Company: BLNE
Filing Date: 2025-05-20
Form Type: 10-Q
Source: 0001641172-25-011724
Chunk: 162

Company: Beeline Holdings, Inc.
Filing Date: 2025-05-20
Form: 10-Q
Item: Part I, Item 2
Chunk 162
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 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, and economic trends and conditions in the industry. Actual
losses incurred are reflected as write-offs against the loan indemnification reserve.

Since
mortgage loans held for sale have maturity dates greater than one year from the balance sheet date but are expected to be sold in a short
time frame (less than one year), they are recorded as current assets.

Changes
in the balance of mortgage loans held for sale are included in cash flows from operating activities in the consolidated statements of
cash flows in accordance with ASC 230-10-45-21, Statement of Cash Flows.

40

Revenue
recognition

Gains
on Sale of Loans, Net

See
discussion above under “Mortgage Loans Held for Sale and Gain on Sale of Loans Revenue Recognition” and below under “Derivative
Financial Instruments and Revenue Recognition”.

Title
Fees

Commissions
earned at loan settlement on insurance premiums paid to title insurance companies.

Loan
Origination Fees and Costs

Loan
origination fees represent revenue earned from originating mortgage loans. Loan origination fees generally represent flat per-loan fee
amounts based on a percentage of the original principal loan balance and are recognized as revenue at the time the mortgage loans are
funded since the loans are held for sale. Loan origination costs are charged to operations as incurred.

Interest
Income

Interest
income on mortgage loans held for sale is recognized for the period from loan funding to