Company: FOACW
Filing Date: 2025-05-20
Form Type: 10-K/A
Source: 0001828937-25-000032
Chunk: 180

Company: Finance of America Companies Inc.
Filing Date: 2025-05-20
Form: 10-K/A
Chunk 180
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 in Fair value changes from market inputs or model assumptions in the Consolidated Statements of Operations.

Refer to Note 6 - Fair Value for further discussion of valuation of loans held for investment, subject to nonrecourse debt.

Loans Held for Investment, at Fair Value

Loans held for investment, at fair value, primarily consists of certain reverse mortgage loans that the Company intends to hold to maturity. The Company has elected the fair value option for all loans held for investment.

Reverse mortgage loans held for investment consists of originated or purchased HECM and non-agency reverse mortgage loans not yet securitized, unsecuritized tails, and certain HECM purchased out of Ginnie Mae HMBS, which the Company intends to hold to maturity.

HECM loans and tails that have not yet been securitized into HMBS consist primarily of newly-issued HECM that the Company has either originated or purchased, subsequent borrower draws, and amounts paid by the Company on the borrower’s behalf for MIP that have not yet been transferred to a Ginnie Mae securitization.

The Company, as an issuer of HMBS, is required to repurchase reverse loans out of the Ginnie Mae securitization pools once the outstanding principal balance of the related HECM is equal to or greater than 98% of the maximum claim amount (“MCA”) (referred to as HECM buyouts). The majority of performing loans are now conveyed to

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| Finance of America Companies Inc.          
 Notes to Consolidated Financial Statements |

HUD prior to the Company needing to finance the HECM buyouts. Nonperforming repurchased loans are generally liquidated through foreclosure, subsequent sale of the real estate owned, and claim submissions to HUD.

The yield recognized on loans held for investment is based on the stated interest rates of the loans and is recorded in Interest income in the Consolidated Statements of Operations. The difference between the cost basis of newly originated or acquired loans and their estimated fair value is recognized in Net origination gains in the Consolidated Statements of Operations. The changes in fair value due to portfolio runoff and realization of modeled income and expenses are recorded in Fair value changes from model amortization in the Consolidated Statements of Operations, and other fair value changes are recorded in Fair value changes from market inputs or model assumptions in the Consolidated Statements of Operations. Refer to Note 6 - Fair Value for further discussion of valuation of loans held for investment.

Loan origination fees represent an up-front fee charged to a