Company: FOACW
Filing Date: 2025-08-11
Form Type: 10-Q
Source: 0001828937-25-000061
Chunk: 59

Company: Finance of America Companies Inc.
Filing Date: 2025-08-11
Form: 10-Q
Item: Item 1
Chunk 59
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 scenarios where FHA insurance proceeds are not expected to cover all principal and interest outstanding and, as servicer, the Company is exposed to losses upon resolution of the loan.Level 3Other assetsLoans held for sale - reverse mortgage loansThe fair value is based on the value of the underlying loans. These loans are valued based on an expected margin on sale as of June 30, 2025. There were not any reverse mortgage loans held for sale as of December 31, 2024.Level 3Retained bondsManagement obtains third-party valuations to assess the reasonableness of the fair value calculations provided by the internal valuation model. The primary assumptions utilized include WAL and discount rate.Level 3LiabilitiesHMBS related obligationsHMBS related obligationsThe fair value is based on the net present value of projected cash flows over the estimated life of the liability. The fair value of the HMBS related obligations also includes the consideration required by a market participant to transfer the HECM and HMBS servicing obligations, including exposure resulting from shortfalls in FHA insurance proceeds as well as assumptions that it believes a market participant would consider in valuing the liability, including, but not limited to, assumptions for repayment, costs to transfer servicing obligations, shortfalls in FHA insurance proceeds, and discount rates. The significant unobservable inputs used in the measurement include WAL, CPR, and discount rates.  Level 3Nonrecourse debtNon-agency reverse mortgage loan securitizations and performing/nonperforming HECM securitizationsThe fair value is based on the net present value of projected cash flows over the estimated life of the liability. The significant unobservable inputs used in the measurement include WAL, CPR, and discount rates.Level 3

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Finance of America Companies Inc.Notes to Condensed Consolidated Financial Statements (Unaudited)

Deferred purchase price liabilitiesDeferred purchase price liabilitiesThese liabilities are measured based on the estimated amount of indemnified claims associated with the acquisition of certain assets and liabilities from American Advisors Group, now known as Bloom Retirement Holdings Inc. (“AAG/Bloom”), and the closing market price of the Company’s publicly-traded stock on the applicable date of the Condensed Consolidated Statements of Financial Condition. Level 3Tax Receivable Agreements (“TRA”) obligationThe fair value is derived through the use of a discounted cash flow (“DCF”) model. The significant unobservable assumptions used in the DCF include the ability to utilize tax attributes based on current tax forecasts, a constant U.S. federal income tax rate, and