loanDepot, Inc.LDI
loanDepot, Inc. Fair Value Disclosure
FAIR VALUE
The Company's consolidated financial statements include assets and liabilities that are measured based on their estimated fair values. Refer to Note 1 - Description of Business and Summary of Significant Accounting Policies for information on the fair value hierarchy, valuation methodologies, and key inputs used to measure financial assets and liabilities recorded at fair value, as well as methods and assumptions used to estimate fair value disclosures for financial instruments not recorded at fair value in their entirety on a recurring basis.
Financial Statement Items Measured at Fair Value on a Recurring Basis
The following tables presents the Company’s assets and liabilities that are measured at fair value on a recurring basis by fair value hierarchy as of the dates indicated.
| December 31, 2025 | ||||||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||
| Fair value through net income: | ||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Loans held for sale | $ | — | $ | 3,165,542 | $ | — | $ | 3,165,542 | ||||||||||||||||||
Loans held for investment | — | 109,821 | — | 109,821 | ||||||||||||||||||||||
| Trading securities | — | 85,640 | — | 85,640 | ||||||||||||||||||||||
| Derivative assets: | ||||||||||||||||||||||||||
| Interest rate lock commitments | — | — | 42,207 | 42,207 | ||||||||||||||||||||||
| Forward sale contracts | — | 158 | — | 158 | ||||||||||||||||||||||
| Servicing rights | — | — | 1,658,223 | 1,658,223 | ||||||||||||||||||||||
| Total assets at fair value | $ | — | $ | 3,361,161 | $ | 1,700,430 | $ | 5,061,591 | ||||||||||||||||||
| Liabilities: | ||||||||||||||||||||||||||
| Derivative liabilities: | ||||||||||||||||||||||||||
| Interest rate lock commitments | $ | — | $ | — | $ | 1,870 | $ | 1,870 | ||||||||||||||||||
| Forward sale contracts | — | 3,416 | — | 3,416 | ||||||||||||||||||||||
| Interest rate swap futures | 3,420 | — | — | 3,420 | ||||||||||||||||||||||
| Put options on treasuries | 2,012 | — | — | 2,012 | ||||||||||||||||||||||
| Servicing rights | — | — | 20,517 | 20,517 | ||||||||||||||||||||||
| Total liabilities at fair value | $ | 5,432 | $ | 3,416 | $ | 22,387 | $ | 31,235 | ||||||||||||||||||
| December 31, 2024 | ||||||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||
| Fair value through net income: | ||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Loans held for sale | $ | — | $ | 2,603,735 | $ | — | $ | 2,603,735 | ||||||||||||||||||
Loans held for investment | — | 116,627 | — | 116,627 | ||||||||||||||||||||||
| Trading securities | — | 87,466 | — | 87,466 | ||||||||||||||||||||||
| Derivative assets: | ||||||||||||||||||||||||||
| Interest rate lock commitments | — | — | 27,739 | 27,739 | ||||||||||||||||||||||
| Forward sale contracts | — | 16,650 | — | 16,650 | ||||||||||||||||||||||
| Servicing rights | — | — | 1,633,661 | 1,633,661 | ||||||||||||||||||||||
| Total assets at fair value | $ | — | $ | 2,824,478 | $ | 1,661,400 | $ | 4,485,878 | ||||||||||||||||||
| Liabilities: | ||||||||||||||||||||||||||
| Derivative liabilities: | ||||||||||||||||||||||||||
| Interest rate lock commitments | $ | — | $ | — | $ | 2,187 | $ | 2,187 | ||||||||||||||||||
| Interest rate swap futures | 16,148 | — | — | 16,148 | ||||||||||||||||||||||
| Forward sale contracts | — | 896 | — | 896 | ||||||||||||||||||||||
| Put options on treasuries | 5,829 | — | — | 5,829 | ||||||||||||||||||||||
| Servicing rights | — | — | 18,151 | 18,151 | ||||||||||||||||||||||
| Total liabilities at fair value | $ | 21,977 | $ | 896 | $ | 20,338 | $ | 43,211 | ||||||||||||||||||
The following presents the changes in the Company’s assets and liabilities that are measured at fair value on a recurring basis using significant unobservable inputs (Level 3):
| Year Ended December 31, 2025 | ||||||||||||||
| IRLCs, net | Servicing Rights, net | |||||||||||||
| Balance at beginning of period | $ | 25,552 | $ | 1,615,510 | ||||||||||
| Total net gains (losses) included in: | ||||||||||||||
| Gain on origination and sale of loans, net: | ||||||||||||||
| Issuances and additions | 492,620 | 271,439 | ||||||||||||
Fallout | (94,477) | — | ||||||||||||
| Transfers of IRLC to LHFS | (383,358) | — | ||||||||||||
Valuation changes in servicing rights, net(1) | — | (212,976) | ||||||||||||
| Sales | — | (36,267) | ||||||||||||
| Balance at end of period | $ | 40,337 | $ | 1,637,706 | ||||||||||
(1)The change in unrealized gains or losses relating to servicing rights still held at December 31, 2025 amounted to a net loss of $69.5 million for the year ended December 31, 2025.
| Year Ended December 31, 2024 | ||||||||||||||
| IRLCs, net | Servicing Rights, net | |||||||||||||
| Balance at beginning of period | $ | 47,940 | $ | 1,985,718 | ||||||||||
| Total net gains (losses) included in: | ||||||||||||||
| Gain on origination and sale of loans, net: | ||||||||||||||
| Issuances and additions | 407,475 | 252,076 | ||||||||||||
Fallout | (94,667) | — | ||||||||||||
| Transfers of IRLC to LHFS | (335,196) | — | ||||||||||||
Valuation changes in servicing rights, net(1) | — | (107,512) | ||||||||||||
| Sales | — | (514,772) | ||||||||||||
| Balance at end of period | $ | 25,552 | $ | 1,615,510 | ||||||||||
(1)The change in unrealized gains or losses relating to servicing rights that were still held at December 31, 2024, amounted to a net loss of $33.6 million for the year ended December 31, 2024.
| Year Ended December 31, 2023 | ||||||||||||||
| IRLCs, net | Servicing Rights, net | |||||||||||||
| Balance at beginning of period | $ | 23,590 | $ | 2,025,136 | ||||||||||
| Total net gains (losses) included in: | ||||||||||||||
| Gain on origination and sale of loans, net: | ||||||||||||||
| Issuances and additions | 387,498 | 277,387 | ||||||||||||
Fallout | (87,697) | — | ||||||||||||
| Transfers of IRLC to LHFS | (275,451) | — | ||||||||||||
Valuation changes in servicing rights, net(1) | — | (136,118) | ||||||||||||
| Sales | — | (180,687) | ||||||||||||
| Balance at end of period | $ | 47,940 | $ | 1,985,718 | ||||||||||
(1)The change in unrealized gains or losses relating to servicing rights that were still held at December 31, 2023, amounted to a net loss of $61.1 million for the year ended December 31, 2023.
The following table presents quantitative information about the valuation techniques and unobservable inputs applied to Level 3 fair value measurements for financial instruments measured at fair value on a recurring basis:
| December 31, 2025 | December 31, 2024 | |||||||||||||||||||||||||||||||||||||
| Unobservable Input | Range of inputs | Weighted Average(1) | Range of inputs | Weighted Average(1) | ||||||||||||||||||||||||||||||||||
| IRLCs | ||||||||||||||||||||||||||||||||||||||
| Pull-through rate | 5.2% | - | 99.9% | 78.3% | 0.1% | - | 99.9% | 75.2% | ||||||||||||||||||||||||||||||
| Servicing rights | ||||||||||||||||||||||||||||||||||||||
Discount rate(2) | 3.8% | - | 17.7% | 6.9% | 4.1% | - | 17.5% | 6.5% | ||||||||||||||||||||||||||||||
| Prepayment rate | 5.8% | - | 14.1% | 8.7% | 5.4% | - | 16.7% | 8.1% | ||||||||||||||||||||||||||||||
| Cost to service (per loan) | $73 | - | $132 | $100 | $73 | - | $129 | $96 | ||||||||||||||||||||||||||||||
(1)Weighted average inputs are based on the committed amounts for IRLCs and the UPB of the underlying loans for servicing rights.
(2)The Company estimates the fair value of MSRs using an option-adjusted spread (“OAS”) model, which projects MSR cash flows over multiple interest rate scenarios in conjunction with the Company’s prepayment model, and then discounts these cash flows at risk-adjusted rates.
Financial Statement Items Measured at Fair Value on a Nonrecurring Basis
The Company did not have any material assets or liabilities that were recorded at fair value on a non-recurring basis as of December 31, 2025 or December 31, 2024.
Financial Statement Items Measured at Amortized Cost
The following table presents the carrying amount and estimated fair value of financial instruments included in the consolidated financial statements that are not recorded at fair value on a recurring or nonrecurring basis. The table excludes cash and cash equivalents, restricted cash, loans eligible for repurchase, warehouse and other lines of credit, and secured debt facilities as these financial instruments are highly liquid or short-term in nature and as a result, their carrying amounts approximate fair value:
| December 31, 2025 | December 31, 2024 | |||||||||||||||||||||||||
| Carrying Amount | Estimated Fair Value | Carrying Amount | Estimated Fair Value | |||||||||||||||||||||||
| Senior Notes | $ | 807,053 | $ | 801,069 | $ | 812,122 | $ | 779,872 | ||||||||||||||||||
Other secured financings | $ | 87,953 | $ | 89,034 | $ | 97,767 | $ | 98,820 | ||||||||||||||||||
Fair value of the Company’s Senior Notes issued in March 2021 and June 2024 is estimated using quoted market prices and classified as Level 2 in the fair value hierarchy. Fair value of the Company’s other secured financings is estimated using quoted market prices and classified as Level 2 in the fair value hierarchy.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 12, 2026 | Showing above |
| 2024 | Mar 13, 2025 | |
| 2023 | Mar 15, 2024 | |
| 2022 | Mar 16, 2023 | |
| 2021 | Mar 18, 2022 | |
About Fair Value Disclosures
Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.
Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.