Company: FOACW
Filing Date: 2025-08-11
Form Type: 10-Q
Source: 0001828937-25-000061
Chunk: 58

Company: Finance of America Companies Inc.
Filing Date: 2025-08-11
Form: 10-Q
Item: Item 1
Chunk 58
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 TechniquesClassification of Fair Value HierarchyAssetsLoans held for investment, subject to HMBS related obligations(1)HECM loans - securitized into Ginnie Mae HMBSThese loans are valued utilizing a present value methodology that discounts estimated future cash flows over the life of the loan portfolio using weighted average remaining life (“WAL”), conditional prepayment rate (“CPR”), loss frequency, loss severity, borrower draw, and discount rate assumptions.Level 3Loans held for investment, subject to nonrecourse debt(1)Non-agency reverse mortgage loans - securitizedThese loans are valued utilizing a present value methodology that discounts estimated future cash flows over the life of the portfolio using WAL, loan-to-value (“LTV”), CPR, loss severity, home price appreciation (“HPA”), and discount rate assumptions.Level 3

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Finance of America Companies Inc.Notes to Condensed Consolidated Financial Statements (Unaudited)

HECM buyouts - securitized (performing)These loans are valued utilizing a present value methodology that discounts estimated future cash flows over the life of the portfolio using WAL, CPR, loss severity, and discount rate assumptions.Level 3HECM buyouts - securitized (nonperforming)These loans are valued utilizing a present value methodology that discounts estimated future cash flows over the life of the portfolio using WAL, CPR, loss frequency, loss severity, and discount rate assumptions.Level 3(1) The Company aggregates loan portfolios based on the underlying securitization trust and values these loans using these aggregated pools. The range of inputs provided is based on the range of inputs utilized for each securitization trust.Loans held for investmentNon-agency reverse mortgage loansThe Company values non-agency reverse mortgage loans utilizing a present value methodology that discounts estimated future cash flows over the life of the loan portfolio. The primary assumptions utilized in valuing the loans include WAL, LTV, CPR, loss severity, HPA, and discount rate. Level 3HECM buyouts (nonperforming)The fair value of repurchased loans is based on expected cash proceeds of the liquidation of the underlying properties and expected claim proceeds from HUD. The primary assumptions utilized in valuing nonperforming repurchased loans include WAL, CPR, loss frequency, loss severity, and discount rate. Termination proceeds are adjusted for expected loss frequencies and severities to arrive at net proceeds that will be provided upon final resolution, including assignments to the FHA. Historical experience is utilized to estimate the loss rates resulting from