Company: FOACW
Filing Date: 2025-03-14
Form Type: 10-K
Source: 0001828937-25-000009
Chunk: 213

Company: Finance of America Companies Inc.
Filing Date: 2025-03-14
Form: 10-K
Item: Item 3
Chunk 213
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 Company intends to hold to maturity.HECM loans and tails that have not yet been securitized into HMBS consist primarily of newly-issued HECM that the Company has either originated or purchased, subsequent borrower draws, and amounts paid by the Company on the borrower’s behalf for MIP that have not yet been transferred to a Ginnie Mae securitization.The Company, as an issuer of HMBS, is required to repurchase reverse loans out of the Ginnie Mae securitization pools once the outstanding principal balance of the related HECM is equal to or greater than 98% of the maximum claim amount (“MCA”) (referred to as HECM buyouts). The majority of performing loans are now conveyed to 

112

Finance of America Companies Inc.Notes to Consolidated Financial Statements

HUD prior to the Company needing to finance the HECM buyouts. Nonperforming repurchased loans are generally liquidated through foreclosure, subsequent sale of the real estate owned, and claim submissions to HUD.The yield recognized on loans held for investment is based on the stated interest rates of the loans and is recorded in Interest income in the Consolidated Statements of Operations. The difference between the cost basis of newly originated or acquired loans and their estimated fair value is recognized in Net origination gains in the Consolidated Statements of Operations. The changes in fair value due to portfolio runoff and realization of modeled income and expenses are recorded in Fair value changes from model amortization in the Consolidated Statements of Operations, and other fair value changes are recorded in Fair value changes from market inputs or model assumptions in the Consolidated Statements of Operations. Refer to Note 6 - Fair Value for further discussion of valuation of loans held for investment.Loan origination fees represent an up-front fee charged to a borrower for processing the HECM or non-agency reverse mortgage application and are recorded in Fee income in the Consolidated Statements of Operations as they are received when a loan is successfully funded. Costs to originate loans are recognized as incurred and recorded in Loan production and portfolio related expenses in the Consolidated Statements of Operations.Certain HECM and non-agency reverse mortgage loans originated or acquired by the Company include broker compensation or correspondent fees. These premiums are remitted to the mortgage broker or correspondent lender who acted as the intermediary for the reverse mortgage. Broker compensation and correspondent fees are recorded as part of Net origination gains in the Consolidated Statements of Operations.Intangible Assets, NetIntangible assets, net, consist of trade names and broker/customer relationships acquired through