Company: RWT-PA
Filing Date: 2025-08-08
Form Type: 10-Q
Source: 0000930236-25-000029
Chunk: 7

Company: REDWOOD TRUST INC
Filing Date: 2025-08-08
Form: 10-Q
Item: Part I, Item 2
Chunk 7
---
 operating footprint despite a sustained slowdown in overall housing market activity.

Sequoia’s jumbo loan lock volume for newly originated or "current coupon" loans in the second quarter of 2025 was its highest since 2021. Amidst sluggish home purchase activity and in a market bereft of meaningful mortgage loan refinance activity, this growth highlights the significant progress we have made in expanding our "wallet share" across both bank and non-bank loan sellers. We are encouraged by the continued depth and diversification of our sourcing network, which exceeds 200 loan sellers with no significant volume concentrated with any one of these sellers.

Second, our Aspire platform, which commenced acquiring expanded residential loan products (also referred to as "non-QM loans") in January, gained meaningful traction in the second quarter, driven by growing lock volume sourced from an increasing number of originators. Aspire’s lock volume tripled compared to the first quarter of 2025. We are in the early stages of leveraging our existing Sequoia seller network to grow Aspire, as many long-time jumbo-loan sellers begin insourcing direct origination of these types of products. These established relationships are now complemented by an expanding group of new non-QM loan sellers who recognize Redwood’s ability to deliver innovative solutions across a variety of home lending products. Given Aspire’s current growth trajectory and relative scale, we remain confident in the platform’s significant potential.

Our business purpose lending platform, CoreVest, funded over $500 million in loans during the second quarter, marking its highest volume since mid-2022. Borrower loyalty remains strong, as evidenced by our high repeat-customer rate during the quarter—an important indicator of stability amid signs of housing stress in select regions. Our diligent approach to credit risk, including targeted credit overlays, tightened leverage in more vulnerable markets, and enhanced structural protections, continues to support strong loan performance and deepening distribution channels. Moreover, strategic hires within our small-balance product segment have significantly contributed to CoreVest’s volumes and positioned the platform for continued prudent growth.

62

RESULTS OF OPERATIONS

Within this Results of Operations section, in accordance with Item 303(c)(2)(ii) of Regulation S-K, we have elected to discuss any material changes in our results of operations by comparing our quarter ended June 30, 2025 to the immediate preceding quarter ended March 31, 2025. We believe that providing a sequential discussion of our results of operations offers highly relevant information for investors and stakeholders to understand and