Walter Investment Management Corp. has filed an 8-K with the Securities and Exchange Commission saying it will be restating the historical financial information of
The filing, obtained through DisclosureNet.com, said the RMS restatements will not require Walter to restate its own financials and it should not have a material impact on the company.
However, Walter says it has “discovered a failure to record certain estimated liabilities relating to servicing errors by RMS.” Those errors apparently relate to RMS’ failure to adhere to the Federal Housing Administration’s “event-specific timelines during the default, foreclosure, conveyance and mortgage insurance claim cycles.” The vast majority of all reverse mortgage loans are insured by FHA through its Home Equity Conversion Mortgage program.
The 8-K continues that based on preliminary discussions with RMS’ public accounting firm, Walter decided that RMS’ previous financial statements could no longer be relied upon and should be restated to reflect the servicing errors. The pro-forma information in the Oct. 15 8-K can also no longer be relied upon.
Walter “has determined that the error is material to the balance sheets and income statements included in the RMS historical financial statements, but has no material effect on the statements of cash flows.”
