10-Q 1 hmpt-20220331.htm 10-Q hmpt-20220331
12/31Q120220001830197FALSE00018301972022-01-012022-03-3100018301972022-05-10xbrli:shares00018301972022-03-31iso4217:USD00018301972021-12-31iso4217:USDxbrli:shares00018301972021-01-012021-03-310001830197us-gaap:CommonStockMember2020-12-310001830197us-gaap:AdditionalPaidInCapitalMember2020-12-310001830197us-gaap:RetainedEarningsMember2020-12-3100018301972020-12-310001830197us-gaap:RetainedEarningsMember2021-01-012021-03-310001830197us-gaap:AdditionalPaidInCapitalMember2021-01-012021-03-310001830197us-gaap:CommonStockMember2021-03-310001830197us-gaap:AdditionalPaidInCapitalMember2021-03-310001830197us-gaap:RetainedEarningsMember2021-03-3100018301972021-03-310001830197us-gaap:CommonStockMember2021-12-310001830197us-gaap:AdditionalPaidInCapitalMember2021-12-310001830197us-gaap:TreasuryStockMember2021-12-310001830197us-gaap:RetainedEarningsMember2021-12-310001830197us-gaap:CommonStockMember2022-01-012022-03-310001830197us-gaap:TreasuryStockMember2022-01-012022-03-310001830197us-gaap:RetainedEarningsMember2022-01-012022-03-310001830197us-gaap:AdditionalPaidInCapitalMember2022-01-012022-03-310001830197us-gaap:CommonStockMember2022-03-310001830197us-gaap:AdditionalPaidInCapitalMember2022-03-310001830197us-gaap:TreasuryStockMember2022-03-310001830197us-gaap:RetainedEarningsMember2022-03-31hmpt:segment0001830197us-gaap:ConventionalLoanMember2022-03-310001830197us-gaap:UsGovernmentAgencyInsuredLoansMember2022-03-310001830197hmpt:ReverseMortgageLoansMember2022-03-310001830197us-gaap:ConventionalLoanMember2021-12-310001830197us-gaap:UsGovernmentAgencyInsuredLoansMember2021-12-310001830197hmpt:ReverseMortgageLoansMember2021-12-310001830197us-gaap:GovernmentNationalMortgageAssociationCertificatesAndObligationsGNMAMember2022-03-310001830197us-gaap:GovernmentNationalMortgageAssociationCertificatesAndObligationsGNMAMember2021-12-310001830197us-gaap:FederalNationalMortgageAssociationCertificatesAndObligationsFNMAMember2022-03-310001830197us-gaap:FederalNationalMortgageAssociationCertificatesAndObligationsFNMAMember2021-12-310001830197us-gaap:FederalHomeLoanMortgageCorporationCertificatesAndObligationsFHLMCMember2022-03-310001830197us-gaap:FederalHomeLoanMortgageCorporationCertificatesAndObligationsFHLMCMember2021-12-310001830197hmpt:OtherMortgageServicingPortfolioMember2022-03-310001830197hmpt:OtherMortgageServicingPortfolioMember2021-12-31xbrli:pure00018301972021-01-012021-12-310001830197hmpt:FinancialAsset30To89DaysPastDueMember2022-03-310001830197hmpt:FinancialAsset30To89DaysPastDueMember2021-12-310001830197us-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMember2022-03-310001830197us-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMember2021-12-310001830197us-gaap:NondesignatedMemberhmpt:ForwardSaleContractsMember2022-03-310001830197us-gaap:InterestRateLockCommitmentsMemberus-gaap:NondesignatedMember2022-03-310001830197us-gaap:NondesignatedMemberhmpt:ForwardPurchaseContractsMember2022-03-310001830197hmpt:InterestRateSwapFuturesPurchaseContractsMemberus-gaap:NondesignatedMember2022-03-310001830197hmpt:TreasuryFuturePurchaseContractsMemberus-gaap:NondesignatedMember2022-03-310001830197hmpt:MarginMemberus-gaap:NondesignatedMember2022-03-310001830197us-gaap:NondesignatedMemberhmpt:ForwardSaleContractsMember2021-12-310001830197us-gaap:InterestRateLockCommitmentsMemberus-gaap:NondesignatedMember2021-12-310001830197us-gaap:NondesignatedMemberhmpt:ForwardPurchaseContractsMember2021-12-310001830197hmpt:InterestRateSwapFuturesPurchaseContractsMemberus-gaap:NondesignatedMember2021-12-310001830197hmpt:TreasuryFuturePurchaseContractsMemberus-gaap:NondesignatedMember2021-12-310001830197hmpt:MarginMemberus-gaap:NondesignatedMember2021-12-310001830197hmpt:ForwardSaleContractsMember2022-01-012022-03-310001830197hmpt:ForwardSaleContractsMember2021-01-012021-03-310001830197us-gaap:InterestRateLockCommitmentsMember2022-01-012022-03-310001830197us-gaap:InterestRateLockCommitmentsMember2021-01-012021-03-310001830197hmpt:ForwardPurchaseContractsMember2022-01-012022-03-310001830197hmpt:ForwardPurchaseContractsMember2021-01-012021-03-310001830197hmpt:InterestRateSwapAndTreasuryFuturePurchaseContractsMember2022-01-012022-03-310001830197hmpt:InterestRateSwapAndTreasuryFuturePurchaseContractsMember2021-01-012021-03-310001830197hmpt:ForwardSaleContractsMember2022-03-310001830197hmpt:ForwardPurchaseContractsMember2022-03-310001830197hmpt:InterestRateSwapAndTreasuryFuturePurchaseContractsMember2022-03-310001830197hmpt:InterestRateLockCommitmentsNotSubjectToMasterNettingAgreementsMember2022-03-310001830197hmpt:ForwardSaleContractsMember2021-12-310001830197hmpt:ForwardPurchaseContractsMember2021-12-310001830197hmpt:InterestRateSwapAndTreasuryFuturePurchaseContractsMember2021-12-310001830197hmpt:InterestRateLockCommitmentsNotSubjectToMasterNettingAgreementsMember2021-12-310001830197us-gaap:WarehouseAgreementBorrowingsMember2022-03-310001830197us-gaap:WarehouseAgreementBorrowingsMember2021-12-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:A700MillionWarehouseFacilityMaturingAugust2022Member2022-03-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:A450MWarehouseFacilityMaturingSeptember2022Member2022-03-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:A500MWarehouseFacilityMaturingSeptember20221Member2022-03-310001830197hmpt:A500MWarehouseFacilityMaturingSeptember20222Memberus-gaap:WarehouseAgreementBorrowingsMember2022-03-310001830197hmpt:A1200MillionWarehouseFacilityMaturingFebruary2023Memberus-gaap:WarehouseAgreementBorrowingsMember2022-03-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:A500MWarehouseFacilityMaturingMarch2023Member2022-03-310001830197hmpt:A400MillionWarehouseFacilityMaturingMarch2023Memberus-gaap:WarehouseAgreementBorrowingsMember2022-03-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:A325MillionWarehouseFacilityMaturingMarch2023Member2022-03-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:A1200MWarehouseFacilityMaturingMay2023Member2022-03-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:A885MWarehouseFacilityMember2022-03-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:A550MWarehouseFacilityMember2022-03-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:GestationMember2022-03-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:EarlyFundingMember2022-03-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:A1200MWarehouseFacilityMember2021-12-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:A500MWarehouseFacilityMaturingMarch20221Member2021-12-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:A500MWarehouseFacilityMaturingMarch20222Member2021-12-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:A1000MWarehouseFacilityMaturingAugust2022Member2021-12-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:A450MWarehouseFacilityMaturingSeptember2022Member2021-12-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:A500MWarehouseFacilityMaturingSeptember20221Member2021-12-310001830197hmpt:A500MWarehouseFacilityMaturingSeptember20222Memberus-gaap:WarehouseAgreementBorrowingsMember2021-12-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:A500MWarehouseFacilityMaturingMarch2023Member2021-12-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:A1500MWarehouseFacilityMaturingMay2023Member2021-12-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:A885MWarehouseFacilityMember2021-12-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:A550MWarehouseFacilityMember2021-12-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:GestationMember2021-12-310001830197us-gaap:WarehouseAgreementBorrowingsMemberhmpt:EarlyFundingMember2021-12-310001830197us-gaap:RevolvingCreditFacilityMemberhmpt:A10BillionMSRFacilityDueMay2025Member2022-03-310001830197us-gaap:RevolvingCreditFacilityMemberhmpt:A10BillionMSRFacilityDueMay2025Member2021-12-310001830197us-gaap:SeniorNotesMemberhmpt:A550MillionSeniorNoteDueFebruary2026Member2021-01-310001830197us-gaap:SeniorNotesMemberhmpt:A550MillionSeniorNoteDueFebruary2026Member2022-03-310001830197us-gaap:SeniorNotesMemberhmpt:A550MillionSeniorNoteDueFebruary2026Member2021-12-310001830197us-gaap:LineOfCreditMemberhmpt:A90MServicingAdvanceFacilityMember2022-03-310001830197us-gaap:LineOfCreditMemberhmpt:A90MServicingAdvanceFacilityMember2021-12-310001830197us-gaap:LineOfCreditMemberhmpt:A35MillionOperatingLineOfCreditMember2022-03-310001830197us-gaap:LineOfCreditMemberhmpt:A35MillionOperatingLineOfCreditMember2021-12-310001830197us-gaap:RevolvingCreditFacilityMemberhmpt:A10BMSRFacilityMember2022-03-310001830197us-gaap:RevolvingCreditFacilityMembersrt:MinimumMemberhmpt:A10BMSRFacilityMember2022-03-310001830197us-gaap:RevolvingCreditFacilityMembersrt:MaximumMemberhmpt:A10BMSRFacilityMember2022-03-310001830197us-gaap:RevolvingCreditFacilityMemberhmpt:A10BMSRFacilityMember2022-01-012022-03-310001830197us-gaap:LineOfCreditMemberhmpt:A90MServicingAdvanceFacilityMember2021-01-310001830197us-gaap:LineOfCreditMembersrt:MinimumMemberhmpt:A90MServicingAdvanceFacilityMember2021-01-310001830197us-gaap:LineOfCreditMembersrt:MaximumMemberhmpt:A90MServicingAdvanceFacilityMember2021-01-310001830197us-gaap:LineOfCreditMemberhmpt:A10BMSRFacilityMember2022-03-310001830197us-gaap:CommitmentsToExtendCreditMember2022-03-310001830197us-gaap:CommitmentsToExtendCreditMember2021-12-310001830197hmpt:HomePointFinancialCorporationHPFMembersrt:MinimumMemberhmpt:BankingRegulationMortgageBankingStateMandateVariousStatesMember2022-03-310001830197srt:MaximumMemberhmpt:HomePointFinancialCorporationHPFMemberhmpt:BankingRegulationMortgageBankingStateMandateVariousStatesMember2022-03-310001830197us-gaap:FederalNationalMortgageAssociationFnmaInsuredLoansMember2022-03-310001830197us-gaap:FederalHomeLoanMortgageCorporationFhlmcInsuredLoansMember2022-03-310001830197us-gaap:FederalHomeLoanMortgageCorporationFhlmcInsuredLoansMember2021-12-310001830197us-gaap:FederalNationalMortgageAssociationFnmaInsuredLoansMember2021-12-310001830197hmpt:MeasurementInputPullThroughRateMembersrt:WeightedAverageMemberus-gaap:InterestRateLockCommitmentsMember2022-03-310001830197us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:MortgageLoansHeldForSaleExcludingEarlyBuyoutLoansMember2022-03-310001830197us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:MortgageLoansHeldForSaleExcludingEarlyBuyoutLoansMember2022-03-310001830197us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:MortgageLoansHeldForSaleExcludingEarlyBuyoutLoansMember2022-03-310001830197us-gaap:FairValueMeasurementsRecurringMemberhmpt:MortgageLoansHeldForSaleExcludingEarlyBuyoutLoansMember2022-03-310001830197us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:InterestRateLockCommitmentsMember2022-03-310001830197us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:InterestRateLockCommitmentsMember2022-03-310001830197us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:InterestRateLockCommitmentsMember2022-03-310001830197us-gaap:FairValueMeasurementsRecurringMemberus-gaap:InterestRateLockCommitmentsMember2022-03-310001830197hmpt:ForwardSaleContractsMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2022-03-310001830197hmpt:ForwardSaleContractsMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2022-03-310001830197hmpt:ForwardSaleContractsMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2022-03-310001830197hmpt:ForwardSaleContractsMemberus-gaap:FairValueMeasurementsRecurringMember2022-03-310001830197us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:ForwardPurchaseContractsMember2022-03-310001830197us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:ForwardPurchaseContractsMember2022-03-310001830197us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:ForwardPurchaseContractsMember2022-03-310001830197us-gaap:FairValueMeasurementsRecurringMemberhmpt:ForwardPurchaseContractsMember2022-03-310001830197us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2022-03-310001830197us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2022-03-310001830197us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2022-03-310001830197us-gaap:FairValueMeasurementsRecurringMember2022-03-310001830197us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:InterestRateSwapFuturesPurchaseContractsMember2022-03-310001830197us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:InterestRateSwapFuturesPurchaseContractsMember2022-03-310001830197us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:InterestRateSwapFuturesPurchaseContractsMember2022-03-310001830197us-gaap:FairValueMeasurementsRecurringMemberhmpt:InterestRateSwapFuturesPurchaseContractsMember2022-03-310001830197hmpt:TreasuryFuturesPurchaseContractsMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2022-03-310001830197hmpt:TreasuryFuturesPurchaseContractsMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2022-03-310001830197us-gaap:FairValueInputsLevel3Memberhmpt:TreasuryFuturesPurchaseContractsMemberus-gaap:FairValueMeasurementsRecurringMember2022-03-310001830197hmpt:TreasuryFuturesPurchaseContractsMemberus-gaap:FairValueMeasurementsRecurringMember2022-03-310001830197us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:MortgageLoansHeldForSaleExcludingEarlyBuyoutLoansMember2021-12-310001830197us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:MortgageLoansHeldForSaleExcludingEarlyBuyoutLoansMember2021-12-310001830197us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:MortgageLoansHeldForSaleExcludingEarlyBuyoutLoansMember2021-12-310001830197us-gaap:FairValueMeasurementsRecurringMemberhmpt:MortgageLoansHeldForSaleExcludingEarlyBuyoutLoansMember2021-12-310001830197us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:InterestRateLockCommitmentsMember2021-12-310001830197us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:InterestRateLockCommitmentsMember2021-12-310001830197us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:InterestRateLockCommitmentsMember2021-12-310001830197us-gaap:FairValueMeasurementsRecurringMemberus-gaap:InterestRateLockCommitmentsMember2021-12-310001830197hmpt:ForwardSaleContractsMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001830197hmpt:ForwardSaleContractsMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001830197hmpt:ForwardSaleContractsMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001830197hmpt:ForwardSaleContractsMemberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001830197us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:ForwardPurchaseContractsMember2021-12-310001830197us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:ForwardPurchaseContractsMember2021-12-310001830197us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:ForwardPurchaseContractsMember2021-12-310001830197us-gaap:FairValueMeasurementsRecurringMemberhmpt:ForwardPurchaseContractsMember2021-12-310001830197us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:InterestRateSwapFuturesPurchaseContractsMember2021-12-310001830197us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:InterestRateSwapFuturesPurchaseContractsMember2021-12-310001830197us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:InterestRateSwapFuturesPurchaseContractsMember2021-12-310001830197us-gaap:FairValueMeasurementsRecurringMemberhmpt:InterestRateSwapFuturesPurchaseContractsMember2021-12-310001830197hmpt:TreasuryFuturesPurchaseContractsMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001830197hmpt:TreasuryFuturesPurchaseContractsMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001830197us-gaap:FairValueInputsLevel3Memberhmpt:TreasuryFuturesPurchaseContractsMemberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001830197hmpt:TreasuryFuturesPurchaseContractsMemberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001830197us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:HedgingMortgageServicingRightsMember2021-12-310001830197us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:HedgingMortgageServicingRightsMember2021-12-310001830197us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMemberhmpt:HedgingMortgageServicingRightsMember2021-12-310001830197us-gaap:FairValueMeasurementsRecurringMemberhmpt:HedgingMortgageServicingRightsMember2021-12-310001830197us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001830197us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001830197us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001830197us-gaap:FairValueMeasurementsRecurringMember2021-12-310001830197hmpt:HedgingMortgageServicingRightsMember2021-12-310001830197us-gaap:InterestRateLockCommitmentsMember2021-12-310001830197hmpt:MortgageLoansHeldForSaleExcludingEarlyBuyoutLoansMember2021-12-310001830197hmpt:HedgingMortgageServicingRightsMember2022-01-012022-03-310001830197us-gaap:InterestRateLockCommitmentsMember2022-01-012022-03-310001830197hmpt:MortgageLoansHeldForSaleExcludingEarlyBuyoutLoansMember2022-01-012022-03-310001830197hmpt:HedgingMortgageServicingRightsMember2022-03-310001830197us-gaap:InterestRateLockCommitmentsMember2022-03-310001830197hmpt:MortgageLoansHeldForSaleExcludingEarlyBuyoutLoansMember2022-03-310001830197hmpt:HedgingMortgageServicingRightsMember2020-12-310001830197us-gaap:InterestRateLockCommitmentsMember2020-12-310001830197hmpt:MortgageLoansHeldForSaleExcludingEarlyBuyoutLoansMember2020-12-310001830197hmpt:HedgingMortgageServicingRightsMember2021-01-012021-03-310001830197us-gaap:InterestRateLockCommitmentsMember2021-01-012021-03-310001830197hmpt:MortgageLoansHeldForSaleExcludingEarlyBuyoutLoansMember2021-01-012021-03-310001830197hmpt:HedgingMortgageServicingRightsMember2021-03-310001830197us-gaap:InterestRateLockCommitmentsMember2021-03-310001830197hmpt:MortgageLoansHeldForSaleExcludingEarlyBuyoutLoansMember2021-03-310001830197srt:MinimumMemberhmpt:HedgingMortgageServicingRightsMemberus-gaap:MeasurementInputDiscountRateMember2022-03-310001830197srt:MaximumMemberhmpt:HedgingMortgageServicingRightsMemberus-gaap:MeasurementInputDiscountRateMember2022-03-310001830197hmpt:HedgingMortgageServicingRightsMemberus-gaap:MeasurementInputDiscountRateMembersrt:WeightedAverageMember2022-03-310001830197srt:MinimumMemberhmpt:HedgingMortgageServicingRightsMemberus-gaap:MeasurementInputPrepaymentRateMember2022-03-310001830197srt:MaximumMemberhmpt:HedgingMortgageServicingRightsMemberus-gaap:MeasurementInputPrepaymentRateMember2022-03-310001830197hmpt:HedgingMortgageServicingRightsMemberus-gaap:MeasurementInputPrepaymentRateMembersrt:WeightedAverageMember2022-03-310001830197hmpt:MeasurementInputPullThroughRateMembersrt:MinimumMemberus-gaap:InterestRateLockCommitmentsMember2022-03-310001830197srt:MaximumMemberhmpt:MeasurementInputPullThroughRateMemberus-gaap:InterestRateLockCommitmentsMember2022-03-310001830197srt:MinimumMemberhmpt:MortgageLoansHeldForSaleMemberhmpt:MeasurementInputInvestorPricingMember2022-03-310001830197srt:MaximumMemberhmpt:MortgageLoansHeldForSaleMemberhmpt:MeasurementInputInvestorPricingMember2022-03-310001830197hmpt:MortgageLoansHeldForSaleMemberhmpt:MeasurementInputInvestorPricingMembersrt:WeightedAverageMember2022-03-310001830197srt:MinimumMemberhmpt:HedgingMortgageServicingRightsMemberus-gaap:MeasurementInputDiscountRateMember2021-12-310001830197srt:MaximumMemberhmpt:HedgingMortgageServicingRightsMemberus-gaap:MeasurementInputDiscountRateMember2021-12-310001830197hmpt:HedgingMortgageServicingRightsMemberus-gaap:MeasurementInputDiscountRateMembersrt:WeightedAverageMember2021-12-310001830197srt:MinimumMemberhmpt:HedgingMortgageServicingRightsMemberus-gaap:MeasurementInputPrepaymentRateMember2021-12-310001830197srt:MaximumMemberhmpt:HedgingMortgageServicingRightsMemberus-gaap:MeasurementInputPrepaymentRateMember2021-12-310001830197hmpt:HedgingMortgageServicingRightsMemberus-gaap:MeasurementInputPrepaymentRateMembersrt:WeightedAverageMember2021-12-310001830197hmpt:MeasurementInputPullThroughRateMembersrt:MinimumMemberus-gaap:InterestRateLockCommitmentsMember2021-12-310001830197srt:MaximumMemberhmpt:MeasurementInputPullThroughRateMemberus-gaap:InterestRateLockCommitmentsMember2021-12-310001830197hmpt:MeasurementInputPullThroughRateMembersrt:WeightedAverageMemberus-gaap:InterestRateLockCommitmentsMember2021-12-310001830197srt:MinimumMemberhmpt:MortgageLoansHeldForSaleMemberhmpt:MeasurementInputInvestorPricingMember2021-12-310001830197srt:MaximumMemberhmpt:MortgageLoansHeldForSaleMemberhmpt:MeasurementInputInvestorPricingMember2021-12-310001830197hmpt:MortgageLoansHeldForSaleMemberhmpt:MeasurementInputInvestorPricingMembersrt:WeightedAverageMember2021-12-310001830197us-gaap:SeniorNotesMemberhmpt:A550MSeniorNotesMember2022-03-310001830197us-gaap:SeniorNotesMemberhmpt:A550MSeniorNotesMember2021-12-3100018301972021-01-2100018301972021-01-212021-01-210001830197us-gaap:RestrictedStockUnitsRSUMember2021-12-310001830197us-gaap:RestrictedStockUnitsRSUMember2022-01-012022-03-310001830197us-gaap:RestrictedStockUnitsRSUMember2022-03-310001830197us-gaap:PerformanceSharesMember2022-01-012022-03-310001830197srt:MinimumMemberus-gaap:PerformanceSharesMember2022-01-012022-03-310001830197srt:MaximumMemberus-gaap:PerformanceSharesMember2022-01-012022-03-310001830197us-gaap:PerformanceSharesMember2021-12-310001830197us-gaap:PerformanceSharesMember2022-03-310001830197us-gaap:StockOptionMember2022-01-012022-03-310001830197us-gaap:StockOptionMember2021-01-012021-03-310001830197us-gaap:StockOptionMember2021-03-312021-03-310001830197us-gaap:EmployeeStockOptionMember2022-01-012022-03-310001830197srt:MinimumMember2022-03-310001830197srt:MaximumMember2022-03-310001830197srt:MinimumMember2021-12-310001830197srt:MaximumMember2021-12-310001830197us-gaap:RestrictedStockUnitsRSUMember2022-01-012022-03-310001830197us-gaap:RestrictedStockUnitsRSUMember2021-01-012021-03-310001830197us-gaap:EmployeeStockOptionMember2022-01-012022-03-310001830197us-gaap:EmployeeStockOptionMember2021-01-012021-03-3100018301972022-02-240001830197hmpt:LongbridgeFinancialLLCMember2022-03-310001830197hmpt:LongbridgeFinancialLLCMember2021-12-310001830197hmpt:LongbridgeFinancialLLCMember2022-01-012022-03-310001830197hmpt:LongbridgeFinancialLLCMember2021-01-012021-03-310001830197us-gaap:OperatingSegmentsMemberhmpt:OriginationSegmentMember2022-01-012022-03-310001830197us-gaap:OperatingSegmentsMemberhmpt:ServicingSegmentMember2022-01-012022-03-310001830197us-gaap:OperatingSegmentsMember2022-01-012022-03-310001830197us-gaap:CorporateNonSegmentMember2022-01-012022-03-310001830197hmpt:OperatingSegmentsAndCorporateNonSegmentMember2022-01-012022-03-310001830197us-gaap:MaterialReconcilingItemsMember2022-01-012022-03-310001830197us-gaap:OperatingSegmentsMemberhmpt:OriginationSegmentMember2021-01-012021-03-310001830197us-gaap:OperatingSegmentsMemberhmpt:ServicingSegmentMember2021-01-012021-03-310001830197us-gaap:OperatingSegmentsMember2021-01-012021-03-310001830197us-gaap:CorporateNonSegmentMember2021-01-012021-03-310001830197hmpt:OperatingSegmentsAndCorporateNonSegmentMember2021-01-012021-03-310001830197us-gaap:MaterialReconcilingItemsMember2021-01-012021-03-310001830197hmpt:LoanExpenseLoanServicingExpenseProductionTechnologyGeneralAndAdministrativeOtherExpensesMemberhmpt:HomePointCapitalLPMember2022-01-012022-03-310001830197hmpt:LoanExpenseLoanServicingExpenseProductionTechnologyGeneralAndAdministrativeOtherExpensesMemberhmpt:HomePointCapitalLPMember2021-01-012021-03-310001830197us-gaap:SubsequentEventMember2022-04-292022-04-290001830197us-gaap:RevolvingCreditFacilityMemberhmpt:A10BMSRFacilityMemberus-gaap:SubsequentEventMember2022-04-290001830197us-gaap:RevolvingCreditFacilityMemberus-gaap:SubsequentEventMemberhmpt:A10BillionMSRFacilityDueMay2025Member2022-04-290001830197us-gaap:RevolvingCreditFacilityMembersrt:MinimumMemberhmpt:A10BMSRFacilityMemberus-gaap:SubsequentEventMember2022-04-290001830197us-gaap:RevolvingCreditFacilityMembersrt:MaximumMemberhmpt:A10BMSRFacilityMemberus-gaap:SubsequentEventMember2022-04-290001830197us-gaap:SubsequentEventMember2022-05-030001830197us-gaap:SubsequentEventMember2022-05-032022-05-030001830197us-gaap:SubsequentEventMember2022-06-072022-06-070001830197us-gaap:SubsequentEventMember2022-05-122022-05-12

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2022
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from  ______________  to ______________
Commission File Number: 001-39964
Home Point Capital Inc.
(Exact name of registrant as specified in its charter)
Delaware90-1116426
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer Identification No.)
2211 Old Earhart Road, Suite 250
Ann Arbor, Michigan
48105
(Address of Principal Executive Offices)(Zip Code)
(888) 616-6866
Registrant's telephone number, including area code
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolName of each exchange on which
registered
Common Stock, par value
$0.0000000072 per share
HMPT
The Nasdaq Stock Market LLC
(The Nasdaq Global Select Market)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days. Yes No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerAccelerated filer
Non-accelerated filerSmaller reporting company
Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes No
As of May 10, 2022, the registrant had 138,311,875 shares of common stock, par value $0.0000000072 per share, outstanding.


TABLE OF CONTENTS
Page
PART I—FINANCIAL INFORMATION
PART II—OTHER INFORMATION

i

Cautionary Note on Forward-Looking Statements
This Quarterly Report on Form 10-Q (this “Report”) contains certain “forward-looking statements,” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are forward-looking statements. Forward-looking statements include, but are not limited to, statements relating to our future financial performance, our business prospects and strategy, anticipated financial position, liquidity and capital needs, the industry in which we operate and other similar matters. Words such as “anticipates,” “expects,” “intends,” “plans,” “predicts,” “believes,” “seeks,” “estimates,” “could,” “would,” “will,” “may,” “can,” “continue,” “potential,” “should” and the negative of these terms or other comparable terminology often identify forward-looking statements. Forward-looking statements are not guarantees of future performance, are based upon assumptions, and are subject to risks and uncertainties that could cause actual results to differ materially from the results contemplated by the forward-looking statements, including the risks discussed in Part I, Item 1A. of our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, which was filed on March 17, 2022 (our “2021 Annual Report”). Factors, risks, and uncertainties that could cause actual outcomes and results to be materially different from those contemplated include, among others:
the effects of the COVID-19 pandemic on our business;
our reliance on our financing arrangements to fund mortgage loans and otherwise operate our business;
the dependence of our loan origination and servicing revenues on macroeconomic and U.S. residential real estate market conditions;
the requirement to repurchase mortgage loans or indemnify investors if we breach representations and warranties;
counterparty risk;
the requirement to make servicing advances that can be subject to delays in recovery or may not be recoverable in certain circumstances;
risks related to any subservicer;
competition for mortgage assets that may limit the availability of desirable originations, acquisitions and result in reduced risk-adjusted returns;
our ability to continue to grow our loan origination business or effectively manage significant increases in our loan production volume;
difficult conditions or disruptions in the mortgage-backed securities (“MBS”), mortgage, real estate and financial markets;
competition in the industry in which we operate;
our ability to acquire loans and sell the resulting MBS in the secondary markets on favorable terms in our production activities;
our ability to adapt to and implement technological changes;
the effectiveness of our risk management efforts;
our ability to detect misconduct and fraud;
any failure to attract and retain a highly skilled workforce, including our senior executives;
our ability to obtain, maintain, protect and enforce our intellectual property;
any cybersecurity risks, cyber incidents and technology failures;
material changes to the laws, regulations or practices applicable to reverse mortgage programs operated by the Federal Housing Administration (“FHA”) and the U.S. Department of Housing and Urban Development;
our vendor relationships;
our failure to deal appropriately with various issues that may give rise to reputational risk, including legal and regulatory requirements;
any employment litigation and related unfavorable publicity;
ii

exposure to new risks and increased costs as a result of initiating new business activities or strategies or significantly expanding existing business activities or strategies;
the impact of changes in political or economic stability or by government policies on our material vendors with operations in India;
our ability to fully utilize our net operating loss (“NOL”) and other tax carryforwards;
any challenge by the Internal Revenue Service of the amount, timing and/or use of our NOL carryforwards;
possible changes in legislation and the effect on our ability to use the tax benefits associated with our NOL carryforwards;
the impact of other changes in tax laws;
the impact of interest rate fluctuations;
risks associated with hedging against interest rate exposure;
the impact of any prolonged economic slowdown, recession or declining real estate values;
risks associated with financing our assets with borrowings;
risks associated with a decrease in value of our collateral;
the dependence of our operations on access to our financing arrangements, which are mostly uncommitted;
risks associated with the financial and restrictive covenants included in our financing agreements;
risks associated with changes in the London Inter-Bank Offered Rate reporting practices and the use of alternative reference rates;
our ability to raise the debt or equity capital required to finance our assets and grow our business;
risks associated with derivative financial instruments;
our ability to comply with continually changing federal, state and local laws and regulations;
the impact of revised rules and regulations and enforcement of existing rules and regulations by the Consumer Financial Protection Bureau;
the impact of revised rules and regulations and enforcement of existing rules and regulations by state regulatory agencies;
our ability to comply with the Government-Sponsored Enterprises (“GSE”), FHA, U.S. Department of Veterans Affairs (“VA”) and U.S. Department of Agriculture (“USDA”) guidelines and changes in these guidelines or GSE and Government National Mortgage Association (“Ginnie Mae”) guarantees;
changes in regulations or the occurrence of other events that impact the business, operations or prospects of government agencies such as Ginnie Mae, the FHA or the VA, the USDA, or GSEs such as the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation, or such changes that increase the cost of doing business with such entities;
our ability to obtain and/or maintain licenses and other approvals in those jurisdictions where required to conduct our business;
our ability to comply with the regulations applicable to our investment management subsidiary;
the impact of private legal proceedings;
risks associated with our acquisition of mortgage servicing rights;
the impact of our counterparties terminating our servicing rights under which we conduct servicing activities;
risks associated with higher risk loans that we service; and
our ability to foreclose on our mortgage assets in a timely manner or at all.
iii


Many of the important factors that will determine these results are beyond our ability to control or predict. You are cautioned not to put undue reliance on any forward-looking statements, which speak only as of the date of this Report. Except as otherwise required by law, we do not assume any obligation to publicly update or release any revisions to these forward-looking statements to reflect events or circumstances after the date of this Report or to reflect the occurrence of unanticipated events. You should refer to the risks and uncertainties listed under the heading “Risk Factors” in our 2021 Annual Report, as such risk factors may be amended, supplemented or superseded from time to time by other reports we file with the Securities and Exchange Commission (“SEC”), for a discussion of other important factors that may cause actual results to differ materially from those expressed or implied by the forward-looking statements.
Unless the context otherwise indicates, any reference in this Report to “Home Point,” “our Company,” “the Company,” “us,” “we” and “our” refers to Home Point Capital Inc. and its subsidiaries.
Website and Social Media Disclosure
We use our website (www.investors.homepoint.com) and our corporate Facebook, LinkedIn, and Twitter accounts as channels of distribution of Company information. The information we post through these channels may be deemed material. Accordingly, investors should monitor these channels, in addition to following our press releases, SEC filings and public conference calls and webcasts. The contents of our website and social media channels are not, however, a part of this Report.

iv

PART I—FINANCIAL INFORMATION
Item 1. Financial Statements

HOME POINT CAPITAL INC. & SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(dollars in thousands, except share and per share amounts)
(Unaudited)
March 31, 2022December 31, 2021
Assets:
Cash and cash equivalents$160,693 $170,987 
Restricted cash37,038 36,803 
Cash and cash equivalents and Restricted cash197,731 207,790 
Mortgage loans held for sale (at fair value)2,889,039 5,107,161 
Mortgage servicing rights (at fair value)1,490,224 1,525,103 
Property and equipment, net21,375 21,892 
Accounts receivable, net218,032 129,092 
Derivative assets183,461 84,385 
Goodwill10,789 10,789 
Government National Mortgage Association loans eligible for repurchase81,341 65,237 
Assets held for sale58,392 63,664 
Other assets48,593 43,228 
Total assets$5,198,977 $7,258,341 
Liabilities and Shareholders’ Equity:
Liabilities:
Warehouse lines of credit$2,724,931 $4,718,658 
Term debt and other borrowings, net942,203 1,226,524 
Accounts payable and accrued expenses135,485 138,193 
Government National Mortgage Association loans eligible for repurchase81,341 65,237 
Deferred tax liabilities232,650 229,752 
Derivative liabilities219,366 26,736 
Other liabilities79,744 76,588 
Total liabilities4,415,720 6,481,688 
Note 9 - Commitments and Contingencies
Shareholders’ Equity:
Preferred stock (250,000,000 authorized shares, none issued and outstanding, $0.0000000072 par value per share)
  
Common stock (1,000,000,000 authorized shares, 139,424,176 and 139,326,953 shares issued and 138,962,486 and 139,326,953 shares outstanding as of March 31, 2022 and December 31, 2021, respectively, $0.0000000072 par value per share)
  
Additional paid-in capital525,639 523,811 
Retained earnings259,131 252,842 
Treasury stock(1,513) 
Total shareholders' equity783,257 776,653 
Total liabilities and shareholders' equity$5,198,977 $7,258,341 





See accompanying notes to the unaudited condensed consolidated financial statements.
1

HOME POINT CAPITAL INC. & SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited - dollars in thousands, except share and per share amounts)
Three months ended March 31,
20222021
Revenue:
Gain on loans, net$45,404 $301,228 
Loan fee income19,904 44,115 
Interest income27,077 25,577 
Interest expense(33,095)(32,935)
Interest expense, net(6,018)(7,358)
Loan servicing fees81,064 70,338 
Change in fair value of mortgage servicing rights17,183 12,848 
Other income634 801 
Total revenue, net158,171 421,972 
Expenses:
Compensation and benefits89,432 153,642 
Loan expense9,015 17,695 
Loan servicing expense5,746 8,093 
Production technology4,865 9,285 
General and administrative19,671 26,237 
Depreciation and amortization2,687 2,761 
Other expenses5,296 9,336 
Total expenses136,712 227,049 
Income before income tax21,459 194,923 
Income tax expense(4,323)(50,117)
(Loss) income from equity method investment(5,272)4,163 
Net income$11,864 $148,969 
Earnings per share:
Basic$0.09 $1.07 
Diluted$0.08 $1.07 









See accompanying notes to the unaudited condensed consolidated financial statements.
2

HOME POINT CAPITAL INC. & SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
(unaudited - dollars in thousands, except share amounts)
Common StockAdditional
Paid in Capital
Retained
Earnings
Total
Shareholders’
Equity
SharesAmount
Beginning balance, December 31, 2020138,860,111 $ $519,510 $407,964 $927,474 
Contributed capital— — — 192 192 
Distributions to parent— — — (295,089)(295,089)
Employee stock purchases (option exercise)— — (1,028)— (1,028)
Equity-based compensation— — 1,779 — 1,779 
Net income— — — 148,969 148,969 
Ending balance, March 31, 2021138,860,111 $ $520,261 $262,036 $782,297 
Common StockAdditional
Paid in Capital
Treasury
Stock
Retained
Earnings
Total
Shareholders’
Equity
SharesAmount
Beginning balance, December 31, 2021139,326,953 $ $523,811 $ $252,842 $776,653 
Stock repurchase(461,690)— — (1,513)— (1,513)
Distributions to shareholders— — — — (5,575)(5,575)
Employee stock purchases (option exercise)97,223 — 122 — — 122 
Equity-based compensation— — 1,706 — — 1,706 
Net income— — — — 11,864 11,864 
Ending balance, March 31, 2022138,962,486 $ $525,639 $(1,513)$259,131 $783,257 












See accompanying notes to the unaudited condensed consolidated financial statements.
3

HOME POINT CAPITAL INC. & SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited - dollars in thousands)
Three Months Ended March 31,
20222021
Operating activities:
Net income$11,864 $148,969 
Adjustments to reconcile net income to cash used in operating activities:
Depreciation2,687 2,761 
Amortization of debt issuance costs846 802 
Gain on loans, net(45,404)(301,228)
Provision for representation and warranty reserve341 5,730 
Equity-based compensation expense1,706 1,779 
Deferred income tax2,898 43,783 
Loss (income) from equity method investment5,272 (4,163)
Distributions for mortgage loans held for sale(12,739,933)(31,055,708)
Proceeds from sale and payments of mortgage loans held for sale14,505,325 29,001,344 
Increase in fair value of mortgage servicing rights(17,183)(12,848)
Decrease in fair value of mortgage loans held for sale132,031 75,790 
(Increase) decrease in fair value of derivative assets(99,076)147,414 
Changes in operating assets and liabilities:
Increase in accounts receivable, net(42,890)(137,710)
Increase in other assets(5,365)(12,065)
Decrease in accounts payable and accrued expenses(12,538)(20,371)
Increase in other liabilities195,445 209,166 
Net cash provided by (used for) operating activities1,896,026 (1,906,555)
Investing activities:
Purchases of property and equipment, net of disposals(2,170)(4,078)
Purchase of mortgage servicing rights(8,588)(4,817)
Proceeds from sale of mortgage servicing rights390,532  
Net cash provided by (used for) investing activities379,774 (8,895)
Financing activities:
Proceeds from warehouse borrowings13,207,385 31,135,000 
Payments on warehouse borrowings(15,201,111)(29,292,983)
Proceeds from term debt borrowings135,000 820,000 
Payments on term debt borrowings(420,000)(335,000)
Proceeds from other borrowings45,000 65,000 
Payments on other borrowings(45,000)(105,000)
Payments of debt issuance costs(167)(11,387)
Employee stock purchases (option expense)122 (1,028)
Common stock repurchases(1,513) 
Contributed capital from parent 192 
Dividends paid to shareholders(5,575) 
Distributions to parent (295,089)
Net cash (used for) provided by financing activities(2,285,859)1,979,705 
Net (decrease) increase in cash, cash equivalents and restricted cash(10,059)64,255 
Cash, cash equivalents and restricted cash at beginning of period207,790 196,893 
Cash, cash equivalents and restricted cash at end of period$197,731 $261,148 
Supplemental disclosure:
Cash paid for interest$42,409 $22,788 
Cash received from tax refunds, net$(1,307)$(260)
See accompanying notes to the unaudited condensed consolidated financial statements.
4

HOME POINT CAPITAL INC. & SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands, Except Shares and Per Share Amounts)
(unaudited)
Note 1 - Organization and Operations
Nature of Business
Home Point Capital Inc., a Delaware corporation (“HPC” or the “Company”), through its subsidiaries, is a residential mortgage originator and servicer with a business model focused on growing originations by leveraging a network of partner relationships and its servicing operation. The Company’s business operations are organized into the following two segments: (1) Origination and (2) Servicing. Home Point Financial Corporation (“HPF”), a New Jersey corporation and a wholly owned subsidiary of the Company, originates, sells, and services residential real estate mortgage loans throughout the United States of America (“U.S.”). Home Point Asset Management LLC (“HPAM”), a Delaware limited liability company, is a wholly owned subsidiary of the Company and manages certain servicing assets. HPAM’s wholly owned subsidiary, Home Point Mortgage Acceptance Corporation (“HPMAC”), an Alabama Corporation, services residential real estate mortgage loans. Home Point Corporation Insurance Agency LLC (“HPCIA”), a Michigan limited liability company, is a wholly owned subsidiary of the Company that brokers home owner insurance policies.
Both HPF and HPMAC are approved sellers and servicers of one-to-four family first mortgages by the Federal National Mortgage Association (“FNMA” or “Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“FHLMC” or “Freddie Mac”) and are approved issuers by the Government National Mortgage Association (“GNMA” or “Ginnie Mae”) (collectively, the “Agencies”), and as such, HPF and HPMAC must meet certain Agency eligibility requirements.
Note 2 - Basis of Presentation and New Accounting Pronouncements
Basis of Presentation
The accompanying condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information. The condensed consolidated financial statements include the financial statements of HPC and its wholly owned subsidiaries. The accompanying condensed consolidated financial statements have been prepared in conformity with Article 10 of Regulation S-X promulgated under the Securities Act of 1933, as amended (the “Securities Act”). The consolidated balance sheet as of December 31, 2021 and related notes were derived from the audited consolidated financial statements but do not include all disclosures required by U.S. GAAP for complete financial statements. Certain information and footnote disclosures normally included in complete financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). These condensed consolidated financial statements reflect, in the opinion of management, all material adjustments (which include normal recurring adjustments) necessary to fairly state, in all material respects, the Company’s financial position as of March 31, 2022 and its results of operations and cash flows for the three months ended March 31, 2022 and 2021. The condensed consolidated financial information should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2021.
All intercompany balances and transactions have been eliminated in consolidation.
Reclassifications
The Company reclassified gains and losses on MSR sales from Other income to the Change in fair value of mortgage servicing rights on the consolidated statement of operations. Prior periods have been reclassified to conform to current period presentation.
Use of Estimates
The preparation of the Company’s condensed consolidated financial statements in conformity with U.S. GAAP requires HPC to make estimates and assumptions about future events that affect the amounts reported and disclosed in the condensed consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable.
Examples of reported amounts that rely on significant estimates include mortgage loans held for sale, mortgage servicing rights (“MSRs”), servicing advances reserve, derivative assets, derivative liabilities, reserves for mortgage repurchases and indemnifications, and deferred tax valuation allowance considerations. Significant estimates are also used in determining the recoverability and fair value of property and equipment and goodwill.
5

Recently Adopted Accounting Pronouncements
ASU 2019-12, Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes, eliminates particular exceptions related to the method for intra period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. It also clarifies and simplifies other aspects of the accounting for income taxes. This amendment is effective for annual periods beginning after December 15, 2021. The Company adopted ASU 2019-12 as of January 1, 2022. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements.
Accounting Pronouncements Issued but Not Yet Adopted
Accounting Standards Update (“ASU”) 2020-04, Reference Rate Reform (Topic 848), Facilitation of the Effects of Reference Rate Reform on Financial Reporting, subject to meeting certain criteria, provides optional expedients and exceptions related to applying U.S. GAAP to certain contract modifications and hedging relationships that reference the London Interbank Offered Rate ("LIBOR") or another rate that is expected to be discontinued. This guidance was effective upon issuance and allows application to contract changes as early as January 1, 2020. Subsequently, in 2021, the FASB issued ASU 2021-01, Reference Rate Reform, to further clarify and expand certain aspects of Topic 848. The Company is in the process of reviewing its derivative and hedging instruments that utilize LIBOR as the reference rate. The Company plans to adopt ASU 2020-04 and ASU 2021-01 when LIBOR is discontinued for the Company and does not expect it to have a material impact on its consolidated financial statements.
Note 3 - Mortgage Loans Held for Sale
The Company sells its originated mortgage loans into the secondary market. The Company may retain the right to service some of these loans upon sale through ownership of servicing rights. The following presents mortgage loans held for sale (“MLHS”) at fair value, by type:
March 31, 2022
Unpaid
Principal
Fair Value
Adjustment
Total
Fair Value
(dollars in thousands)
Conventional(1)
$2,099,171 $(29,121)$2,070,050 
Government(2)
820,416 (1,619)818,797 
Reverse(3)
275 (83)192 
Total$2,919,862 $(30,823)$2,889,039 
December 31, 2021
Unpaid
Principal
Fair Value
Adjustment
Total
Fair Value
(dollars in thousands)
Conventional(1)
$4,206,099 $79,389 $4,285,488 
Government(2)
799,579 21,902 821,481 
Reverse(3)
275 (83)192 
Total$5,005,953 $101,208 $5,107,161 
(1)Conventional includes mortgage loans meeting the eligibility requirements to be sold to FNMA or FHLMC.
(2)Government includes mortgage loans meeting the eligibility requirements to be sold to GNMA (including Federal Housing Administration, Department of Veterans Affairs and United States Department of Agricultural mortgage loans).
(3)Reverse loan presented in MLHS on the consolidated balance sheets as a result of a repurchase.
MLHS on nonaccrual status had $25.6 million and $26.1 million of unpaid principal balances and $21.3 million and $21.6 million estimated fair value, as of March 31, 2022 and December 31, 2021, respectively.
The Company had $2.9 billion in unpaid principal balance pledged to secure its mortgage warehouse line of credit as of March 31, 2022.
The following presents a reconciliation of the changes in MLHS to the amounts presented on the condensed consolidated statements of cash flows:
6

Three Months Ended March 31,
20222021
(dollars in thousands)
Fair value at beginning of period$5,107,161 $3,301,694 
Mortgage loans originated and purchased12,739,933 31,055,708 
Proceeds on sales and payments received(14,505,325)(29,001,344)
Change in fair value(132,031)(75,790)
Loss on loans(1)
(320,699)(89,007)
Fair value at end of period$2,889,039 $5,191,261 
(1)This line as presented on the consolidated statements of cash flows excludes originated mortgage servicing rights and mortgage servicing rights hedging.
Note 4 - Mortgage Servicing Rights
The Company sells residential mortgage loans in the secondary market and typically retains the right to service the loans sold.
Mortgage Servicing Rights (“MSRs”) give the Company the contractual right to receive service fees and other remuneration in exchange for performing loan servicing functions on behalf of investors in mortgage loans and securities. Upon sale of a mortgage loan for which the Company retains the underlying servicing, an MSR asset is capitalized, which represents the current fair value of the future net cash flows that are expected to be realized for performing servicing activities.

The following presents an analysis of the changes in capitalized MSRs:
Three Months Ended March 31,
20222021
(dollars in thousands)
Balance at beginning of period$1,525,103 $748,457 
MSRs originated208,741294,357
MSRs purchased8,5884,817
MSRs sold(480,244)
Changes in valuation model inputs276,986197,896
Change due to cash payoffs and principal amortization(48,950)(89,170)
Balance at end of period$1,490,224 $1,156,357 
The following presents the Company’s total capitalized mortgage servicing portfolio (based on the unpaid principal balance (“UPB”) of the underlying mortgage loans):
March 31, 2022December 31, 2021
(dollars in thousands)
Ginnie Mae$6,004,854$5,602,582
Fannie Mae53,896,65370,174,987
Freddie Mac42,050,00552,547,588
Other33,25534,417
Total$101,984,767$128,359,574
MSR balance$1,490,224 $1,525,103 
The following presents the key weighted average assumptions used in determining the fair value of the Company’s MSRs:
March 31, 2022December 31, 2021
Discount rate7.91 %8.68 %
Weighted average prepayment speeds6.30 %8.30 %
The key assumptions used to estimate the fair value of the MSRs are discount rate and the Conditional Prepayment Rate (“CPR” or “prepayment speeds”). An increase in prepayment speeds generally has an adverse effect on the value of MSRs as the underlying loans prepay faster. In a declining interest rate environment, the fair value of MSRs generally decreases as prepayments increase. A decrease in prepayment speeds generally has a positive effect on the value of the MSRs as the underlying
7

loans prepay less frequently. In a rising interest rate environment, the fair value of MSRs generally increases as prepayments decrease. Increases in the discount rate result in a lower MSR value and decreases in the discount rate result in a higher MSR value. MSR uncertainties are hypothetical and do not always have a direct correlation with each assumption. Changes in one assumption may result in changes to another assumption, which might magnify or counteract the uncertainties.
The following presents the impact on the fair value of the Company’s MSR portfolio when applying the following hypothetical data points:
Discount Rate
Prepayment Speeds
100 BPS
Adverse Change
200 BPS
Adverse Change
10% Adverse
Change
20% Adverse
Change
(dollars in thousands)(dollars in thousands)
March 31, 2022$(70,667)$(135,054)$(44,813)$(87,161)
December 31, 2021$(66,885)$(128,172)$(56,278)$(108,621)
The following presents information related to loans serviced:
March 31, 2022December 31, 2021
(dollars in thousands)
Total unpaid principal balance$104,432,037 $133,889,085 
Loans 30-89 days delinquent559,998 656,012 
Loans delinquent 90 or more days or in foreclosure738,301 777,650 
The following presents components of Loan servicing fees as reported in the Company’s condensed consolidated statements of operations:
Three Months Ended March 31,
20222021
(dollars in thousands)
Contractual servicing fees$80,763 $67,483 
Late fees1,125 1,142 
Other(824)1,713 
Total$81,064 $70,338 
The Company held for its customers $21.4 million and $19.9 million of escrow funds recorded in Other liabilities in the condensed consolidated balance sheets as of March 31, 2022 and December 31, 2021, respectively. The Company reported $53.5 million loss on MSR sales in the Change in fair value of mortgage servicing rights in the condensed consolidated statement of operations for the three months ended March 31, 2022. The Company reported $37.0 million gain on MSR sales in the Other income in the consolidated statement of operations for the year ended December 31, 2021.
8

Note 5 - Derivative Financial Instruments
The following presents the outstanding notional amounts and fair values of derivative instruments not designated as hedging instruments:
March 31, 2022
Notional
Value
Derivative
Asset
Derivative
Liability
(dollars in thousands)
Forward sale contracts$6,070,500 $97,691 $2,797 
Interest rate lock commitments5,366,027 12,141 45,458 
Forward purchase contracts390,000 177 8,799 
Interest rate swap futures contracts1,400,000  5,716 
Treasury futures purchase contracts700,000  32,725 
Margin73,452 123,871 
Total$183,461 $219,366 
December 31, 2021
Notional
Value
Derivative
Asset
Derivative
Liability
(dollars in thousands)
Forward sale contracts$7,819,802 $6,969 $8,242 
Interest rate lock commitments6,068,763 29,887 2,843 
Forward purchase contracts1,521,000 3,031 281 
Interest rate swap futures contracts1,540,000 25,313 5,662 
Treasury futures purchase contracts4,720,000 111  
Margin19,074 9,708 
Total$84,385 $26,736 
9

The following presents the recorded gain (loss) on derivative financial instruments:
Three Months Ended March 31,
20222021
(dollars in thousands)
Forward sale contracts$(60,753)$180,554 
Interest rate lock commitments88,668 (239,588)
Forward purchase contracts(3,872)(21,387)
Interest rate swap and Treasury futures purchase contracts$(118,352)$(70,655)
Counterparty agreements for forward commitments contain master netting agreements. The master netting agreements contain a legal right to offset amounts due to and from the same counterparty. The Company incurred no credit losses due to nonperformance of any of its counterparties for the three months ended March 31, 2022 and 2021.
The following presents a summary of derivative assets and liabilities and related netting amounts:
March 31, 2022
Gross Amounts Not Offset in the Statement of Financial Position(1)
Gross Amount of Assets (Liabilities) RecognizedFinancial InstrumentsCash CollateralNet Amount
(dollars in thousands)
Derivatives subject to master netting agreements:
Assets:
Forward sale contracts$97,691 $(2,797)$(72,926)$21,968 
Forward purchase contracts177  (177) 
Interest rate swap and Treasury futures purchase contracts    
Liabilities:
Forward sale contracts(2,797)2,797   
Forward purchase contracts(8,799) 7,547 (1,252)
Interest rate swap and Treasury futures purchase contracts(38,441) 38,441  
Derivatives not subject to master netting agreements:
Assets:
Interest rate lock commitments12,141 — — 12,141 
Liabilities:
Interest rate lock commitments(45,458)— — (45,458)
Total derivatives
Assets$110,009 $(2,797)$(73,103)$34,109 
Liabilities$(95,495)$2,797 $45,988 $(46,710)
10


December 31, 2021
Gross Amounts Not Offset in the Statement of Financial Position(1)
Gross Amount of Assets (Liabilities) RecognizedFinancial InstrumentsCash CollateralNet Amount
(dollars in thousands)
Derivatives subject to master netting agreements:
Assets:
Forward sale contracts$6,969 $(4,886)$(1,272)$811 
Forward purchase contracts3,031 (258)(2,627)146 
Interest rate swap and Treasury futures purchase contracts25,424 (5,662) 19,762 
Liabilities:
Forward sale contracts(8,242)4,886 1,252 (2,104)
Forward purchase contracts(281)258  (23)
Interest rate swap and Treasury futures purchase contracts(5,662)5,662   
Derivatives not subject to master netting agreements:
Assets:
Interest rate lock commitments29,887 — — 29,887 
Liabilities:
Interest rate lock commitments(2,843)— — (2,843)
Total derivatives
Assets$65,311 $(10,806)$(3,899)$50,606 
Liabilities$(17,028)$10,806 $1,252 $(4,970)
(1) Amounts disclosed for collateral received from or posted to the same counterparty includes cash up to and not exceeding the net amount of the derivative asset or liability presented in the balance sheet. The fair value of the total collateral received from or posted to the same counterparty may exceed the amounts presented. The amounts of collateral received from or posted to counterparty are presented as margin and included as a component of either Derivative assets or Other liabilities in the Balance Sheet.
For information on the determination of fair value, refer to Note 12 - Fair Value Measurements.
Note 6 - Accounts Receivable, net
The following presents principal categories of Accounts receivable, net:
March 31, 2022December 31, 2021
(dollars in thousands)
Pair off receivable$72,282 $3,738 
Servicing sale receivable60,380 14,364 
Servicing advance receivable
56,849 71,884 
Servicing advance reserve
(2,875)(4,207)
Agency receivable15,393 20,184 
Income tax receivable
8,449 11,181 
Servicing receivable-general
1,688 359 
Warehouse receivable1,055 1,934 
Interest on servicing deposits
185 464 
Other
4,626 9,191 
Total
$218,032 $129,092 
As part of managing the Company’s servicing advances, servicing advance reserve is recognized with management’s estimate of current expected losses and maintained at a level that management considers adequate based upon continuing assessments of collectability, historical loss experience, current trends, and reasonable and supportable forecasts.
11

The following presents changes to the servicing advance reserve:
Three Months Ended March 31,
20222021
(dollars in thousands)
Servicing advance reserve at beginning of period$(4,207)$(8,380)
Additions(7,517)(1,343)
Charge-offs8,849 974 
Servicing advance reserve at end of period$(2,875)$(8,749)
Note 7 - Warehouse Lines of Credit
The Company maintains mortgage warehouse lines of credit arrangements with various financial institutions, primarily to fund the origination of mortgage loans. The Company held mortgage funding arrangements with 11 separate financial institutions with a total maximum borrowing capacity of $6.6 billion and $7.5 billion as of March 31, 2022 and December 31, 2021, respectively. The Company had $3.9 billion and $2.8 billion of unused capacity under its warehouse lines of credit as of March 31, 2022 and December 31, 2021, respectively.
The following presents the amounts outstanding and maturity dates under the Company’s various mortgage funding arrangements:
Maturity Date
March 31, 2022
(dollars in thousands)
$700 million Warehouse Facility
August 2022$346,312 
$450 million Warehouse Facility
September 202250,643 
$500 million Warehouse Facility
September 2022173,128 
$500 million Warehouse Facility
September 2022161,706 
$1,200 million Warehouse Facility
February 2023329,956 
$500 million Warehouse Facility
March 2023262,955 
$400 million Warehouse Facility
March 2023275,781 
$325 million Warehouse Facility
March 2023264,389 
$1,200 million Warehouse Facility
May 2023349,505 
$88.5 million Warehouse Facility
Evergreen10,850 
$550 million Warehouse Facility
Evergreen311,164 
Gestation Warehouse FacilityEvergreen188,542 
Early Funding(1)
 
Total$2,724,931 

12

Maturity DateDecember 31, 2021
(dollars in thousands)
$1,200 million Warehouse Facility2
February 2022$604,421 
$500 million Warehouse Facility2
March 2022335,509 
$500 million Warehouse Facility2
March 2022381,087 
$1,000 million Warehouse Facility
August 2022716,802 
$450 million Warehouse Facility
September 2022277,060 
$500 million Warehouse Facility
September 2022339,521 
$500 million Warehouse Facility
September 2022375,381 
$500 million Warehouse Facility
March 2023309,898 
$1,500 million Warehouse Facility
May 2023731,132 
$88.5 million Warehouse Facility
Evergreen11,409 
$550 million Warehouse Facility
Evergreen363,959 
Gestation Warehouse FacilityEvergreen179,360 
Early Funding(1)
93,119 
Total$4,718,658 
(1)In addition to warehouse facilities, the Company is an approved lender for early funding facilities with Fannie Mae through its As Soon As Pooled (“ASAP”) program and Freddie Mac through its Early Funding (“EF”) program. From time to time, the Company enters into agreements to deliver certified pools of mortgage loans and receive funding in exchange for such pools. All mortgage loans delivered under these programs must adhere to a set of eligibility criteria. Early funding programs with Fannie Mae and Freddie Mac do not have stated expiration dates or maximum capacities.
(2)Maturity Dates in this table are as of December 31, 2021. These Warehouse Facilities have been renewed as reflected in the table above.
The Company’s warehouse facilities’ variable interest rates are calculated using an index rate generally tied to either (a) 1-month LIBOR or (b) a Secured Overnight Financing Rate (“SOFR”); plus applicable interest rate margins, with varying index interest and interest rate margin floors. The weighted average interest rate for the Company’s warehouse facilities was 2.26% and 2.36% as of March 31, 2022 and December 31, 2021, respectively. The Company’s borrowings are 100% secured by MLHS at fair value.
The Company’s warehouse facilities require the maintenance of certain financial covenants relating to net worth, profitability, liquidity, and ratio of indebtedness to net worth among others. In March 2022, the Company’s warehouse lines that contain profitability covenants were amended to allow for a net loss under such covenants for the three months ended March 31, 2022. The Company was in compliance with all warehouse facility covenants as of March 31, 2022.
The Company continually evaluates its warehouse capacity in relation to expected financing needs.
Note 8 - Term Debt and Other Borrowings, net
The following presents the Company’s term debt and other borrowings, net:
Maturity DateCollateralMarch 31, 2022December 31, 2021
(dollars in thousands)
$1.0 billion MSR Facility
May 2025MSRs$400,000 $685,000 
$550 million Senior Notes
February 2026Unsecured550,000 550,000 
$90 million Servicing Advance Facility
May 2022Servicing Advances3,250 3,250 
$35 million Operating Line of Credit
May 2022Mortgage loans1,000 1,000 
Gross954,250 1,239,250 
Debt issuance costs(12,047)(12,726)
Total$942,203 $1,226,524 
The Company maintains a $1.0 billion MSR financing facility (the “MSR Facility”), which is comprised of $650.0 million of committed capacity and $350.0 million of uncommitted capacity and is collateralized by the Company’s FNMA, FHLMC, and GNMA MSRs. Interest on the MSR Facility is based on 3-Month LIBOR or SOFR; plus the applicable interest rate margin, with advance rates generally ranging from 62.5% to 72.5% of the value of the underlying MSRs. The MSR Facility has a three-year revolving period ending on May 4, 2024 followed by a one-year period during which the balance drawn must be repaid and no further amounts may be drawn down, which ends on May 20, 2025. The MSR Facility requires the maintenance of certain financial covenants relating to net worth, liquidity, and indebtedness of the Company. As of March 31, 2022, the Company was in compliance with all covenants under the MSR Facility.
13

In January 2021, the Company issued $550.0 million aggregate principal amount of its 5.0% Senior Notes due 2026 (the “Senior Notes”) in a private placement transaction. The Senior Notes are guaranteed on a senior unsecured basis by each of the Company’s wholly owned subsidiaries existing on the date of issuance, other than HPAM and HPMAC. The Senior Notes bear interest at a rate of 5.0% per annum, payable semi-annually in arrears. The Senior Notes will mature on February 1, 2026.
The Indenture governing the Senior Notes contains covenants and restrictions that, among other things and subject to certain exceptions, limit the ability of the Company and its restricted subsidiaries to (i) incur additional debt or issue certain preferred shares; (ii) incur liens; (iii) make certain distributions, investments, and other restricted payments; (iv) engage in certain transactions with affiliates; and (v) merge or consolidate or sell, transfer, lease, or otherwise dispose of all or substantially all of their assets.
The Company has a $90.0 million servicing advance facility which is collateralized by all of the Company’s servicing advances. The facility carries an interest rate of 1-month LIBOR plus a margin and an advance rate ranging from 85.0-95.0%. The servicing advance facility requires the maintenance of certain financial covenants relating to net worth, liquidity, and indebtedness of the Company. As of March 31, 2022, the Company was in compliance with all covenants under the servicing advance facility.
The Company also has a $35.0 million operating line, with an interest rate based on the Prime Rate.
The Company had total available capacity of $449.9 million and $45.5 million for its MSR Facility and servicing advance facility, respectively as of March 31, 2022. The Company has no available capacity for its operating line of credit as of March 31, 2022.
Note 9 - Commitments and Contingencies
Commitments to Extend Credit
The Company’s Interest rate lock commitments (“IRLCs”) expose the Company to market risk if interest rates change and the loan is not economically hedged or committed to an investor. The Company is also exposed to credit loss if the loan is originated and not sold to an investor and the customer does not perform. The collateral upon extension of credit typically consists of a first deed of trust in the mortgagor’s residential property. Commitments to originate loans do not necessarily reflect future cash requirements as some commitments are expected to expire without being drawn upon. Total commitments to originate loans were $5.4 billion and $6.1 billion as of March 31, 2022 and December 31, 2021, respectively.
Litigation
The Company is subject to various legal proceedings arising out of the ordinary course of business. There were no current or pending claims against the Company which are expected to have a material impact on the Company's condensed consolidated balance sheets, statements of operations, or cash flows.
Regulatory Contingencies
The Company is subject to periodic audits and examinations, both formal and informal in nature, from various federal and state agencies, including those conducted as part of regulatory oversight of our mortgage origination, servicing, and financing activities. Such audits and examinations could result in additional actions, penalties, or fines by state or federal governmental bodies, regulators, or the courts with respect to our mortgage origination, servicing, and financing activities, which may be applicable generally to the mortgage industry or to the Company in particular. The Company did not pay any material penalties or fines during the three months ended March 31, 2022 and 2021 and is not currently required to pay any such penalties or fines.
Note 10 - Regulatory Net Worth Requirements
The Company is subject to various regulatory capital requirements administered by the Department of Housing and Urban Development (“HUD”), which govern non-supervised, direct endorsement mortgagees. The Company is also subject to regulatory capital requirements administered by Ginnie Mae, Fannie Mae, and Freddie Mac, which govern issuers of Ginnie Mae, Fannie Mae, and Freddie Mac securities. Additionally, the Company is required to maintain minimum net worth requirements; these range from $0 to $1,000, depending on the state.
Failure to meet minimum capital requirements can result in certain mandatory and possibly additional discretionary remedial actions by regulators that, if undertaken, could (i) remove the Company’s ability to sell and service loans to, or on behalf of, the Agencies and (ii) have a direct material effect on the Company’s condensed consolidated financial statements. In accordance with the regulatory capital guidelines, the Company must meet specific quantitative measures of assets, liabilities, and certain off-balance sheet items calculated under regulatory accounting practices. Changes in regulatory and accounting standards, as well as the impact of future events on the Company’s results, may significantly affect the Company’s net worth adequacy.
The Company is subject to the following minimum net worth, minimum capital ratio, and minimum liquidity requirements established by the Federal Housing Finance Agency for Fannie Mae and Freddie Mac Seller/Servicers, and Ginnie Mae for single family issuers:
14

Minimum Net Worth
The minimum net worth requirement for Fannie Mae and Freddie Mac is defined as follows:
Base Adjusted/Tangible Net Worth (as defined by HUD) of $2.5 million plus 25 basis points of outstanding UPB for total loans serviced.
Adjusted/Tangible Net Worth, as defined by HUD, is comprised of total equity less goodwill, intangible assets, affiliate receivables, deferred tax assets, prepaid expenses, and certain pledged assets.
The minimum net worth requirement for Ginnie Mae is defined as follows:
Base Adjusted/Tangible Net Worth (as defined by HUD) of $2.5 million plus 35 basis points of the issuer’s total single-family effective outstanding obligations.
Adjusted/Tangible Net Worth, as defined by HUD, is comprised of total equity less goodwill, intangible assets, affiliate receivables, deferred tax assets, prepaid expenses, and certain pledged assets.
Minimum Capital Ratio
For Fannie Mae, Freddie Mac, and Ginnie Mae, the Company is also required to hold a ratio of Adjusted/Tangible Net Worth to Total Assets greater than 6.0%.