Company: RWT-PA
Filing Date: 2025-08-08
Form Type: 10-Q
Source: 0000930236-25-000029
Chunk: 176

Company: REDWOOD TRUST INC
Filing Date: 2025-08-08
Form: 10-Q
Item: Part I, Item 1
Chunk 176
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 loan inventory. Our inventory of loans is managed with a combination of our capital and loan warehouse facilities. At June 30, 2025, total warehouse capacity was $2.18 billion, with $1.48 billion of available capacity (inclusive of capacity on non-recourse facilities). All of these facilities are non-marginable (i.e., not subject to margin calls based solely on the lender's determination, in its discretion, of the market value of the underlying collateral that is non-delinquent).

Six Months Ended June 30, 2025 Compared to Six Months Ended June 30, 2024

CoreVest segment contribution increased $14 million during the six months ended June 30, 2025, compared to the six months ended June 30, 2024. The increase is attributable to higher mortgage banking income, driven by an increase in total loan funding volumes and robust distribution via whole loan sales and joint ventures. Funded volume for the six months ended June 30, 2025 was $991 million compared to $785 million for the period ended June 30, 2024, representing a 26% increase. All strategies saw growth over the period through growth was particularly notable in products of strategic focus such as RTL (54%) and DSCR (86%) loans. Term (18%) and bridge (7%) loans witnessed more modest gains. 

Distribution activity for the sixth months ended June 30, 2025 was also elevated compared to the six months ended June 30, 2024. For the six months ended June 30, 2025, CoreVest distributed $991 million of loans compared to $785 million of loans for the six months ended June 30, 2024, an increase of 26%. A significant driver of the increase in distribution activity in 2025 compared to the same period 2024 was the establishment of our joint venture with CPP Investments, which was announced in March 2024 and became active in the third quarter of 2024. Net cost to originate improved from 2.61% in early 2024 to 0.94% in the second quarter of 2025, supported by increased operational scale without significant growth in operating expenses. 

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Redwood Investments Segment

This segment consists of retained operating investments sourced through our Sequoia securitizations and CoreVest term and bridge loan securitizations, some of which we consolidate for GAAP purposes, and other third-party securities.

In the second