falsedesktopNSM2018-06-30000152056618000053{"tbl_sim": "https://q10k.com/tbl-sim", "search": "https://q10k.com/search"}{"q10k_tbl_0": "\t\tPage\nPART I\tFINANCIAL INFORMATION\t\nItem 1.\tFinancial Statements\t3\n\tConsolidated Balance Sheets as of June 30 2018 (unaudited) and December 31 2017\t3\n\tConsolidated Statements of Operations (unaudited) for the Three and Six Months Ended June 30 2018 and 2017\t4\n\tConsolidated Statements of Stockholders' Equity (unaudited) for the Six Months Ended June 30 2018 and 2017\t5\n\tConsolidated Statements of Cash Flows (unaudited) for the Six Months Ended June 30 2018 and 2017\t6\n\tNotes to Consolidated Financial Statements (unaudited)\t8\nItem 2.\tManagement's Discussion and Analysis of Financial Condition and Results of Operations\t54\nItem 3.\tQuantitative and Qualitative Disclosures about Market Risk\t85\nItem 4.\tControls and Procedures\t85\nPART II\tOTHER INFORMATION\t\nItem 1.\tLegal Proceedings\t86\nItem 1A.\tRisk Factors\t87\nItem 2.\tUnregistered Sales of Equity Securities and Use of Proceeds\t87\nItem 3.\tDefaults Upon Senior Securities\t88\nItem 4.\tMine Safety Disclosures\t88\nItem 5.\tOther Information\t88\nItem 6.\tExhibits\t89\n", "q10k_tbl_1": "\tJune 30 2018\tDecember 31 2017\n\t(unaudited)\t\nAssets\t\t\nCash and cash equivalents\t185\t215\nRestricted cash\t310\t360\nMortgage servicing rights $3356 and $2937 at fair value respectively\t3356\t2941\nAdvances and other receivables net of reserves of $294 and $284 respectively\t1317\t1706\nReverse mortgage interests net of reserves of $117 and $115 respectively\t9477\t9984\nMortgage loans held for sale at fair value\t1635\t1891\nMortgage loans held for investment net\t132\t139\nProperty and equipment net of accumulated depreciation of $195 and $169 respectively\t123\t121\nDerivative financial instruments at fair value\t62\t65\nOther assets\t593\t614\nTotal assets\t17190\t18036\nLiabilities and Stockholders' Equity\t\t\nUnsecured senior notes net\t1815\t1874\nAdvance facilities net\t516\t855\nWarehouse facilities net\t3086\t3285\nPayables and accrued liabilities\t1288\t1234\nMSR related liabilities - nonrecourse at fair value\t1063\t1006\nMortgage servicing liabilities\t27\t41\nDerivative financial instruments at fair value\t9\t5\nOther nonrecourse debt net\t7445\t8014\nTotal liabilities\t15249\t16314\nCommitments and contingencies (Note 15)\t\t\nPreferred stock at $0.01 par value - 300000 thousand shares authorized no shares issued and outstanding\t0\t0\nCommon stock at $0.01 par value - 1000000 thousand shares authorized 109915 thousand and 109915 thousand shares issued respectively\t1\t1\nAdditional paid-in-capital\t1140\t1131\nRetained earnings\t949\t731\nTreasury shares at cost 11752 thousand and 12187 thousand shares respectively\t(150)\t(148)\nTotal Nationstar stockholders' equity\t1940\t1715\nNon-controlling interests\t1\t7\nTotal stockholders' equity\t1941\t1722\nTotal liabilities and stockholders' equity\t17190\t18036\n", "q10k_tbl_2": "\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nRevenues:\t\t\t\t\nService related net\t317\t213\t781\t496\nNet gain on mortgage loans held for sale\t127\t167\t251\t311\nTotal revenues\t444\t380\t1032\t807\nExpenses:\t\t\t\t\nSalaries wages and benefits\t177\t182\t357\t374\nGeneral and administrative\t162\t185\t346\t362\nTotal expenses\t339\t367\t703\t736\nOther income (expenses):\t\t\t\t\nInterest income\t140\t139\t285\t278\nInterest expense\t(164)\t(188)\t(335)\t(381)\nOther income (expenses)\t(2)\t7\t6\t6\nTotal other income (expenses) net\t(26)\t(42)\t(44)\t(97)\nIncome before income tax expense (benefit)\t79\t(29)\t285\t(26)\nLess: Income tax expense (benefit)\t21\t(10)\t67\t(9)\nNet income (loss)\t58\t(19)\t218\t(17)\nLess: Net income attributable to non-controlling interests\t0\t1\t0\t1\nNet income (loss) attributable to Nationstar\t58\t(20)\t218\t(18)\nNet income (loss) per common share attributable to Nationstar:\t\t\t\t\nBasic\t0.59\t(0.20)\t2.22\t(0.18)\nDiluted\t0.59\t(0.20)\t2.20\t(0.18)\nWeighted average shares of common stock outstanding (in thousands):\t\t\t\t\nBasic\t98203\t97752\t98037\t97672\nDilutive effect of stock awards\t927\t0\t1086\t0\nDiluted\t99130\t97752\t99123\t97672\n", "q10k_tbl_3": "\tNumber of Shares Outstanding (in thousands)\tAmount (millions of dollars)\t\t\t\t\t\t\n\tCommon Stock\tCommon Stock\tAdditional Paid-in Capital\tRetained Earnings\tTreasury Share Amount\tTotal Nationstar Stockholders' Equity\tNon-controlling Interests\tTotal Equity\nBalance at January 1 2017\t97497\t1\t1122\t701\t(147)\t1677\t6\t1683\nShares issued / (surrendered) under incentive compensation plan\t214\t0\t(4)\t0\t(1)\t(5)\t0\t(5)\nShare-based compensation\t0\t0\t9\t0\t0\t9\t0\t9\nDividends to non-controlling interests\t0\t0\t(5)\t0\t0\t(5)\t0\t(5)\nNet income (loss)\t0\t0\t0\t(18)\t0\t(18)\t1\t(17)\nBalance at June 30 2017\t97711\t1\t1122\t683\t(148)\t1658\t7\t1665\nBalance at January 1 2018\t97728\t1\t1131\t731\t(148)\t1715\t7\t1722\nShares issued / (surrendered) under incentive compensation plan\t435\t0\t(4)\t0\t(2)\t(6)\t0\t(6)\nShare-based compensation\t0\t0\t8\t0\t0\t8\t0\t8\nDividends to non-controlling interests\t0\t0\t5\t0\t0\t5\t(6)\t(1)\nNet income\t0\t0\t0\t218\t0\t218\t0\t218\nBalance at June 30 2018\t98163\t1\t1140\t949\t(150)\t1940\t1\t1941\n", "q10k_tbl_4": "\tSix Months Ended June 30\t\n\t2018\t2017\nOperating Activities\t\t\nNet income (loss) attributable to Nationstar\t218\t(18)\nAdjustments to reconcile net income (loss) to net cash attributable to operating activities:\t\t\nNet income attributable to non-controlling interests\t0\t1\nNet gain on mortgage loans held for sale\t(251)\t(311)\nReverse mortgage loan interest income\t(237)\t(233)\nGain on sale of assets\t(9)\t(8)\nProvision for servicing reserves\t54\t59\nFair value changes and amortization/accretion of mortgage servicing rights/liabilities\t(155)\t233\nFair value changes in excess spread financing\t74\t15\nFair value changes in mortgage servicing rights financing liability\t6\t(14)\nAmortization of premiums net of discount accretion\t6\t27\nDepreciation and amortization for property and equipment and intangible assets\t29\t29\nShare-based compensation\t8\t9\nOther loss\t2\t9\nRepurchases of forward loan assets out of Ginnie Mae securitizations\t(475)\t(599)\nMortgage loans originated and purchased for sale net of fees\t(10639)\t(8896)\nSales proceeds and loan payment proceeds for mortgage loans held for sale and held for investment\t11500\t10006\nExcess tax deficiency from share-based compensation\t(1)\t(1)\nChanges in assets and liabilities:\t\t\nAdvances and other receivables\t355\t118\nReverse mortgage interests\t1326\t769\nOther assets\t10\t24\nPayables and accrued liabilities\t48\t(348)\nNet cash attributable to operating activities\t1869\t871\nInvesting Activities\t\t\nProperty and equipment additions net of disposals\t(31)\t(25)\nPurchase of forward mortgage servicing rights net of liabilities incurred\t(123)\t(13)\nNet payment related to acquisition of HECM related receivables\t(1)\t0\nProceeds on sale of forward and reverse mortgage servicing rights\t0\t(2)\nProceeds on sale of assets\t13\t16\nNet cash attributable to investing activities\t(142)\t(24)\n", "q10k_tbl_5": "\tSix Months Ended June 30\t\n\t2018\t2017\nFinancing Activities\t\t\n(Decrease) increase in warehouse facilities\t(199)\t100\nDecrease in advance facilities\t(339)\t(214)\nProceeds from issuance of HECM securitizations\t443\t308\nRepayment of HECM securitizations\t(423)\t(176)\nProceeds from issuance of participating interest financing in reverse mortgage interests\t184\t355\nRepayment of participating interest financing in reverse mortgage interests\t(1368)\t(1260)\nIssuance of excess spread financing\t70\t0\nRepayment of excess spread financing\t(93)\t(109)\nRepayment of nonrecourse debt - legacy assets\t(6)\t(9)\nRepurchase of unsecured senior notes\t(62)\t(95)\nSurrender of shares relating to stock vesting\t(6)\t(5)\nDebt financing costs\t(7)\t(6)\nDividends to non-controlling interests\t(1)\t(5)\nNet cash attributable to financing activities\t(1807)\t(1116)\nNet decrease in cash cash equivalents and restricted cash\t(80)\t(269)\nCash cash equivalents and restricted cash - beginning of period\t575\t877\nCash cash equivalents and restricted cash - end of period(1)\t495\t608\nSupplemental Disclosures of Cash Activities\t\t\nCash paid for interest expense\t373\t399\nNet cash paid for income taxes\t36\t70\n(1) The following table provides a reconciliation of cash cash equivalents and restricted cash to amount reported within the consolidated balance sheet.\t\t\n\tJune 30\t\n\t2018\t2017\nCash and cash equivalents\t185\t184\nRestricted cash\t310\t424\nTotal cash cash equivalents and restricted cash\t495\t608\n", "q10k_tbl_6": "MSRs and Related Liabilities\tJune 30 2018\tDecember 31 2017\nMortgage servicing rights - fair value and amortized cost(1)\t3356\t2941\nMortgage servicing liabilities - amortized cost\t27\t41\nExcess spread financing - fair value\t1047\t996\nMortgage servicing rights financing - fair value\t16\t10\nMSR related liabilities - nonrecourse at fair value\t1063\t1006\n", "q10k_tbl_7": "\tSix Months Ended June 30\t\nMSRs - Fair Value\t2018\t2017\nFair value - beginning of period\t2937\t3160\nAdditions:\t\t\nServicing retained from mortgage loans sold\t139\t103\nPurchases of servicing rights\t132\t13\nDispositions:\t\t\nSales of servicing assets(1)\t4\t2\nChanges in fair value:\t\t\nChanges in valuation inputs or assumptions used in the valuation model\t283\t(74)\nOther changes in fair value\t(139)\t(158)\nFair value - end of period\t3356\t3046\n", "q10k_tbl_8": "MSRs - Sensitivity Pools\tJune 30 2018\t\tDecember 31 2017\t\n\tUPB\tFair Value\tUPB\tFair Value\nCredit sensitive\t153552\t1695\t167605\t1572\nInterest sensitive\t124553\t1661\t113775\t1365\nTotal\t278105\t3356\t281380\t2937\n", "q10k_tbl_9": "Credit Sensitive\tJune 30 2018\tDecember 31 2017\nDiscount rate%\t11.4\t11.4%\nTotal prepayment speeds%\t11.7\t15.2%\nExpected weighted-average life\t6.6 years\t5.7 years\nInterest Sensitive\t\t\nDiscount rate%\t9.2\t9.2%\nTotal prepayment speeds%\t9.8\t10.7%\nExpected weighted-average life\t7.0 years\t6.7 years\n", "q10k_tbl_10": "\tDiscount Rate\t\tTotal Prepayment Speeds\t\nMSRs - Hypothetical Sensitivities\t100 bps Adverse Change\t200 bps Adverse Change\t10% Adverse Change\t20% Adverse Change\nJune 30 2018\t\t\t\t\nMortgage servicing rights\t(130)\t(251)\t(119)\t(231)\nDecember 31 2017\t\t\t\t\nMortgage servicing rights\t(108)\t(208)\t(118)\t(227)\n", "q10k_tbl_11": "Excess Spread Financing\tPrepayment Speeds\tAverage Life (Years)\tDiscount Rate\tRecapture Rate\nJune 30 2018\t\t\t\t\nLow\t6.0%\t5.2\t8.5%\t8.2%\nHigh\t15.1%\t8.1\t14.0%\t27.3%\nWeighted-average\t11.1%\t6.5\t10.6%\t18.0%\nDecember 31 2017\t\t\t\t\nLow\t6.2%\t4.4\t8.5%\t7.2%\nHigh\t21.2%\t6.9\t14.1%\t30.0%\nWeighted-average\t13.7%\t5.9\t10.8%\t18.7%\n", "q10k_tbl_12": "\tDiscount Rate\t\tPrepayment Speeds\t\nExcess Spread Financing - Hypothetical Sensitivities\t100 bps Adverse Change\t200 bps Adverse Change\t10% Adverse Change\t20% Adverse Change\nJune 30 2018\t\t\t\t\nExcess spread financing\t40\t83\t31\t64\nDecember 31 2017\t\t\t\t\nExcess spread financing\t37\t78\t34\t71\n", "q10k_tbl_13": "Mortgage Servicing Rights Financing Assumptions\tJune 30 2018\tDecember 31 2017\nAdvance financing rates%\t4.1\t3.5%\nAnnual advance recovery rates%\t18.9\t23.2%\n", "q10k_tbl_14": "\tThree Months Ended June 30\t\tSix Months Ended June 30\t\nServicing Revenue\t2018\t2017\t2018\t2017\nContractually specified servicing fees(1)\t245\t253\t495\t508\nOther service-related income(1)(2)\t28\t46\t56\t86\nIncentive and modification income(1)\t18\t21\t33\t43\nLate fees(1)\t22\t22\t46\t46\nReverse servicing fees\t14\t13\t33\t27\nMark-to-market adjustments(2)(3)\t19\t(84)\t171\t(116)\nCounterparty revenue share(4)\t(50)\t(59)\t(95)\t(121)\nAmortization net of accretion(5)\t(48)\t(66)\t(96)\t(127)\nTotal servicing revenue\t248\t146\t643\t346\n", "q10k_tbl_15": "\tJune 30 2018\tDecember 31 2017\nServicing advances\t1248\t1599\nReceivables from agencies investors and prior servicers\t363\t391\nReserves\t(294)\t(284)\nTotal advances and other receivables net\t1317\t1706\n", "q10k_tbl_16": "\tThree Months Ended June 30\t\tSix Months Ended June 30\t\nReserves for Advances and Other Receivables\t2018\t2017\t2018\t2017\nBalance - beginning of period\t277\t208\t284\t184\nProvision and other additions(1)\t38\t36\t60\t76\nWrite-offs\t(21)\t(8)\t(50)\t(24)\nBalance - end of period\t294\t236\t294\t236\n", "q10k_tbl_17": "\tJune 30 2018\tDecember 31 2017\nParticipating interests in HECM mortgage-backed securities (\"HMBS\")\t6518\t7107\nOther interests securitized\t908\t912\nUnsecuritized interests\t2168\t2080\nReserves\t(117)\t(115)\nTotal reverse mortgage interests net\t9477\t9984\n", "q10k_tbl_18": "\tJune 30 2018\tDecember 31 2017\nRepurchased HECM loans\t1749\t1662\nHECM related receivables\t332\t311\nFunded borrower draws not yet securitized\t62\t82\nREO related receivables\t25\t25\nTotal unsecuritized interests\t2168\t2080\n", "q10k_tbl_19": "\tThree Months Ended June 30\t\tSix Months Ended June 30\t\nReserves for reverse mortgage interests\t2018\t2017\t2018\t2017\nBalance - beginning of period\t134\t137\t115\t131\nProvision (release) net\t(6)\t14\t20\t22\nWrite-offs\t(11)\t(2)\t(18)\t(4)\nBalance - end of period\t117\t149\t117\t149\n", "q10k_tbl_20": "\tJune 30 2018\tDecember 31 2017\nMortgage loans held for sale - UPB\t1586\t1837\nMark-to-market adjustment(1)\t49\t54\nTotal mortgage loans held for sale\t1635\t1891\n", "q10k_tbl_21": "\tJune 30 2018\t\tDecember 31 2017\t\nMortgage Loans Held for Sale - UPB\tUPB\tFair Value\tUPB\tFair Value\nNon-accrual\t57\t53\t66\t64\n", "q10k_tbl_22": "\tSix Months Ended June 30\t\nMortgage loans held for sale\t2018\t2017\nBalance - beginning of period\t1891\t1788\nMortgage loans originated and purchased net of fees\t10630\t8887\nLoans sold\t(11377)\t(9753)\nRepurchase of loans out of Ginnie Mae securitizations\t475\t599\nTransfer of mortgage loans held for sale to advances/accounts receivable net related to claims(1)\t(6)\t(8)\nNet transfer of mortgage loans held for sale from REO in other assets(2)\t12\t11\nChanges in fair value\t1\t10\nOther purchase-related activities(3)\t9\t9\nBalance - end of period\t1635\t1543\n", "q10k_tbl_23": "\tJune 30 2018\tDecember 31 2017\nMortgage loans held for investment net - UPB\t183\t193\nTransfer discount:\t\t\nNon-accretable\t(37)\t(41)\nAccretable\t(13)\t(12)\nAllowance for loan losses\t(1)\t(1)\nTotal mortgage loans held for investment net\t132\t139\n", "q10k_tbl_24": "\tSix Months Ended June 30\t\nAccretable Yield Discount\t2018\t2017\nBalance - beginning of the period\t(12)\t(13)\nAccretion\t1\t1\nReclassifications from non-accretable discount\t(2)\t(2)\nBalance - end of the period\t(13)\t(14)\n", "q10k_tbl_25": "\tJune 30 2018\tDecember 31 2017\nLoans subject to repurchase right from Ginnie Mae\t206\t218\nAccrued revenues\t128\t148\nGoodwill\t71\t72\nPrepaid expenses\t31\t27\nDeposits\t21\t19\nReal estate owned (REO) net\t18\t23\nIntangible assets\t14\t19\nReceivables from affiliates net\t6\t6\nOther\t98\t82\nTotal other assets\t593\t614\n", "q10k_tbl_26": "\tExpiration Dates\tOutstanding Notional\tFair Value\tRecorded Gains / (Losses)\nSix Months Ended June 30 2018\t\t\t\t\nAssets\t\t\t\t\nMortgage loans held for sale\t\t\t\t\nLoan sale commitments\t2018\t368\t7.2\t7.1\nDerivative financial instruments\t\t\t\t\nIRLCs\t2018\t1778\t60.2\t0.9\nForward sales of MBS\t2018\t568\t0.4\t(2.0)\nLPCs\t2018\t271\t1.7\t0.8\nTreasury futures\t2018\t35\t0.1\t(1.8)\nEurodollar futures(1)\t2018-2021\t22\t0\t0\nLiabilities\t\t\t\t\nDerivative financial instruments\t\t\t\t\nIRLCs(1)\t2018\t1\t0\t0\nForward sales of MBS\t2018\t2710\t8.0\t5.2\nLPCs\t2018\t185\t0.7\t0.1\nTreasury futures(1)\t2018\t63\t0\t(1.4)\nEurodollar futures(1)\t2020-2021\t6\t0\t0\nYear Ended December 31 2017\t\t\t\t\nAssets\t\t\t\t\nMortgage loans held for sale\t\t\t\t\nLoan sale commitments(1)\t2018\t13\t0.1\t0\nDerivative financial instruments\t\t\t\t\nIRLCs\t2018\t2065\t59.3\t(32.9)\nForward sales of MBS\t2018\t1802\t2.4\t(36.9)\nLPCs\t2018\t171\t0.9\t(1.0)\nTreasury futures\t2018\t81\t1.9\t1.9\nEurodollar futures(1)\t2018-2021\t26\t0\t0\nInterest rate swaps(1)\t2018\t0\t0\t(0.1)\nLiabilities\t\t\t\t\nDerivative financial instruments\t\t\t\t\nIRLCs(1)\t2018\t7\t0\t1.1\nForward sales of MBS\t2018\t1579\t2.8\t7.2\nLPCs\t2018\t213\t0.6\t0.9\nTreasury futures\t2018\t128\t1.4\t(1.4)\nEurodollar futures(1)\t2018-2021\t17\t0\t0\nInterest rate swaps(1)\t2018\t0\t0\t0.1\n", "q10k_tbl_27": "\t\t\t\t\tJune 30 2018\t\tDecember 31 2017\t\nAdvance Facilities\tInterest Rate\tMaturity Date\tCollateral\tCapacity Amount\tOutstanding\tCollateral Pledged\tOutstanding\tCollateral pledged\nNationstar agency advance receivables trust\tLIBOR+2.0% to 2.6%\tNovember 2019\tServicing advance receivables\t575\t248\t292\t416\t492\nNationstar mortgage advance receivable trust\tLIBOR+1.4% to 6.5%\tNovember 2018\tServicing advance receivables\t500\t142\t243\t230\t287\nNationstar agency advance financing facility\tLIBOR+1.0% to 7.4%\tJanuary 2019\tServicing advance receivables\t150\t77\t92\t102\t117\nMBS advance financing facility\tLIBOR+2.5%\tMarch 2019\tServicing advance receivables\t130\t0\t0\t63\t64\nMBS servicer advance facility (2014)\tLIBOR+3.0%\tOctober 2018\tServicing advance receivables\t125\t49\t139\t44\t140\nAdvance facilities principal amount\t\t\t\t\t516\t766\t855\t1100\nUnamortized debt issuance costs\t\t\t\t\t0\t\t0\t\nAdvance facilities net\t\t\t\t\t516\t\t855\t\n\t\t\t\t\tJune 30 2018\t\tDecember 31 2017\t\nWarehouse Facilities\tInterest Rate\tMaturity Date\tCollateral\tCapacity Amount\tOutstanding\tCollateral Pledged\tOutstanding\tCollateral pledged\n1200 warehouse facility\tLIBOR+1.9% to 3.8%\tOctober 2018\tMortgage loans or MBS\t1200\t768\t836\t889\t960\n1000 warehouse facility\tLIBOR+2.0% to 2.5%\tSeptember 2018\tMortgage loans or MBS\t1000\t289\t297\t299\t308\n950 warehouse facility\tLIBOR+2.0% to 3.5%\tNovember 2018\tMortgage loans or MBS\t950\t632\t705\t721\t785\n600 warehouse facility\tLIBOR+2.5%\tFebruary 2019\tMortgage loans or MBS\t600\t354\t379\t333\t347\n500 warehouse facility\tLIBOR+1.8% to 2.8%\tSeptember 2018\tMortgage loans or MBS\t500\t198\t202\t233\t239\n500 warehouse facility\tLIBOR+1.8% to 2.8%\tNovember 2018\tMortgage loans or MBS\t500\t288\t318\t305\t337\n500 warehouse facility\tLIBOR+2.0% to 3.5%\tApril 2019\tMortgage loans or MBS\t500\t312\t338\t246\t272\n300 warehouse facility\tLIBOR+2.3%\tJanuary 2019\tMortgage loans or MBS\t300\t109\t135\t116\t141\n200 warehouse facility\tLIBOR+1.6%\tApril 2019\tMortgage loans or MBS\t200\t34\t35\t80\t81\n200 warehouse facility\tLIBOR+5.5% to 6.8%\tJune 2020\tMortgage loans or MBS\t200\t100\t195\t50\t50\n150 warehouse facility\tLIBOR+4.3%\tSeptember 2018\tMortgage loans or MBS\t150\t0\t94\t0\t0\n50 warehouse facility\tLIBOR+4.5%\tAugust 2020\tMortgage loans or MBS\t50\t0\t48\t10\t10\n40 warehouse facility\tLIBOR+3.0%\tNovember 2018\tMortgage loans or MBS\t40\t3\t5\t4\t6\nWarehouse facilities principal amount\t\t\t\t\t3087\t3587\t3286\t3536\nUnamortized debt issuance costs\t\t\t\t\t(1)\t\t(1)\t\nWarehouse facilities net\t\t\t\t\t3086\t\t3285\t\nPledged Collateral:\t\t\t\t\t\t\t\t\nMortgage loans net\t\t\t\t\t1544\t1431\t1852\t1680\nReverse mortgage interests net\t\t\t\t\t1443\t1612\t1434\t1575\nMSR and other collateral\t\t\t\t\t100\t544\t0\t281\n", "q10k_tbl_28": "\tJune 30 2018\t\tDecember 31 2017\t\n600 face value 6.500% interest rate payable semi-annually due July 2021\t595\t\t595\t\n400 face value 7.875% interest rate payable semi-annually due October 2020\t394\t\t397\t\n475 face value 6.500% interest rate payable semi-annually due August 2018\t364\t\t364\t\n375 face value 9.625% interest rate payable semi-annually due May 2019\t266\t\t323\t\n300 face value 6.500% interest rate payable semi-annually due June 2022\t206\t\t206\t\nUnsecured senior notes principal amount\t1825\t\t1885\t\nUnamortized debt issuance costs\t(10\t)\t(11\t)\nUnsecured senior notes net\t1815\t\t1874\t\n", "q10k_tbl_29": "Year Ending December 31\tAmount\n2018(1)\t364\n2019(2)\t266\n2020(1)\t394\n2021\t595\n2022\t206\nUnsecured senior notes principal amount\t1825\nUnamortized debt issuance costs\t(10)\nUnsecured senior notes net\t1815\n", "q10k_tbl_30": "\t\t\t\t\tJune 30 2018\tDecember 31 2017\n\tIssue Date\tMaturity Date\tClass of Note\tSecuritized Amount\tOutstanding\tOutstanding\nParticipating interest financing(1)\t0\t0\t0\t0\t6590\t7173\nSecuritization of nonperforming HECM loans\t\t\t\t\t\t\nTrust 2016-2\tJune 2016\tJune 2026\tA M1 M2\t0\t0\t94\nTrust 2016-3\tAugust 2016\tAugust 2026\tA M1 M2\t0\t0\t138\nTrust 2017-1\tMay 2017\tMay 2027\tA M1 M2\t207\t170\t213\nTrust 2017-2\tSeptember 2017\tSeptember 2027\tA M1 M2\t334\t291\t365\nTrust 2018-1\tMarch 2018\tMarch 2028\tA M1 M2 M3 M4 M5\t380\t369\t0\nNonrecourse debt - legacy assets\tNovember 2009\tOctober 2039\tA\t118\t36\t42\nOther nonrecourse debt principal amount\t\t\t\t\t7456\t8025\nUnamortized debt issuance costs and issuance discount\t\t\t\t\t(11)\t(11)\nOther nonrecourse debt net\t\t\t\t\t7445\t8014\n", "q10k_tbl_31": "\tJune 30 2018\tDecember 31 2017\nPayables to servicing and subservicing investors\t557\t516\nLoans subject to repurchase from Ginnie Mae\t206\t218\nPayables to GSEs and securitized trusts\t135\t92\nAccounts payable and other accrued liabilities\t114\t99\nPayable to insurance carriers and insurance cancellation reserves\t60\t61\nTaxes\t58\t36\nAccrued bonus and payroll\t52\t82\nAccrued interest\t39\t62\nAccrued legal expenses\t22\t25\nLease obligations\t20\t24\nMSR purchases payable including advances\t16\t10\nRepurchase reserves\t9\t9\nTotal payables and accrued liabilities\t1288\t1234\n", "q10k_tbl_32": "\tThree Months Ended June 30\t\tSix Months Ended June 30\t\nRepurchase Reserves\t2018\t2017\t2018\t2017\nBalance - beginning of period\t9\t15\t9\t18\nProvisions\t2\t1\t3\t3\nReleases\t(2)\t(2)\t(3)\t(6)\nCharge-offs\t0\t0\t0\t(1)\nBalance - end of period\t9\t14\t9\t14\n", "q10k_tbl_33": "\tJune 30 2018\t\tDecember 31 2017\t\n\tTransfers Accounted for as Secured Borrowings\tReverse Secured Borrowings\tTransfers Accounted for as Secured Borrowings\tReverse Secured Borrowings\nAssets\t\t\t\t\nRestricted cash\t87\t35\t106\t26\nReverse mortgage interests net\t0\t7379\t0\t7981\nAdvances and other receivables net\t627\t0\t896\t0\nMortgage loans held for investment net\t132\t0\t138\t0\nOther assets\t0\t0\t2\t0\nTotal assets\t846\t7414\t1142\t8007\nLiabilities\t\t\t\t\nAdvance facilities(1)\t467\t0\t749\t0\nPayables and accrued liabilities\t1\t0\t2\t1\nParticipating interest financing(2)\t0\t6527\t0\t7107\nHECM Securitizations (HMBS)\t\t\t\t\nTrust 2016-2\t0\t0\t0\t94\nTrust 2016-3\t0\t0\t0\t138\nTrust 2017-1\t0\t170\t0\t213\nTrust 2017-2\t0\t291\t0\t365\nTrust 2018-1\t0\t369\t0\t0\nNonrecourse debt-legacy assets\t31\t0\t36\t0\nTotal liabilities\t499\t7357\t787\t7918\n", "q10k_tbl_34": "\tJune 30 2018\tDecember 31 2017\nTotal collateral balances\t2012\t2291\nTotal certificate balances\t1956\t2129\n", "q10k_tbl_35": "Principal Amount of Loans 60 Days or More Past Due\tJune 30 2018\tDecember 31 2017\nUnconsolidated securitization trusts\t362\t448\n", "q10k_tbl_36": "\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nIncome tax expense (benefit)\t21\t(10)\t67\t(9)\nEffective tax rate\t26.5%\t33.1%\t23.6%\t32.8%\n", "q10k_tbl_37": "\tJune 30 2018\t\t\t\n\t\tRecurring Fair Value Measurements\t\t\n\tTotal Fair Value\tLevel 1\tLevel 2\tLevel 3\nAssets\t\t\t\t\nMortgage loans held for sale(1)\t1635.2\t0\t1635.2\t0\nMortgage servicing rights(1)\t3355.7\t0\t0\t3355.7\nDerivative financial instruments\t\t\t\t\nIRLCs\t60.2\t0\t60.2\t0\nForward MBS trades\t0.4\t0\t0.4\t0\nLPCs\t1.7\t0\t1.7\t0\nEurodollar futures(2)\t0\t0\t0\t0\nTreasury futures\t0.1\t0\t0.1\t0\nTotal assets\t5053.3\t0\t1697.6\t3355.7\nLiabilities\t\t\t\t\nDerivative financial instruments\t\t\t\t\nIRLCs(2)\t0\t0\t0\t0\nForward MBS trades\t8.0\t0\t8.0\t0\nLPCs\t0.7\t0\t0.7\t0\nEurodollar futures(2)\t0\t0\t0\t0\nTreasury futures(2)\t0\t0\t0\t0\nMortgage servicing rights financing\t16.1\t0\t0\t16.1\nExcess spread financing\t1046.5\t0\t0\t1046.5\nTotal liabilities\t1071.3\t0\t8.7\t1062.6\n", "q10k_tbl_38": "\tDecember 31 2017\t\t\t\n\t\tRecurring Fair Value Measurements\t\t\n\tTotal Fair Value\tLevel 1\tLevel 2\tLevel 3\nAssets\t\t\t\t\nMortgage loans held for sale(1)\t1890.8\t0\t1890.8\t0\nMortgage servicing rights(1)\t2937.4\t0\t0\t2937.4\nDerivative financial instruments\t\t\t\t\nIRLCs\t59.3\t0\t59.3\t0\nForward MBS trades\t2.4\t0\t2.4\t0\nLPCs\t0.9\t0\t0.9\t0\nEurodollar futures(2)\t0\t0\t0\t0\nTreasury futures\t1.9\t0\t1.9\t0\nTotal assets\t4892.7\t0\t1955.3\t2937.4\nLiabilities\t\t\t\t\nDerivative financial instruments\t\t\t\t\nForward MBS trades\t2.8\t0\t2.8\t0\nLPCs\t0.6\t0\t0.6\t0\nEurodollar futures(2)\t0\t0\t0\t0\nTreasury futures\t1.4\t0\t1.4\t0\nMortgage servicing rights financing\t9.5\t0\t0\t9.5\nExcess spread financing\t996.5\t0\t0\t996.5\nTotal liabilities\t1010.8\t0\t4.8\t1006.0\n", "q10k_tbl_39": "\tAssets\tLiabilities\t\n\tMortgage servicing rights\tExcess spread financing\tMortgage servicing rights financing\nSix Months Ended June 30 2018\t\t\t\nBalance - beginning of period\t2937\t996\t10\nTotal gains or losses included in earnings\t144\t74\t6\nPurchases issuances sales and settlements\t\t\t\nPurchases\t132\t0\t0\nIssuances\t139\t70\t0\nSales\t4\t0\t0\nSettlements\t0\t(93)\t0\nBalance - end of period\t3356\t1047\t16\n", "q10k_tbl_40": "\tAssets\tLiabilities\t\n\tMortgage servicing rights\tExcess spread financing\tMortgage servicing rights financing\nYear Ended December 31 2017\t\t\t\nBalance - beginning of period\t3160\t1214\t27\nTotal gains or losses included in earnings\t(432)\t12\t(17)\nPurchases issuances sales and settlements\t\t\t\nPurchases\t66\t0\t0\nIssuances\t203\t0\t0\nSales\t(60)\t0\t0\nSettlements\t0\t(230)\t0\nBalance - end of period\t2937\t996\t10\n", "q10k_tbl_41": "\tJune 30 2018\t\t\t\n\tCarrying Amount\tFair Value\t\t\n\tLevel 1\tLevel 2\tLevel 3\nFinancial assets\t\t\t\t\nCash and cash equivalents\t185\t185\t0\t0\nRestricted cash\t310\t310\t0\t0\nAdvances and other receivables net\t1317\t0\t0\t1317\nReverse mortgage interests net\t9477\t0\t0\t9665\nMortgage loans held for sale\t1635\t0\t1635\t0\nMortgage loans held for investment net\t132\t0\t0\t133\nDerivative financial instruments\t62\t0\t62\t0\nFinancial liabilities\t\t\t\t\nUnsecured senior notes\t1815\t1832\t0\t0\nAdvance facilities\t516\t0\t516\t0\nWarehouse facilities\t3086\t0\t3086\t0\nMortgage servicing rights financing liability\t16\t0\t0\t16\nExcess spread financing\t1047\t0\t0\t1047\nDerivative financial instruments\t9\t0\t9\t0\nParticipating interest financing\t6584\t0\t6780\t0\nHECM Securitization (HMBS)\t\t\t\t\nTrust 2017-1\t170\t0\t0\t191\nTrust 2017-2\t291\t0\t0\t309\nTrust 2018-1\t369\t0\t0\t352\nNonrecourse debt - legacy assets\t31\t0\t0\t30\n\tDecember 31 2017\t\t\t\n\tCarrying Amount\tFair Value\t\t\n\tLevel 1\tLevel 2\tLevel 3\nFinancial assets\t\t\t\t\nCash and cash equivalents\t215\t215\t0\t0\nRestricted cash\t360\t360\t0\t0\nAdvances and other receivables net\t1706\t0\t0\t1706\nReverse mortgage interests net\t9984\t0\t0\t10164\nMortgage loans held for sale\t1891\t0\t1891\t0\nMortgage loans held for investment net\t139\t0\t0\t139\nDerivative financial instruments\t65\t0\t65\t0\nFinancial liabilities\t\t\t\t\nUnsecured senior notes\t1874\t1912\t0\t0\nAdvance facilities\t855\t0\t855\t0\nWarehouse facilities\t3285\t0\t3286\t0\nMortgage servicing rights financing liability\t10\t0\t0\t10\nExcess spread financing\t996\t0\t0\t996\nDerivative financial instruments\t5\t0\t5\t0\nParticipating interest financing\t7167\t0\t7353\t0\nHECM Securitization (HMBS)\t\t\t\t\nTrust 2016-2\t94\t0\t0\t112\nTrust 2016-3\t138\t0\t0\t155\nTrust 2017-1\t213\t0\t0\t225\nTrust 2017-2\t365\t0\t0\t371\nNonrecourse debt - legacy assets\t37\t0\t0\t36\n", "q10k_tbl_42": "\tThree Months Ended June 30 2018\t\t\t\t\t\t\n\tServicing\tOriginations\tXome\tEliminations\tTotal Operating Segments\tCorporate and Other\tConsolidated\nRevenues\t\t\t\t\t\t\t\nService related net\t248\t17\t62\t(11)\t316\t1\t317\nNet gain on mortgage loans held for sale\t0\t116\t0\t11\t127\t0\t127\nTotal revenues\t248\t133\t62\t0\t443\t1\t444\nTotal Expenses\t166\t102\t52\t0\t320\t19\t339\nOther income (expenses)\t\t\t\t\t\t\t\nInterest income\t121\t17\t0\t0\t138\t2\t140\nInterest expense\t(115)\t(16)\t0\t0\t(131)\t(33)\t(164)\nOther\t0\t0\t0\t0\t0\t(2)\t(2)\nTotal Other Income (expenses) net\t6\t1\t0\t0\t7\t(33)\t(26)\nIncome (loss) before income tax expense (benefit)\t88\t32\t10\t0\t130\t(51)\t79\nDepreciation and amortization for property and equipment and intangible assets\t6\t3\t3\t0\t12\t2\t14\nTotal assets\t14640\t4794\t423\t(3538)\t16319\t871\t17190\n", "q10k_tbl_43": "\tThree Months Ended June 30 2017\t\t\t\t\t\t\n\tServicing\tOriginations\tXome\tEliminations\tTotal Operating Segments\tCorporate and Other\tConsolidated\nRevenues\t\t\t\t\t\t\t\nService related net\t146\t15\t76\t(24)\t213\t0\t213\nNet gain on mortgage loans held for sale\t0\t143\t0\t24\t167\t0\t167\nTotal revenues\t146\t158\t76\t0\t380\t0\t380\nTotal Expenses\t173\t103\t67\t0\t343\t24\t367\nOther income (expenses)\t\t\t\t\t\t\t\nInterest income\t123\t11\t0\t0\t134\t5\t139\nInterest expense\t(138)\t(13)\t0\t0\t(151)\t(37)\t(188)\nOther\t0\t0\t8\t0\t8\t(1)\t7\nTotal Other Income (expenses) net\t(15)\t(2)\t8\t0\t(9)\t(33)\t(42)\nIncome (loss) before income tax expense (benefit)\t(42)\t53\t17\t0\t28\t(57)\t(29)\nDepreciation and amortization for property and equipment and intangible assets\t5\t3\t3\t0\t11\t4\t15\nTotal assets\t15482\t4447\t369\t(2694)\t17604\t673\t18277\n", "q10k_tbl_44": "\tSix Months Ended June 30 2018\t\t\t\t\t\t\n\tServicing\tOriginations\tXome\tEliminations\tTotal Operating Segments\tCorporate and Other\tConsolidated\nRevenues\t\t\t\t\t\t\t\nService related net\t643\t32\t127\t(22)\t780\t1\t781\nNet gain on mortgage loans held for sale\t0\t229\t0\t22\t251\t0\t251\nTotal revenues\t643\t261\t127\t0\t1031\t1\t1032\nTotal expenses\t348\t211\t104\t0\t663\t40\t703\nOther income (expenses)\t\t\t\t\t\t\t\nInterest income\t247\t32\t0\t0\t279\t6\t285\nInterest expense\t(233)\t(31)\t0\t0\t(264)\t(71)\t(335)\nOther\t(1)\t0\t9\t0\t8\t(2)\t6\nTotal other income (expenses) net\t13\t1\t9\t0\t23\t(67)\t(44)\nIncome (loss) before income tax expense (benefit)\t308\t51\t32\t0\t391\t(106)\t285\nDepreciation and amortization for property and equipment and intangible assets\t13\t6\t6\t0\t25\t4\t29\nTotal assets\t14640\t4794\t423\t(3538)\t16319\t871\t17190\n", "q10k_tbl_45": "\tSix Months Ended June 30 2017\t\t\t\t\t\t\n\tServicing\tOriginations\tXome\tEliminations\tTotal Operating Segments\tCorporate and Other\tConsolidated\nRevenues\t\t\t\t\t\t\t\nService related net\t346\t31\t161\t(43)\t495\t1\t496\nNet gain on mortgage loans held for sale\t0\t268\t0\t43\t311\t0\t311\nTotal revenues\t346\t299\t161\t0\t806\t1\t807\nTotal expenses\t328\t220\t139\t0\t687\t49\t736\nOther income (expenses)\t\t\t\t\t\t\t\nInterest income\t243\t25\t0\t0\t268\t10\t278\nInterest expense\t(277)\t(26)\t0\t0\t(303)\t(78)\t(381)\nOther\t0\t0\t8\t0\t8\t(2)\t6\nTotal other income (expenses) net\t(34)\t(1)\t8\t0\t(27)\t(70)\t(97)\nIncome (loss) before income tax expense (benefit)\t(16)\t78\t30\t0\t92\t(118)\t(26)\nDepreciation and amortization for property and equipment and intangible assets\t10\t5\t7\t0\t22\t7\t29\nTotal assets\t15482\t4447\t369\t(2694)\t17604\t673\t18277\n", "q10k_tbl_46": "NATIONSTAR MORTGAGE HOLDINGS INC. CONSOLIDATING BALANCE SHEET JUNE 30 2018\t\t\t\t\t\t\n\tNationstar\tIssuer(1)\tGuarantor (Subsidiaries of Issuer)\tNon-Guarantor (Subsidiaries of Issuer)\tEliminations\tConsolidated\nAssets\t\t\t\t\t\t\nCash and cash equivalents\t0\t166\t1\t18\t0\t185\nRestricted cash\t0\t187\t0\t123\t0\t310\nMortgage servicing rights\t0\t3319\t0\t37\t0\t3356\nAdvances and other receivables net\t0\t1317\t0\t0\t0\t1317\nReverse mortgage interests net\t0\t8615\t0\t862\t0\t9477\nMortgage loans held for sale at fair value\t0\t1635\t0\t0\t0\t1635\nMortgage loans held for investment net\t0\t0\t0\t132\t0\t132\nProperty and equipment net\t0\t106\t0\t17\t0\t123\nDerivative financial instruments at fair value\t0\t62\t0\t0\t0\t62\nOther assets\t0\t466\t192\t573\t(638)\t593\nInvestment in subsidiaries\t2070\t574\t0\t0\t(2644)\t0\nTotal assets\t2070\t16447\t193\t1762\t(3282)\t17190\nLiabilities and Stockholders' Equity\t\t\t\t\t\t\nUnsecured senior notes net\t0\t1815\t0\t0\t0\t1815\nAdvance facilities net\t0\t49\t0\t467\t0\t516\nWarehouse facilities net\t0\t3086\t0\t0\t0\t3086\nPayables and accrued liabilities\t0\t1255\t1\t32\t0\t1288\nMSR related liabilities - nonrecourse at fair value\t0\t1043\t0\t20\t0\t1063\nMortgage servicing liabilities\t0\t27\t0\t0\t0\t27\nDerivative financial instruments at fair value\t0\t9\t0\t0\t0\t9\nOther nonrecourse debt net\t0\t6584\t0\t861\t0\t7445\nPayables to affiliates\t129\t509\t0\t0\t(638)\t0\nTotal liabilities\t129\t14377\t1\t1380\t(638)\t15249\nTotal stockholders' equity\t1941\t2070\t192\t382\t(2644)\t1941\nTotal liabilities and stockholders' equity\t2070\t16447\t193\t1762\t(3282)\t17190\n", "q10k_tbl_47": "NATIONSTAR MORTGAGE HOLDINGS INC. CONSOLIDATING STATEMENT OF OPERATIONS THREE MONTHS ENDED JUNE 30 2018\t\t\t\t\t\t\n\tNationstar\tIssuer(1)\tGuarantor (Subsidiaries of Issuer)\tNon-Guarantor (Subsidiaries of Issuer)\tEliminations\tConsolidated\nRevenues:\t\t\t\t\t\t\nService related net\t0\t247\t7\t63\t0\t317\nNet gain on mortgage loans held for sale\t0\t127\t0\t0\t0\t127\nTotal revenues\t0\t374\t7\t63\t0\t444\nExpenses:\t\t\t\t\t\t\nSalaries wages benefits\t0\t149\t1\t27\t0\t177\nGeneral and administrative\t0\t134\t0\t28\t0\t162\nTotal expenses\t0\t283\t1\t55\t0\t339\nOther income (expenses):\t\t\t\t\t\t\nInterest income\t0\t127\t0\t13\t0\t140\nInterest expense\t0\t(153)\t0\t(11)\t0\t(164)\nOther income (expenses)\t0\t(3)\t0\t1\t0\t(2)\nGain (loss) from subsidiaries\t58\t18\t0\t0\t(76)\t0\nTotal other income (expenses) net\t58\t(11)\t0\t3\t(76)\t(26)\nIncome (loss) before income tax expense (benefit)\t58\t80\t6\t11\t(76)\t79\nLess: Income tax expense (benefit)\t0\t22\t0\t(1)\t0\t21\nNet income (loss)\t58\t58\t6\t12\t(76)\t58\nLess: Net income attributable to non-controlling interests\t0\t0\t0\t0\t0\t0\nNet income (loss) attributable to Nationstar\t58\t58\t6\t12\t(76)\t58\n", "q10k_tbl_48": "NATIONSTAR MORTGAGE HOLDINGS INC. CONSOLIDATING STATEMENT OF OPERATIONS SIX MONTHS ENDED JUNE 30 2018\t\t\t\t\t\t\n\tNationstar\tIssuer(1)\tGuarantor (Subsidiaries of Issuer)\tNon-Guarantor (Subsidiaries of Issuer)\tEliminations\tConsolidated\nRevenues:\t\t\t\t\t\t\nService related net\t0\t637\t13\t131\t0\t781\nNet gain on mortgage loans held for sale\t0\t251\t0\t0\t0\t251\nTotal revenues\t0\t888\t13\t131\t0\t1032\nExpenses:\t\t\t\t\t\t\nSalaries wages benefits\t0\t301\t2\t54\t0\t357\nGeneral and administrative\t0\t290\t1\t55\t0\t346\nTotal expenses\t0\t591\t3\t109\t0\t703\nOther income (expenses):\t\t\t\t\t\t\nInterest income\t0\t258\t0\t27\t0\t285\nInterest expense\t0\t(315)\t0\t(20)\t0\t(335)\nOther income (expense)\t0\t(4)\t0\t10\t0\t6\nGain (loss) from subsidiaries\t218\t50\t0\t0\t(268)\t0\nTotal other income (expenses) net\t218\t(11)\t0\t17\t(268)\t(44)\nIncome (loss) before income tax expense (benefit)\t218\t286\t10\t39\t(268)\t285\nLess: income tax expense (benefit)\t0\t68\t0\t(1)\t0\t67\nNet income (loss)\t218\t218\t10\t40\t(268)\t218\nLess: net loss attributable to noncontrolling interests\t0\t0\t0\t0\t0\t0\nNet income (loss) attributable to Nationstar\t218\t218\t10\t40\t(268)\t218\n", "q10k_tbl_49": "NATIONSTAR MORTGAGE HOLDINGS INC. CONSOLIDATING STATEMENT OF CASH FLOWS SIX MONTHS ENDED JUNE 30 2018\t\t\t\t\t\t\n\tNationstar\tIssuer(1)\tGuarantor (Subsidiaries of Issuer)\tNon-Guarantor (Subsidiaries of Issuer)\tEliminations\tConsolidated\nOperating Activities\t\t\t\t\t\t\nNet income (loss) attributable to Nationstar\t218\t218\t10\t40\t(268)\t218\nAdjustments to reconcile net income (loss) to net cash attributable to operating activities:\t\t\t\t\t\t\n(Gain) loss from subsidiaries\t(218)\t(50)\t0\t0\t268\t0\nNet gain on mortgage loans held for sale\t0\t(251)\t0\t0\t0\t(251)\nReverse mortgage loan interest income\t0\t(237)\t0\t0\t0\t(237)\nGain on sale of assets\t0\t0\t0\t(9)\t0\t(9)\nProvision for servicing reserves\t0\t54\t0\t0\t0\t54\nFair value changes and amortization of mortgage servicing rights\t0\t(155)\t0\t0\t0\t(155)\nFair value changes in excess spread financing\t0\t73\t0\t1\t0\t74\nFair value changes in mortgage servicing rights financing liability\t0\t6\t0\t0\t0\t6\nAmortization of premiums net of discount accretion\t0\t9\t0\t(3)\t0\t6\nDepreciation and amortization for property and equipment and intangible assets\t0\t23\t0\t6\t0\t29\nShare-based compensation\t0\t7\t0\t1\t0\t8\nOther (gain) loss\t0\t3\t0\t(1)\t0\t2\nRepurchases of forward loans assets out of Ginnie Mae securitizations\t0\t(475)\t0\t0\t0\t(475)\nMortgage loans originated and purchased for sale net of fees\t0\t(10639)\t0\t0\t0\t(10639)\nSales proceeds and loan payment proceeds for mortgage loans held for sale and held for investment\t0\t11490\t0\t10\t0\t11500\nExcess tax deficiency from share-based compensation\t0\t(1)\t0\t0\t0\t(1)\nChanges in assets and liabilities:\t\t\t\t\t\t\nAdvances and other receivables\t0\t355\t0\t0\t0\t355\nReverse mortgage interests\t0\t1314\t0\t12\t0\t1326\nOther assets\t6\t(188)\t(10)\t202\t0\t10\nPayables and accrued liabilities\t0\t52\t0\t(4)\t0\t48\nNet cash attributable to operating activities\t6\t1608\t0\t255\t0\t1869\n", "q10k_tbl_50": "NATIONSTAR MORTGAGE HOLDINGS INC. CONSOLIDATING STATEMENT OF CASH FLOWS SIX MONTHS ENDED JUNE 30 2018 (Continued)\t\t\t\t\t\t\n\tNationstar\tIssuer(1)\tGuarantor (Subsidiaries of Issuer)\tNon-Guarantor (Subsidiaries of Issuer)\tEliminations\tConsolidated\nInvesting Activities\t\t\t\t\t\t\nProperty and equipment additions net of disposals\t0\t(27)\t0\t(4)\t0\t(31)\nPurchase of forward mortgage servicing rights net of liabilities incurred\t0\t(117)\t0\t(6)\t0\t(123)\nNet payment related to acquisition of HECM related receivables\t0\t(1)\t0\t0\t0\t(1)\nProceeds on sale of assets\t0\t0\t0\t13\t0\t13\nNet cash attributable to investing activities\t0\t(145)\t0\t3\t0\t(142)\nFinancing Activities\t\t\t\t\t\t\nDecrease in warehouse facilities\t0\t(199)\t0\t0\t0\t(199)\nDecrease in advance facilities\t0\t(57)\t0\t(282)\t0\t(339)\nProceeds from issuance of HECM securitizations\t0\t0\t0\t443\t0\t443\nRepayment of HECM securitizations\t0\t0\t0\t(423)\t0\t(423)\nProceeds from issuance of participating interest financing in reverse mortgage interests\t0\t184\t0\t0\t0\t184\nRepayment of participating interest financing in reverse mortgage interests\t0\t(1368)\t0\t0\t0\t(1368)\nIssuance of excess spread financing\t0\t70\t0\t0\t0\t70\nRepayment of excess spread financing\t0\t(93)\t0\t0\t0\t(93)\nRepayment of nonrecourse debt - legacy assets\t0\t0\t0\t(6)\t0\t(6)\nRepurchase of unsecured senior notes\t0\t(62)\t0\t0\t0\t(62)\nSurrender of shares relating to stock vesting\t(6)\t0\t0\t0\t0\t(6)\nDebt financing costs\t0\t(7)\t0\t0\t0\t(7)\nDividends to non-controlling interests\t0\t(1)\t0\t0\t0\t(1)\nNet cash attributable to financing activities\t(6)\t(1533)\t0\t(268)\t0\t(1807)\nNet decrease in cash cash equivalents and restricted cash\t0\t(70)\t0\t(10)\t0\t(80)\nCash cash equivalents and restricted cash - beginning of period\t0\t423\t1\t151\t0\t575\nCash cash equivalents and restricted cash - end of period\t0\t353\t1\t141\t0\t495\n", "q10k_tbl_51": "NATIONSTAR MORTGAGE HOLDINGS INC. CONSOLIDATING BALANCE SHEET DECEMBER 31 2017\t\t\t\t\t\t\n\tNationstar\tIssuer(1)\tGuarantor (Subsidiaries of Issuer)\tNon-Guarantor (Subsidiaries of Issuer)\tEliminations\tConsolidated\nAssets\t\t\t\t\t\t\nCash and cash equivalents\t0\t195\t1\t19\t0\t215\nRestricted cash\t0\t228\t0\t132\t0\t360\nMortgage servicing rights\t0\t2910\t0\t31\t0\t2941\nAdvances and other receivables net\t0\t1706\t0\t0\t0\t1706\nReverse mortgage interests net\t0\t9110\t0\t874\t0\t9984\nMortgage loans held for sale at fair value\t0\t1891\t0\t0\t0\t1891\nMortgage loans held for investment net\t0\t1\t0\t138\t0\t139\nProperty and equipment net\t0\t102\t0\t19\t0\t121\nDerivative financial instruments at fair value\t0\t65\t0\t0\t0\t65\nOther assets\t0\t520\t182\t779\t(867)\t614\nInvestment in subsidiaries\t1846\t522\t0\t0\t(2368)\t0\nTotal assets\t1846\t17250\t183\t1992\t(3235)\t18036\nLiabilities and Stockholders' Equity\t\t\t\t\t\t\nUnsecured senior notes net\t0\t1874\t0\t0\t0\t1874\nAdvance facilities net\t0\t106\t0\t749\t0\t855\nWarehouse facilities net\t0\t3285\t0\t0\t0\t3285\nPayables and accrued liabilities\t0\t1197\t1\t36\t0\t1234\nMSR related liabilities - nonrecourse at fair value\t0\t987\t0\t19\t0\t1006\nMortgage servicing liabilities\t0\t41\t0\t0\t0\t41\nDerivative financial instruments at fair value\t0\t5\t0\t0\t0\t5\nOther nonrecourse debt net\t0\t7167\t0\t847\t0\t8014\nPayables to affiliates\t124\t742\t0\t1\t(867)\t0\nTotal liabilities\t124\t15404\t1\t1652\t(867)\t16314\nTotal stockholders' equity\t1722\t1846\t182\t340\t(2368)\t1722\nTotal liabilities and stockholders' equity\t1846\t17250\t183\t1992\t(3235)\t18036\n", "q10k_tbl_52": "NATIONSTAR MORTGAGE HOLDINGS INC. CONSOLIDATING STATEMENT OF OPERATIONS THREE MONTHS ENDED JUNE 30 2017\t\t\t\t\t\t\n\tNationstar\tIssuer(1)\tGuarantor (Subsidiaries of Issuer)\tNon-Guarantor (Subsidiaries of Issuer)\tEliminations\tConsolidated\nRevenues:\t\t\t\t\t\t\nService related net\t0\t131\t9\t73\t0\t213\nNet gain on mortgage loans held for sale\t0\t167\t0\t0\t0\t167\nTotal revenues\t0\t298\t9\t73\t0\t380\nExpenses:\t\t\t\t\t\t\nSalaries wages and benefits\t0\t145\t1\t36\t0\t182\nGeneral and administrative\t0\t145\t5\t35\t0\t185\nTotal expenses\t0\t290\t6\t71\t0\t367\nOther income (expenses):\t\t\t\t\t\t\nInterest income\t0\t124\t0\t15\t0\t139\nInterest expense\t0\t(174)\t0\t(14)\t0\t(188)\nOther expenses\t0\t(1)\t0\t8\t0\t7\nGain (loss) from subsidiaries\t(20)\t14\t0\t0\t6\t0\nTotal other income (expenses) net\t(20)\t(37)\t0\t9\t6\t(42)\nIncome (loss) before income tax expense (benefit)\t(20)\t(29)\t3\t11\t6\t(29)\nLess: Income tax benefit\t0\t(10)\t0\t0\t0\t(10)\nNet income (loss)\t(20)\t(19)\t3\t11\t6\t(19)\nLess: Net income attributable to non-controlling interests\t0\t1\t0\t0\t0\t1\nNet income (loss) attributable to Nationstar\t(20)\t(20)\t3\t11\t6\t(20)\n", "q10k_tbl_53": "NATIONSTAR MORTGAGE HOLDINGS INC. CONSOLIDATING STATEMENT OF OPERATIONS SIX MONTHS ENDED JUNE 30 2017\t\t\t\t\t\t\n\tNationstar\tIssuer(1)\tGuarantor (Subsidiaries of Issuer)\tNon-Guarantor (Subsidiaries of Issuer)\tEliminations\tConsolidated\nRevenues:\t\t\t\t\t\t\nService related net\t0\t316\t14\t166\t0\t496\nNet gain on mortgage loans held for sale\t0\t310\t0\t1\t0\t311\nTotal Revenues\t0\t626\t14\t167\t0\t807\nExpenses:\t\t\t\t\t\t\nSalaries wages and benefits\t0\t298\t2\t74\t0\t374\nGeneral and administrative\t0\t280\t7\t75\t0\t362\nTotal expenses\t0\t578\t9\t149\t0\t736\nOther income (expenses):\t\t\t\t\t\t\nInterest income\t0\t251\t0\t27\t0\t278\nInterest expense\t0\t(352)\t0\t(29)\t0\t(381)\nOther expense\t0\t(2)\t0\t8\t0\t6\nGain (loss) from subsidiaries\t(18)\t29\t0\t0\t(11)\t0\nTotal other income (expenses) net\t(18)\t(74)\t0\t6\t(11)\t(97)\nIncome (loss) before taxes\t(18)\t(26)\t5\t24\t(11)\t(26)\nIncome tax benefit\t0\t(9)\t0\t0\t0\t(9)\nNet income (loss)\t(18)\t(17)\t5\t24\t(11)\t(17)\nLess: net income attributable to non-controlling interests\t0\t1\t0\t0\t0\t1\nNet income (loss) attributable to Nationstar\t(18)\t(18)\t5\t24\t(11)\t(18)\n", "q10k_tbl_54": "NATIONSTAR MORTGAGE HOLDINGS INC. CONSOLIDATING STATEMENT OF CASH FLOWS SIX MONTHS ENDED JUNE 30 2017\t\t\t\t\t\t\n\tNationstar\tIssuer(1)\tGuarantor (Subsidiaries of Issuer)\tNon-Guarantor (Subsidiaries of Issuer)\tEliminations\tConsolidated\nOperating Activities\t\t\t\t\t\t\nNet income (loss) attributable to Nationstar\t(18)\t(18)\t5\t24\t(11)\t(18)\nAdjustments to reconcile net income (loss) to net cash attributable to operating activities:\t\t\t\t\t\t\nNet income attributable to non-controlling interests\t0\t1\t0\t0\t0\t1\n(Gain) loss from subsidiaries\t18\t(29)\t0\t0\t11\t0\nNet gain on mortgage loans held for sale\t0\t(310)\t0\t(1)\t0\t(311)\nReverse mortgage loan interest income\t0\t(233)\t0\t0\t0\t(233)\n(Gain) loss on sale of assets\t0\t0\t0\t(8)\t0\t(8)\nProvision for servicing reserves\t0\t59\t0\t0\t0\t59\nFair value changes and amortization of mortgage servicing rights\t0\t233\t0\t0\t0\t233\nFair value changes in excess spread financing\t0\t16\t0\t(1)\t0\t15\nFair value changes in mortgage servicing rights financing liability\t0\t(14)\t0\t0\t0\t(14)\nAmortization of premiums net of discount accretion\t0\t(4271)\t0\t4298\t0\t27\nDepreciation and amortization for property and equipment and intangible assets\t0\t21\t0\t8\t0\t29\nShare-based compensation\t0\t6\t0\t3\t0\t9\nOther loss\t0\t9\t0\t0\t0\t9\nRepurchases of forward loans assets out of Ginnie Mae securitizations\t0\t(599)\t0\t0\t0\t(599)\nMortgage loans originated and purchased for sale net of fees\t0\t(8896)\t0\t0\t0\t(8896)\nSale proceeds and loan payment proceeds for mortgage loans held for sale and held for investment\t0\t14290\t0\t(4284)\t0\t10006\nExcess tax benefit from share-based compensation\t0\t(1)\t0\t0\t0\t(1)\nChanges in assets and liabilities:\t\t\t\t\t\t\nAdvances and other receivables\t0\t118\t0\t0\t0\t118\nReverse mortgage interests\t0\t926\t0\t(157)\t0\t769\nOther assets\t5\t(164)\t(6)\t189\t0\t24\nPayables and accrued liabilities\t0\t(337)\t0\t(11)\t0\t(348)\nNet cash attributable to operating activities\t5\t807\t(1)\t60\t0\t871\n", "q10k_tbl_55": "NATIONSTAR MORTGAGE HOLDINGS INC. CONSOLIDATING STATEMENT OF CASH FLOWS SIX MONTHS ENDED JUNE 30 2017 (Continued)\t\t\t\t\t\t\n\tNationstar\tIssuer(1)\tGuarantor (Subsidiaries of Issuer)\tNon-Guarantor (Subsidiaries of Issuer)\tEliminations\tConsolidated\nInvesting Activities\t\t\t\t\t\t\nProperty and equipment additions net of disposals\t0\t(23)\t0\t(2)\t0\t(25)\nPurchase of forward mortgage servicing rights net of liabilities incurred\t0\t(6)\t0\t(7)\t0\t(13)\nProceeds on sale of forward and reverse mortgage servicing rights\t0\t(2)\t0\t0\t0\t(2)\nProceeds on sale of assets\t0\t16\t0\t0\t0\t16\nNet cash attributable to investing activities\t0\t(15)\t0\t(9)\t0\t(24)\nFinancing Activities\t\t\t\t\t\t\nIncrease in warehouse facilities\t0\t100\t0\t0\t0\t100\nDecrease in advance facilities\t0\t(76)\t0\t(138)\t0\t(214)\nProceeds from issuance of HECM securitizations\t0\t0\t0\t308\t0\t308\nRepayment of HECM securitizations\t0\t(1)\t0\t(175)\t0\t(176)\nProceeds from issuance of participating interest financing in reverse mortgage interests\t0\t355\t0\t0\t0\t355\nRepayment of participating interest financing in reverse mortgage interests\t0\t(1260)\t0\t0\t0\t(1260)\nRepayment of excess spread financing\t0\t(109)\t0\t0\t0\t(109)\nRepayment of nonrecourse debt - legacy assets\t0\t0\t0\t(9)\t0\t(9)\nRepurchase of unsecured senior notes\t0\t(95)\t0\t0\t0\t(95)\nSurrender of shares relating to stock vesting\t(5)\t0\t0\t0\t0\t(5)\nDebt financing costs\t0\t(6)\t0\t0\t0\t(6)\nDividends to non-controlling interests\t0\t(5)\t0\t0\t0\t(5)\nNet cash attributable to financing activities\t(5)\t(1097)\t0\t(14)\t0\t(1116)\nNet increase (decrease) in cash cash equivalents and restricted cash\t0\t(305)\t(1)\t37\t0\t(269)\nCash cash equivalents and restricted cash - beginning of period\t0\t612\t2\t263\t0\t877\nCash cash equivalents and restricted cash - end of period\t0\t307\t1\t300\t0\t608\n", "q10k_tbl_56": "Table 1. Consolidated Operations\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nRevenues - operational(1)\t425\t464\t861\t923\nRevenues - Mark-to-market(1)\t19\t(84)\t171\t(116)\nTotal revenues\t444\t380\t1032\t807\nExpenses\t339\t367\t703\t736\nOther income (expenses) net\t(26)\t(42)\t(44)\t(97)\nIncome before income tax expense\t79\t(29)\t285\t(26)\nLess: Income tax expense\t21\t(10)\t67\t(9)\nNet income\t58\t(19)\t218\t(17)\nLess: Income attributable to non-controlling interests\t0\t1\t0\t1\nNet income attributable to Nationstar\t58\t(20)\t218\t(18)\nEffective tax rate\t26.5%\t33.1%\t23.6%\t32.8%\nIncome (loss) before income tax expense by operating and non-operating segments:\t\t\t\t\nServicing\t88\t(42)\t308\t(16)\nOriginations\t32\t53\t51\t78\nXome\t10\t17\t32\t30\nCorporate and other\t(51)\t(57)\t(106)\t(118)\nConsolidated income before income tax expense\t79\t(29)\t285\t(26)\n", "q10k_tbl_57": "Table 2. Servicing Operations\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nRevenues\t\t\t\t\nOperational(1)\t277\t296\t568\t589\nAmortization\t(48)\t(66)\t(96)\t(127)\nMark-to-market(1)\t19\t(84)\t171\t(116)\nTotal revenues\t248\t146\t643\t346\nExpenses\t166\t173\t348\t328\nTotal other income (expenses) net\t6\t(15)\t13\t(34)\nIncome before income tax expense\t88\t(42)\t308\t(16)\n", "q10k_tbl_58": "Table 3. Forward Servicing and Subservicing Portfolio UPB Rollforward\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nBalance - beginning of period\t466401\t431825\t473256\t434295\nAdditions:\t\t\t\t\nOriginations\t5545\t4256\t10633\t9154\nAcquisitions\t14655\t47513\t20804\t60826\nDeductions:\t\t\t\t\nDispositions\t(1739)\t(424)\t(1793)\t(2105)\nPrincipal reductions and other\t(4724)\t(4342)\t(9659)\t(7974)\nVoluntary reductions(1)\t(13166)\t(14839)\t(24829)\t(27930)\nInvoluntary reductions(2)\t(1478)\t(1931)\t(2823)\t(4093)\nNet changes in loans serviced by others\t(96)\t(185)\t(191)\t(300)\nBalance - end of period\t465398\t461873\t465398\t461873\n", "q10k_tbl_59": "Table 4. Servicing - Revenues\tThree Months Ended June 30\t\t\t\tSix Months Ended June 30\t\t\t\n\t2018\t\t2017\t\t2018\t\t2017\t\n\tAmounts\tbps(1)\tAmounts\tbps(1)\tAmounts\tbps(1)\tAmounts\tbps(1)\nForward MSR Operational Revenue\t\t\t\t\t\t\t\t\nBase servicing fees\t214\t17\t229\t19\t433\t17\t464\t19\nModification fees(2)\t13\t1\t12\t0\t20\t1\t28\t1\nIncentive fees(2)\t4\t0\t8\t0\t11\t0\t13\t1\nLate payment fees(2)\t19\t2\t20\t2\t39\t2\t44\t2\nOther ancillary revenues(2)(3)\t26\t2\t44\t4\t53\t2\t82\t3\nTotal forward MSR operational revenue\t276\t22\t313\t25\t556\t22\t631\t26\nBase subservicing fees and other subservicing revenue(2)\t37\t3\t29\t3\t74\t3\t52\t2\nReverse servicing fees\t14\t1\t13\t1\t33\t1\t27\t1\nTotal servicing fee revenue\t327\t26\t355\t29\t663\t26\t710\t29\nAmortization\t\t\t\t\t\t\t\t\nForward MSR amortization\t(84)\t(7)\t(105)\t(8)\t(162)\t(7)\t(207)\t(8)\nExcess spread accretion\t36\t3\t40\t3\t66\t3\t82\t3\nReverse MSR amortization\t0\t0\t(1)\t0\t0\t0\t(2)\t0\nTotal amortization\t(48)\t(4)\t(66)\t(5)\t(96)\t(4)\t(127)\t(5)\nMSR financing liability costs\t(14)\t(1)\t(19)\t(2)\t(29)\t(1)\t(39)\t(2)\nExcess spread costs - principal\t(36)\t(2)\t(40)\t(3)\t(66)\t(2)\t(82)\t(3)\nTotal operational revenue\t229\t19\t230\t19\t472\t19\t462\t19\nMark-to-Market Adjustments\t\t\t\t\t\t\t\t\nMSR MTM(3)(4)\t25\t2\t(108)\t(9)\t251\t10\t(114)\t(5)\nExcess spread / financing MTM\t(6)\t0\t24\t2\t(80)\t(3)\t(2)\t0\nTotal MTM adjustments\t19\t2\t(84)\t(7)\t171\t7\t(116)\t(5)\nTotal revenues - Servicing\t248\t21\t146\t12\t643\t26\t346\t14\n", "q10k_tbl_60": "Table 5. Servicing Portfolio - Unpaid Principal Balances\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nAverage UPB:\t\t\t\t\nForward MSRs\t277297\t302243\t279504\t306513\nSubservicing and other(1)\t187068\t154704\t187663\t137931\nReverse portfolio\t32873\t36868\t33651\t37639\nTotal average UPB\t497238\t493815\t500818\t482083\n\t\t\tJune 30\t\n\t\t\t2018\t2017\nEnding UPB:\t\t\t\t\nForward MSRs\t\t\t\t\nAgency\t\t\t206017\t217964\nNon-agency\t\t\t72088\t78380\nTotal Forward MSRs\t\t\t278105\t296344\nSubservicing and other(1)\t\t\t\t\nAgency\t\t\t178236\t156597\nNon-agency\t\t\t9057\t8932\nTotal subservicing and other\t\t\t187293\t165529\nReverse loans\t\t\t\t\nMSL(2)\t\t\t22777\t25712\nSecuritized loans\t\t\t9487\t10589\nTotal reverse portfolio serviced\t\t\t32264\t36301\nTotal ending UPB\t\t\t497662\t498174\n", "q10k_tbl_61": "Table 6. Forward Loan Modifications and Workout Units\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nHome Affordable Modification Program (\"HAMP\") modifications\t9\t2243\t31\t6575\nNon-HAMP modifications\t7547\t5505\t13382\t11320\nWorkouts(1)\t7159\t7274\t21252\t14879\nTotal modification and workout units\t14715\t15022\t34665\t32774\n", "q10k_tbl_62": "Table 7. Key Performance Metrics - Forward Servicing and Subservicing Portfolio(1)\tJune 30\t\n\t2018\t2017\nLoan count\t2970692\t2815303\nAverage loan amount(2)\t156688\t164087\nAverage coupon - credit sensitive(3)\t4.8%\t4.7%\nAverage coupon - interest sensitive(3)\t4.2%\t4.2%\n60+ delinquent (% of loans)(4)\t2.8%\t3.5%\n90+ delinquent (% of loans)(4)\t2.5%\t3.2%\n120+ delinquent (% of loans)(4)\t2.3%\t2.9%\nTotal prepayment speed (12 month constant pre-payment rate)\t12.1%\t14.2%\n", "q10k_tbl_63": "Table 8. Servicer Ratings\tFitch\tMoody's\tS&P\nRating date\tAugust 2017\tJune 2017\tJanuary & February 2018\nResidential\tRPS2-\tNot Rated\tAbove Average\nMaster Servicer\tRMS2+\tSQ2-\tAbove Average\nSpecial Servicer\tRSS2-\tNot Rated\tAbove Average\nSubprime Servicer\tRPS2-\tNot Rated\tAbove Average\nFitch Rating Scale of 1 (Highest Performance) to 5 (Low/No Proficiency)\t\t\t\nMoody's Rating Scale of SQ1 (Strong Ability/Stability) to SQ5 (Weak Ability/Stability)\t\t\t\nS&P's Rating Scale of Strong to Weak\t\t\t\n", "q10k_tbl_64": "Table 9. Servicing - Expenses\tThree Months Ended June 30\t\t\t\tSix Months Ended June 30\t\t\t\n\t2018\t\t2017\t\t2018\t\t2017\t\n\tAmounts\tbps\tAmounts\tbps\tAmounts\tbps\tAmounts\tbps\nSalaries wages and benefits\t74\t6\t73\t6\t150\t6\t142\t6\nGeneral and administrative\t\t\t\t\t\t\t\t\nServicing support fees\t35\t3\t38\t3\t62\t2\t71\t3\nCorporate and other general and administrative expenses\t32\t2\t33\t3\t63\t3\t66\t2\nForeclosure and other liquidation related expenses\t19\t2\t24\t2\t60\t2\t39\t2\nDepreciation and amortization\t6\t0\t5\t0\t13\t1\t10\t0\nTotal general and administrative expenses\t92\t7\t100\t8\t198\t8\t186\t7\nTotal expenses - Servicing\t166\t13\t173\t14\t348\t14\t328\t13\n", "q10k_tbl_65": "Table 10. Servicing - Other Income (Expenses) Net\tThree Months Ended June 30\t\t\t\tSix Months Ended June 30\t\t\t\n\t2018\t\t2017\t\t2018\t\t2017\t\n\tAmounts\tbps\tAmounts\tbps\tAmounts\tbps\tAmounts\tbps\nReverse mortgage interest income\t118\t10\t115\t9\t237\t10\t233\t10\nOther interest income\t3\t0\t8\t1\t10\t0\t10\t0\nInterest income\t121\t10\t123\t10\t247\t10\t243\t10\nReverse mortgage interest expense\t(95)\t(8)\t(99)\t(8)\t(191)\t(7)\t(198)\t(8)\nAdvance interest expense\t(12)\t(1)\t(9)\t(1)\t(17)\t(1)\t(18)\t(1)\nOther interest expense\t(8)\t(1)\t(30)\t(2)\t(25)\t(1)\t(61)\t(2)\nInterest expense\t(115)\t(10)\t(138)\t(11)\t(233)\t(9)\t(277)\t(11)\nOther expense\t0\t0\t0\t0\t(1)\t0\t0\t0\nTotal other income (expenses) net - Servicing\t6\t0\t(15)\t(1)\t13\t1\t(34)\t(1)\nWeighted average cost - advance facilities\t4.0%\t\t3.1%\t\t3.9%\t\t3.1%\t\nWeighted average cost - excess spread financing\t8.8%\t\t8.9%\t\t8.9%\t\t8.9%\t\n", "q10k_tbl_66": "Table 11. Serviced Portfolios and Related Liabilities\tJune 30 2018\t\t\tDecember 31 2017\t\t\n\tUPB\tCarrying Amount\tWeighted Avg. Coupon\tUPB\tCarrying Amount\tWeighted Avg. Coupon\nForward MSRs - fair value\t\t\t\t\t\t\nAgency\t206017\t2647\t4.5%\t202868\t2251\t4.5%\nNon-agency\t72088\t709\t4.7%\t78512\t686\t4.6%\nTotal Forward MSRs - fair value\t278105\t3356\t4.5%\t281380\t2937\t4.5%\nSubservicing and other(1)\t\t\t\t\t\t\nAgency\t178236\tN/A\tN/A\t183519\tN/A\tN/A\nNon-agency\t9057\tN/A\tN/A\t8357\tN/A\tN/A\nTotal subservicing and other\t187293\tN/A\tN/A\t191876\tN/A\tN/A\nReverse portfolio - amortized cost\t\t\t\t\t\t\nMSL(2)\t22777\t(27)\tN/A\t25124\t(37)\tN/A\nSecuritized loans\t9487\t9477\tN/A\t9988\t9984\tN/A\nTotal reverse portfolio serviced\t32264\t9450\tN/A\t35112\t9947\tN/A\nTotal servicing portfolio unpaid principal balance\t497662\t12806\tN/A\t508368\t12884\tN/A\n", "q10k_tbl_67": "Table 12. Fair Value MSR Valuation\tJune 30 2018\t\t\tDecember 31 2017\t\t\n\tUPB\tCarrying Amount\tbps\tUPB\tCarrying Amount\tbps\nMSRs - fair value\t\t\t\t\t\t\nCredit sensitive\t153552\t1695\t110\t167605\t1572\t94\nInterest sensitive - agency\t124553\t1661\t133\t113775\t1365\t120\nTotal MSRs - fair value\t278105\t3356\t121\t281380\t2937\t104\n", "q10k_tbl_68": "Table 13. MSRs - Fair Value Roll Forward\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nFair value - beginning of period\t3194\t3168\t2937\t3160\nAdditions:\t\t\t\t\nServicing retained from mortgage loans sold\t71\t44\t139\t103\nPurchases of servicing rights\t113\t8\t132\t13\nDispositions:\t\t\t\t\nSales of servicing rights(1)\t4\t2\t4\t2\nChanges in fair value:\t\t\t\t\nDue to changes in valuation inputs or assumptions used in the valuation model:\t\t\t\t\nCredit sensitive\t11\t(46)\t192\t(9)\nInterest sensitive\t33\t(42)\t91\t(65)\nOther changes in fair value:\t\t\t\t\nScheduled principal payments\t(19)\t(20)\t(38)\t(42)\nDisposition of negative MSRs and other(2)\t14\t15\t23\t48\nPrepayments\t\t\t\t\nVoluntary prepayments\t\t\t\t\nCredit sensitive\t(31)\t(45)\t(61)\t(89)\nInterest sensitive\t(25)\t(27)\t(46)\t(50)\nInvoluntary prepayments\t\t\t\t\nCredit sensitive\t(5)\t(7)\t(10)\t(16)\nInterest sensitive\t(4)\t(4)\t(7)\t(9)\nFair value - end of period\t3356\t3046\t3356\t3046\n", "q10k_tbl_69": "Table 14. MSRs - Fair Value\tJune 30\t\n\t2018\t2017\nCredit Sensitive MSRs\t\t\nDiscount rate%\t11.4\t11.4%\nWeighted average prepayment speeds%\t11.7\t15.8%\nWeighted average life of loans\t6.6 years\t5.9 years\nInterest Sensitive MSRs\t\t\nDiscount rate%\t9.2\t9.2%\nWeighted average prepayment speeds%\t9.8\t11.3%\nWeighted average life of loans\t7.0 years\t6.5 years\n", "q10k_tbl_70": "Table 15. Excess Spread Financing\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nFair value - beginning of period\t1001\t1181\t996\t1214\nAdditions:\t\t\t\t\nNew financings\t70\t0\t70\t0\nDeductions:\t\t\t\t\nRepayments of debt\t(2)\t0\t(2)\t0\nSettlements of principal balances\t(46)\t(50)\t(91)\t(108)\nFair value changes:\t\t\t\t\nCredit Sensitive\t20\t(3)\t66\t17\nInterest Sensitive\t4\t(7)\t8\t(2)\nFair value - end of period\t1047\t1121\t1047\t1121\n\t\t\tJune 30\t\nKey Assumptions\t\t\t2018\t2017\nWeighted average prepayment speeds\t\t\t11.1%\t14.3%\nWeighted average life of loans\t\t\t6.5 years\t6.1 years\nDiscount rate\t\t\t10.6%\t10.8%\nCredit Sensitive\t\t\t\t\nMortgage prepayment speeds\t\t\t11.4%\t14.9%\nAverage life of mortgage loans\t\t\t6.5 years\t6.0 years\nDiscount rate\t\t\t11.1%\t11.1%\nInterest Sensitive\t\t\t\t\nMortgage prepayment speeds\t\t\t9.9%\t11.5%\nAverage life of mortgage loans\t\t\t6.8 years\t6.3 years\nDiscount rate\t\t\t9.0%\t9.0%\n", "q10k_tbl_71": "Table 16. MSRs Financing Liability - Rollforward\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nFair value - beginning of period\t34\t28\t10\t27\nChanges in fair value:(1)\t\t\t\t\nChanges in valuation inputs or assumptions used in the valuation model\t(14)\t(16)\t11\t(15)\nOther changes in fair value\t(4)\t1\t(5)\t1\nFair value - end of period\t16\t13\t16\t13\n\t\t\tJune 30\t\n\t\t\t2018\t2017\nWeighted Average Assumptions\t\t\t\t\nAdvance financing rates\t\t\t4.1%\t3.4%\nAnnual advance recovery rates\t\t\t18.9%\t26.0%\n", "q10k_tbl_72": "Table 17. Leveraged Portfolio Characteristics\tJune 30\t\n\t2018\t2017\nOwned forward servicing portfolio - unencumbered\t91619\t78178\nOwned forward servicing portfolio - encumbered\t186486\t218166\nSubserviced forward servicing portfolio and other\t187293\t165529\nTotal unpaid principal balance\t465398\t461873\n", "q10k_tbl_73": "Table 18. Reverse - Mortgage Portfolio Characteristics\tJune 30 2018\tDecember 31 2017\nLoan count\t205438\t212415\nEnding unpaid principal balance\t32264\t35112\nAverage loan amount(1)\t157050\t165299\nAverage coupon\t4.2%\t3.8%\nAverage borrower age\t79\t79\n", "q10k_tbl_74": "Table 19. Originations - Operations\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nRevenues\t133\t158\t261\t299\nExpenses\t102\t103\t211\t220\nOther income (expenses) net\t1\t(2)\t1\t(1)\nIncome before income tax expense\t32\t53\t51\t78\nIncome before taxes margin\t24.1%\t33.5%\t19.5%\t26.1%\n\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nRevenue\t133\t158\t261\t299\nPull through adjusted lock volume\t5440\t4200\t10302\t8008\nRevenue basis points(1)\t2.44%\t3.76%\t2.53%\t3.73%\nExpenses\t102\t103\t211\t220\nFunded volume\t5543\t4254\t10630\t8887\nExpenses basis points(2)\t1.84%\t2.42%\t1.98%\t2.48%\nMargin\t0.60%\t1.34%\t0.55%\t1.25%\n", "q10k_tbl_75": "Table 20. Originations - Revenues\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nService related net - Originations\t17\t15\t32\t31\nNet gain on mortgage loans held for sale\t\t\t\t\nGain on loans originated and sold\t45\t106\t101\t204\nFair value adjustment on loans held for sale\t6\t(10)\t1\t10\nMark-to-market on locks and commitments(1)\t3\t(10)\t2\t(22)\nMark-to-market on derivative/hedges\t(6)\t16\t(8)\t(24)\nCapitalized servicing rights\t69\t40\t134\t97\nProvision of repurchase reserves net of release\t(1)\t1\t(1)\t3\nTotal net gain on mortgage loans held for sale\t116\t143\t229\t268\nTotal revenues - Originations\t133\t158\t261\t299\nKey Metrics\t\t\t\t\nConsumer direct lock pull through adjusted volume(2)\t2552\t2769\t5294\t5463\nOther locked pull through adjusted volume(2)\t2888\t1431\t5008\t2545\nTotal pull through adjusted volume\t5440\t4200\t10302\t8008\nFunded volume\t5543\t4254\t10630\t8887\nFunded HARP volume\t324\t937\t760\t2160\nRecapture percentage\t21.8%\t24.2%\t24.3%\t28.0%\nPurchase percentage of funded volume\t51.3%\t28.6%\t45.8%\t24.2%\nValue of capitalized servicing\t126 bps\t96 bps\t125 bps\t106 bps\n", "q10k_tbl_76": "Table 21. Originations - Expenses\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nSalaries wages and benefits\t61\t59\t127\t129\nGeneral and administrative\t\t\t\t\nLoan origination expenses\t13\t13\t27\t33\nCorporate and other general and administrative expenses\t12\t14\t23\t26\nMarketing and professional service fee\t13\t14\t28\t27\nDepreciation and amortization\t3\t3\t6\t5\nTotal general and administrative\t41\t44\t84\t91\nTotal expenses - Originations\t102\t103\t211\t220\n", "q10k_tbl_77": "Table 22. Originations - Other Income (Expenses) Net\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nInterest income\t17\t11\t32\t25\nInterest expense\t(16)\t(13)\t(31)\t(26)\nTotal other income net - Originations\t1\t(2)\t1\t(1)\nWeighted average note rate - mortgage loans held for sale\t4.7%\t4.2%\t4.5%\t4.2%\nWeighted average cost of funds (excluding facility fees)\t4.4%\t3.5%\t4.2%\t3.4%\n", "q10k_tbl_78": "Table 23. Repurchase Reserves\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nRepurchase reserves - beginning of period\t9\t15\t9\t18\nProvisions\t2\t1\t3\t3\nReleases\t(2)\t(2)\t(3)\t(6)\nCharge-offs\t0\t0\t0\t(1)\nRepurchase reserves - end of period\t9\t14\t9\t14\n", "q10k_tbl_79": "Table 24. Xome - Operations\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nRevenues\t62\t76\t127\t161\nExpenses\t52\t67\t104\t139\nOther income (expenses) net\t0\t8\t9\t8\nIncome before income tax expense\t10\t17\t32\t30\nIncome before taxes margin - Xome\t16.1%\t22.4%\t25.2%\t18.6%\n", "q10k_tbl_80": "Table 25. Xome - Revenues\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nExchange\t27\t27\t53\t58\nServices\t30\t41\t63\t88\nSaaS\t5\t8\t11\t15\nTotal revenues - Xome\t62\t76\t127\t161\nKey Metrics\t\t\t\t\nProperty listings sold\t3112\t3074\t5992\t6488\nREO listings at period end\t3619\t4174\t3619\t4174\nXome services completed orders\t117093\t107220\t228432\t226970\nPercentage of revenue earned from third party customers(1)\t28.0%\t21.6%\t27.5%\t23.8%\n", "q10k_tbl_81": "Table 26. Xome - Expenses\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nSalaries wages and benefits\t25\t34\t49\t71\nGeneral and administrative\t\t\t\t\nOperational expenses\t24\t28\t49\t59\nDepreciation and amortization\t3\t3\t6\t7\nLoss on impairment of assets\t0\t2\t0\t2\nTotal general and administrative\t27\t33\t55\t68\nTotal expenses - Xome\t52\t67\t104\t139\n", "q10k_tbl_82": "Table 27. Corporate and Other - Operations\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nRevenues\t1\t0\t1\t1\nExpenses\t19\t24\t40\t49\nOther income (expenses) net\t(33)\t(33)\t(67)\t(70)\nLoss before income tax benefit\t(51)\t(57)\t(106)\t(118)\n", "q10k_tbl_83": "Table 28. Legacy Portfolio\tJune 30 2018\tDecember 31 2017\nPerforming - UPB\t145\t153\nNonperforming (90+ delinquency) - UPB\t37\t39\nREO - estimated fair value\t2\t1\nTotal legacy portfolio\t184\t193\n", "q10k_tbl_84": "Table 29. Corporate and Other - Expenses\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nSalaries wages and benefits\t17\t16\t31\t30\nGeneral and administrative\t\t\t\t\nOperational expenses\t0\t4\t5\t12\nDepreciation and amortization\t2\t4\t4\t7\nTotal general and administrative\t2\t8\t9\t19\nTotal expenses - Corporate and Other\t19\t24\t40\t49\n", "q10k_tbl_85": "Table 30. Corporate and Other - Other Income (Expenses) Net\tThree Months Ended June 30\t\tSix Months Ended June 30\t\n\t2018\t2017\t2018\t2017\nInterest income legacy portfolio\t3\t5\t6\t10\nInterest expense legacy portfolio\t(1)\t(1)\t(2)\t(3)\nInterest expense on unsecured senior notes\t(31)\t(36)\t(66)\t(73)\nOther interest net\t(2)\t0\t(3)\t(2)\nTotal interest expense\t(34)\t(37)\t(71)\t(78)\nOther income (expense)\t(2)\t(1)\t(2)\t(2)\nOther income (expenses) net - Corporate and Other\t(33)\t(33)\t(67)\t(70)\nWeighted average cost - unsecured senior notes\t7.3%\t7.4%\t7.3%\t7.4%\n", "q10k_tbl_86": "Table 31. Assets\tJune 30 2018\tDecember 31 2017\t% Change\nCash and cash equivalents\t185\t215\t(14.0)%\nMortgage servicing rights\t3356\t2941\t14.1%\nAdvances and other receivables net\t1317\t1706\t(22.8)%\nReverse mortgage interests net\t9477\t9984\t(5.1)%\nMortgage loans held for sale at fair value\t1635\t1891\t(13.5)%\nOther\t1220\t1299\t(6.1)%\nTotal assets\t17190\t18036\t(4.7)%\n", "q10k_tbl_87": "Table 32. Liabilities and Stockholders' Equity\tJune 30 2018\tDecember 31 2017\t% Change\nUnsecured senior notes net\t1815\t1874\t(3.1)%\nAdvance facilities net\t516\t855\t(39.6)%\nWarehouse facilities net\t3086\t3285\t(6.1)%\nMSR related liabilities - nonrecourse at fair value\t1063\t1006\t5.7%\nOther nonrecourse debt net\t7445\t8014\t(7.1)%\nOther liabilities\t1324\t1280\t3.4%\nTotal liabilities\t15249\t16314\t(6.5)%\nTotal stockholders' equity attributable to Nationstar\t1940\t1715\t13.1%\nNoncontrolling interest\t1\t7\t(85.7)%\nTotal liabilities and stockholders' equity\t17190\t18036\t(4.7)%\n", "q10k_tbl_88": "Table 33. Operating Cash Flow\tSix Months Ended June 30\t\n\t2018\t2017\nOriginations net sales activities\t386\t511\nCash provided by operating profits and changes in working capital and other assets\t1483\t360\nNet cash attributable to operating activities\t1869\t871\n", "q10k_tbl_89": "Table 34. Investing Cash Flows\tSix Months Ended June 30\t\n\t2018\t2017\nPurchase of forward mortgage servicing rights net of liabilities incurred\t(123)\t(13)\nProceeds on sale of assets\t13\t16\nOther\t(32)\t(27)\nNet cash attributable to investing activities\t(142)\t(24)\n", "q10k_tbl_90": "Table 35. Financing Cash Flow\tSix Months Ended June 30\t\n\t2018\t2017\nDecrease in advance facilities\t(339)\t(214)\nChanges in warehouse facilities\t(199)\t100\nPayment of senior unsecured notes and nonrecourse debt\t(75)\t(110)\nIssuance of excess spread financing\t70\t0\nRepayment of excess spread financing\t(93)\t(109)\nDecrease in participating interest financing in reverse mortgage interests\t(1184)\t(905)\nHECM securitizations\t20\t132\nOther\t(7)\t(10)\nNet cash attributable to financing activities\t(1807)\t(1116)\n", "q10k_tbl_91": "Table 36. Debt\tJune 30 2018\tDecember 31 2017\nAdvance facilities net\t516\t855\nWarehouse facilities net\t3086\t3285\nUnsecured senior notes net\t1815\t1874\n", "q10k_tbl_92": "Year Ending December 31\tAmount\n2018(1)\t364\n2019(2)\t266\n2020(1)\t394\n2021\t595\n2022\t206\nUnsecured senior notes principal amount\t1825\nUnamortized debt issuance costs\t(10)\nUnsecured senior notes net\t1815\n", "q10k_tbl_93": "(in thousands except Average Price Paid per Share)\t\t\t\t\nPeriod\t(a) Total Number of Shares (or Units) Purchased (in thousands)\t(b) Average Price Paid per Share (or Unit)\t(c) Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs(1) (in thousands)\t(d) Maximum Number (or Appropriate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Program (in millions)\nApril 1 - 30 2018\t0\t0\t0\t0\nMay 1 - 31 2018\t0\t0\t0\t0\nJune 1 - 30 2018\t73\t(1) $17.94\t0\t0\nTotal\t73\t\t0\t\n", "q10k_tbl_94": "\t\tIncorporated by Reference\t\t\nExhibit Number\tDescription\tForm File No.\tExhibit Filing Date\tFiled or Furnished Herewith\n4.1\tSecond Supplemental Indenture dated as of June 21 2018 by and among Nationstar Mortgage LLC Nationstar Capital Corporation the guarantors thereto and Wells Fargo Bank National Association as trustee\t8-K 001-35449\t4.1 06/22/2018\t\n4.2\tFirst Supplemental Indenture dated as of June 21 2018 by and among Nationstar Mortgage LLC Nationstar Capital Corporation the guarantors thereto and Wells Fargo Bank National Association as trustee\t8-K 001-35449\t4.2 06/22/2018\t\n10.1\tAmendment Number Six dated as of May 29 2018 to the Second Amended and Restated Master Repurchase Agreement dated January 29 2016 among Barclays Bank PLC as purchaser and agent Sutton Funding LLC as a purchaser and Nationstar Mortgage LLC as seller\t\t\tX\n31.1\tCertification by Chief Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002\t\t\tX\n31.2\tCertification by Chief Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002\t\t\tX\n32.1\tCertification by Chief Executive Officer Pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002\t\t\tX\n32.2\tCertification by Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002\t\t\tX\n101.INS\tXBRL Instance Document\t\t\tX\n101.SCH\tXBRL Taxonomy Extension Schema Document\t\t\tX\n101.CAL\tXBRL Taxonomy Extension Calculation Linkbase Document\t\t\tX\n101.DEF\tXBRL Taxonomy Extension Definition Linkbase Document\t\t\tX\n101.LAB\tXBRL Taxonomy Extension Label Linkbase Document\t\t\tX\n101.PRE\tXBRL Taxonomy Extension Presentation Linkbase Document\t\t\tX\n"}{"bs": "q10k_tbl_1", "is": "q10k_tbl_2", "cf": "q10k_tbl_4"}None
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 x No ¨
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files). Yes x No ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, 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 12(b)-2 of the Exchange Act.
Large Accelerated Filer
¨
Accelerated Filer
x
Non-Accelerated Filer
¨
(Do not check if a smaller reporting company)
Smaller 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 Exchange Act). Yes ¨ No x
Number of shares of common stock, $0.01 par value, outstanding as of July 30, 2018 was 98,178,069.
Mortgage servicing rights, $3,356 and $2,937 at fair value, respectively
3,356
2,941
Advances and other receivables, net of reserves of $294 and $284, respectively
1,317
1,706
Reverse mortgage interests, net of reserves of $117 and $115, respectively
9,477
9,984
Mortgage loans held for sale at fair value
1,635
1,891
Mortgage loans held for investment, net
132
139
Property and equipment, net of accumulated depreciation of $195 and $169, respectively
123
121
Derivative financial instruments at fair value
62
65
Other assets
593
614
Total assets
$
17,190
$
18,036
Liabilities and Stockholders' Equity
Unsecured senior notes, net
$
1,815
$
1,874
Advance facilities, net
516
855
Warehouse facilities, net
3,086
3,285
Payables and accrued liabilities
1,288
1,234
MSR related liabilities - nonrecourse at fair value
1,063
1,006
Mortgage servicing liabilities
27
41
Derivative financial instruments at fair value
9
5
Other nonrecourse debt, net
7,445
8,014
Total liabilities
15,249
16,314
Commitments and contingencies (Note 15)
Preferred stock at $0.01 par value - 300,000 thousand shares authorized, no shares issued and outstanding
—
—
Common stock at $0.01 par value - 1,000,000 thousand shares authorized, 109,915 thousand and 109,915 thousand shares issued, respectively
1
1
Additional paid-in-capital
1,140
1,131
Retained earnings
949
731
Treasury shares at cost, 11,752 thousand and 12,187 thousand shares, respectively
(150
)
(148
)
Total Nationstar stockholders' equity
1,940
1,715
Non-controlling interests
1
7
Total stockholders' equity
1,941
1,722
Total liabilities and stockholders' equity
$
17,190
$
18,036
See accompanying notes to the consolidated financial statements.
3
NATIONSTAR MORTGAGE HOLDINGS INC.
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(millions of dollars, except for earnings per share data)
Three Months Ended June 30,
Six Months Ended June 30,
2018
2017
2018
2017
Revenues:
Service related, net
$
317
$
213
$
781
$
496
Net gain on mortgage loans held for sale
127
167
251
311
Total revenues
444
380
1,032
807
Expenses:
Salaries, wages and benefits
177
182
357
374
General and administrative
162
185
346
362
Total expenses
339
367
703
736
Other income (expenses):
Interest income
140
139
285
278
Interest expense
(164
)
(188
)
(335
)
(381
)
Other income (expenses)
(2
)
7
6
6
Total other income (expenses), net
(26
)
(42
)
(44
)
(97
)
Income before income tax expense (benefit)
79
(29
)
285
(26
)
Less: Income tax expense (benefit)
21
(10
)
67
(9
)
Net income (loss)
58
(19
)
218
(17
)
Less: Net income attributable to non-controlling interests
—
1
—
1
Net income (loss) attributable to Nationstar
$
58
$
(20
)
$
218
$
(18
)
Net income (loss) per common share attributable to Nationstar:
Basic
$
0.59
$
(0.20
)
$
2.22
$
(0.18
)
Diluted
$
0.59
$
(0.20
)
$
2.20
$
(0.18
)
Weighted average shares of common stock outstanding (in thousands):
Basic
98,203
97,752
98,037
97,672
Dilutive effect of stock awards
927
—
1,086
—
Diluted
99,130
97,752
99,123
97,672
See accompanying notes to the consolidated financial statements.
4
NATIONSTAR MORTGAGE HOLDINGS INC.
UNAUDITED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
Number of Shares Outstanding (in thousands)
Amount
(millions of dollars)
Common Stock
Common Stock
Additional Paid-in Capital
Retained Earnings
Treasury Share Amount
Total Nationstar Stockholders'
Equity
Non-controlling Interests
Total
Equity
Balance at January 1, 2017
97,497
$
1
$
1,122
$
701
$
(147
)
$
1,677
$
6
$
1,683
Shares issued / (surrendered) under incentive compensation plan
214
—
(4
)
—
(1
)
(5
)
—
(5
)
Share-based compensation
—
—
9
—
—
9
—
9
Dividends to non-controlling interests
—
—
(5
)
—
—
(5
)
—
(5
)
Net income (loss)
—
—
—
(18
)
—
(18
)
1
(17
)
Balance at June 30, 2017
97,711
$
1
$
1,122
$
683
$
(148
)
$
1,658
$
7
$
1,665
Balance at January 1, 2018
97,728
$
1
$
1,131
$
731
$
(148
)
$
1,715
$
7
$
1,722
Shares issued / (surrendered) under incentive compensation plan
435
—
(4
)
—
(2
)
(6
)
—
(6
)
Share-based compensation
—
—
8
—
—
8
—
8
Dividends to non-controlling interests
—
—
5
—
—
5
(6
)
(1
)
Net income
—
—
—
218
—
218
—
218
Balance at June 30, 2018
98,163
$
1
$
1,140
$
949
$
(150
)
$
1,940
$
1
$
1,941
See accompanying notes to the consolidated financial statements.
5
NATIONSTAR MORTGAGE HOLDINGS INC.
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
(millions of dollars)
Six Months Ended June 30,
2018
2017
Operating Activities
Net income (loss) attributable to Nationstar
$
218
$
(18
)
Adjustments to reconcile net income (loss) to net cash attributable to operating activities:
Net income attributable to non-controlling interests
—
1
Net gain on mortgage loans held for sale
(251
)
(311
)
Reverse mortgage loan interest income
(237
)
(233
)
Gain on sale of assets
(9
)
(8
)
Provision for servicing reserves
54
59
Fair value changes and amortization/accretion of mortgage servicing rights/liabilities
(155
)
233
Fair value changes in excess spread financing
74
15
Fair value changes in mortgage servicing rights financing liability
6
(14
)
Amortization of premiums, net of discount accretion
6
27
Depreciation and amortization for property and equipment and intangible assets
29
29
Share-based compensation
8
9
Other loss
2
9
Repurchases of forward loan assets out of Ginnie Mae securitizations
(475
)
(599
)
Mortgage loans originated and purchased for sale, net of fees
(10,639
)
(8,896
)
Sales proceeds and loan payment proceeds for mortgage loans held for sale and held for investment
11,500
10,006
Excess tax deficiency from share-based compensation
(1
)
(1
)
Changes in assets and liabilities:
Advances and other receivables
355
118
Reverse mortgage interests
1,326
769
Other assets
10
24
Payables and accrued liabilities
48
(348
)
Net cash attributable to operating activities
1,869
871
Investing Activities
Property and equipment additions, net of disposals
(31
)
(25
)
Purchase of forward mortgage servicing rights, net of liabilities incurred
(123
)
(13
)
Net payment related to acquisition of HECM related receivables
(1
)
—
Proceeds on sale of forward and reverse mortgage servicing rights
—
(2
)
Proceeds on sale of assets
13
16
Net cash attributable to investing activities
(142
)
(24
)
Continued on following page.
See accompanying notes to the consolidated financial statements.
6
NATIONSTAR MORTGAGE HOLDINGS INC.
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Continued)
(millions of dollars)
Six Months Ended June 30,
2018
2017
Financing Activities
(Decrease) increase in warehouse facilities
(199
)
100
Decrease in advance facilities
(339
)
(214
)
Proceeds from issuance of HECM securitizations
443
308
Repayment of HECM securitizations
(423
)
(176
)
Proceeds from issuance of participating interest financing in reverse mortgage interests
184
355
Repayment of participating interest financing in reverse mortgage interests
(1,368
)
(1,260
)
Issuance of excess spread financing
70
—
Repayment of excess spread financing
(93
)
(109
)
Repayment of nonrecourse debt – legacy assets
(6
)
(9
)
Repurchase of unsecured senior notes
(62
)
(95
)
Surrender of shares relating to stock vesting
(6
)
(5
)
Debt financing costs
(7
)
(6
)
Dividends to non-controlling interests
(1
)
(5
)
Net cash attributable to financing activities
(1,807
)
(1,116
)
Net decrease in cash, cash equivalents, and restricted cash
(80
)
(269
)
Cash, cash equivalents, and restricted cash - beginning of period
575
877
Cash, cash equivalents, and restricted cash - end of period(1)
$
495
$
608
Supplemental Disclosures of Cash Activities
Cash paid for interest expense
$
373
$
399
Net cash paid for income taxes
$
36
$
70
(1) The following table provides a reconciliation of cash, cash equivalents and restricted cash to amount reported within the consolidated balance sheet.
June 30,
2018
2017
Cash and cash equivalents
$
185
$
184
Restricted cash
310
424
Total cash, cash equivalents, and restricted cash
$
495
$
608
See accompanying notes to the consolidated financial statements.
7
NATIONSTAR MORTGAGE HOLDINGS INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(millions of dollars, unless otherwise stated)
1. Nature of Business and Basis of Presentation
Nature of Business
Nationstar Mortgage Holdings Inc., a Delaware corporation, including its consolidated subsidiaries (collectively, "Nationstar", the "Company", "we", "us" or "our"), earns fees through the delivery of servicing, origination and transaction-based services related primarily to single-family residences throughout the United States.
Merger With WMIH Corp.
On February 12, 2018, the Company entered into an Agreement and Plan of Merger (the "Merger Agreement") with WMIH Corp., a Delaware corporation ("WMIH"), and Wand Merger Corporation, a Delaware corporation and a wholly-owned subsidiary of WMIH ("Merger Sub"). On July 31, 2018, pursuant to the Merger Agreement, Merger Sub was merged with and into the Company (the “Merger”), with the Company continuing as a wholly-owned subsidiary of WMIH.
Pursuant to the terms of the Merger Agreement, at the effective time of the Merger (the "Effective Time") and as a result of the Merger, each share of the Company’s common stock issued and outstanding immediately prior to the Effective Time was converted into the right to receive, at the election of the holder of such share, (i) $18.00 per share in cash, without interest, or (ii) 12.7793 shares of validly issued, fully paid and nonassessable shares of WMIH common stock, par value $0.00001 per share ("WMIH Common Stock") (the "Merger Consideration"). The Merger Consideration was subject to automatic proration and adjustment pursuant to the Merger Agreement to ensure that the total amount of cash paid (excluding cash paid in lieu of fractional shares) equaled exactly $1,225,885,248.00. As a result of such automatic proration and adjustment based on the final election results, Company stockholders who made a valid election for cash consideration will receive cash for approximately 94% of their shares and will retain stock for approximately 6% of their shares. More specifically, for each share of Nationstar common stock held, $16.917371 in cash (approximately 94% of $18.00) and 0.7686 shares of common stock of WMIH (approximately 6% of 12.7793) will be distributed and Company stockholders who made a valid election for stock consideration (including those deemed to have made an election to receive stock consideration) will receive 12.7793 shares of common stock of WMIH for each share of Nationstar common stock held.
Pursuant to the Merger Agreement, immediately prior to the Effective Time, subject to certain exceptions, (i) each then-outstanding share of Nationstar restricted stock automatically vested in full and was converted into the right to receive the Merger Consideration, as elected by the holder thereof, and (ii) each then-outstanding Nationstar restricted stock unit, whether vested or unvested, was automatically vested in full, assumed by WMIH and converted into a WMIH restricted stock unit entitling the holder thereof to receive upon settlement the Merger Consideration, as elected by the holder, as described above with respect to shares of Nationstar restricted stock.
Basis of Presentation
The consolidated interim financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP") for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X as promulgated by the Securities and Exchange Commission ("SEC"). Accordingly, the financial statements do not include all of the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2017.
The interim consolidated financial statements are unaudited; however, in the opinion of management, all adjustments considered necessary for a fair presentation of the results of the interim periods have been included. Certain prior period amounts have been reclassified to conform to the current period presentation. Dollar amounts are reported in millions, except per share data and other key metrics, unless otherwise noted.
The Company evaluated subsequent events through the date these interim consolidated financial statements were issued.
The Company describes its significant accounting policies in Note 2 of the notes to the consolidated financial statements in its Annual Report on Form 10-K for the year ended December 31, 2017. During the six months ended June 30, 2018, no significant changes were made to those accounting policies.
8
Basis of Consolidation
The consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries, and other entities in which the Company has a controlling financial interest, and those variable interest entities ("VIE") where the Company's wholly-owned subsidiaries are the primary beneficiaries. Assets and liabilities of VIEs and their respective results of operations are consolidated from the date that the Company became the primary beneficiary through the date the Company ceases to be the primary beneficiary. The Company applies the equity method of accounting to investments where it is able to exercise significant influence, but not control, over the policies and procedures of the entity and owns less than 50% of the voting interests. Investments in certain companies over which the Company does not exert significant influence are accounted for as cost method investments. Intercompany balances and transactions on consolidated entities have been eliminated.
Use of Estimates
The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from these estimates due to factors such as adverse changes in the economy, changes in interest rates, secondary market pricing for loans held for sale and derivatives, strength of underwriting and servicing practices, changes in prepayment assumptions, declines in home prices or discrete events adversely affecting specific borrowers, and such differences could be material.
Reclassification
Certain reclassifications have been made in the 2017 consolidated financial statements to conform to the 2018 presentation. Such reclassifications did not affect total revenues or net income. Refer to the Recent Accounting Guidance Adopted footnote for additional information regarding retrospective reclassifications related to Accounting Standards Update No. 2016-18 adopted in 2018.
Recent Accounting Guidance Adopted
Accounting Standards Update No. 2014-09, 2016-08, 2016-10, 2016-12 and 2016-20, collectively implemented as Financial Accounting Standard Board ("FASB") Accounting Standards Codification ("ASC") Topic 606 ("ASC 606") Revenue from Contracts with Customers, provides guidance for revenue recognition. This ASC’s core principle requires a company to recognize revenue when it transfers promised goods or services to customers in an amount that reflects consideration to which the company expects to be entitled in exchange for those goods or services. The standard also clarifies the principal versus agent considerations, providing the evaluation must focus on whether the entity has control of the goods or services before they are transferred to the customer. The new standard permits the use of either the modified retrospective or full retrospective transition method. The Company's revenue is generated from loan servicing, loan originations, and services provided by Xome. Servicing revenue is comprised of servicing fees and other ancillary fees in connection with the Company's servicing activities as well as fees earned under subservicing arrangements. Origination revenue is comprised of fee income earned at origination of a loan, interest income earned for the period the loans are held, and gain on sale on loans upon disposition of the loan. Xome's revenue is comprised of income earned from real estate exchange, real estate services and real estate software as a service. The Company has performed a review of the new guidance as compared to its current accounting policies, and evaluated all services rendered to its customers as well as underlying contracts to determine the impact of this standard to its revenue recognition process. The majority of services rendered by the Company in connection with originations and servicing are not within the scope of ASC 606. However, all revenues from Xome fall within the scope of ASC 606. Xome's operations are comprised of Exchange, Services and Software as a Service ("SaaS").
•
Exchange is a national technology-enabled platform that manages and sells residential properties through its Xome.com platform. Revenue-generating activities include commission and buyer’s premium of winning bids on auctioned real estate owned ("REO") and short sale properties. Revenue is recognized when performance obligation is completed, which is at the closing of real estate transactions and transfer of ownership to the buyer.
•
Services connects the major touch points of the real estate transactions process by providing title, escrow and collateral valuation services for purchase, refinance and default transactions. Major revenue-generating activities include title and escrow services, and valuation services. Revenue is recognized when performance obligation is completed, which is when services are rendered to customers.
•
SaaS includes Company’s software as a service platform providing integrated technology, media and data solutions to mortgage servicers, originators and multiple listing service ("MLS") organizations and associations. Revenue-generating activities include software and platform system access and use, system implementation, software maintenance and support, data services and any additional customized enhancement. Revenue is recognized when performance obligation is completed, which is generally recognized on straight-line basis over the contractual terms. Additionally, any additional fees owed due to usage metrics in excess of the monthly minimum will be recognized each month under the usage-based royalties guidance of ASC 606.
9
Upon completion of its review of relevant contracts, the Company made a determination that there was no material impact to revenue recognition upon adoption of the new standard. Additionally, the Company identified and implemented changes to its accounting policies and practices, business processes, and controls to support the new revenue recognition standard. The Company adopted the standard on January 1, 2018 and there is no material impact recorded to revenue in 2018.
Accounting Standards Update No. 2016-15, Classification of Certain Cash Receipts and Cash Payments (ASU 2016-15), relates to the Statement of Cash Flows (Topic 230) and is intended to provide specific guidance to reduce diversity in practice. ASU 2016-15 addresses the following eight cash flow classification issues: (1) debt prepayment or debt extinguishment costs, (2) settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing, (3) contingent consideration payments made after a business combination, (4) proceeds from the settlement of life insurance claims, (5) proceeds from the settlement of corporate owned life insurance policies, including bank-owned life insurance policies, (6) distributions received from equity method investees, (7) beneficial interests in securitization transactions and (8) separately identifiable cash flows and application of the predominance principle. ASU 2016-15 is effective for annual reporting period beginning after December 15, 2017, including interim periods within that reporting period, with early adoption permitted. The Company adopted ASU 2016-15 in the first quarter of 2018 and determined that the implementation of this standard has no impact on the Company’s consolidated statement of cash flows.
Accounting Standards Update No. 2016-18, Statement of Cash Flows (Topic 230) Restricted Cash (ASU 2016-18), requires that a statement of cash flows explain the change during the period in the total cash, cash equivalents, and amounts generally described as restricted cash and restricted cash equivalents. ASU 2016-18 is effective for annual reporting period beginning after December 15, 2017, including interim periods within that reporting period, with early adoption permitted. The Company adopted ASU 2016-18 in the first quarter of 2018 and retrospectively applied the guidance to all periods presented. As a result, the Company includes restricted cash with cash and cash equivalents when reconciling the beginning and end of period total amounts shown on the consolidated statements of cash flows, and the Company no longer presents changes in restricted cash as a component of financing activities.
Accounting Standards Update No. 2016-01, Financial Instruments – Overall: Recognition and Measurement of Financial Assets and Financial Liabilities (ASU 2016-1), ASU 2016-01 addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. Among other things, ASU 2016-01 requires equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. However, an entity may choose to measure equity investments that do not have readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. Furthermore, equity investments without readily determinable fair values are to be assessed for impairment using a quantitative approach. ASU 2016-01 is effective for interim period beginning after December 15, 2017, and requires a modified retrospective approach to adoption. The Company adopted ASU 2016-01 in the first quarter of 2018 and determined that the implementation of this standard has no significant impact on the Company’s consolidated financial statements.
Recent Accounting Guidance Not Yet Adopted
Accounting Standards Update No. 2016-02, Leases (Topic 842) (ASU 2016-02), No.2018-10, Codification Improvements to Topic 842, Leases (ASU 2018-10), and No. 2018-11, Leases (Topic 842): Targeted Improvements (ASU 2018-11), primarily impact lessee accounting by requiring the recognition of a right-of-use asset and a corresponding lease liability on the balance sheet for long-term lease agreements. ASU 2016-02 requires the recognition of a lease liability that is equal to the present value of all reasonably certain lease payments. The right-of-use asset will be based on the liability, subject to adjustment for initial direct costs. Lease agreements with terms 12 months or less are permitted to be excluded from the balance sheet. In general, leases will be amortized on a straight-line basis with the exception of finance lease agreements. ASU 2018-10 and ASU 2018-11 affect narrow aspects of the guidance issued in the amendments in ASU 2016-02. ASU 2018-11 specifically relieves companies of the requirement to present prior comparative years' result when they adopt ASU 2016-02 and gives companies the option to recognize the cumulative effect of applying ASU 2016-02 to lease assets and liabilities as an adjustment to the opening balance of retained earnings. ASU 2016-02, ASU 2018-10, and ASU 2018-11 are effective for the Company for its interim periods beginning after December 15, 2018, with early adoption permitted. The Company does not expect adoption of ASU 2016-02, ASU 2018-10, and ASU 2018-11 to have a material impact on its consolidated balance sheets and statements of operations based on the Company's preliminary analysis.
10
Accounting Standards Update No. 2016-13, Financial Instruments - Credit Losses (Topic 326) (ASU 2016-13), requires expected credit losses for financial instruments held at the reporting date to be measured based on historical experience, current conditions and reasonable and supportable forecasts. The update eliminates the probable initial recognition threshold in current GAAP and instead reflects an entity’s current estimate of all expected credit losses. Previously, when credit losses were measured under GAAP, an entity generally only considered past events and current conditions in measuring the incurred loss. ASU 2016-13 is effective for interim periods beginning after December 15, 2019. The Company is currently evaluating the potential impact of ASU 2016-13 on its consolidated financial statements.
Accounting Standards Update No. 2017-04, Simplifying the Test for Goodwill Impairment, simplifies the accounting for goodwill impairment for all entities by requiring impairment charges to be based on the first step in today’s two-step impairment test under ASC Topic 350 Intangibles - Goodwill and Other. ASU 2017-04 is effective for the Company for its annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. ASU 2017-04 will be adopted prospectively. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently evaluating the potential impact of ASU 2017-04 on its consolidated financial statements.
2. Mortgage Servicing Rights ("MSRs") and Related Liabilities
The following table sets forth the carrying value of Company's MSRs and the related liabilities.
MSRs and Related Liabilities
June 30, 2018
December 31, 2017
Mortgage servicing rights - fair value and amortized cost(1)
$
3,356
$
2,941
Mortgage servicing liabilities - amortized cost
$
27
$
41
Excess spread financing - fair value
$
1,047
$
996
Mortgage servicing rights financing - fair value
16
10
MSR related liabilities - nonrecourse at fair value
$
1,063
$
1,006
(1) Amount as of December 31, 2017 includes $4 of reverse MSRs at amortized cost. There were no reverse MSRs as of June 30, 2018.
Mortgage Servicing Rights
The Company owns and records at fair value the rights to service traditional residential mortgage ("forward") loans for others either as a result of purchase transactions or from the retained servicing associated with the sales and securitizations of loans originated. MSRs are comprised of servicing rights related to both agency and non-agency loans.
11
The following table sets forth the activities of forward MSRs.
Six Months Ended June 30,
MSRs - Fair Value
2018
2017
Fair value - beginning of period
$
2,937
$
3,160
Additions:
Servicing retained from mortgage loans sold
139
103
Purchases of servicing rights
132
13
Dispositions:
Sales of servicing assets(1)
4
2
Changes in fair value:
Changes in valuation inputs or assumptions used in the valuation model
283
(74
)
Other changes in fair value
(139
)
(158
)
Fair value - end of period
$
3,356
$
3,046
(1) Amounts are related to the sale of nonperforming loans which have a negative MSR.
From time to time, the Company sells its ownership interest in certain MSRs and is retained as the subservicer for the sold assets. The Company has evaluated the sale accounting requirements related to these transactions, including the Company's continued involvement as the subservicer, and concluded that these transactions qualify for sale accounting treatment.
MSRs measured at fair value are segregated between credit sensitive and interest sensitive pools. Credit sensitive pools are primarily impacted by borrower performance under specified repayment terms, which most directly impacts involuntary prepayments and delinquency rates. Interest sensitive pools are primarily impacted by changes in forecasted interest rates, which in turn impact voluntary prepayment speeds. The Company assesses whether acquired portfolios are more credit sensitive or interest sensitive in nature on the date of acquisition. Numerous factors are considered in making this assessment, including loan-to-value ratios, FICO scores, percentage of portfolio previously modified, portfolio seasoning and similar criteria. The determination between credit sensitive and interest sensitive for a pool is made at the date of acquisition and no subsequent changes are made.
Credit sensitive portfolios generally consist of higher delinquency, single-family non-conforming residential forward mortgage loans serviced for agency and non-agency investors. Interest sensitive portfolios generally consist of lower delinquency, single-family conforming residential forward mortgage loans for agency investors.
The following table provides a breakdown of credit sensitive and interest sensitive unpaid principal balance ("UPB") for the Company's forward MSRs.
MSRs - Sensitivity Pools
June 30, 2018
December 31, 2017
UPB
Fair Value
UPB
Fair Value
Credit sensitive
$
153,552
$
1,695
$
167,605
$
1,572
Interest sensitive
124,553
1,661
113,775
1,365
Total
$
278,105
$
3,356
$
281,380
$
2,937
The Company used the following key weighted-average inputs and assumptions in estimating the fair value of MSRs.
Credit Sensitive
June 30, 2018
December 31, 2017
Discount rate
11.4
%
11.4
%
Total prepayment speeds
11.7
%
15.2
%
Expected weighted-average life
6.6 years
5.7 years
Interest Sensitive
Discount rate
9.2
%
9.2
%
Total prepayment speeds
9.8
%
10.7
%
Expected weighted-average life
7.0 years
6.7 years
12
The following table shows the hypothetical effect on the fair value of the MSRs when applying certain unfavorable variations of key assumptions to these assets for the dates indicated.
Discount Rate
Total Prepayment Speeds
MSRs - Hypothetical Sensitivities
100 bps
Adverse
Change
200 bps
Adverse
Change
10%
Adverse
Change
20%
Adverse
Change
June 30, 2018
Mortgage servicing rights
$
(130
)
$
(251
)
$
(119
)
$
(231
)
December 31, 2017
Mortgage servicing rights
$
(108
)
$
(208
)
$
(118
)
$
(227
)
These hypothetical sensitivities should be evaluated with care. The effect on fair value of a 10% variation in assumptions generally cannot be determined because the relationship of the change in assumptions to the fair value may not be linear. Additionally, the impact of a variation in a particular assumption on the fair value is calculated while holding other assumptions constant. In reality, changes in one factor may lead to changes in other factors, which could impact the above hypothetical effects.
The Company services and subservices certain Home Equity Conversion Mortgage ("HECM") reverse mortgage loans with an unpaid principal balance of $32,264 and $35,112 as of June 30, 2018 and December 31, 2017, respectively. Mortgage servicing liabilities had an ending balance of $27 and $41 as of June 30, 2018 and December 31, 2017, respectively. For the six months ended June 30, 2018, the Company accreted $11 of the MSL and recorded other MSL adjustments of $3. The fair value of MSL was $(5) and $34 as of June 30, 2018 and December 31, 2017, respectively. The fair value of MSL as of June 30, 2018 was primarily driven by net excess payments made to a government sponsored entity which will be reimbursed in the future. Based on management's assessment at June 30, 2018, no increased obligation was needed.
Excess Spread Financing - Fair Value
In order to finance the acquisition of certain MSRs on various loan pools ("Portfolios"), the Company has entered into sale and assignment agreements with a third-party associated with funds and accounts under management of BlackRock Financial Management Inc. ("BlackRock"), a third-party associated with funds and accounts under management of Värde Partners, Inc. ("Varde") and with certain affiliated entities formed and managed by New Residential Investment Corp. ("New Residential"), which is managed by an affiliate of Fortress Investment Group LLC ("Fortress"). The Company sold to such entities the right to receive a specified percentage of the excess cash flow generated from the Portfolios after receipt of a fixed base servicing fee per loan. Servicing fees associated with traditional MSRs can be segregated into a contractually specified base servicing fee component and an excess servicing fee. The base servicing fee, along with ancillary income, is designed to cover costs incurred to service the specified pool plus a reasonable profit margin. The remaining servicing fee is considered excess. The Company retains all the base servicing fee and ancillary revenues associated with servicing the Portfolios and retains a portion of the excess servicing fee. The Company continues to be the servicer of the Portfolios and provides all servicing and advancing functions.
Contemporaneous with the above, the Company entered into refinanced loan obligations with New Residential, BlackRock and Varde. Should the Company refinance any loan in the Portfolios, subject to certain limitations, it will be required to transfer the new loan or a replacement loan of similar economic characteristics into the Portfolios. The new or replacement loan will be governed by the same terms set forth in the sale and assignment agreement described above, which is the primary driver of the recapture rate assumption.
13
The range of key assumptions used in the Company's valuation of excess spread financing are as follows.
Excess Spread Financing
Prepayment Speeds
Average Life (Years)
Discount Rate
Recapture Rate
June 30, 2018
Low
6.0%
5.2
8.5%
8.2%
High
15.1%
8.1
14.0%
27.3%
Weighted-average
11.1%
6.5
10.6%
18.0%
December 31, 2017
Low
6.2%
4.4
8.5%
7.2%
High
21.2%
6.9
14.1%
30.0%
Weighted-average
13.7%
5.9
10.8%
18.7%
The following table shows the hypothetical effect on the excess spread financing fair value when applying certain unfavorable variations of key assumptions to these liabilities for the dates indicated.
As the cash flow assumptions utilized in determining the fair value amounts in the excess spread financing are based on the related cash flow assumptions utilized in the financed MSRs, any fair value changes recognized in the MSRs would inherently have an inverse impact on the carrying amount of the related excess spread financing. For example, while an increase in discount rates would negatively impact the value of the Company's MSRs, it would reduce the carrying value of the associated excess spread financing liability.
These hypothetical sensitivities should be evaluated with care. The effect on fair value of a 10% variation in assumptions generally cannot be determined because the relationship of the change in assumptions to the fair value may not be linear. Additionally, the impact of a variation in a particular assumption on the fair value is calculated while holding other assumptions constant. In reality, changes in one factor may lead to changes in other factors, which could impact the above hypothetical effects. Also, a positive change in the above assumptions would not necessarily correlate with the corresponding decrease in the net carrying amount of the excess spread financing.
Mortgage Servicing Rights Financing - Fair Value
From December 2013 through June 2014, the Company entered into agreements to sell a contractually specified base servicing fee component of certain MSRs and servicing advances under specified terms to a joint venture capitalized by New Residential and certain unaffiliated third-party investors. The Company continues to be the named servicer and, for accounting purposes, ownership of the mortgage servicing rights continues to reside with the Company. Accordingly, the Company records the MSRs and a MSR financing liability associated with this transaction in its consolidated balance sheets. See Note 18. Transactions with Affiliates for additional information.
The following table sets forth the weighted average assumptions used in the valuation of the mortgage servicing rights financing liability.
Mortgage Servicing Rights Financing Assumptions
June 30, 2018
December 31, 2017
Advance financing rates
4.1
%
3.5
%
Annual advance recovery rates
18.9
%
23.2
%
14
The following table sets forth the items comprising revenues associated with servicing loan portfolios.
Three Months Ended June 30,
Six Months Ended June 30,
Servicing Revenue
2018
2017
2018
2017
Contractually specified servicing fees(1)
$
245
$
253
$
495
$
508
Other service-related income(1)(2)
28
46
56
86
Incentive and modification income(1)
18
21
33
43
Late fees(1)
22
22
46
46
Reverse servicing fees
14
13
33
27
Mark-to-market adjustments(2)(3)
19
(84
)
171
(116
)
Counterparty revenue share(4)
(50
)
(59
)
(95
)
(121
)
Amortization, net of accretion(5)
(48
)
(66
)
(96
)
(127
)
Total servicing revenue
$
248
$
146
$
643
$
346
(1) Amounts include subservicing related revenues.
(2) In the fourth quarter of 2017, the Company reevaluated presentation of adjustments related to certain Ginnie Mae early buyout activities and reclassified $6 and $12 from other service-related income to mark-to-market adjustments for the three and six months ended June 30, 2017, respectively. Total servicing revenue was not affected by this reclassification adjustment.
(3) Mark-to-market ("MTM") includes fair value adjustments on MSR, excess spread financing and MSR financing liabilities. The amount of MSR MTM reflected is net of cumulative incurred losses related to advances and other receivables associated with inactive and liquidated loans that are no longer part of the MSR portfolio and these incurred losses have been transferred to reserves on advances and other receivables. These cumulative incurred losses totaled $22 and $22 for the three months ended June 30, 2018 and 2017, respectively, and $34 and $37 for the six months ended June 30, 2018 and 2017, respectively.
(4) Counterparty revenue share represents the excess servicing fee that the Company pays to the counterparties under the excess spread financing arrangements and the payments made associated with MSRs financing arrangements.
(5) Amortization is net of excess spread accretion of $37 and $40 for the three months ended June 30, 2018 and 2017, respectively and $67 and $82 for the six months ended June 30, 2018 and 2017, respectively.
3. Advances and Other Receivables, Net
Advances and other receivables, net consists of the following.
June 30, 2018
December 31, 2017
Servicing advances
$
1,248
$
1,599
Receivables from agencies, investors and prior servicers
363
391
Reserves
(294
)
(284
)
Total advances and other receivables, net
$
1,317
$
1,706
The Company, as a loan servicer, is contractually responsible to advance funds on behalf of the borrower and investor primarily for loan principal and interest, property taxes and hazard insurance, and foreclosure costs. Advances are primarily recovered through reimbursement from the investor, proceeds from sale of loan collateral, or mortgage insurance claims. Reserves for advances and other receivables on loans transferred out of the MSR portfolio are established within advances and other receivables.
The Company estimates and records an asset for estimated recoveries to be collected from prior servicers for their respective portion of the losses associated with the underlying loans that were not serviced in accordance with established guidelines. Receivables from prior servicers totaled $136 and $134 for the Company's forward loan portfolio at June 30, 2018 and December 31, 2017, respectively.
15
The following table sets forth the activities of the reserves for advances and other receivables.
Three Months Ended June 30,
Six Months Ended June 30,
Reserves for Advances and Other Receivables
2018
2017
2018
2017
Balance - beginning of period
$
277
$
208
$
284
$
184
Provision and other additions(1)
38
36
60
76
Write-offs
(21
)
(8
)
(50
)
(24
)
Balance - end of period
$
294
$
236
$
294
$
236
(1) A provision of $22 and $22 was recorded through the MTM adjustments in service related revenues for the three months ended June 30, 2018 and 2017, respectively, and $34 and $37 for the six months ended June 30, 2018 and 2017, respectively, for inactive and liquidated loans that are no longer part of the MSR portfolio. Other additions represent reclassifications of required reserves from other balance sheet accounts.
4. Reverse Mortgage Interests, Net
Reverse mortgage interests, net consists of the following.
June 30, 2018
December 31, 2017
Participating interests in HECM mortgage-backed securities ("HMBS")
$
6,518
$
7,107
Other interests securitized
908
912
Unsecuritized interests
2,168
2,080
Reserves
(117
)
(115
)
Total reverse mortgage interests, net
$
9,477
$
9,984
Participating Interests in HMBS
Participating interests in HMBS consist of the Company's reverse mortgage interests in HECM loans which have been transferred to Ginnie Mae ("GNMA") and subsequently securitized through the issuance of HMBS. During the six months ended June 30, 2018 and 2017, a total of $174 and $338 in UPB were transferred to Ginnie Mae and securitized, respectively.
Other Interests Securitized
Other interests securitized consist of reverse mortgage interests that no longer meet HMBS program eligibility criteria and have been repurchased out of HMBS. These reverse mortgage interests have subsequently been transferred to private securitization trusts and are accounted for as a secured borrowing. During the six months ended June 30, 2018, a total of $443 UPB was securitized through Trust 2018-1 and a total of $284 UPB from Trust 2016-2 and Trust 2016-3 were called and debt extinguished. Refer to Other Nonrecourse Debt in Note 8, Indebtedness for additional information.
Unsecuritized Interests
Unsecuritized interests in reverse mortgages consists of the following.
June 30, 2018
December 31, 2017
Repurchased HECM loans
$
1,749
$
1,662
HECM related receivables
332
311
Funded borrower draws not yet securitized
62
82
REO related receivables
25
25
Total unsecuritized interests
$
2,168
$
2,080
16
Unsecuritized interests include repurchased HECM loans for which the Company is required to repurchase from the HMBS pool when the outstanding principal balance of the HECM loan is equal to or greater than 98% of the maximum claim amount established at origination in accordance with HMBS program guidelines. The Company repurchased a total of $2,109 and $2,208 HECM loans out of Ginnie Mae HMBS securitizations during the six months ended June 30, 2018 and 2017, respectively, of which $444 and $550 were subsequently assigned to a third party in accordance with applicable servicing agreements, respectively. To the extent a loan is not subject to applicable servicing agreements and assigned to a third party, the loan is either subject to assignment to HUD, per contractual obligations with Ginnie Mae, liquidated via a payoff from the borrower, or liquidated via a foreclosure according to the terms of the underlying mortgage.
The Company also estimates and records an asset for probable recoveries from prior servicers for their respective portion of the losses associated with the underlying loans that were not serviced in accordance with established guidelines. Receivables from prior servicers totaled $36 and $22 for the Company's reverse loan portfolio at June 30, 2018 and December 31, 2017, respectively.
Purchase of Reverse Mortgage Servicing Rights and Interests
On December 1, 2016, the Company executed an asset purchase agreement with a large financial institution and acquired servicing rights and reverse mortgage interests. As part of the asset purchase agreement, the Company agreed to acquire remaining components of the reverse portfolio, primarily including servicing of whole HECM loans and REO advances upon receiving regulatory approval. In September 2017, the Company executed a mortgage servicing rights purchase agreement and a subservicing agreement to acquire servicing rights and subservicing contracts on the remaining reverse portfolio. In March 2018, the Company executed an asset purchase agreement to acquire reverse mortgage interests on the subservicing contracts acquired in September 2017 referenced above, acquiring $467 UPB of participating interests in HECM loans and $460 UPB of related HMBS obligations. The Company performed a relative fair value allocation upon the March 2018 acquisition, resulting in the aforementioned assets and liabilities in addition to $2 of HECM related receivables and $7 of purchase discount within unsecuritized interests. In addition, the Company paid net proceeds of $1 for the acquisition of these assets and assumption of related liabilities.
Reserves for Reverse Mortgage Interests
The Company records reserves related to reverse mortgage interests based on potential unrecoverable costs and loss exposures expected to be realized. Recoverability is determined based on the Company’s ability to meet U.S. Department of Housing and Urban Development ("HUD") servicing guidelines and is viewed as two different categories of expenses: financial and operational. Financial exposures are defined as the cost of doing business related to servicing the HECM product and include potential unrecoverable costs primarily based on HUD claim guidelines related to recoverable expenses and unfavorable changes in the appraised value of the loan collateral. Operational exposures are defined as unrecoverable debenture interest curtailments imposed for missed Federal Housing Administration ("FHA") specified servicing timelines.
The activity of the reserves for reverse mortgage interests is set forth below.
Three Months Ended June 30,
Six Months Ended June 30,
Reserves for reverse mortgage interests
2018
2017
2018
2017
Balance - beginning of period
$
134
$
137
$
115
$
131
Provision (release), net
(6
)
14
20
22
Write-offs
(11
)
(2
)
(18
)
(4
)
Balance - end of period
$
117
$
149
$
117
$
149
Reverse Mortgage Interest Income
The Company accrues interest income for its participating interest in reverse mortgages based on the stated rates underlying HECM loans and FHA guidelines. Total interest earned on the Company's reverse mortgage interests was $118 and $115 for the three months ended June 30, 2018 and 2017, respectively, and $237 and $233 for the six months ended June 30, 2018 and 2017, respectively.
In connection with previous reverse mortgage portfolio acquisitions, the Company recorded a purchase discount within unsecuritized interests. During the three and six months ended June 30, 2018, the Company accreted $6 and $12, respectively, of the purchase discount to interest income related to the above referenced transactions. There was $84 purchase discount remaining related to the above referenced transactions as of June 30, 2018.
17
5. Mortgage Loans Held for Sale and Investment
Mortgage Loans Held for Sale
The Company maintains a strategy of originating and purchasing residential mortgage loan products primarily for the purpose of selling to government-sponsored enterprises ("GSEs") or other third-party investors in the secondary market on a servicing-retained basis. The Company focuses on assisting customers currently in the Company's servicing portfolio with refinancing of loans or new home purchases. Generally, all newly originated mortgage loans held for sale are securitized and transferred to GSEs or delivered to third-party purchasers shortly after origination on a servicing-retained basis.
Mortgage loans held for sale are recorded at fair value as set forth below.
June 30, 2018
December 31, 2017
Mortgage loans held for sale – UPB
$
1,586
$
1,837
Mark-to-market adjustment(1)
49
54
Total mortgage loans held for sale
$
1,635
$
1,891
(1) The mark-to-market adjustment is recorded in net gain on mortgage loans held for sale in the consolidated statements of operations.
The Company accrues interest income as earned and places loans on non-accrual status after any portion of principal or interest has been delinquent for more than 90 days. Accrued interest is recorded as interest income in the consolidated statements of operations.
The total UPB of mortgage loans held for sale on non-accrual status was as follows for the dates indicated.
June 30, 2018
December 31, 2017
Mortgage Loans Held for Sale - UPB
UPB
Fair Value
UPB
Fair Value
Non-accrual
$
57
$
53
$
66
$
64
From time to time, the Company exercises its right to repurchase individual delinquent loans in Ginnie Mae securitization pools to minimize interest spread losses, to re-pool into new Ginnie Mae securitizations, or to otherwise sell to third-party investors. During the six months ended June 30, 2018 and 2017, the Company repurchased $109 and $144 of delinquent Ginnie Mae loans, respectively, and securitized or sold to third-party investors $135 and $172 of previously repurchased loans, respectively. As of June 30, 2018 and 2017, $92 and $33 of the repurchased loans have re-performed and were held in accrual status, respectively, and remaining balances continue to be held under a nonaccrual status.
The total UPB of mortgage loans held for sale for which the Company has begun formal foreclosure proceedings was $40 and $51 as of June 30, 2018 and December 31, 2017, respectively.
18
The following table details a roll forward of the change in the account balance of mortgage loans held for sale.
Six Months Ended June 30,
Mortgage loans held for sale
2018
2017
Balance - beginning of period
$
1,891
$
1,788
Mortgage loans originated and purchased, net of fees
10,630
8,887
Loans sold
(11,377
)
(9,753
)
Repurchase of loans out of Ginnie Mae securitizations
475
599
Transfer of mortgage loans held for sale to advances/accounts receivable, net related to claims(1)
(6
)
(8
)
Net transfer of mortgage loans held for sale from REO in other assets(2)
12
11
Changes in fair value
1
10
Other purchase-related activities(3)
9
9
Balance - end of period
$
1,635
$
1,543
(1) Amounts are comprised of claims made on certain government insured mortgage loans upon completion of the REO sale.
(2) Net amounts are comprised of REO in the sales process, which are transferred to other assets, and certain government insured mortgage REO, which are transferred from other assets upon completion of the sale so that the claims process can begin.
(3) Amounts are comprised primarily of non-Ginnie Mae loan purchases and buyouts.
For the six months ended June 30, 2018 and 2017, the Company received proceeds of $11,491 and $10,007, respectively, on the sale of mortgage loans held for sale, resulting in gains of $114 and $254, respectively.
The Company has the right to repurchase any individual loan in a Ginnie Mae securitization pool if that loan meets certain criteria, including being delinquent greater than 90 days. The majority of Ginnie Mae repurchased loans are repurchased solely with the intent to re-pool into new Ginnie Mae securitizations upon re-performance of the loan or to otherwise sell to third-party investors. Therefore, these loans are classified as held for sale. The amounts repurchased out of Ginnie Mae pools, as presented above, are primarily in connection with loan modifications and loan resolution activity as part of the Company's contractual obligations as the servicer of the loans.
Mortgage Loans Held for Investment, Net
The following sets forth the composition of mortgage loans held for investment, net.
June 30, 2018
December 31, 2017
Mortgage loans held for investment, net – UPB
$
183
$
193
Transfer discount:
Non-accretable
(37
)
(41
)
Accretable
(13
)
(12
)
Allowance for loan losses
(1
)
(1
)
Total mortgage loans held for investment, net
$
132
$
139
19
The changes in accretable yield discount on loans transferred to mortgage loans held for investment, net are set forth below.
Six Months Ended June 30,
Accretable Yield Discount
2018
2017
Balance - beginning of the period
$
(12
)
$
(13
)
Accretion
1
1
Reclassifications from non-accretable discount
(2
)
(2
)
Balance - end of the period
$
(13
)
$
(14
)
The Company may periodically modify the terms of any outstanding mortgage loans held for investment for loans that are either in default or in imminent default. Modifications often involve reduced payments by borrowers, modification of the original terms of the mortgage loans, forgiveness of debt and/or modified servicing advances. As a result of the volume of modification agreements entered into, the estimated average outstanding life in this pool of mortgage loans has been extended. The Company records interest income on the transferred loans on a level-yield method. To maintain a level-yield on these transferred loans over the estimated extended life, the Company reclassified to accretable yield discount approximately $2 and $2 of transfer discount designated as reserves for future loss, for the six months ended June 30, 2018 and 2017, respectively. No provision for reserves was required for the six months ended June 30, 2018 and 2017, respectively, as the fair value of the underlying collateral exceeded the carrying value of the loans, net of the non-accretable discount.
The total UPB of mortgage loans held for investment for which the Company has begun formal foreclosure proceedings was $19 and $22 as of June 30, 2018 and December 31, 2017, respectively.
6. Other Assets
Other assets consist of the following.
June 30, 2018
December 31, 2017
Loans subject to repurchase right from Ginnie Mae
$
206
$
218
Accrued revenues
128
148
Goodwill
71
72
Prepaid expenses
31
27
Deposits
21
19
Real estate owned (REO), net
18
23
Intangible assets
14
19
Receivables from affiliates, net
6
6
Other
98
82
Total other assets
$
593
$
614
Loans Subject to Repurchase Right from Ginnie Mae
Forward loans are sold to Ginnie Mae in conjunction with the issuance of mortgage backed securities. The Company, as the issuer of the mortgage backed securities, has the unilateral right to repurchase any individual loan in a Ginnie Mae securitization pool if that loan meets certain criteria, including being delinquent greater than 90 days. Once the Company has the unilateral right to repurchase a delinquent loan, it has effectively regained control over the loan and recognizes these rights to the loan on its consolidated balance sheets and establishes a corresponding repurchase liability regardless of the Company’s intention to repurchase the loan.
Goodwill
In February 2018, the Company sold the software-based business of Xome's Real Estate Digital ("RED") business. In connection with the sale, the Company wrote off $1 goodwill.
Accrued Revenues
Accrued revenues are primarily comprised of service fees earned but not received based upon the terms of the Company's servicing and subservicing agreements.
20
REO, Net
REO, net includes $11 and $15 of REO-related receivables with government insurance at June 30, 2018 and December 31, 2017, respectively, limiting loss exposure to the Company.
Other
Other primarily includes tax receivables and non-advance related accounts receivable due from investors.
7. Derivative Financial Instruments
Derivative instruments utilized by the Company primarily include interest rate lock commitments ("IRLCs"), Loan Purchase Commitments ("LPCs"), forward Mortgage Backed Securities ("MBS") trades, Eurodollar and Treasury futures and interest rate swap agreements.
Associated with the Company's derivatives are $6 and $1 in collateral deposits on derivative instruments recorded in other assets on the Company's consolidated balance sheets as of June 30, 2018 and December 31, 2017, respectively. The Company does not offset fair value amounts recognized for derivative instruments with amounts collected and/or deposited on derivative instruments in its consolidated balance sheets.
21
The following table provides the outstanding notional balances, fair values of outstanding positions and recorded gains/(losses).
Expiration
Dates
Outstanding
Notional
Fair
Value
Recorded
Gains /
(Losses)
Six Months Ended June 30, 2018
Assets
Mortgage loans held for sale
Loan sale commitments
2018
$
368
$
7.2
$
7.1
Derivative financial instruments
IRLCs
2018
1,778
60.2
0.9
Forward sales of MBS
2018
568
0.4
(2.0
)
LPCs
2018
271
1.7
0.8
Treasury futures
2018
35
0.1
(1.8
)
Eurodollar futures(1)
2018-2021
22
—
—
Liabilities
Derivative financial instruments
IRLCs(1)
2018
1
—
—
Forward sales of MBS
2018
2,710
8.0
5.2
LPCs
2018
185
0.7
0.1
Treasury futures(1)
2018
63
—
(1.4
)
Eurodollar futures(1)
2020-2021
6
—
—
Year Ended December 31, 2017
Assets
Mortgage loans held for sale
Loan sale commitments(1)
2018
$
13
$
0.1
$
—
Derivative financial instruments
IRLCs
2018
2,065
59.3
(32.9
)
Forward sales of MBS
2018
1,802
2.4
(36.9
)
LPCs
2018
171
0.9
(1.0
)
Treasury futures
2018
81
1.9
1.9
Eurodollar futures(1)
2018-2021
26
—
—
Interest rate swaps(1)
2018
—
—
(0.1
)
Liabilities
Derivative financial instruments
IRLCs(1)
2018
7
—
1.1
Forward sales of MBS
2018
1,579
2.8
7.2
LPCs
2018
213
0.6
0.9
Treasury futures
2018
128
1.4
(1.4
)
Eurodollar futures(1)
2018-2021
17
—
—
Interest rate swaps(1)
2018
—
—
0.1
(1) Fair values or recorded gains/(losses) of derivative instruments are less than $0.1 for the specified dates.