| Summary of components of other financing lines of credit |
The following summarizes the components of other financing lines of credit related to continuing operations (in thousands):
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Outstanding borrowings at |
| Maturity Date |
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Interest Rate |
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Collateral Pledged |
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Total Capacity(1)
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September 30, 2023 |
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December 31, 2022 |
| Mortgage Lines: |
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October 2023(2)
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Bloomberg short-term
bank yield ("BSBY") index + applicable margin |
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First Lien Mortgages |
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$ |
15,000 |
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$ |
9,332
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$ |
83,814 |
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November 2023(2)
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Secured Overnight Financing Rate ("SOFR") + applicable margin |
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Home Improvement Consumer Loans |
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50,000 |
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3,384
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7,495 |
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Various(3)
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Bond accrual rate + applicable margin |
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Mortgage Related Assets |
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36,828 |
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36,828
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37,604 |
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| N/A |
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N/A |
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MSR |
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— |
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—
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10,312 |
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| Subtotal mortgage lines of credit |
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$ |
101,828 |
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$ |
49,544
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$ |
139,225 |
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| Reverse Lines: |
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October 2023(2) - June 2024
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BSBY/SOFR + applicable margin |
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First Lien Mortgages |
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$ |
935,000 |
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$ |
353,524
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$ |
584,658 |
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Various(3)
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Bond accrual rate/SOFR + applicable margin |
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Mortgage Related Assets |
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360,514 |
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340,514
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320,715 |
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| October 2027 |
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SOFR + applicable margin |
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MSR |
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70,000 |
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69,231
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33,036 |
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| March 2024 |
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Prime + .50%; 6% floor |
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Unsecuritized Tails |
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20,000 |
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20,000
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45,001 |
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| Subtotal reverse lines of credit |
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$ |
1,385,514 |
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$ |
783,269
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$ |
983,410 |
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| Commercial Lines: |
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| January 2024 |
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SOFR + applicable margin |
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Mortgage Related Assets |
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$ |
20,000 |
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$ |
20,000
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$ |
12,500 |
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| N/A |
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N/A |
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First Lien Mortgages |
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— |
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—
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159,938 |
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| N/A |
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N/A |
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Encumbered Agricultural Loans |
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— |
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—
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7,561 |
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| N/A |
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N/A |
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Second Lien Mortgages |
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— |
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—
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25,000 |
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| Subtotal commercial lines of credit |
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$ |
20,000 |
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$ |
20,000
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$ |
204,999 |
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| Total other financing lines of credit |
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$ |
1,507,342 |
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$ |
852,813
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$ |
1,327,634 |
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(1)Capacity is dependent upon maintaining compliance with, or obtaining waivers of, the terms, conditions, and covenants of the respective agreements, including asset-eligibility requirements. Capacity amounts presented are as of September 30, 2023. The lines of credit with no capacity are terminated as of September 30, 2023.
(2)The other financing lines of credit with maturity dates in October and November of 2023 have either been renewed or paid off subsequent to September 30, 2023.
(3)These lines of credit are tied to the maturity date of the underlying mortgage related assets that have been pledged as collateral.
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| Summary of maximum allowable distributions available to the Company based on the most restrictive of such financial covenant ratios |
As of September 30, 2023, the maximum allowable distributions available to the Company based on the most restrictive of such financial covenant ratios is presented in the table below (in thousands, except for ratios):
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| Financial Covenants |
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Requirement |
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September 30, 2023 |
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Maximum Allowable Distribution(1)
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| FAM |
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| Adjusted Tangible Net Worth |
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$ |
10,000
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$ |
16,543
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$ |
6,543
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| Liquidity |
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1,000
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2,984
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1,984
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| FAR |
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| Adjusted Tangible Net Worth |
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$ |
250,000
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$ |
254,739
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$ |
4,739
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| Liquidity |
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45,000
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61,863
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16,863
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| Leverage Ratio |
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6:1 |
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4.9:1 |
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44,990
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| FAH |
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| Adjusted Tangible Net Worth |
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$ |
300,000
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$ |
217,055
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$ |
—
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| Liquidity |
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40,000
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62,539
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22,539
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| Leverage Ratio |
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10:1 |
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6.5:1 |
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75,861
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(1) The Maximum Allowable Distribution for any of the originations subsidiaries is the lowest of the amounts shown for the particular originations subsidiary. We obtained financial covenant waivers as of September 30, 2023 or subsequently paid off a line of credit for not being in compliance with the adjusted tangible net worth requirements for FAH.
As of December 31, 2022, the maximum allowable distributions available to the Company based on the most restrictive of such financial covenant ratios is presented in the table below (in thousands, except for ratios):
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| Financial Covenants |
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Requirement |
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December 31, 2022 |
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Maximum Allowable Distribution(1)
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| FAM |
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| Adjusted Tangible Net Worth |
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$ |
100,000 |
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$ |
100,907 |
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$ |
907 |
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| Liquidity |
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20,000 |
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23,368 |
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3,368 |
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| Leverage Ratio |
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13:1 |
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9.3:1 |
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28,732 |
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| FAR |
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| Adjusted Tangible Net Worth |
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$ |
250,000 |
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$ |
267,067 |
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$ |
17,067 |
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| Liquidity |
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24,724 |
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28,718 |
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3,994 |
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| Leverage Ratio |
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6:1 |
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5.3:1 |
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31,808 |
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| FAH |
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| Adjusted Tangible Net Worth |
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$ |
300,000 |
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$ |
310,850 |
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$ |
10,850 |
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| Liquidity |
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45,000 |
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52,270 |
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7,270 |
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| Leverage Ratio |
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10:1 |
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6.6:1 |
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107,292 |
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(1) The Maximum Allowable Distribution for any of the originations subsidiaries is the lowest of the amounts shown for the particular originations subsidiary.
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