portfolio [Line Items] | ' | ' | ' | |||
Servicing | $360,919,248 | [1] | $397,546,635 | [1] | $362,792,312 | [1] |
Subservicing | 50,360,366 | 67,104,697 | 72,027,114 | |||
Assets Serviced | 411,279,614 | 464,651,332 | 434,819,426 | |||
Commercial Real Estate [Member] | ' | ' | ' | |||
Schedule of Servicing and Subservicing Portfolio [Line Items] | ' | ' | ' | |||
Servicing | 0 | [1] | 0 | [1] | 0 | [1] |
Subservicing | 216,111 | 400,502 | 495,312 | |||
Assets Serviced | 216,111 | 400,502 | 495,312 | |||
Total [Member] | ' | ' | ' | |||
Schedule of Servicing and Subservicing Portfolio [Line Items] | ' | ' | ' | |||
Servicing | 360,919,248 | [1] | 397,546,635 | [1] | 362,792,312 | [1] |
Subservicing | 50,576,477 | 67,505,199 | 72,522,426 | |||
Assets Serviced | $411,495,725 | $465,051,834 | $435,314,738 | |||
[1] | Includes primary servicing UPB of $160.8 billion, $175.1 billion and $177.1 billion at September 30, 2014, December 31, 2013 and September 30, 2013, respectively, for which the Rights to MSRs have been sold to HLSS. |
Mortgage_Servicing_Schedule_of4
Mortgage Servicing - Schedule of Components of Servicing and Subservicing Fees (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Transfers and Servicing [Abstract] | ' | ' | ' | ' |
Servicing | $331,794 | $335,884 | $1,039,033 | $887,500 |
Subservicing | 30,926 | 35,286 | 95,509 | 115,437 |
Servicing and Subservicing fees, total | 362,720 | 371,170 | 1,134,542 | 1,002,937 |
Home Affordable Modification Program (HAMP) fees | 37,644 | 40,213 | 111,000 | 118,412 |
Late charges | 27,634 | 30,445 | 97,002 | 85,930 |
Loan collection fees | 8,655 | 8,387 | 25,573 | 22,524 |
Custodial accounts (float earnings) | 1,831 | 743 | 5,235 | 4,533 |
Other | 27,480 | 32,309 | 74,744 | 99,056 |
Fees, total | $465,964 | $483,267 | $1,448,096 | $1,333,392 |
Mortgage_Servicing_Narrative_D
Mortgage Servicing - Narrative (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Feb. 26, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Feb. 26, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 |
Mortgage Servicing Rights [Member] | OneWest MSR Transaction [Member] | OneWest MSR Transaction [Member] | Greenpoint MSR Transaction [Member] | OASIS Series 2014-1 [Member] | HLSS [Member] | HLSS [Member] | HLSS [Member] | ||||
Mortgage Servicing Rights [Member] | Mortgage Servicing Rights [Member] | Mortgage Servicing Rights [Member] | Other Secured Borrowings [Member] | ||||||||
Servicing Asset at Amortized Cost [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Asset acquisition loans unpaid principal balance | ' | ' | ' | ' | $30,500,000,000 | $1,100,000,000 | $948,900,000 | ' | ' | ' | ' |
Asset acquisition advances acquired | ' | ' | ' | ' | 371,600,000 | 34,300,000 | 47,600,000 | ' | ' | ' | ' |
Acquisitions | ' | ' | ' | ' | 127,000,000 | ' | ' | ' | ' | ' | ' |
Face amount | ' | ' | ' | ' | ' | ' | ' | 123,600,000 | ' | ' | ' |
Principal amount outstanding on loans securitized or asset-backed financing arrangement | ' | ' | ' | 11,800,000,000 | ' | ' | ' | ' | ' | ' | ' |
Unpaid Principal Balance | ' | ' | ' | ' | ' | ' | ' | ' | 160,800,000,000 | 175,100,000,000 | 177,100,000,000 |
Unpaid principal balance of small balance commercial loans serviced | 2,400,000,000 | 2,600,000,000 | 2,500,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Float balances | $3,700,000,000 | ' | $3,500,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Receivables_Schedule_of_Receiv
Receivables - Schedule of Receivables (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Receivables [Abstract] | ' | ' | ||
Servicing receivable, government-insured loan claims | $60,236 | [1] | $54,012 | [1] |
Servicing receivable, due from custodial accounts | 33,553 | 2,943 | ||
Servicing receivable, reimbursable expenses | 21,575 | 35,933 | ||
Servicing receivable, other | 26,673 | 31,649 | ||
Servicing receivable, total | 142,037 | 124,537 | ||
Income taxes receivable | 56,174 | 6,369 | ||
Due from related parties | 30,075 | [2] | 14,553 | [2] |
Other receivables | 44,040 | [3] | 24,579 | [3] |
Other receivables, gross | 272,326 | 170,038 | ||
Allowance for losses | -26,509 | [1] | -17,522 | [1] |
Receivables, total | $245,817 | $152,516 | ||
[1] | The total allowance for losses at September 30, 2014 and December 31, 2013 includes $26.4 million and $17.4 million, respectively, related to receivables of our Servicing business. Allowance for losses related to defaulted FHA or VA insured loans repurchased from Ginnie Mae guaranteed securitizations (government-insured loan claims) at September 30, 2014 and December 31, 2013 were $17.4 million and $14.0 million, respectively. | |||
[2] | See Note 20 – Related Party Transactions for additional information. | |||
[3] | The balance at September 30, 2014 and December 31, 2013 includes $28.3 million and $13.6 million, respectively, related to losses expected to be indemnified under the terms of the merger agreement entered into in connection with the acquisition of Homeward. See Note 20 – Related Party Transactions for additional information regarding this receivable. |
Receivables_Narrative_Detail
Receivables - Narrative (Detail) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | ||
In Millions, unless otherwise specified | ||||
Receivables [Abstract] | ' | ' | ||
Servicing receivables, allowance for losses | ($26.40) | [1] | ($17.40) | [1] |
Allowance for losses related to FHA or VA insured loans | 17.4 | 14 | ||
Other receivables, probable losses | $28.30 | $13.60 | ||
[1] | The total allowance for losses at September 30, 2014 and December 31, 2013 includes $26.4 million and $17.4 million, respectively, related to receivables of our Servicing business. Allowance for losses related to defaulted FHA or VA insured loans repurchased from Ginnie Mae guaranteed securitizations (government-insured loan claims) at September 30, 2014 and December 31, 2013 were $17.4 million and $14.0 million, respectively. |
Other_Assets_Schedule_of_Other
Other Assets - Schedule of Other Assets (Details) (USD $) | Sep. 30, 2014 | Jan. 31, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | |||||
Other Assets [Abstract] | ' | ' | ' | ||
Debt service accounts | $100,003 | [1] | ' | $129,897 | [1] |
Prepaid lender fees and debt issuance costs, net | 31,200 | ' | 31,481 | ||
Purchase price deposit | 25,000 | [2] | 15,000 | 10,000 | [2] |
Prepaid income taxes | 25,142 | ' | 20,585 | ||
Prepaid expenses | 12,095 | ' | 16,132 | ||
Derivatives, at fair value | 6,169 | [3] | ' | 15,494 | [3] |
Contingent assets - ResCap Acquisition | 0 | [4] | ' | 51,932 | [4] |
Investment in unconsolidated entities | 0 | [5] | ' | 11,771 | [5] |
Other | 37,631 | ' | 21,851 | ||
Other assets | $237,240 | ' | $309,143 | ||
[1] | Under our advance funding facilities, we are contractually required to remit collections on pledged advances to the trustee within two days of receipt. The collected funds are not applied to reduce the related match funded debt until the payment dates specified in the indenture. The balances also include amounts that have been set aside from the proceeds of our match funded advance facilities and certain of our warehouse facilities to provide for possible shortfalls in the funds available to pay certain expenses and interest. The funds related to match funded facilities are held in interest earning accounts in the name of the SPE created in connection with the facility. | ||||
[2] | The balance at December 31, 2013 represents an initial cash deposit that we made in connection with the agreement we entered into on December 20, 2013 to acquire MSRs and related advances from Wells Fargo Bank, N.A. This deposit, along with an additional deposit of $15.0 million that we made in January 2014, is being held in an escrow account pending the transaction closing. See Note 22 – Commitments and Contingencies for additional information on this transaction. | ||||
[3] | See Note 15 – Derivative Financial Instruments and Hedging Activities for additional information. | ||||
[4] | As disclosed in Note 3 – Business Acquisitions, the purchase of certain MSRs and related advances from ResCap was not complete on the date of acquisition pending the receipt of certain consents and court approvals. We recorded a contingent asset effective on the date of the acquisition until we subsequently obtained the required consents and approvals for the MSRs and paid the additional purchase price. | ||||
[5] | The balance at December 31, 2013 includes an investment of $5.1 million in OSI and an investment of $6.6 million in PowerLink Settlement Services, LP and related entities. As disclosed in Note 3 – Business Acquisitions, we increased our ownership in OSI from 26.00% to 87.35% on January 31, 2014. Effective on that date, we began including the accounts of OSI in our consolidated financial statements and eliminated our current investment in consolidation. In June 2014, we received proceeds from the dissolution of PowerLink Settlement Services, LP equal to our investment. |
Other_Assets_Narrative_Details
Other Assets - Narrative (Details) (USD $) | 9 Months Ended | ||||||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Jan. 31, 2014 | Dec. 31, 2013 | Jan. 31, 2014 | Jan. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | ||
Ocwen Structured Investments, LLC (OSI) [Member] | Ocwen Structured Investments, LLC (OSI) [Member] | Ocwen Structured Investments, LLC (OSI) [Member] | Powerlink Settlement Services [Member] | ||||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' | ' | ||
Period required to remit collections on pledged advances | '2 days | ' | ' | ' | ' | ' | ' | ||
Purchase price deposit | $25,000 | [1] | $15,000 | $10,000 | [1] | ' | ' | ' | ' |
Investment in unconsolidated entities | $0 | [2] | ' | $11,771 | [2] | ' | ' | $5,100 | $6,600 |
Percentage of voting interests acquired | ' | ' | ' | 87.35% | 26.00% | ' | ' | ||
[1] | The balance at December 31, 2013 represents an initial cash deposit that we made in connection with the agreement we entered into on December 20, 2013 to acquire MSRs and related advances from Wells Fargo Bank, N.A. This deposit, along with an additional deposit of $15.0 million that we made in January 2014, is being held in an escrow account pending the transaction closing. See Note 22 – Commitments and Contingencies for additional information on this transaction. | ||||||||
[2] | The balance at December 31, 2013 includes an investment of $5.1 million in OSI and an investment of $6.6 million in PowerLink Settlement Services, LP and related entities. As disclosed in Note 3 – Business Acquisitions, we increased our ownership in OSI from 26.00% to 87.35% on January 31, 2014. Effective on that date, we began including the accounts of OSI in our consolidated financial statements and eliminated our current investment in consolidation. In June 2014, we received proceeds from the dissolution of PowerLink Settlement Services, LP equal to our investment. |
Borrowings_Schedule_of_Match_F
Borrowings - Schedule of Match Funded Liabilities (Details) (USD $) | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Dec. 31, 2013 | ||
Debt Instrument [Line Items] | ' | ' | ||
Transfers accounted for as secured borrowings, associated liabilities, carrying amount | $2,035,639 | $2,364,814 | ||
Weighted average interest rate | 1.91% | 2.08% | ||
Advance Receivable Backed Notes Series E [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Available borrowing capacity | 130,753 | [1],[2] | ' | |
Transfers accounted for as secured borrowings, associated liabilities, carrying amount | 344,247 | [2] | 417,388 | [2] |
Maturity date | 30-Jun-17 | [2],[3] | ' | |
Amortization date | 'Jun. 2015 | [2],[3] | ' | |
Advance Receivable Backed Notes Series F [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Available borrowing capacity | 44,987 | [1] | ' | |
Transfers accounted for as secured borrowings, associated liabilities, carrying amount | 5,013 | 33,211 | ||
Maturity date | 31-Dec-15 | [3] | ' | |
Amortization date | 'Dec. 2014 | [3] | ' | |
Homeward Agency Advance Funding Trust 2012-1 [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Available borrowing capacity | 0 | [1],[4] | ' | |
Transfers accounted for as secured borrowings, associated liabilities, carrying amount | 0 | [4] | 21,019 | [4] |
Maturity date | 30-Apr-14 | [3],[4] | ' | |
Amortization date | 'Apr. 2014 | [3],[4] | ' | |
Class A1 Term Note [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Available borrowing capacity | 156,812 | [1],[5] | ' | |
Transfers accounted for as secured borrowings, associated liabilities, carrying amount | 843,188 | [5] | 1,494,628 | [5] |
Maturity date | 31-Oct-44 | [3],[5] | ' | |
Amortization date | 'Oct. 2014 | [3],[5] | ' | |
Class A2 Variable Funding Note [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Available borrowing capacity | 75,693 | [1],[5] | ' | |
Transfers accounted for as secured borrowings, associated liabilities, carrying amount | 408,019 | [5] | 385,645 | [5] |
Maturity date | 31-Oct-44 | [3],[5] | ' | |
Amortization date | 'Oct. 2014 | [3],[5] | ' | |
Class B Term Note [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Available borrowing capacity | 2,711 | [1],[5] | ' | |
Transfers accounted for as secured borrowings, associated liabilities, carrying amount | 13,577 | [5] | 12,923 | [5] |
Maturity date | 3-Oct-44 | [3],[5] | ' | |
Amortization date | 'Oct. 2014 | [3],[5] | ' | |
Class A3 Variable Funding Note [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Available borrowing capacity | 78,405 | [1],[6] | ' | |
Transfers accounted for as secured borrowings, associated liabilities, carrying amount | 421,595 | [6] | 0 | [6] |
Maturity date | 31-Oct-44 | [3],[6] | ' | |
Amortization date | 'Oct. 2014 | [3],[6] | ' | |
Match Funded Liabilties [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Available borrowing capacity | 489,361 | ' | ||
Transfers accounted for as secured borrowings, associated liabilities, carrying amount | $2,035,639 | $2,364,814 | ||
London Interbank Offered Rate (LIBOR) [Member] | Advance Receivable Backed Notes Series E [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Basis spread on variable rate | 1.75% | [2],[7] | ' | |
London Interbank Offered Rate (LIBOR) [Member] | Advance Receivable Backed Notes Series F [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Basis spread on variable rate | 3.00% | ' | ||
London Interbank Offered Rate (LIBOR) [Member] | Homeward Agency Advance Funding Trust 2012-1 [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Basis spread on variable rate | 3.00% | [4] | ' | |
London Interbank Offered Rate (LIBOR) [Member] | Class A1 Term Note [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Basis spread on variable rate | 1.75% | [5],[8],[9] | ' | |
London Interbank Offered Rate (LIBOR) [Member] | Class A2 Variable Funding Note [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Basis spread on variable rate | 1.67% | [10],[5],[9] | ' | |
London Interbank Offered Rate (LIBOR) [Member] | Class B Term Note [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Basis spread on variable rate | 4.25% | [11],[5],[9] | ' | |
London Interbank Offered Rate (LIBOR) [Member] | Class A3 Variable Funding Note [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Basis spread on variable rate | 1.75% | [6],[9] | ' | |
[1] | Borrowing capacity is available to us provided that we have additional eligible collateral to pledge. Collateral may only be pledged to one facility. At September 30, 2014, only $51.2 million of the available borrowing capacity could be used based on the amount of eligible collateral that had been pledged. | |||
[2] | On October 28, 2014, the maximum borrowing capacity under this facility was reduced to $450.0 million and will further decline to $400.0 million in February 2015. | |||
[3] | The amortization date of our facilities is the date on which the revolving period ends under each advance facility note and repayment of the outstanding balance must begin if the note is not renewed or extended. The maturity date is the date on which all outstanding balances must be repaid. In two advance facilities, there are multiple notes outstanding. For each note, after the amortization date, all collections that represent the repayment of advances pledged to the facility must be applied to reduce the balance of the note outstanding, and any new advances are ineligible to be financed. | |||
[4] | Advance facility assumed as part of the acquisition of Homeward. This facility was terminated on April 16, 2014, and the advances pledged to the facility were transferred to another facility. | |||
[5] | These notes were issued in connection with the OneWest MSR Transaction. On February 3, 2014, the maximum borrowing capacity on the 2013-VF2 notes was increased by $100.0 million to a total of $500.0 million. On March 17, 2014, the maximum borrowing capacity under the 2013-VF1 note declined by $500.0 million to a total of $1.0 billion. On October 1, 2014, the VF1 note was fully repaid. The maximum borrowing capacity of the VF2, Class A notes was increased to $564.0 million, and the maximum borrowing capacity of the VF2, Class B notes was increased to $36.0 million. In addition, the amortization date of the VF2 Class A and B notes was extended to October 15, 2015, and the maturity date was extended to October 15, 2045. Finally, a new series, the Series 2014-VF4 note, was issued with a maximum borrowing capacity of $600.0 million, an amortization date of October 15, 2015 and a maturity date of October 15, 2045. The interest margin on this new series of notes was set to 175 bps through July 14, 2015, to 200 bps on July 15, 2015, to 212 bps on August 15, 2015 and to 250 bps on September 15, 2015. | |||
[6] | This note was issued on March 17, 2014 with a maximum borrowing capacity of $500.0 million. The interest margin on this note increased to 200 bps on July 15, 2014, to 225 bps on August 15, 2014 and 250 bps on September 15, 2014. On October 1, 2014, the maximum borrowing capacity of the note was increased to $600.0 million, the amortization date was extended to October 15, 2015 and the maturity date was extended to October 15, 2045. The interest margin was set to 175 bps through July 14, 2015, to 200 bps on July 15, 2015, to 225 bps on August 15, 2015 and to 250 bps on September 15, 2015. | |||
[7] | 1-Month LIBOR (1ML) was 0.16% and 0.17% at September 30, 2014 and December 31, 2013, respectively. | |||
[8] | The interest margin on these notes increased to 200 bps on July 15, 2014, to 225 bps on August 15, 2014 and 250 bps on September 15, 2014. | |||
[9] | On July 15, 2014, the lenders agreed to waive the increase in interest margin scheduled for July 15, 2014. On August 15, 2014, the lenders also agreed to waive the increases in interest margin that were scheduled for August 15, 2014 and September 15, 2014. | |||
[10] | The interest margin on these notes increased to 191 bps on July 15, 2014, to 215 bps on August 15, 2014 and 238 bps on September 15, 2014. Effective October 1, 2014, the interest margin on these notes was set to 167 bps through July 14, 2015, to 191 bps on July 15, 2015, to 215 bps on August 15, 2015 and to 239 bps on September 15, 2015. | |||
[11] | The interest margin on these notes increased to 486 bps on July 15, 2014, to 546 bps on August 15, 2014 and 607 bps on September 15, 2014. Effective October 1, 2014, the interest margin on these notes was set to 300 bps through July 14, 2015, to 343 bps on July 15, 2015, to 386 bps on August 15, 2015 and to 429 bps on September 15, 2015. |
Borrowings_Financing_Liabiliti
Borrowings - Financing Liabilities (Details) (USD $) | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Dec. 31, 2013 | ||
Debt Instrument [Line Items] | ' | ' | ||
Financing liabilities | $2,057,490 | $1,266,973 | ||
Financing Liabilities [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Financing liabilities | 2,057,490 | 1,266,973 | ||
Servicing [Member] | Financing Liabilities [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Financing liabilities | 821,396 | 633,804 | ||
Servicing [Member] | Financing Liability Mortgage Servicing Rates Pledged 1 [Member] | Financing Liabilities [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Financing liabilities | 618,855 | 633,804 | ||
Servicing [Member] | OASIS Series 2014-1 [Member] | Financing Liabilities [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Maturity date | 28-Feb-28 | [1] | ' | |
Financing liabilities | 115,039 | [1] | 0 | [1] |
Servicing [Member] | Financing Liability Advances Pledged [Member] | Financing Liabilities [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Financing liabilities | 87,502 | [2] | 0 | [3] |
Lending [Member] | Financing Liabilities [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Financing liabilities | 1,236,094 | 633,169 | ||
Lending [Member] | Financing Liability Mortgage Servicing Rights Pledged 2 [Member] | Financing Liabilities [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Financing liabilities | 0 | [4] | 17,593 | [4] |
Lending [Member] | HMBS - Related Borrowings [Member] | Financing Liabilities [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Financing liabilities | $1,236,094 | [5] | $615,576 | [5] |
London Interbank Offered Rate (LIBOR) [Member] | HMBS - Related Borrowings [Member] | Financing Liabilities [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Basis spread on variable rate | 2.45% | [5] | ' | |
[1] | OASIS noteholders are entitled to receive a monthly payment amount equal to the sum of: a) the designated servicing fee amount (21 basis points of the UPB of the reference pool of Freddie Mac mortgages); b) any termination payment amounts; c) any excess refinance amounts; and d) the note redemption amounts, each as defined in the indenture supplement for the notes. The notes have a final stated maturity of February 2028. We accounted for this transaction as a financing. Monthly amortization of the liability is estimated using the proportion of monthly projected service fees on the underlying MSRs as a percentage of lifetime projected fees, adjusted for the term of the security. | |||
[2] | Under this repurchase agreement, the lender provides financing on a committed basis for $50.0 million and, at the discretion of the lender, on an uncommitted basis for an additional $50.0 million. | |||
[3] | Certain advances were sold to HLSS Mortgage and HLSS SEZ LP on March 4, 2014 and May 2, 2014, respectively. These sales of advances did not qualify for sales accounting treatment and were accounted for as a financing. See Note 5 – Loans Held for Sale for additional information. | |||
[4] | Sales of MSRs to a third party accounted for as a financing. The financing liability was being amortized using the interest method with the servicing income that was remitted to the purchaser representing payments of principal and interest. In April 2014, we derecognized the remaining liability related to this MSR sale. During 2014, we recognized a gain of $2.6 million on the extinguishment of the financing liability. | |||
[5] | Represents amounts due to the holders of beneficial interests in Ginnie Mae guaranteed HMBS. The beneficial interests have no maturity dates, and the borrowings mature as the related loans are repaid. See Note 2 – Securitizations and Variable Interest Entities for additional information. |
Borrowings_Secured_Borrowings_
Borrowings - Secured Borrowings (Details) (USD $) | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Dec. 31, 2013 | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Financing liabilities | $2,057,490 | $1,266,973 | ||
Other Secured Borrowings [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Debt Instrument, Unused Borrowing Capacity, Amount | 191,262 | ' | ||
Unamortized discount | -4,358 | [1] | -5,349 | [1] |
Long-term Debt | 1,666,427 | 1,777,669 | ||
Debt, Weighted Average Interest Rate | 4.94% | 4.86% | ||
Other Secured Borrowings [Member] | Servicing [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Debt Instrument, Unused Borrowing Capacity, Amount | 27,338 | ' | ||
Financing liabilities | 1,303,162 | 1,323,286 | ||
Other Secured Borrowings [Member] | Servicing [Member] | Senior Secured Term Loan 2 [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Debt Instrument, Unused Borrowing Capacity, Amount | 0 | [1] | ' | |
Financing liabilities | 1,280,500 | [1] | 1,290,250 | [1] |
Unamortized discount | -6,500 | ' | ||
Maturity date | 28-Feb-18 | [1] | ' | |
Other Secured Borrowings [Member] | Servicing [Member] | Promissory Note [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Debt Instrument, Unused Borrowing Capacity, Amount | 0 | [2] | ' | |
Financing liabilities | 0 | [2] | 15,529 | [2] |
Maturity date | 31-May-17 | [2] | ' | |
Other Secured Borrowings [Member] | Servicing [Member] | Repurchase Agreement [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Debt Instrument, Unused Borrowing Capacity, Amount | 27,338 | [3] | ' | |
Financing liabilities | 22,662 | [3] | 17,507 | [3] |
Maturity date | 30-Jun-15 | [3] | ' | |
Other Secured Borrowings [Member] | Lending [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Debt Instrument, Unused Borrowing Capacity, Amount | 163,924 | ' | ||
Financing liabilities | 362,945 | 455,020 | ||
Other Secured Borrowings [Member] | Lending [Member] | Master Repurchase Agreement [Member] | April 2014 [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Debt Instrument, Unused Borrowing Capacity, Amount | 17,199 | [4] | ' | |
Financing liabilities | 132,801 | [4] | 105,659 | [4] |
Maturity date | 30-Apr-15 | ' | ||
Other Secured Borrowings [Member] | Lending [Member] | Master Repurchase Agreement [Member] | September 2014 - 2 [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Debt Instrument, Unused Borrowing Capacity, Amount | 10,645 | [5] | ' | |
Financing liabilities | 64,355 | [5] | 91,990 | [5] |
Maturity date | 31-Oct-15 | [5] | ' | |
Other Secured Borrowings [Member] | Lending [Member] | Master Repurchase Agreement [Member] | November 2014 [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Debt Instrument, Unused Borrowing Capacity, Amount | 99,527 | [6] | ' | |
Financing liabilities | 50,473 | [6] | 89,836 | [6] |
Maturity date | 30-Nov-14 | ' | ||
Other Secured Borrowings [Member] | Lending [Member] | Master Repurchase Agreement [Member] | September 2014 - 3 [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Debt Instrument, Unused Borrowing Capacity, Amount | 858 | [7] | ' | |
Financing liabilities | 36,642 | [7] | 51,975 | [7] |
Maturity date | 31-Oct-14 | [7] | ' | |
Other Secured Borrowings [Member] | Lending [Member] | Participation Agreement [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Debt Instrument, Unused Borrowing Capacity, Amount | 0 | [8] | ' | |
Financing liabilities | 54,369 | [8] | 81,268 | [8] |
Maturity date | 31-May-15 | [8] | ' | |
Other Secured Borrowings [Member] | Lending [Member] | Mortgage Warehouse Agreement [Member] | July 2014 [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Debt Instrument, Unused Borrowing Capacity, Amount | 35,695 | [9] | ' | |
Financing liabilities | 24,305 | [9] | 34,292 | [9] |
Maturity date | 31-May-15 | [10] | ' | |
Interest rate at index floor rate | 3.50% | [10] | ' | |
Other Secured Borrowings [Member] | Corporate Items and Other [Member] | Securities Sold Under Agreement To Repurchase [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Debt Instrument, Unused Borrowing Capacity, Amount | 0 | [10] | ' | |
Financing liabilities | 4,678 | [10] | 4,712 | [10] |
Other Secured Borrowings [Member] | Corporate Items and Other [Member] | Total Servicing Lines Of Credit [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Debt Instrument, Unused Borrowing Capacity, Amount | 191,262 | ' | ||
Financing liabilities | $1,670,785 | $1,783,018 | ||
Eurodollar [Member] | Other Secured Borrowings [Member] | Servicing [Member] | Senior Secured Term Loan 2 [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Basis spread on variable rate | 3.75% | [1] | ' | |
Interest rate at index floor rate | 1.25% | [1] | ' | |
London Interbank Offered Rate (LIBOR) [Member] | Other Secured Borrowings [Member] | Servicing [Member] | Promissory Note [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Basis spread on variable rate | 3.50% | [2] | ' | |
London Interbank Offered Rate (LIBOR) [Member] | Other Secured Borrowings [Member] | Lending [Member] | Master Repurchase Agreement [Member] | April 2014 [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Basis spread on variable rate | 1.75% | ' | ||
London Interbank Offered Rate (LIBOR) [Member] | Other Secured Borrowings [Member] | Lending [Member] | Master Repurchase Agreement [Member] | September 2014 - 3 [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Basis spread on variable rate | 2.75% | [7] | ' | |
London Interbank Offered Rate (LIBOR) [Member] | Other Secured Borrowings [Member] | Lending [Member] | Mortgage Warehouse Agreement [Member] | July 2014 [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Basis spread on variable rate | 2.75% | [10] | ' | |
Minimum [Member] | London Interbank Offered Rate (LIBOR) [Member] | Other Secured Borrowings [Member] | Servicing [Member] | Repurchase Agreement [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Basis spread on variable rate | 2.00% | [3] | ' | |
Minimum [Member] | London Interbank Offered Rate (LIBOR) [Member] | Other Secured Borrowings [Member] | Lending [Member] | Master Repurchase Agreement [Member] | September 2014 - 2 [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Basis spread on variable rate | 1.75% | [5] | ' | |
Minimum [Member] | London Interbank Offered Rate (LIBOR) [Member] | Other Secured Borrowings [Member] | Lending [Member] | Master Repurchase Agreement [Member] | November 2014 [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Basis spread on variable rate | 1.75% | ' | ||
Maximum [Member] | London Interbank Offered Rate (LIBOR) [Member] | Other Secured Borrowings [Member] | Servicing [Member] | Repurchase Agreement [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Basis spread on variable rate | 3.45% | [3] | ' | |
Maximum [Member] | London Interbank Offered Rate (LIBOR) [Member] | Other Secured Borrowings [Member] | Lending [Member] | Master Repurchase Agreement [Member] | September 2014 - 2 [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Basis spread on variable rate | 2.75% | [5] | ' | |
Maximum [Member] | London Interbank Offered Rate (LIBOR) [Member] | Other Secured Borrowings [Member] | Lending [Member] | Master Repurchase Agreement [Member] | November 2014 [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Basis spread on variable rate | 2.00% | ' | ||
Class A-2 Note [Member] | London Interbank Offered Rate (LIBOR) [Member] | Other Secured Borrowings [Member] | Corporate Items and Other [Member] | Securities Sold Under Agreement To Repurchase [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Basis spread on variable rate | 2.00% | [7] | ' | |
Class A-3 Note [Member] | London Interbank Offered Rate (LIBOR) [Member] | Other Secured Borrowings [Member] | Corporate Items and Other [Member] | Securities Sold Under Agreement To Repurchase [Member] | ' | ' | ||
Line of Credit Facility [Line Items] | ' | ' | ||
Basis spread on variable rate | 3.00% | [7] | ' | |
[1] | This facility had an initial balance of $1.3 billion and was issued with an original issue discount of $6.5 million that we are amortizing over the term of the loan. We are required to repay the principal amount of the borrowings in consecutive quarterly installments of $3.3 million. In addition, we are generally required to use the net cash proceeds (as defined) from any asset sale (as defined) to repay loan principal, subject to a 270-day reinvestment provision (or, in the case of a sale of MSRs, related servicing advances or other related assets to HLSS, we have a 180-day reinvestment provision and the net cash proceeds must be invested in MSRs or related assets, such as advances). We are also required to make mandatory prepayments in certain circumstances based on our corporate leverage ratio (as defined) if we have positive consolidated excess cash flow (as defined) in any fiscal year. The borrowings are secured by a first priority security interest in substantially all of the assets of Ocwen. Borrowings bear interest, at the election of Ocwen, at a rate per annum equal to either (a) the base rate [the greatest of (i) the prime rate in effect on such day, (ii) the federal funds rate in effect on such day plus 0.50% and (iii) the one-month Eurodollar rate (1-Month LIBOR)], plus a margin of 2.75% and a base rate floor of 2.25% or (b) the one month Eurodollar rate, plus a margin of 3.75% with a one month Eurodollar floor of 1.25%. To date, we have elected option (b) to determine the interest rate. | |||
[2] | This note was repaid in full on February 28, 2014. | |||
[3] | Under this repurchase agreement, the lender provides financing on a committed basis for $50.0 million and, at the discretion of the lender, on an uncommitted basis for an additional $50.0 million. | |||
[4] | Under this repurchase agreement, the lender provides financing on a committed basis for $150.0 million and, at the discretion of the lender, on an uncommitted basis for an additional $150.0 million. | |||
[5] | Under this repurchase agreement, the lender provides financing on a committed basis for $75.0 million and, at the discretion of the lender, on an uncommitted basis for an additional $75.0 million. On September 2, 2014, the maturity date of this facility was extended to October 2, 2014. On October 2, 2014, the maturity date was further extended to September 1, 2015. | |||
[6] | Under this repurchase agreement, the lender provides financing on a committed basis for $150.0 million and, at the discretion of the lender, on an uncommitted basis for an additional $300.0 million. On October 24, 2014, this facility was repaid in full and terminated. | |||
[7] | On September 2, 2014, the maturity date of this facility was extended to October 2, 2014, and the maximum borrowing capacity was reduced to $37.5 million on a committed basis plus an additional $37.5 million on an uncommitted basis at the discretion of the lender. On October 1, 2014, the maturity date was extended to October 31, 2014. Effective October 31, 2014, the maturity date was further extended to November 14, 2014. | |||
[8] | Under this participation agreement, the lender provides financing on an uncommitted basis for $50.0 million to $100.0 million at the discretion of the lender. The participation agreement allows the lender to acquire a 100% beneficial interest in the underlying mortgage loans. The transaction does not qualify for sale accounting treatment and is accounted for as a secured borrowing. The lender earns the stated interest rate of the underlying mortgage loans while the loans are financed under the participation agreement. | |||
[9] | In August 2014, the maturity date of this facility was extended to May 28, 2015. | |||
[10] | Represents repurchase agreement for Class A-2 and A-3 notes issued by Ocwen Real Estate Asset Liquidating Trust 2007-1 which have a current face value of $22.4 million at September 30, 2014. This agreement has no stated credit limit and lending is determined for each transaction based on the acceptability of the securities presented as collateral. |
Borrowings_Senior_Unsecured_No
Borrowings - Senior Unsecured Notes Redemption (Details) (Unsecured Debt [Member], 6.625% Senior Notes due 2019) | 9 Months Ended |
Sep. 30, 2014 | |
2016 [Member] | ' |
Debt Instrument, Redemption [Line Items] | ' |
Redemption price, percentage | 104.97% |
2017 [Member] | ' |
Debt Instrument, Redemption [Line Items] | ' |
Redemption price, percentage | 103.31% |
2018 and thereafter [Member] | ' |
Debt Instrument, Redemption [Line Items] | ' |
Redemption price, percentage | 100.00% |
Borrowings_Narrative_Details
Borrowings - Narrative (Details) (USD $) | 9 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 9 Months Ended | 9 Months Ended | 1 Months Ended | 0 Months Ended | 9 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 9 Months Ended | 9 Months Ended | 9 Months Ended | 9 Months Ended | 0 Months Ended | 0 Months Ended | 9 Months Ended | 9 Months Ended | 9 Months Ended | 9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Sep. 30, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Feb. 03, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Mar. 17, 2014 | Sep. 30, 2014 | Mar. 17, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Mar. 17, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Apr. 30, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | Feb. 26, 2014 | 12-May-14 | Sep. 30, 2014 | 12-May-14 | Sep. 30, 2014 | Jul. 15, 2014 | Jul. 15, 2014 | Jul. 15, 2014 | Jul. 15, 2014 | Aug. 15, 2014 | Aug. 15, 2014 | Aug. 15, 2014 | Aug. 15, 2014 | Sep. 15, 2014 | Sep. 15, 2014 | Sep. 15, 2014 | Sep. 15, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 02, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Oct. 28, 2014 | Oct. 01, 2014 | Oct. 01, 2014 | Oct. 01, 2014 | Oct. 01, 2014 | Oct. 01, 2014 | Oct. 01, 2014 | Oct. 01, 2014 | Oct. 01, 2014 | Oct. 01, 2014 | Oct. 01, 2014 | Oct. 01, 2014 | Oct. 01, 2014 | Oct. 01, 2014 | Oct. 01, 2014 | Oct. 01, 2014 | Oct. 01, 2014 | Oct. 01, 2014 | Oct. 01, 2014 | Oct. 01, 2014 | Oct. 01, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Feb. 28, 2015 | |||||||||||||||||||||||||
Facility | London Interbank Offered Rate (LIBOR) [Member] | London Interbank Offered Rate (LIBOR) [Member] | Advance Receivable Backed Notes Series E [Member] | Advance Receivable Backed Notes Series E [Member] | Class A2 Variable Funding Note [Member] | Class A2 Variable Funding Note [Member] | Class A2 Variable Funding Note [Member] | Class A1 Term Note [Member] | Class A1 Term Note [Member] | Class A1 Term Note [Member] | Class A1 Term Note [Member] | Class B Term Note [Member] | Class B Term Note [Member] | Class A3 Variable Funding Note [Member] | Class A3 Variable Funding Note [Member] | Class A3 Variable Funding Note [Member] | OASIS Series 2014-1 [Member] | Financing Liability Mortgage Servicing Rights Pledged 2 [Member] | Other Secured Borrowings [Member] | Other Secured Borrowings [Member] | Other Secured Borrowings [Member] | Unsecured Debt [Member] | Unsecured Debt [Member] | Unsecured Debt [Member] | Unsecured Debt [Member] | July 15, 2014 [Member] | July 15, 2014 [Member] | July 15, 2014 [Member] | July 15, 2014 [Member] | August 15, 2014 [Member] | August 15, 2014 [Member] | August 15, 2014 [Member] | August 15, 2014 [Member] | September 15, 2014 [Member] | September 15, 2014 [Member] | September 15, 2014 [Member] | September 15, 2014 [Member] | Participation Agreement [Member] | Securities Sold Under Agreement To Repurchase [Member] | Servicing [Member] | Servicing [Member] | Servicing [Member] | Lending [Member] | Lending [Member] | Corporate Items and Other [Member] | Corporate Items and Other [Member] | HLSS [Member] | Option A1 [Member] | Option A2 [Member] | Option A3 [Member] | Option B [Member] | Minimum [Member] | Minimum [Member] | Minimum [Member] | Minimum [Member] | Maximum [Member] | Maximum [Member] | Maximum [Member] | Maximum [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Residential Mortgage [Member] | April 2014 [Member] | April 2014 [Member] | September 2014 - 2 [Member] | September 2014 - 2 [Member] | September 2014 - 2 [Member] | November 2014 [Member] | November 2014 [Member] | November 2014 [Member] | Scenario, Forecast [Member] | |||||||||||||||||||||||||
London Interbank Offered Rate (LIBOR) [Member] | London Interbank Offered Rate (LIBOR) [Member] | London Interbank Offered Rate (LIBOR) [Member] | London Interbank Offered Rate (LIBOR) [Member] | London Interbank Offered Rate (LIBOR) [Member] | OASIS Series 2014-1 [Member] | 6.625% Senior Notes due 2019 | 6.625% Senior Notes due 2019 | 6.625% Senior Notes due 2019 | 6.625% Senior Notes due 2019 | Class A2 Variable Funding Note [Member] | Class A1 Term Note [Member] | Class B Term Note [Member] | Class A3 Variable Funding Note [Member] | Class A2 Variable Funding Note [Member] | Class A1 Term Note [Member] | Class B Term Note [Member] | Class A3 Variable Funding Note [Member] | Class A2 Variable Funding Note [Member] | Class A1 Term Note [Member] | Class B Term Note [Member] | Class A3 Variable Funding Note [Member] | Other Secured Borrowings [Member] | Senior Secured Term Loan 2 [Member] | Repurchase Agreement [Member] | Other Secured Borrowings [Member] | Participation Agreement [Member] | Securities Sold Under Agreement To Repurchase [Member] | Securities Sold Under Agreement To Repurchase [Member] | Servicing [Member] | Servicing [Member] | Servicing [Member] | Servicing [Member] | Servicing [Member] | Unsecured Debt [Member] | Unsecured Debt [Member] | Participation Agreement [Member] | Servicing [Member] | Unsecured Debt [Member] | Unsecured Debt [Member] | Participation Agreement [Member] | Servicing [Member] | Advance Receivable Backed Notes Series E [Member] | Class A2 Variable Funding Note [Member] | Class B Term Note [Member] | Class A3 Variable Funding Note [Member] | Class A4 Variable Funding Note [Member] | October 1, 2014 [Member] | October 1, 2014 [Member] | October 1, 2014 [Member] | October 1, 2014 [Member] | July 15, 2015 [Member] | July 15, 2015 [Member] | July 15, 2015 [Member] | July 15, 2015 [Member] | August 15, 2015 [Member] | August 15, 2015 [Member] | August 15, 2015 [Member] | August 15, 2015 [Member] | September 15, 2015 [Member] | September 15, 2015 [Member] | September 15, 2015 [Member] | September 15, 2015 [Member] | Facility | Lending [Member] | Lending [Member] | Lending [Member] | Minimum [Member] | Maximum [Member] | Lending [Member] | Minimum [Member] | Maximum [Member] | Subsequent Event [Member] | |||||||||||||||||||||||||||||||||||||||||||
Debt Instrument, Redemption, Period Four [Member] | Other Secured Borrowings [Member] | Other Secured Borrowings [Member] | Other Secured Borrowings [Member] | Other Secured Borrowings [Member] | Other Secured Borrowings [Member] | Senior Secured Term Loan 2 [Member] | Senior Secured Term Loan 2 [Member] | Senior Secured Term Loan 2 [Member] | Senior Secured Term Loan 2 [Member] | Senior Secured Term Loan 2 [Member] | 6.625% Senior Notes due 2019 | 6.625% Senior Notes due 2019 | Repurchase Agreement [Member] | 6.625% Senior Notes due 2019 | 6.625% Senior Notes due 2019 | Repurchase Agreement [Member] | Class A2 Variable Funding Note [Member] | Class B Term Note [Member] | Class A3 Variable Funding Note [Member] | Class A4 Variable Funding Note [Member] | Class A2 Variable Funding Note [Member] | Class B Term Note [Member] | Class A3 Variable Funding Note [Member] | Class A4 Variable Funding Note [Member] | Class A2 Variable Funding Note [Member] | Class B Term Note [Member] | Class A3 Variable Funding Note [Member] | Class A4 Variable Funding Note [Member] | Class A2 Variable Funding Note [Member] | Class B Term Note [Member] | Class A3 Variable Funding Note [Member] | Class A4 Variable Funding Note [Member] | Master Repurchase Agreement [Member] | Master Repurchase Agreement [Member] | Master Repurchase Agreement [Member] | Lending [Member] | Lending [Member] | Master Repurchase Agreement [Member] | Lending [Member] | Lending [Member] | Advance Receivable Backed Notes Series E [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Secured Borrowings [Member] | Other Secured Borrowings [Member] | Other Secured Borrowings [Member] | Other Secured Borrowings [Member] | Other Secured Borrowings [Member] | Debt Instrument, Redemption, Period Four [Member] | Debt Instrument, Redemption, Period Five [Member] | Other Secured Borrowings [Member] | Debt Instrument, Redemption, Period Four [Member] | Debt Instrument, Redemption, Period Five [Member] | Other Secured Borrowings [Member] | Other Secured Borrowings [Member] | Other Secured Borrowings [Member] | Other Secured Borrowings [Member] | Master Repurchase Agreement [Member] | Master Repurchase Agreement [Member] | Other Secured Borrowings [Member] | Master Repurchase Agreement [Member] | Master Repurchase Agreement [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
London Interbank Offered Rate (LIBOR) [Member] | London Interbank Offered Rate (LIBOR) [Member] | London Interbank Offered Rate (LIBOR) [Member] | Other Secured Borrowings [Member] | Other Secured Borrowings [Member] | Other Secured Borrowings [Member] | Other Secured Borrowings [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
London Interbank Offered Rate (LIBOR) [Member] | London Interbank Offered Rate (LIBOR) [Member] | London Interbank Offered Rate (LIBOR) [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Number of Line of Credit Facility | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Debt Instrument, Unused Borrowing Capacity, Amount | ' | ' | ' | $130,753,000 | [1],[2] | ' | ' | $75,693,000 | [1],[3] | ' | ' | $156,812,000 | [1],[3] | ' | ' | $2,711,000 | [1],[3] | ' | $78,405,000 | [1],[4] | ' | ' | ' | ' | $191,262,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $27,338,000 | $0 | [5] | $27,338,000 | [6] | $163,924,000 | $0 | [7] | $0 | [8] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $51,200,000 | $17,199,000 | [9] | ' | $10,645,000 | [10] | ' | ' | $99,527,000 | [11] | ' | ' | ' | ||||||||||||
Redemption of principal amount (up to 35%) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 35.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Description of variable rate basis | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'the prime rate in effect on such day | 'the federal funds rate in effect on such day | 'the one-month Eurodollar rate (1-Month LIBOR) | 'the one month Eurodollar rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Face amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 123,600,000 | ' | ' | 350,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 22,400,000 | ' | 1,300,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Basis spread on unpaid principal balance | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.21% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Maximum borrowing capacity | ' | ' | ' | ' | ' | 500,000,000 | ' | ' | ' | ' | 1,000,000,000 | ' | ' | ' | ' | 500,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,000,000 | ' | ' | ' | 37,500,000 | [12] | ' | ' | ' | ' | ' | ' | ' | 50,000,000 | ' | ' | ' | 100,000,000 | ' | 450,000,000 | ' | ' | 600,000,000 | 600,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 150,000,000 | ' | 75,000,000 | ' | ' | 150,000,000 | ' | ' | 400,000,000 | |||||||||||||||||||||||
Beneficial interest | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Additional borrowing capacity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,000,000 | ' | ' | ' | 37,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 150,000,000 | ' | 75,000,000 | ' | ' | 300,000,000 | ' | ' | ' | ||||||||||||||||||||||||
Basis spread on variable rate | ' | ' | ' | ' | 1.75% | [13],[2] | ' | ' | 1.67% | [14],[15],[3] | ' | ' | ' | 1.75% | [14],[16],[3] | ' | 4.25% | [14],[17],[3] | ' | ' | 1.75% | [14],[4] | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.91% | 2.00% | 4.86% | 2.00% | 2.15% | 2.25% | 5.46% | 2.25% | 2.38% | 2.50% | 6.07% | 2.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.50% | 2.75% | 3.75% | ' | ' | ' | 2.00% | [6] | ' | ' | ' | 3.45% | [6] | ' | ' | ' | ' | ' | 1.67% | 3.00% | 1.75% | 1.75% | 1.91% | 3.43% | 2.00% | 2.00% | 2.15% | 3.86% | 2.25% | 2.12% | 2.39% | 4.29% | 2.50% | 2.50% | ' | ' | 1.75% | ' | 1.75% | [10] | 2.75% | [10] | ' | 1.75% | 2.00% | ' | |||||||||||||||
Interest rate at index floor rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.25% | 1.25% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Increase (decrease) to borrowing capacity | ' | ' | ' | ' | ' | 100,000,000 | ' | ' | -500,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 564,000,000 | 36,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Basis for effective rate at period end | ' | 0.16% | 0.17% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Gain on retirement of financing liability | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Unamortized discount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,358,000 | [5] | 5,349,000 | [5] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||
Balloon payment to be paid | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Mandatory principal repayment of net cash proceeds from asset sale, period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '270 days | ' | ' | ' | ' | ' | '180 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Stated credit limit | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Interest rate, stated percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6.63% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Proceeds from debt, net of issuance costs | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 343,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Redemption period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '30 days | '30 days | ' | ' | '60 days | '60 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Redemption price, percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Additional premium, percentage of principal amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Additional interest, percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.25% | ' | ' | ' | 1.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Use of cash proceeds from Equity Offerings, redemption price, percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 106.63% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Use of cash proceeds from Equity Offerings, minimum percentage of principal amount outstanding | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 65.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Days after Equity Offering consummation for redemption (not more than 120 days) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '120 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Change of control, purchase price, percentage | 101.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Days after the closing of the offering for the registration statement to become effective (on or prior to 270 days) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '270 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Unamortized debt issuance expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Covenant compliance, consolidated tangible net worth | 630,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Covenant compliance, percent of quarterly net income | 65.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Covenant compliance, consolidated tangible net worth at period end | $957,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
[1] | Borrowing capacity is available to us provided that we have additional eligible collateral to pledge. Collateral may only be pledged to one facility. At September 30, 2014, only $51.2 million of the available borrowing capacity could be used based on the amount of eligible collateral that had been pledged. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[2] | On October 28, 2014, the maximum borrowing capacity under this facility was reduced to $450.0 million and will further decline to $400.0 million in February 2015. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[3] | These notes were issued in connection with the OneWest MSR Transaction. On February 3, 2014, the maximum borrowing capacity on the 2013-VF2 notes was increased by $100.0 million to a total of $500.0 million. On March 17, 2014, the maximum borrowing capacity under the 2013-VF1 note declined by $500.0 million to a total of $1.0 billion. On October 1, 2014, the VF1 note was fully repaid. The maximum borrowing capacity of the VF2, Class A notes was increased to $564.0 million, and the maximum borrowing capacity of the VF2, Class B notes was increased to $36.0 million. In addition, the amortization date of the VF2 Class A and B notes was extended to October 15, 2015, and the maturity date was extended to October 15, 2045. Finally, a new series, the Series 2014-VF4 note, was issued with a maximum borrowing capacity of $600.0 million, an amortization date of October 15, 2015 and a maturity date of October 15, 2045. The interest margin on this new series of notes was set to 175 bps through July 14, 2015, to 200 bps on July 15, 2015, to 212 bps on August 15, 2015 and to 250 bps on September 15, 2015. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[4] | This note was issued on March 17, 2014 with a maximum borrowing capacity of $500.0 million. The interest margin on this note increased to 200 bps on July 15, 2014, to 225 bps on August 15, 2014 and 250 bps on September 15, 2014. On October 1, 2014, the maximum borrowing capacity of the note was increased to $600.0 million, the amortization date was extended to October 15, 2015 and the maturity date was extended to October 15, 2045. The interest margin was set to 175 bps through July 14, 2015, to 200 bps on July 15, 2015, to 225 bps on August 15, 2015 and to 250 bps on September 15, 2015. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[5] | This facility had an initial balance of $1.3 billion and was issued with an original issue discount of $6.5 million that we are amortizing over the term of the loan. We are required to repay the principal amount of the borrowings in consecutive quarterly installments of $3.3 million. In addition, we are generally required to use the net cash proceeds (as defined) from any asset sale (as defined) to repay loan principal, subject to a 270-day reinvestment provision (or, in the case of a sale of MSRs, related servicing advances or other related assets to HLSS, we have a 180-day reinvestment provision and the net cash proceeds must be invested in MSRs or related assets, such as advances). We are also required to make mandatory prepayments in certain circumstances based on our corporate leverage ratio (as defined) if we have positive consolidated excess cash flow (as defined) in any fiscal year. The borrowings are secured by a first priority security interest in substantially all of the assets of Ocwen. Borrowings bear interest, at the election of Ocwen, at a rate per annum equal to either (a) the base rate [the greatest of (i) the prime rate in effect on such day, (ii) the federal funds rate in effect on such day plus 0.50% and (iii) the one-month Eurodollar rate (1-Month LIBOR)], plus a margin of 2.75% and a base rate floor of 2.25% or (b) the one month Eurodollar rate, plus a margin of 3.75% with a one month Eurodollar floor of 1.25%. To date, we have elected option (b) to determine the interest rate. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[6] | Under this repurchase agreement, the lender provides financing on a committed basis for $50.0 million and, at the discretion of the lender, on an uncommitted basis for an additional $50.0 million. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[7] | Under this participation agreement, the lender provides financing on an uncommitted basis for $50.0 million to $100.0 million at the discretion of the lender. The participation agreement allows the lender to acquire a 100% beneficial interest in the underlying mortgage loans. The transaction does not qualify for sale accounting treatment and is accounted for as a secured borrowing. The lender earns the stated interest rate of the underlying mortgage loans while the loans are financed under the participation agreement. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[8] | Represents repurchase agreement for Class A-2 and A-3 notes issued by Ocwen Real Estate Asset Liquidating Trust 2007-1 which have a current face value of $22.4 million at September 30, 2014. This agreement has no stated credit limit and lending is determined for each transaction based on the acceptability of the securities presented as collateral. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[9] | Under this repurchase agreement, the lender provides financing on a committed basis for $150.0 million and, at the discretion of the lender, on an uncommitted basis for an additional $150.0 million. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[10] | Under this repurchase agreement, the lender provides financing on a committed basis for $75.0 million and, at the discretion of the lender, on an uncommitted basis for an additional $75.0 million. On September 2, 2014, the maturity date of this facility was extended to October 2, 2014. On October 2, 2014, the maturity date was further extended to September 1, 2015. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[11] | Under this repurchase agreement, the lender provides financing on a committed basis for $150.0 million and, at the discretion of the lender, on an uncommitted basis for an additional $300.0 million. On October 24, 2014, this facility was repaid in full and terminated. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[12] | On September 2, 2014, the maturity date of this facility was extended to October 2, 2014, and the maximum borrowing capacity was reduced to $37.5 million on a committed basis plus an additional $37.5 million on an uncommitted basis at the discretion of the lender. On October 1, 2014, the maturity date was extended to October 31, 2014. Effective October 31, 2014, the maturity date was further extended to November 14, 2014. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[13] | 1-Month LIBOR (1ML) was 0.16% and 0.17% at September 30, 2014 and December 31, 2013, respectively. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[14] | On July 15, 2014, the lenders agreed to waive the increase in interest margin scheduled for July 15, 2014. On August 15, 2014, the lenders also agreed to waive the increases in interest margin that were scheduled for August 15, 2014 and September 15, 2014. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[15] | The interest margin on these notes increased to 191 bps on July 15, 2014, to 215 bps on August 15, 2014 and 238 bps on September 15, 2014. Effective October 1, 2014, the interest margin on these notes was set to 167 bps through July 14, 2015, to 191 bps on July 15, 2015, to 215 bps on August 15, 2015 and to 239 bps on September 15, 2015. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[16] | The interest margin on these notes increased to 200 bps on July 15, 2014, to 225 bps on August 15, 2014 and 250 bps on September 15, 2014. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[17] | The interest margin on these notes increased to 486 bps on July 15, 2014, to 546 bps on August 15, 2014 and 607 bps on September 15, 2014. Effective October 1, 2014, the interest margin on these notes was set to 300 bps through July 14, 2015, to 343 bps on July 15, 2015, to 386 bps on August 15, 2015 and to 429 bps on September 15, 2015. |
Other_Liabilities_Schedule_of_
Other Liabilities - Schedule of Other Liabilities (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2014 | Dec. 31, 2013 | Feb. 15, 2013 | ||||
In Thousands, unless otherwise specified | ResCap [Member] | ResCap [Member] | ResCap [Member] | ||||||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' | ' | ||||
Liability for indemnification obligations | $143,836 | [1] | $192,716 | [1] | $206,074 | $38,140 | ' | ' | $49,500 | ||
Accrued expenses | 227,309 | [2] | 108,870 | [2] | ' | ' | ' | ' | ' | ||
Payable to loan servicing and subservicing investors | 83,778 | 33,501 | ' | ' | ' | ' | ' | ||||
Due to related parties | 60,235 | [3] | 77,997 | [3] | ' | ' | ' | ' | ' | ||
Liability for selected tax items | 30,627 | 27,273 | ' | ' | ' | ' | ' | ||||
Checks held for escheat | 19,880 | 24,392 | ' | ' | ' | ' | ' | ||||
Liability for certain foreclosure matters | 0 | [4] | 66,948 | [4] | ' | ' | ' | ' | ' | ||
Additional purchase price due seller - ResCap Acquisition | ' | ' | ' | ' | 0 | [5] | 54,220 | [5] | ' | ||
Other | 65,976 | 58,678 | ' | ' | ' | ' | ' | ||||
Total other liabilities | $631,641 | $644,595 | ' | ' | ' | ' | ' | ||||
[1] | See Note 22 – Commitments and Contingencies for additional information. | ||||||||||
[2] | Accrued expenses at September 30, 2014 includes $100.0 million related to certain regulatory contingencies. See Note 22 – Commitments and Contingencies for additional information. | ||||||||||
[3] | See Note 20 – Related Party Transactions for additional information. | ||||||||||
[4] | This liability was settled in May 2014. See Note 22 – Commitments and Contingencies for additional information regarding the National Mortgage Settlement. | ||||||||||
[5] | See Note 3 – Business Acquisitions for additional information. |
Other_Liabilities_Narrative_De
Other Liabilities - Narrative (Details) (Unfavorable Regulatory Action [Member], USD $) | Sep. 30, 2014 |
In Millions, unless otherwise specified | |
Unfavorable Regulatory Action [Member] | ' |
Loss Contingencies [Line Items] | ' |
Regulatory contingencies | $100 |
Mezzanine_Equity_Summary_of_Ac
Mezzanine Equity - Summary of Activity in Mezzanine Equity (Details) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Temporary Equity [Line Items] | ' | ' |
Conversion of Preferred Shares | ($62,000) | ($100,000) |
Series A Preferred Stock [Member] | ' | ' |
Temporary Equity [Line Items] | ' | ' |
Beginning balance | 60,361 | 153,372 |
Conversion of Preferred Shares | -62,000 | -100,000 |
Accretion of beneficial conversion feature discount (Deemed dividend) | 1,639 | 6,573 |
Ending balance | $0 | $59,945 |
Mezzanine_Equity_Narrative_Det
Mezzanine Equity - Narrative (Details) (USD $) | 0 Months Ended | 9 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Jul. 14, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | Jul. 14, 2014 |
Temporary Equity [Line Items] | ' | ' | ' | ' |
Number of preferred shares to be converted (in shares) | ' | ' | ' | 62,000 |
Shares issued (in shares) | 1,950,296 | ' | ' | ' |
Accelerated write-off of unamortized discount | ' | $0.80 | $3.50 | ' |
Equity_Schedule_of_Accumulated
Equity - Schedule of Accumulated Other Comprehensive Loss (AOCL), Net of Income Taxes (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Equity [Abstract] | ' | ' |
Unrealized losses on cash flow hedges | $8,663 | $10,026 |
Other | 121 | 125 |
Accumulated Other Comprehensive Income (Loss), Net of Tax | $8,784 | $10,151 |
Equity_Narrative_Details
Equity - Narrative (Details) (USD $) | 0 Months Ended | 9 Months Ended | 11 Months Ended | |||
Jul. 14, 2014 | Oct. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Jul. 14, 2014 | |
Equity [Abstract] | ' | ' | ' | ' | ' | ' |
Repurchase of common stock | $72,300,000 | ' | $325,609,000 | $157,880,000 | ' | ' |
Repurchase of common stock (in shares) | 1,950,296 | ' | 7,970,353 | ' | 9,096,060 | ' |
Number of preferred shares to be converted (in shares) | ' | ' | ' | ' | ' | 62,000 |
Stock repurchase program, authorized amount | ' | 500,000,000 | ' | ' | ' | ' |
Stock redeemed or called during period, value | ' | ' | $253,400,000 | ' | $313,400,000 | ' |
Derivative_Financial_Instrumen2
Derivative Financial Instruments and Hedging Activities - Schedule of Changes in Notional Balance of Holdings of Derivatives (Details) (USD $) | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Dec. 31, 2013 | ||
Fair value of derivative assets (liabilities) at: | ' | ' | ||
Derivatives, at fair value | $6,169 | [1] | $15,494 | [1] |
Interest Rate Lock Commitments [Member] | ' | ' | ||
Derivative Notional Balance [Roll Forward] | ' | ' | ||
Beginning notional balance | 751,436 | ' | ||
Additions | 3,795,311 | ' | ||
Amortization | 94,571 | ' | ||
Maturities | -3,298,265 | ' | ||
Terminations | -876,254 | ' | ||
Ending notional balance | 466,799 | ' | ||
Fair value of derivative assets (liabilities) at: | ' | ' | ||
Derivatives, at fair value | 6,117 | 8,433 | ||
Maturity | 'Nov. 2014 - Jan. 2014 | ' | ||
Forward Mortgage Backed Securities Trades [Member] | ' | ' | ||
Derivative Notional Balance [Roll Forward] | ' | ' | ||
Beginning notional balance | 950,648 | ' | ||
Additions | 6,951,828 | ' | ||
Amortization | 0 | ' | ||
Maturities | -3,379,589 | ' | ||
Terminations | -3,762,592 | ' | ||
Ending notional balance | 760,295 | ' | ||
Fair value of derivative assets (liabilities) at: | ' | ' | ||
Derivatives, at fair value | -1,089 | 6,905 | ||
Maturity | 'Nov. 2014 - Dec. 2014 | ' | ||
Interest Rate Cap [Member] | ' | ' | ||
Derivative Notional Balance [Roll Forward] | ' | ' | ||
Beginning notional balance | 1,868,000 | ' | ||
Additions | 100,000 | ' | ||
Amortization | -490,000 | ' | ||
Maturities | 0 | ' | ||
Terminations | 0 | ' | ||
Ending notional balance | 1,478,000 | ' | ||
Fair value of derivative assets (liabilities) at: | ' | ' | ||
Derivatives, at fair value | $91 | $442 | ||
Maturity | 'Nov. 2016 | ' | ||
[1] | See Note 15 – Derivative Financial Instruments and Hedging Activities for additional information. |
Derivative_Financial_Instrumen3
Derivative Financial Instruments and Hedging Activities - Schedule of Changes in the Losses on Cash Flow Hedges Included in AOCL (Details) (USD $) | 9 Months Ended | 9 Months Ended | 9 Months Ended | ||||||||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | ||||
Gain On Loans Held For Sale Net [Member] | Gain On Loans Held For Sale Net [Member] | Interest Rate Cap [Member] | Interest Rate Cap [Member] | Interest Rate Cap [Member] | Interest Rate Cap [Member] | Interest Rate Swap [Member] | Interest Rate Swap [Member] | ||||||
IRLCs [Member] | IRLCs [Member] | Other Net [Member] | Other Net [Member] | Gain On Loans Held For Sale Net [Member] | Gain On Loans Held For Sale Net [Member] | ||||||||
Not Designated as Hedging Instrument [Member] | Not Designated as Hedging Instrument [Member] | Forward MBS Trades [Member] | Forward MBS Trades [Member] | ||||||||||
Not Designated as Hedging Instrument [Member] | |||||||||||||
Hedge the effect of changes in interest rates on interest expense on borrowings | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Expiration Date | ' | 'Nov. 2014 - Jan. 2014 | ' | ' | ' | 'Nov. 2016 | ' | 'Nov. 2014 - Dec. 2014 | ' | ||||
Notional Amount | ' | ' | $466,799 | $1,478,000 | $1,868,000 | ' | $1,478,000 | ' | $760,295 | ||||
Fair Value | 5,119 | [1] | 6,117 | [1] | ' | ' | ' | 91 | [1] | ' | -1,089 | [1] | ' |
Gains / (Losses) | ($34,872) | ($2,315) | ' | ' | ' | ($374) | ' | ($32,183) | ' | ||||
Consolidated Statements of Operations Caption | ' | 'Gain on loans held for sale, net | ' | ' | ' | 'Other, net | ' | 'Gain on loans held for sale, net | ' | ||||
[1] | Derivatives are reported at fair value in Receivables, Other assets and Other liabilities on our unaudited Consolidated Balance Sheet. |
Derivative_Financial_Instrumen4
Derivative Financial Instruments and Hedging Activities - Accumulated Other Comprehensive Loss (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ' | ' | ' | ' |
Beginning balance | ' | ' | $10,151 | ' |
Other | 2 | 31 | 5 | 711 |
Ending balance | 8,784 | ' | 8,784 | ' |
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member] | ' | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ' | ' | ' | ' |
Beginning balance | ' | ' | 10,151 | 6,441 |
Additional net losses on cash flow hedges | ' | ' | 0 | 12,363 |
Ineffectiveness of cash flow hedges reclassified to earnings | ' | ' | 0 | -657 |
Losses on terminated hedging relationships amortized to earnings | ' | ' | -1,579 | -9,434 |
Net increase (decrease) in accumulated losses on cash flow hedges | ' | ' | -1,579 | 2,272 |
Decrease (increase) in deferred taxes on accumulated losses on cash flow hedges | ' | ' | 217 | -933 |
(Decrease) increase in accumulated losses on cash flow hedges, net of taxes | ' | ' | -1,362 | 1,339 |
Other | ' | ' | -5 | -711 |
Ending balance | $8,784 | $7,069 | $8,784 | $7,069 |
Derivative_Financial_Instrumen5
Derivative Financial Instruments and Hedging Activities - Schedule of Statements of Operations Related to Derivative Financial Instruments (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ' | ' | ' |
Losses on economic hedges | ($6) | ($103) | ($374) | ($3,822) |
Ineffectiveness of cash flow hedges | 0 | 0 | 0 | -657 |
Write-off of losses in AOCL for a discontinued hedge relationship | -408 | -7,780 | -1,580 | -9,434 |
Loss on derivatives | ($414) | ($7,883) | ($1,954) | ($13,913) |
Derivative_Financial_Instrumen6
Derivative Financial Instruments and Hedging Activities - Narrative (Details) (USD $) | 9 Months Ended | |
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ' |
Unrealized gain (loss) on derivatives arising during period, before tax | $9.20 | $12.20 |
Other comprehensive income (loss), tax | 0.5 | 4.5 |
Projected amortization of unrealized losses from AOCL to earnings, coming twelve months | $1.60 | ' |
Interest_Expense_Schedule_of_C
Interest Expense - Schedule of Components of Interest Expense (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | ||||
Debt securities: | ' | ' | ' | ' | ||||
Interest expense | $133,049 | $116,885 | $409,129 | $319,564 | ||||
Financing Liabilities [Member] | ' | ' | ' | ' | ||||
Debt securities: | ' | ' | ' | ' | ||||
Interest expense | 88,246 | [1],[2] | 81,192 | [1],[2] | 281,930 | [1],[2] | 185,116 | [1],[2] |
Other Secured Borrowings [Member] | ' | ' | ' | ' | ||||
Debt securities: | ' | ' | ' | ' | ||||
Interest expense | 20,790 | 21,608 | 62,359 | 60,211 | ||||
Match Funded Liabilties [Member] | ' | ' | ' | ' | ||||
Debt securities: | ' | ' | ' | ' | ||||
Interest expense | 15,097 | 10,775 | 46,762 | 65,774 | ||||
Unsecured Debt [Member] | ' | ' | ' | ' | ||||
Debt securities: | ' | ' | ' | ' | ||||
Interest expense | 6,141 | 0 | 9,466 | 0 | ||||
Other [Member] | ' | ' | ' | ' | ||||
Debt securities: | ' | ' | ' | ' | ||||
Interest expense | $2,775 | $3,310 | $8,612 | $8,463 | ||||
[1] | Includes interest expense related to financing liabilities recorded in connection with the HLSS Transactions as indicated in the table below. As discussed in Note 1A — Restatement of Previously Issued Consolidated Financial Statements, we are restating our previously reported consolidated operating results for the three and nine months ended September 30, 2013 to correct an error in the accounting applicable to the financing liabilities in connection with Rights to MSRs sold to HLSS. Three months Nine Months2014 2013 2014 2013Servicing fees collected on behalf of HLSS$177,113 $200,838 $553,423 $431,795Less: Subservicing fee retained by Ocwen83,550 102,040 266,514 214,587Net servicing fees remitted to HLSS93,563 98,798 286,909 217,208Less: Reduction in financing liability8,736 17,764 12,960 32,357Interest expense on HLSS financing liability$84,827$81,034 $273,949 $184,851 | |||||||
[2] | Interest expense that we expect to be paid on the HMBS-related borrowings is included with net fair value gains in Other revenues. See Note 2 – Securitizations and Variable Interest Entities for additional information. |
Interest_Expense_Schedule_of_R
Interest Expense - Schedule of Related Party Interest Expense (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Schedule of Interest Expense [Line Items] | ' | ' | ' | ' |
Servicing fees collected on behalf of HLSS | ($465,964) | ($483,267) | ($1,448,096) | ($1,333,392) |
HLSS [Member] | ' | ' | ' | ' |
Schedule of Interest Expense [Line Items] | ' | ' | ' | ' |
Servicing fees collected on behalf of HLSS | 177,113 | 200,838 | 553,423 | 431,795 |
Less: Subservicing fee retained by Ocwen | 83,550 | 102,040 | 266,514 | 214,587 |
Net servicing fees remitted to HLSS | 93,563 | 98,798 | 286,909 | 217,208 |
Less: Reduction in financing liability | 8,736 | 17,764 | 12,960 | 32,357 |
Interest expense on HLSS financing liability | $84,827 | $81,034 | $273,949 | $184,851 |
Income_Taxes_Narrative_Details
Income Taxes - Narrative (Details) (USD $) | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 |
Income Tax Disclosure [Abstract] | ' | ' | ' |
Effective income tax rate | 31.80% | 11.90% | ' |
Unrecognized tax benefits that would affect the effective tax rate if recognized | $35.10 | ' | $23.70 |
Accrued interest and penalties related to unrecognized tax benefits | $5.50 | ' | $3.60 |
Basic_and_Diluted_Earnings_Los2
Basic and Diluted Earnings (Loss) per Share - Schedule of Basic EPS to Diluted EPS (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |||||
Basic EPS: | ' | ' | ' | ' | ||||
Net income (loss) attributable to Ocwen common stockholders | ($76,189,000) | $54,725,000 | $49,273,000 | $164,120,000 | ||||
Weighted average shares of common stock (in shares) | 130,551,197 | 135,787,834 | 133,318,381 | 135,705,892 | ||||
Basic EPS (in USD per share) | ($0.58) | $0.40 | $0.37 | $1.21 | ||||
Diluted EPS: | ' | ' | ' | ' | ||||
Net income (loss) attributable to Ocwen common stockholders | -76,189,000 | [1] | 54,725,000 | [1] | 49,273,000 | [1] | 164,120,000 | [1] |
Preferred stock dividends | 0 | [1],[2] | 0 | [1],[2] | 0 | [1],[2] | 0 | [1],[2] |
Adjusted net income (loss) attributable to Ocwen | -76,189,000 | [1] | 54,725,000 | [1] | 49,273,000 | [1] | 164,120,000 | [1] |
Weighted average shares of common stock (in shares) | 130,551,197 | 135,787,834 | 133,318,381 | 135,705,892 | ||||
Effect of dilutive elements: | ' | ' | ' | ' | ||||
Dilutive weighted average shares of common stock (in shares) | 130,551,197 | [1] | 140,057,195 | [1] | 136,881,326 | [1] | 139,747,490 | [1] |
Diluted EPS (in USD per share) | ($0.58) | $0.39 | $0.36 | $1.17 | ||||
Stock options excluded from the computation of diluted EPS: | ' | ' | ' | ' | ||||
Anti-dilutive Securities (in shares) | 91,250 | [3] | 0 | [3] | 47,083 | [3] | 0 | [3] |
Market-based [Member] | ' | ' | ' | ' | ||||
Stock options excluded from the computation of diluted EPS: | ' | ' | ' | ' | ||||
Anti-dilutive Securities (in shares) | 295,000 | [4] | 547,500 | [4] | 295,000 | [4] | 547,500 | [4] |
Preferred shares [Member] | ' | ' | ' | ' | ||||
Effect of dilutive elements: | ' | ' | ' | ' | ||||
Dilutive Securities | 0 | [1],[2] | 0 | [1],[2] | 0 | [1],[2] | 0 | [1],[2] |
Stock options [Member] | ' | ' | ' | ' | ||||
Effect of dilutive elements: | ' | ' | ' | ' | ||||
Dilutive Securities | 0 | [1] | 4,263,965 | [1] | 3,558,689 | [1] | 4,030,297 | [1] |
Common stock awards [Member] | ' | ' | ' | ' | ||||
Effect of dilutive elements: | ' | ' | ' | ' | ||||
Dilutive Securities | $0 | [1] | $5,396 | [1] | $4,256 | [1] | $11,301 | [1] |
[1] | For the three months ended September 30, 2014, we have excluded the effect of the Preferred Shares, stock options and common stock awards from the computation of diluted EPS because of the anti-dilutive effect of our reported net loss. | |||||||
[2] | The effect of our Preferred Shares on diluted EPS is computed using the if-converted method. For purposes of computing diluted EPS, we assume the conversion of the Preferred Shares into shares of common stock unless the effect is anti-dilutive. Conversion of the Preferred Shares has not been assumed for the nine months ended September 30, 2014 and the three and nine months ended September 30, 2013 because the effect would have been antidilutive. | |||||||
[3] | These options were anti-dilutive because their exercise price was greater than the average market price of our stock. | |||||||
[4] | Shares that are issuable upon the achievement of certain performance criteria related to Ocwen’s stock price and an annualized rate of return to investors. |
Business_Segment_Reporting_Sch
Business Segment Reporting - Schedule of Segment Reporting Information (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | ||||
Results of Operations | ' | ' | ' | ' | ' | ||||
Operating expenses | $455,039 | $346,260 | $1,149,696 | $960,418 | ' | ||||
Other income (expense): | ' | ' | ' | ' | ' | ||||
Interest expense | -133,049 | -116,885 | -409,129 | -319,564 | ' | ||||
Income before income taxes | -72,266 | 69,445 | 76,614 | 198,895 | ' | ||||
Total Assets | ' | ' | ' | ' | ' | ||||
Balance | 8,355,640 | ' | 8,355,640 | ' | 7,927,003 | ||||
Servicing [Member] | ' | ' | ' | ' | ' | ||||
Results of Operations | ' | ' | ' | ' | ' | ||||
Revenue | 485,303 | 496,302 | 1,526,606 | 1,381,872 | ' | ||||
Operating expenses | 313,964 | [1] | 305,654 | [1] | 919,998 | [1] | 795,645 | [1] | ' |
Income (loss) from operations | 171,339 | 190,648 | 606,608 | 586,227 | ' | ||||
Other income (expense): | ' | ' | ' | ' | ' | ||||
Interest income | 903 | 859 | 1,805 | 1,382 | ' | ||||
Interest expense | -124,106 | -113,678 | [2] | -391,122 | -309,606 | [2] | ' | ||
Other | -3,618 | -6,631 | -4,622 | -30,961 | ' | ||||
Other income (expense), net | -126,821 | -119,450 | -393,939 | -339,185 | ' | ||||
Income before income taxes | 44,518 | 71,198 | 212,669 | 247,042 | ' | ||||
Total Assets | ' | ' | ' | ' | ' | ||||
Balance | 6,059,359 | 4,086,378 | 6,059,359 | 4,086,378 | 6,295,976 | ||||
Lending [Member] | ' | ' | ' | ' | ' | ||||
Results of Operations | ' | ' | ' | ' | ' | ||||
Revenue | 26,877 | 33,539 | 86,811 | 81,180 | ' | ||||
Operating expenses | 22,632 | [1] | 29,504 | [1] | 81,261 | [1] | 69,543 | [1] | ' |
Income (loss) from operations | 4,245 | 4,035 | 5,550 | 11,637 | ' | ||||
Other income (expense): | ' | ' | ' | ' | ' | ||||
Interest income | 4,825 | 3,066 | 13,117 | 12,432 | ' | ||||
Interest expense | -2,601 | -3,279 | [2] | -8,271 | -10,108 | [2] | ' | ||
Other | 139 | 1,843 | 3,846 | 6,852 | ' | ||||
Other income (expense), net | 2,363 | 1,630 | 8,692 | 9,176 | ' | ||||
Income before income taxes | 6,608 | 5,665 | 14,242 | 20,813 | ' | ||||
Total Assets | ' | ' | ' | ' | ' | ||||
Balance | 1,706,964 | 704,641 | 1,706,964 | 704,641 | 1,195,812 | ||||
Corporate Items and Other [Member] | ' | ' | ' | ' | ' | ||||
Results of Operations | ' | ' | ' | ' | ' | ||||
Revenue | 1,557 | 1,801 | 4,734 | 19,758 | ' | ||||
Operating expenses | 118,482 | [1] | 11,143 | [1] | 148,555 | [1] | 95,361 | [1] | ' |
Income (loss) from operations | -116,925 | -9,342 | -143,821 | -75,603 | ' | ||||
Other income (expense): | ' | ' | ' | ' | ' | ||||
Interest income | 865 | 1,454 | 2,550 | 3,516 | ' | ||||
Interest expense | -6,342 | 72 | [2] | -9,736 | 150 | [2] | ' | ||
Other | -990 | 398 | 710 | 2,977 | ' | ||||
Other income (expense), net | -6,467 | 1,924 | -6,476 | 6,643 | ' | ||||
Income before income taxes | -123,392 | -7,418 | -150,297 | -68,960 | ' | ||||
Total Assets | ' | ' | ' | ' | ' | ||||
Balance | 589,317 | 609,236 | 589,317 | 609,236 | 435,215 | ||||
Corporate Eliminations [Member] | ' | ' | ' | ' | ' | ||||
Results of Operations | ' | ' | ' | ' | ' | ||||
Revenue | -39 | -402 | -118 | -492 | ' | ||||
Operating expenses | -39 | [1] | -41 | [1] | -118 | [1] | -131 | [1] | ' |
Income (loss) from operations | 0 | -361 | 0 | -361 | ' | ||||
Other income (expense): | ' | ' | ' | ' | ' | ||||
Interest income | 0 | 0 | 0 | 0 | ' | ||||
Interest expense | 0 | 0 | [2] | 0 | 0 | [2] | ' | ||
Other | 0 | 361 | 0 | 361 | ' | ||||
Other income (expense), net | 0 | 361 | 0 | 361 | ' | ||||
Income before income taxes | 0 | 0 | 0 | 0 | ' | ||||
Total Assets | ' | ' | ' | ' | ' | ||||
Balance | 0 | 0 | 0 | 0 | 0 | ||||
Business Segments Consolidated [Member] | ' | ' | ' | ' | ' | ||||
Results of Operations | ' | ' | ' | ' | ' | ||||
Revenue | 513,698 | 531,240 | 1,618,033 | 1,482,318 | ' | ||||
Operating expenses | 455,039 | [1] | 346,260 | [1] | 1,149,696 | [1] | 960,418 | [1] | ' |
Income (loss) from operations | 58,659 | 184,980 | 468,337 | 521,900 | ' | ||||
Other income (expense): | ' | ' | ' | ' | ' | ||||
Interest income | 6,593 | 5,379 | 17,472 | 17,330 | ' | ||||
Interest expense | -133,049 | -116,885 | [2] | -409,129 | -319,564 | [2] | ' | ||
Other | -4,469 | -4,029 | -66 | -20,771 | ' | ||||
Other income (expense), net | -130,925 | -115,535 | -391,723 | -323,005 | ' | ||||
Income before income taxes | -72,266 | 69,445 | 76,614 | 198,895 | ' | ||||
Total Assets | ' | ' | ' | ' | ' | ||||
Balance | $8,355,640 | $5,400,255 | $8,355,640 | $5,400,255 | $7,927,003 | ||||
[1] | Depreciation and amortization expense are as follows: Servicing Lending Corporate Items and Other Business Segments ConsolidatedFor the three months ended September 30, 2014 Depreciation expense$2,636 $98 $3,022 $5,756Amortization of mortgage servicing rights60,689 94 — 60,783Amortization of debt discount331 — 344 675Amortization of debt issuance costs 1,114 — — 1,114 For the three months ended September 30, 2013 Depreciation expense$3,589 $135 $2,973 $6,697Amortization of mortgage servicing rights79,035 148 — 79,183Amortization of debt discount330 — — 330Amortization of debt issuance costs 1,178 — — 1,178 For the nine months ended September 30, 2014 Depreciation expense$8,099 $235 $8,267 $16,601Amortization of mortgage servicing rights185,263 613 199 186,075Amortization of debt discount991 — 513 1,504Amortization of debt issuance costs 3,241 — — 3,241 For the nine months ended September 30, 2013 Depreciation expense$9,968 $209 $6,976 $17,153Amortization of mortgage servicing rights197,287 148 — 197,435Amortization of debt discount1,082 — — 1,082Amortization of debt issuance costs 3,264 — — 3,264 | ||||||||
[2] | Includes interest expense related to financing liabilities recorded in connection with the HLSS Transactions. As discussed in Note 1A — Restatement of Previously Issued Consolidated Financial Statements, we are restating our previously reported consolidated operating results for the three and nine months ended September 30, 2013 to correct an error in the accounting applicable to the financing liabilities in connection with Rights to MSRs sold to HLSS. |
Business_Segment_Reporting_Sch1
Business Segment Reporting - Schedule of Depreciation and Amortization by Segment (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Segment Reporting Information [Line Items] | ' | ' | ' | ' |
Amortization of mortgage servicing rights | $60,783 | $79,183 | $186,075 | $197,435 |
Servicing [Member] | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' |
Depreciation expense | 2,636 | 3,589 | 8,099 | 9,968 |
Amortization of mortgage servicing rights | 60,689 | 79,035 | 185,263 | 197,287 |
Amortization of debt discount | 331 | 330 | 991 | 1,082 |
Amortization of debt issuance costs | 1,114 | 1,178 | 3,241 | 3,264 |
Lending [Member] | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' |
Depreciation expense | 98 | 135 | 235 | 209 |
Amortization of mortgage servicing rights | 94 | 148 | 613 | 148 |
Amortization of debt discount | 0 | 0 | 0 | 0 |
Amortization of debt issuance costs | 0 | 0 | 0 | 0 |
Corporate Items and Other [Member] | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' |
Depreciation expense | 3,022 | 2,973 | 8,267 | 6,976 |
Amortization of mortgage servicing rights | 0 | 0 | 199 | 0 |
Amortization of debt discount | 344 | 0 | 513 | 0 |
Amortization of debt issuance costs | 0 | 0 | 0 | 0 |
Business Segments Consolidated [Member] | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' |
Depreciation expense | 5,756 | 6,697 | 16,601 | 17,153 |
Amortization of mortgage servicing rights | 60,783 | 79,183 | 186,075 | 197,435 |
Amortization of debt discount | 675 | 330 | 1,504 | 1,082 |
Amortization of debt issuance costs | $1,114 | $1,178 | $3,241 | $3,264 |
Related_Party_Transactions_Sch
Related Party Transactions - Schedule of Revenue and Expenses Related to Various Service Agreements (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Altisource [Member] | ' | ' | ' | ' |
Revenues and Expenses: | ' | ' | ' | ' |
Revenues | $10,716 | $5,185 | $30,007 | $15,390 |
Expenses | 27,099 | 13,153 | 70,577 | 36,650 |
HLSS [Member] | ' | ' | ' | ' |
Revenues and Expenses: | ' | ' | ' | ' |
Revenues | 84 | 20 | 458 | 172 |
Expenses | 345 | 386 | 1,590 | 1,615 |
AAMC [Member] | ' | ' | ' | ' |
Revenues and Expenses: | ' | ' | ' | ' |
Revenues | 251 | 0 | 952 | 0 |
Residential [Member] | ' | ' | ' | ' |
Revenues and Expenses: | ' | ' | ' | ' |
Revenues | $4,618 | $493 | $12,141 | $606 |
Related_Party_Transactions_Sch1
Related Party Transactions - Schedule of Amounts Receivable or Payable (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Net Receivable (Payable) | ' | ' |
Net Receivable (Payable) | ($30,160) | ($62,355) |
Altisource [Member] | ' | ' |
Net Receivable (Payable) | ' | ' |
Net Receivable (Payable) | -12,626 | -3,843 |
HLSS [Member] | ' | ' |
Net Receivable (Payable) | ' | ' |
Net Receivable (Payable) | -17,812 | -59,505 |
AAMC [Member] | ' | ' |
Net Receivable (Payable) | ' | ' |
Net Receivable (Payable) | 278 | 943 |
Residential [Member] | ' | ' |
Net Receivable (Payable) | ' | ' |
Net Receivable (Payable) | $0 | $50 |
Related_Party_Transactions_Nar
Related Party Transactions - Narrative (Details) (USD $) | 3 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | ||||||||||||
Jun. 30, 2014 | Mar. 04, 2014 | Sep. 30, 2013 | 2-May-14 | Apr. 22, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Jul. 31, 2014 | Jun. 26, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | |
HLSS [Member] | HLSS [Member] | HLSS SEZ LP [Member] | Executive Chairman of the Board of Directors Chairman [Member] | Executive Chairman of the Board of Directors Chairman [Member] | Executive Chairman of the Board of Directors Chairman [Member] | Executive Chairman of the Board of Directors Chairman [Member] | Executive Chairman of the Board of Directors Chairman [Member] | Executive Chairman of the Board of Directors Chairman [Member] | Executive Chairman of the Board of Directors Chairman [Member] | Mortgage Servicing Rights [Member] | Mortgage Servicing Rights [Member] | Homeward Acquisition [Member] | Homeward Acquisition [Member] | Homeward Acquisition [Member] | ||
Ocwen [Member] | Altisource [Member] | HLSS [Member] | Altisource Asset Management Corporation [Member] | Altisource Residential Lp [Member] | HLSS Mortgage LP [Member] | HLSS Mortgage LP [Member] | Maximum [Member] | |||||||||
Related Party Transaction [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership percentage by related party | ' | ' | ' | ' | ' | ' | 14.00% | 29.00% | 1.00% | 28.00% | 4.00% | ' | ' | ' | ' | ' |
Share-based compensation arrangement by share-based payment award, options, outstanding, number (in shares) | ' | ' | ' | ' | ' | 3,620,498 | ' | 873,501 | ' | 87,350 | ' | ' | ' | ' | ' | ' |
Share-based compensation arrangement by share-based payment award, options, exercisable, number (in shares) | ' | ' | ' | ' | ' | 3,220,498 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options surrendered (in shares) | ' | ' | ' | ' | 1,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Recognized compensation expense | $5,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unpaid principal balance of loans related to servicing assets sold | ' | ' | 109,800,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fair value of servicing assets sold | ' | ' | 388,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sale of match funded advances | ' | ' | 3,500,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds from sale of loans held-for-sale | ' | 612,300,000 | ' | 20,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unpaid principal balance assets acquired | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 92,900,000 | 396,900,000 | ' | ' | ' |
Indemnification recovery | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $28,300,000 | $13,600,000 | $75,000,000 |
Regulatory_Requirements_Narrat
Regulatory Requirements - Narrative (Details) (USD $) | Sep. 30, 2014 |
In Millions, unless otherwise specified | |
Brokers and Dealers [Abstract] | ' |
Capital requirement, unpaid principal balance | $753.10 |
Commitments_and_Contingencies_1
Commitments and Contingencies - Schedule of Indemnification Obligations (Details) (USD $) | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | ||
Indemnification Obligations Liability [Roll Forward] | ' | ' | ||
Beginning balance | $192,716 | [1] | $38,140 | |
Provision for representation and warranty obligations | 5,076 | 18,116 | ||
New production reserves | 820 | 1,055 | ||
Obligations assumed in connection with MSR and servicing business acquisitions | 0 | 189,742 | ||
Charge-offs and other | -54,776 | [2] | -40,979 | [2] |
Ending balance | $143,836 | [1] | $206,074 | |
[1] | See Note 22 – Commitments and Contingencies for additional information. | |||
[2] | Includes principal and interest losses realized in connection with repurchased loans, make-whole, indemnification and fee payments and settlements net of recoveries, if any. |
Commitments_and_Contingencies_2
Commitments and Contingencies - Narrative (Details) (USD $) | 9 Months Ended | 0 Months Ended | 1 Months Ended | |||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Dec. 19, 2013 | Sep. 30, 2014 | 31-May-14 | Dec. 19, 2013 | Feb. 28, 2014 | |
Loan | Loan | Mortgage Servicing Practice [Member] | Unfavorable Regulatory Action [Member] | Unfavorable Regulatory Action [Member] | Unfavorable Regulatory Action [Member] | Unfavorable Regulatory Action [Member] | Wells Fargo [Member] | |
Minimum [Member] | Loan | |||||||
Loss Contingencies [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Estimate of possible loss | ' | ' | $19,100,000 | ' | $100,000,000 | ' | ' | ' |
Mortgage loans on real estate, number of acquired loans on hold | ' | ' | ' | ' | ' | ' | ' | 184,000 |
Acquisitions | ' | ' | ' | ' | ' | ' | ' | 39,000,000,000 |
Oversight monitor period | ' | ' | ' | '3 years | ' | ' | ' | ' |
Consumer relief fund payment | ' | ' | ' | 127,300,000 | ' | ' | ' | ' |
Consumer relief fund, former owner's responsibility amount | ' | ' | ' | ' | ' | 60,400,000 | ' | ' |
Consumer relief fund, former owner's responsibility amount received | ' | ' | ' | ' | ' | 49,000,000 | ' | ' |
Principal forgiveness modification program, aggregate amount | ' | ' | ' | ' | ' | ' | 2,000,000,000 | ' |
Principal forgiveness modification program, term | ' | ' | ' | '3 years | ' | ' | ' | ' |
Provided or assumed representation and warranty obligations of unpaid principal balance | 83,400,000,000 | 89,400,000,000 | ' | ' | ' | ' | ' | ' |
Warranty repurchase demands unpaid principal balance | $108,200,000 | $113,000,000 | ' | ' | ' | ' | ' | ' |
Warranty repurchase demands number of loans | 578 | 534 | ' | ' | ' | ' | ' | ' |
Subsequent_Events_Narrative_De
Subsequent Events - Narrative (Details) (USD $) | 0 Months Ended | 9 Months Ended | 11 Months Ended | 1 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Jul. 14, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Oct. 30, 2014 |
Subsequent Event [Member] | |||||
Subsequent Event [Line Items] | ' | ' | ' | ' | ' |
Repurchase of common stock (in shares) | 1,950,296 | 7,970,353 | ' | 9,096,060 | 1,988,673 |
Repurchase of common stock | $72,300 | $325,609 | $157,880 | ' | $47,000 |