Finance of America Companies (FOA) FY2025 10-K Risk Factors: 11 New, 9 Dropped

What the changes say

Partnership strategies expand with Better and PHH agreements to scale reverse mortgage distribution.

What changed since the prior 10-K

New

NewRisks Related to the Business of the Company
We may fail to capitalize on strategic partnerships and our strategic partnerships present additional risks to us
The company faces risks from strategic partnerships, including October 2025 reverse mortgage agreements with Better and PHH.
NewRisks Related to the Business of the Company
We generated net profits of $103.0 million and $35.7 million for the years ended December 31, 2025 and 2024, respectively. However, we generated net losses in each of the three preceding years and our accumulated deficit was $653.7 million as of December 31, 2025
Despite a net profit of $103.0 million for 2025, the company has an accumulated deficit of $653.7 million.
NewRisks Related to the Business of the Company
Our business could suffer if we fail to attract, or retain, highly skilled employees. In addition, our success depends on the continuing efforts of our founder and chairman, executive management team, and key personnel
The company relies heavily on founder, chairman, and key personnel in the reverse mortgage sector.
NewRisks Related to the Business of the Company
impede our ability to implement our current strategy or take advantage of strategic acquisitions or other growth opportunities that may be presented to us, which could materially affect our business, financial condition, and results of operations
Ineffective succession planning could impede the execution of strategic, financial, and operating goals.
NewRisks Related to Our Lending Business
We are subject to the risk of fraudulent activity by loan applicants and other participants in the loan origination process
Mortgage origination fraud risk has increased due to AI technologies used by bad actors.
NewRisks Related to Our Lending Business
Additionally, our hedge instruments may expose us to counterparty risk—the possibility that a loss may occur from the failure of another party to perform in accordance with the terms of the contract, which loss exceeds the value of existing collateral, if any
Hedge instruments expose the company to counterparty risk and market risks from prepayment speeds and credit spreads.
NewRisks Related to Our Lending Business
We are undertaking initiatives to enhance our internal servicing capabilities, which initiatives present operational and regulatory risks and may not result in the anticipated benefits
Enhancing internal servicing capabilities introduces operational and regulatory risks without guaranteed benefits.
NewRisks Related to Our Organizational Structure
including tax benefits attributable to making payments under the Tax Receivable Agreement. The Company will generally retain the benefit of the remaining 15% of these cash tax benefits
Estimating Tax Receivable Agreement payments is imprecise and expected to be substantial.
NewRisks Related to Ownership of our Class A Common Stock
The terms of the Company’s Series A Preferred Stock may materially adversely affect the value and rights of the Company’s Class A Common Stock
The company issued 50,000 shares of Series A Preferred Stock for $50.0 million with a 9.0% initial dividend.
NewRisks Related to Ownership of our Class A Common Stock
There may be sales of a substantial amount of Class A Common Stock by certain of the Company’s shareholders and these sales could cause the price of the Company’s securities to fall
Sales of Class A Common Stock by certain shareholders pursuant to registration rights could depress the stock price.
NewRisks Related to Ownership of our Class A Common Stock
There can be no assurance that we will be able to satisfy the continued listing standards that are required to be satisfied in order for our Class A Common Stock to continue to be listed on the NYSE and NYSE Texas
The company previously received NYSE non-compliance notices for a stock price below $1.00 and executed a 1-for-10 reverse stock split.

Dropped

DroppedRisks Related to the Business of the Company
While we generated a net profit in 2024, we have a recent history of net losses and we may not maintain profitability in the future due to the risks and uncertainties associated with operating as a unified modern retirement solutions platform
DroppedRisks Related to the Business of the Company
Our business could suffer if we fail to attract, or retain, highly skilled employees, and changes in our executive management team may be disruptive to our business
Covered 2024 net profit of $35.7 million against historical net losses.
DroppedRisks Related to the Business of the Company
have other negative consequences, including as a result of our employees interacting with our customers in an unauthorized manner in various social media outlets
DroppedRisks Related to Our Lending Business
Any of the circumstances described above, alone or in combination, may lead to volatility in or disruption of the credit markets at any time and may have a detrimental effect on our business
DroppedRisks Related to Our Lending Business
obligations. RMF’s bankruptcy filing initially created disruption in the reverse mortgage market and adversely impacted the liquidity of reverse mortgage-backed securities as well as the cost of and availability of credit to reverse mortgage financial participants
DroppedRisks Related to Ownership of our Class A Common Stock
The NYSE imposes requirements that must be complied with in order for securities to remain listed on the NYSE, some of which are not completely within the Company’s control
Covered talent attraction and retention risks in the mortgage industry.
DroppedRisks Related to Ownership of our Class A Common Stock
Pursuant to the Registration Rights Agreement, certain shareholders were entitled to demand that the Company register the resale of their securities subject to certain minimum requirements. These shareholders also have certain “piggyback” registration rights with respect to previously filed registration statements
DroppedRisks Related to Ownership of our Class A Common Stock
The Company is a “controlled company” within the meaning of the NYSE rules and, as a result, qualifies for exemptions from certain corporate governance requirements. The stockholders of the Company do not have the same protections afforded to stockholders of companies that are subject to such requirements
DroppedRisks Related to Ownership of our Class A Common Stock
The A&R Charter does not limit the ability of the principal stockholders to compete with the Company and they may have investments in businesses whose interests conflict with the Company

Reworded

83% rewrittenRisks Related to the Business of the Company
We may fail to realize the anticipated benefits of the efforts we have undertaken to enhance our marketing and digital capabilities
Updated to reflect 2025 brand platform launch A Better Way with FOA and AI chatbot Joy.
Was: We may fail to realize the anticipated benefits of the efforts we have undertaken to transition to a unified lending platform and to streamline and enhance our marketing and originations operations and digital capabilities
78% rewrittenRisks Related to Our Lending Business
We are subject to risks arising from conditions in the real estate and mortgage markets, in particular, the reverse mortgage market; we rely on the initiatives of HUD and Ginnie Mae to support the HECM program
Clarified references to HECM loans and Ginnie Mae HMBS mandatory repurchase requirements.
77% rewrittenRisks Related to Our Organizational Structure
The Company is required to make payments under the Tax Receivable Agreement for certain tax benefits the Company may claim, and the amounts of such payments could be significant
Removed specific references to Blackstone entities in Tax Receivable Agreement descriptions.
Was: The Company is required to make payments under the Tax Receivable Agreements for certain tax benefits the Company may claim, and the amounts of such payments could be significant
73% rewrittenRisks Related to Ownership of our Class A Common Stock
If securities or industry analysts do not publish research or reports about the Company, or if they publish adverse recommendations regarding the Company's securities, then the Company's stock price and trading volume could decline
Added that no securities analysts currently cover the company, reducing market visibility.
Was: If securities or industry analysts cease publishing research or reports about the Company, its business, or its market, or if they change their recommendations regarding the Company’s securities adversely, the price and trading volume of the Company’s securities could decline
69% rewrittenRisks Related to Our Lending Business
We currently only hedge a subset of our assets and our hedging strategies may not be successful in mitigating our risks associated with changes in interest rates and valuations; our Company is exposed to other credit risk
Added that the company now hedges a subset of non-agency fixed rate loans prior to securitization.
Was: We do not currently and may not in the future actively hedge our assets, and if we do hedge our assets, our hedging strategies may not be successful in mitigating our risks associated with changes in interest rates and valuations; our Company is exposed to other credit risk
56% rewrittenRisks Related to Ownership of our Class A Common Stock
The principal stockholder has substantial influence over the Company and its interests may conflict with the interests of the Company or its stockholders in the future
Updated principal voting power ownership percentage to approximately 47.7% as of March 2026.
Was: The principal stockholders control the Company and their interests may conflict with the Company’s or yours in the future
56% rewrittenRisks Related to Ownership of our Class A Common Stock
You may be diluted by the future issuance of additional Class A Common Stock or Class A LLC Units in connection with the Company’s incentive plans, acquisitions, warrants, notes, Series A Preferred Stock, or otherwise
Updated share counts and added Series A Preferred Stock conversion shares as of March 2026.
Was: You may be diluted by the future issuance of additional Class A Common Stock or Class A LLC Units in connection with the Company’s incentive plans, acquisitions, warrants, or otherwise
48% rewrittenRisks Related to Our Indebtedness
The agreements that govern our warehouse facilities and lines of credit typically contain covenants relating to our financial condition and we may experience difficulties in complying with such financial covenants
Removed the specific 2024 fourth quarter net income covenant waiver mention.
47% rewrittenRisks Related to Laws and Regulations
We are subject to legal proceedings, federal or state governmental examinations, and enforcement investigations from time to time. Some of these matters are highly complex and slow to develop, and results are difficult to predict or estimate
46% rewrittenRisks Related to Ownership of our Class A Common Stock
Because we have no current plans to pay cash dividends on our shares of Class A Common Stock for the foreseeable future, you may not receive any return on investment unless you sell your shares of Class A Common Stock for a price greater than that which you paid for it
45% rewrittenRisks Related to Ownership of our Class A Common Stock
The Company may not be able to effectively continue to implement and maintain controls and procedures required by the Sarbanes-Oxley Act that are applicable to us
43% rewrittenRisks Related to the Business of the Company
Our capital investments in technology may not achieve anticipated returns
37% rewrittenRisks Related to Laws and Regulations
Unlike competitors that are national banks, we are subject to state licensing and operational requirements that result in substantial compliance costs and risks
34% rewrittenRisks Related to the Business of the Company
We are incorporating AI technologies into our processes. These technologies may present business, compliance, and reputational risks
Was: We are incorporating artificial intelligence technologies into our processes. These technologies may present business, compliance, and reputational risks
34% rewrittenRisks Related to Our Indebtedness
Our ability to service our indebtedness is dependent on cash flow generated and made available by our subsidiaries, which may be subject to limitations beyond our control
31% rewrittenRisks Related to the Business of the Company
Reputational harm, including as a result of our actual or alleged conduct or public opinion, could adversely affect our business, results of operations, and financial condition
30% rewrittenRisks Related to Our Lending Business
We have risks related to our Subservicers that could have a material adverse effect on our business, liquidity, financial condition, and results of operations
29% rewrittenRisks Related to the Business of the Company
A security breach or a cyber-attack could adversely affect our results of operations and financial condition
26% rewrittenRisks Related to Our Organizational Structure
The Company is a holding company and its only material asset is its interest in FOA Equity. It is accordingly dependent upon distributions from FOA Equity to pay taxes, make payments under the Tax Receivable Agreement, and pay dividends
Was: The Company is a holding company and its only material asset is its interest in FOA Equity. It is accordingly dependent upon distributions from FOA Equity to pay taxes, make payments under the Tax Receivable Agreements, and pay dividends
26% rewrittenRisks Related to Our Lending Business
Our loan origination and servicing revenues are highly dependent on macroeconomic and U.S. residential real estate market conditions
23% rewrittenRisks Related to Ownership of our Class A Common Stock
The Company may issue additional preferred stock in the future whose terms could materially adversely affect the value and rights of the Company’s Class A Common Stock
Was: The Company may issue preferred stock whose terms could materially adversely affect the voting power or value of its Class A Common Stock
23% rewrittenRisks Related to Our Lending Business
We face competition that could adversely affect us and we may not be able to maintain or grow the volume of our loan originations
21% rewrittenRisks Related to Our Organizational Structure
In certain cases, payments under the Tax Receivable Agreement may be accelerated and/or significantly exceed the actual benefits, if any, the Company realizes in respect of the tax attributes subject to the Tax Receivable Agreement
Was: In certain cases, payments under the Tax Receivable Agreements may be accelerated and/or significantly exceed the actual benefits, if any, the Company realizes in respect of the tax attributes subject to the Tax Receivable Agreements
21% rewrittenRisks Related to Ownership of our Class A Common Stock
The trading history of our common stock has been characterized by low trading volume
20% rewrittenRisks Related to Our Indebtedness
Despite our current level of indebtedness, we may be able to incur substantially more debt and enter into other transactions, which could further exacerbate the risks to our financial condition described above
20% rewrittenRisks Related to Our Organizational Structure
The Company will not be reimbursed for any payments made to the TRA Parties under the Tax Receivable Agreement in the event that any tax benefits are disallowed
Was: The Company will not be reimbursed for any payments made to the TRA Parties under the Tax Receivable Agreements in the event that any tax benefits are disallowed

All 61 risk factors

Headings as the filing states them, in filing order.

Risks Related to the Business of the Company

01We may fail to realize the anticipated benefits of the efforts we have undertaken to enhance our marketing and digital capabilities83% rewritten
02We may fail to capitalize on strategic partnerships and our strategic partnerships present additional risks to usNew
03We generated net profits of $103.0 million and $35.7 million for the years ended December 31, 2025 and 2024, respectively. However, we generated net losses in each of the three preceding years and our accumulated deficit was $653.7 million as of December 31, 2025New
04Our geographic concentration could materially and adversely affect us if the economic conditions in our current markets should decline or if our current markets are impacted by natural disasters
05Our capital investments in technology may not achieve anticipated returns43% rewritten
06We are incorporating AI technologies into our processes. These technologies may present business, compliance, and reputational risks34% rewritten
07Our business could suffer if we fail to attract, or retain, highly skilled employees. In addition, our success depends on the continuing efforts of our founder and chairman, executive management team, and key personnelNew
08impede our ability to implement our current strategy or take advantage of strategic acquisitions or other growth opportunities that may be presented to us, which could materially affect our business, financial condition, and results of operationsNew
09Our failure to implement and maintain effective internal controls over financial reporting could require us to restate financial statements and cause investors to lose confidence in our reported financial information
10A security breach or a cyber-attack could adversely affect our results of operations and financial condition29% rewritten
11Technology disruptions or failures, including a failure in our operational or security systems or infrastructure, or those of third parties with whom we do business, could disrupt our business, cause legal or reputational harm, and adversely impact our results of operations and financial condition
12Reputational harm, including as a result of our actual or alleged conduct or public opinion, could adversely affect our business, results of operations, and financial condition31% rewritten
13Climate change, climate change-related regulation, and focus on environmental, social, and governance (“ESG”) issues may adversely affect our business and financial results and damage our reputation
14Our business is subject to the risks of earthquakes, fires, floods, and other natural catastrophic events, which may increase in frequency or severity as a result of global climate change, and to interruption by man-made issues such as strikes, wars, and civil unrest as well as health pandemics and epidemics
15Our risk management efforts may not be effective

Risks Related to Our Lending Business

16Our loan origination and servicing revenues are highly dependent on macroeconomic and U.S. residential real estate market conditions26% rewritten
17We are subject to the risk of fraudulent activity by loan applicants and other participants in the loan origination processNew
18We are subject to risks arising from conditions in the real estate and mortgage markets, in particular, the reverse mortgage market; we rely on the initiatives of HUD and Ginnie Mae to support the HECM program78% rewritten
19We face competition that could adversely affect us and we may not be able to maintain or grow the volume of our loan originations23% rewritten
20If we are unable to obtain sufficient capital to meet the financing requirements of our business, or if we fail to comply with our debt agreements, our business, financing activities, financial condition, and results of operations will be adversely affected
21We currently only hedge a subset of our assets and our hedging strategies may not be successful in mitigating our risks associated with changes in interest rates and valuations; our Company is exposed to other credit risk69% rewritten
22Additionally, our hedge instruments may expose us to counterparty risk—the possibility that a loss may occur from the failure of another party to perform in accordance with the terms of the contract, which loss exceeds the value of existing collateral, if anyNew
23A disruption in the secondary mortgage loan market, including the MBS market, could have a detrimental effect on our business
24We have third-party secondary market risks and counterparty risks (including mortgage loan brokers) that could have a material adverse effect on our business, liquidity, financial condition, and results of operations
25We have risks related to our Subservicers that could have a material adverse effect on our business, liquidity, financial condition, and results of operations30% rewritten
26We are undertaking initiatives to enhance our internal servicing capabilities, which initiatives present operational and regulatory risks and may not result in the anticipated benefitsNew
27Risks with respect to our non-agency second lien reverse mortgage loan product could ultimately result in delays or shortfalls in recoveries of amounts due from borrowers
28We are required to make servicing advances that can be subject to delays in recovery or may not be recoverable in certain circumstances
29Our counterparties may terminate subservicing contracts under which we conduct servicing activities

Risks Related to Laws and Regulations

30We operate in a heavily regulated industry, and our loan origination and servicing activities expose us to risks of noncompliance with an increasing and inconsistent body of complex laws and regulations at the U.S. federal, state, and local levels
31Unlike competitors that are national banks, we are subject to state licensing and operational requirements that result in substantial compliance costs and risks37% rewritten
32Compliance with federal, state, and local laws and regulations that govern employment practices and working conditions may be particularly burdensome to us due to the distributed nature of our workforce
33There may be material changes to the laws, regulations, rules, or practices applicable to the FHA, HUD, or Ginnie Mae that could materially adversely affect the reverse mortgage industry as a whole, including our business
34We are subject to legal proceedings, federal or state governmental examinations, and enforcement investigations from time to time. Some of these matters are highly complex and slow to develop, and results are difficult to predict or estimate47% rewritten

Risks Related to Our Indebtedness

35Our ability to service our indebtedness is dependent on cash flow generated and made available by our subsidiaries, which may be subject to limitations beyond our control34% rewritten
36Despite our current level of indebtedness, we may be able to incur substantially more debt and enter into other transactions, which could further exacerbate the risks to our financial condition described above20% rewritten
37The agreements that govern our senior notes, warehouse facilities, and lines of credit impose significant operating and financial restrictions on the Company and its restricted subsidiaries, which may prevent us from capitalizing on business opportunities
38The agreements that govern our warehouse facilities and lines of credit typically contain covenants relating to our financial condition and we may experience difficulties in complying with such financial covenants48% rewritten
39Our variable rate indebtedness subjects us to interest rate risk, which could cause our indebtedness service obligations to increase significantly
40Our failure to comply with the requirements of our outstanding indebtedness could result in an event of default that could materially and adversely affect our financial condition and ultimately force us into liquidation or bankruptcy

Risks Related to Our Organizational Structure

41The Company is a holding company and its only material asset is its interest in FOA Equity. It is accordingly dependent upon distributions from FOA Equity to pay taxes, make payments under the Tax Receivable Agreement, and pay dividends26% rewritten
42The Company will be required to pay income taxes on its allocable share of any net taxable income of FOA Equity
43The Company is required to make payments under the Tax Receivable Agreement for certain tax benefits the Company may claim, and the amounts of such payments could be significant77% rewritten
44including tax benefits attributable to making payments under the Tax Receivable Agreement. The Company will generally retain the benefit of the remaining 15% of these cash tax benefitsNew
45In certain cases, payments under the Tax Receivable Agreement may be accelerated and/or significantly exceed the actual benefits, if any, the Company realizes in respect of the tax attributes subject to the Tax Receivable Agreement21% rewritten
46The Company will not be reimbursed for any payments made to the TRA Parties under the Tax Receivable Agreement in the event that any tax benefits are disallowed20% rewritten
47Certain of the TRA Parties have substantial control over the Company, and their interests, along with the interests of other TRA Parties, may conflict with your interests
48The Company is not required to distribute any excess tax distributions that it receives from FOA Equity to the Company’s stockholders

Risks Related to Ownership of our Class A Common Stock

49The market price of our securities may fluctuate or decline
50The trading history of our common stock has been characterized by low trading volume21% rewritten
51If securities or industry analysts do not publish research or reports about the Company, or if they publish adverse recommendations regarding the Company's securities, then the Company's stock price and trading volume could decline73% rewritten
52The terms of the Company’s Series A Preferred Stock may materially adversely affect the value and rights of the Company’s Class A Common StockNew
53The Company may issue additional preferred stock in the future whose terms could materially adversely affect the value and rights of the Company’s Class A Common Stock23% rewritten
54Because we have no current plans to pay cash dividends on our shares of Class A Common Stock for the foreseeable future, you may not receive any return on investment unless you sell your shares of Class A Common Stock for a price greater than that which you paid for it46% rewritten
55You may be diluted by the future issuance of additional Class A Common Stock or Class A LLC Units in connection with the Company’s incentive plans, acquisitions, warrants, notes, Series A Preferred Stock, or otherwise56% rewritten
56There may be sales of a substantial amount of Class A Common Stock by certain of the Company’s shareholders and these sales could cause the price of the Company’s securities to fallNew
57There can be no assurance that we will be able to satisfy the continued listing standards that are required to be satisfied in order for our Class A Common Stock to continue to be listed on the NYSE and NYSE TexasNew
58The Company incurs significant expenses and administrative burdens as a public company, which could have a material adverse effect on our business, financial condition, and results of operations
59The Company may not be able to effectively continue to implement and maintain controls and procedures required by the Sarbanes-Oxley Act that are applicable to us45% rewritten
60The principal stockholder has substantial influence over the Company and its interests may conflict with the interests of the Company or its stockholders in the future56% rewritten
61Anti-takeover provisions under Delaware law could make an acquisition of the Company, which may be beneficial to the Company’s stockholders, more difficult and may prevent attempts by the Company’s stockholders to replace or remove the Company’s management

Other Finance of America Companies 10-Ks

FY2024 10-K risk factors
59 risks
Finance of America relies heavily on the reverse mortgage market, with 44% of loans secured in California.
Filed Mar 14, 2025

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The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.