Company: BLNE
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001641172-25-004793
Chunk: 1109

Company: Beeline Holdings, Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 7
Chunk 1109
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under the fair value option in accordance with ASC 825, Financial Instruments, with changes in fair value recorded in gain on sale
of loans, net on the consolidated statements of operations. The fair value of mortgage loans held for sale committed to investors is calculated
using observable market information such as the investor commitment, assignment of trade or other mandatory delivery commitment prices.
The fair value of mortgage loans held for sale not committed to investors is based on quoted best execution secondary market prices. If
no such quoted price exists, the fair value is determined using quoted prices for a similar asset or assets, such as Mortgage-Backed Securities
(“MBS”) prices, adjusted for the specific attributes of that loan, which would be used by other market participants. Mortgage
loans held for sale not calculated using observable market information are based on third-party broker quotations or market bid pricing.

Gains and losses from the sale of mortgage loans held
for sale are recognized based upon the difference between the sales proceeds and carrying value of the related loans upon sale and are
recorded in gain on sale of loans, net on the consolidated statements of operations. Sales proceeds reflect the cash received from investors
through the sale of the loan and servicing release premium. Gain on sale of loans, net also includes the unrealized gains and losses associated
with the changes in the fair value of mortgage loans held for sale, and the realized and unrealized gains and losses from derivative instruments.

Mortgage loans held for sale are considered sold when
the Company surrenders control over the financial assets. Control is considered to have been surrendered when the transferred assets have
been isolated from the Company, beyond the reach of the Company and its creditors; the purchaser obtains the right (free of conditions
that constrain it from taking advantage of that right) to pledge or exchange the transferred assets; and the Company does not maintain
effective control over the transferred assets through either an agreement that both entitles and obligates the Company to repurchase or
redeem the transferred assets 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, indemn