Company: TWO-PC
Filing Date: 2025-10-28
Form Type: 10-Q
Source: 0001465740-25-000152
Chunk: 22

Company: TWO HARBORS INVESTMENT CORP.
Filing Date: 2025-10-28
Form: 10-Q
Item: Item 1
Chunk 22
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,297 Other assets— — 1 50 Total serviced mortgage assets856,304 $206,314,920 861,609 $211,838,718 

Note 7. Mortgage Loans Held-for-Sale, at Fair Value

The Company originates residential mortgage loans for the purpose of selling to the GSEs or other third-party investors in the secondary market on a servicing-retained basis, typically within 60 days of origination. The Company also holds a small amount of mortgage loans purchased from the collateral underlying its MSR. Mortgage loans held-for-sale are recorded at fair value as a result of a fair value option election. The following table presents the carrying value of Company’s mortgage loans held-for-sale as of September 30, 2025 and December 31, 2024:(in thousands)September 30,2025December 31,2024Unpaid principal balance$12,301 $2,297 Mark-to-market adjustments334 37 Total mortgage loans held-for-sale$12,635 $2,334 The following table presents a reconciliation of the Company’s mortgage loans held-for-sale for the three and nine months ended September 30, 2025 and 2024:Three Months EndedNine Months EndedSeptember 30,September 30,(in thousands)2025202420252024Balance at beginning of period$9,888 $278 $2,334 $332 Originations and purchases of mortgage loans49,753 22,394 127,292 22,445 Sales and principal collections(47,113)(19,378)(117,288)(19,479)Unrealized gains (losses) on mortgage loans107 50 297 46 Balance at end of period$12,635 $3,344 $12,635 $3,344 The Company is subject to credit risk associated with its originated mortgage loans during the period of time prior to the sale of these loans. The Company considers credit risk associated with these loans to be minimal as it holds the loans for a short period of time and the market for these loans continues to be highly liquid.

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Table of ContentsTWO HARBORS INVESTMENT CORP.Notes to the Consolidated Financial Statements (unaudited)

The Company utilizes repurchase agreements and warehouse lines of credit to finance its mortgage loans held-for-sale. At September 30, 2025, the Company had pledged mortgage loans held