Company: BLNE
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001641172-25-004793
Chunk: 371

Company: Beeline Holdings, Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 1B
Chunk 371
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 asset or assets, such as Mortgage-Backed Securities
(“MBS”) prices, adjusted for the specific attributes of that loan, which would be used by other market participants. Mortgage
loans held for sale not calculated using observable market information are based on third-party broker quotations or market bid pricing.

Gains and losses from the sale of mortgage loans held
for sale are recognized based upon the difference between the sales proceeds and carrying value of the related loans upon sale and are
recorded in gain on sale of loans, net on the consolidated statements of operations. Sales proceeds reflect the cash received from investors
through the sale of the loan and servicing release premium. Gain on sale of loans, net also includes the unrealized gains and losses associated
with the changes in the fair value of mortgage loans held for sale, and the realized and unrealized gains and losses from derivative instruments.

Mortgage loans held for sale are considered sold when
the Company surrenders control over the financial assets. Control is considered to have been surrendered when the transferred assets have
been isolated from the Company, beyond the reach of the Company and its creditors; the purchaser obtains the right (free of conditions
that constrain it from taking advantage of that right) to pledge or exchange the transferred assets; and the Company does not maintain
effective control over the transferred assets through either an agreement that both entitles and obligates the Company to repurchase or
redeem the transferred assets before their maturity or the ability to unilaterally cause the holder to return specific financial assets.
The Company typically considers the above criteria to have been met upon acceptance and receipt of sales proceeds from the purchaser.

Mortgage loans sold to investors by the Company, and
which met investor underwriting guidelines at the time of sale, may be subject to repurchase in the event of specific default by the borrower
or subsequent discovery that underwriting standards were not met. The Company may, upon mutual agreement, indemnify the investor against
future losses on such loans. Additionally, reserves are established for estimated liabilities from the need to repay, where applicable,
a portion of the premium received from investors on the sale of certain mortgage loans if such loans are repaid in their entirety within
a specified period after the sale of the loans. The Company has established a reserve for potential losses related to these representations
and warranties. In assessing the adequacy of the reserve, management evaluates various factors including actual write-offs during the
period, historical loss experience, known delinquent and other problem loans