v3.26.1
DEBT
 6 Months Ended
Jun. 30, 2026
Debt Disclosure [Abstract]  
DEBT DEBT
Repurchase Agreements

The Company has entered into one repurchase facility whereby the Company acquires commercial loans or pools of RTLs which are then sold by the Company as “seller” to a counterparty, the “buyer.” Upon the time of the initial sale to the buyer, the Company, with a simultaneous agreement, also agreed to repurchase the commercial loans or pools of RTLs from the buyer. Interest is calculated based on a spread to one-month SOFR, subject to a floor. The advance rate is between 65% and 85% of the asset’s acquisition price.

The Company has also entered into one repurchase facility, substantially similar to the CRE repurchase facility, but where the pledged assets are pools of residential mortgage loans. Mortgage loans sold under this facility carries interest calculated based on a spread to one-month Secured Overnight Financing Rate (“SOFR”), which is fixed for the term of the borrowing. The advance rate is between 75% and 90% of the asset’s acquisition price. The obligations of the Company to repurchase these mortgage loans at a future date are guaranteed by the Operating Partnership.

As of June 30, 2026, the Company is also a party to six repurchase facilities, substantially similar to the CRE repurchase facility, but where the pledged assets are the Company’s investments in bonds and bonds retained from the Company’s securitization trusts. Each repurchase transaction represents its own borrowing. As such, the ceilings associated with these transactions are the amounts currently borrowed at any one time.

If the value of collateral underlying the repurchase financing agreements declines by more than a de minimis threshold, the counterparty could require the Company to post additional collateral, or margin, in the form of cash and cash equivalents.

The Company has effective control over all of the assets subject to these transactions; therefore, the Company’s repurchase financing agreements are accounted for as financing arrangements. The Operating Partnership, as guarantor, will provide to the buyers a limited guaranty (“Guaranty”) of certain losses incurred by the buyers in connection with certain events and/or the seller’s obligations under the mortgage loan purchase agreement, following the breach of certain covenants by the seller, the occurrence of certain bad acts by the seller, the occurrence of certain insolvency events of the seller or other events specified in the Guaranty. As security for its obligations under each Guaranty, the guarantor will pledge the trust certificate representing the guarantor’s 100% beneficial interest in the seller.
The following tables set forth the details of the Company’s repurchase financing agreements and facilities:
June 30, 2026
Maturity DateAmount OutstandingAmount of CollateralInterest Rate
Goldman Sachs - loans(1)
April 29, 2028$87,889 $127,743 5.87 %
Lucid - bonds(2)
$38,229 $45,000 4.25 %
A bondsJuly 16, 202638,229 45,000 4.25 %
Barclays - bonds(2)
$53,063 $70,977 4.56 %
A bondsJuly 8, 202612,963 15,000 4.36 %
July 17, 202613,626 18,815 4.65 %
July 22, 202616,951 20,946 4.37 %
B bondsJuly 17, 20264,634 8,340 5.04 %
July 22, 20264,322 6,754 5.09 %
M bondsJuly 17, 2026471 973 4.84 %
July 22, 202696 149 4.69 %
Nomura - bonds(2)
$99,243 $185,121 (3)5.19 %
A bondsSeptember 30, 20268,161 11,731 5.28 %
B bondsSeptember 21, 20261,539 4,101 5.43 %
B bondsSeptember 30, 202638,699 71,622 5.07 %
M bondsSeptember 30, 202617,734 26,019 4.94 %
Beneficial Interests(4)
September 21, 202633,110 71,648 5.43 %
Nomura - loans(5)
February 26, 2027$12,248 $14,956 5.85 %
Santander bonds(2)
$20,835 $24,366 4.31 %
A BondsJuly 15, 202620,835 24,366 4.31 %
Totals/Weighted Averages$311,507 $468,163 5.12 %
(1)Maximum borrowing capacity subject to pledging sufficient collateral as of June 30, 2026 was $300.0 million.
(2)Maximum borrowing capacity subject to pledging sufficient collateral is the equivalent of the amount outstanding as of June 30, 2026.
(3)Includes bonds that are consolidated on the Company’s balance sheet as of June 30, 2026.
(4)Collateral of beneficial interests presented at fair value, as disclosed in Note 7.
(5)Maximum borrowing capacity subject to pledging sufficient collateral as of June 30, 2026 was $400.0 million.

December 31, 2025
Maturity DateAmount OutstandingAmount of CollateralInterest Rate
Goldman Sachs - bonds(1)
$36,431 $42,767 4.58 %
A bondsJanuary 12, 20268,510 10,000 4.41 %
February 17, 202627,921 32,767 4.63 %
Goldman Sachs - loans(2)
December 12, 2027$11,148 $17,150 6.62 %
Lucid - bonds(1)
$50,829 $60,000 4.42 %
A bondsJanuary 12, 202629,543 35,000 4.47 %
A bondsJanuary 15, 202621,286 25,000 4.36 %
Barclays - bonds(1)
$85,885 $109,816 4.65 %
A bondsJanuary 9, 202614,780 17,439 4.47 %
January 12, 202612,963 15,000 4.51 %
January 14, 202615,598 18,540 4.71 %
January 23, 202618,576 23,014 4.46 %
March 19, 202614,629 20,041 4.82 %
December 31, 2025
Maturity DateAmount OutstandingAmount of CollateralInterest Rate
B bondsJanuary 23, 20264,195 6,531 5.18 %
March 19, 20264,573 8,129 5.20 %
M bondsJanuary 23, 202690 149 4.78 %
March 19, 2026481 973 5.00 %
Nomura - bonds(1)
$99,005 $178,102 (3)5.16 %
A bondsMarch 30, 20269,009 12,885 5.24 %
B bondsMarch 19, 20261,638 4,101 5.45 %
B bondsMarch 30, 202638,477 71,204 5.02 %
M bondsMarch 30, 202617,894 26,019 4.89 %
Beneficial Interests(4)
March 19, 202631,987 63,893 5.45 %
Nomura - loans(5)
February 27, 2026$20,543 $25,999 5.91 %
Santander bonds(1)
$103,231 $120,093 4.54 %
A bondsJanuary 12, 202621,396 25,000 4.41 %
January 15, 202681,835 95,093 4.58 %
Totals/Weighted Averages
$407,072 $553,927 4.83 %
(1)Maximum borrowing capacity subject to pledging sufficient collateral is the equivalent of the amount outstanding as of December 31, 2025.
(2)Maximum borrowing capacity subject to pledging sufficient collateral as of December 31, 2025 was $200.0 million.
(3)Includes bonds that are consolidated on the Company’s balance sheet as of December 31, 2025.
(4)Collateral of beneficial interests presented at fair value, as disclosed in Note 7.
(5)Maximum borrowing capacity subject to pledging sufficient collateral as of December 31, 2025 was $400.0 million.

Each Guaranty establishes a master netting arrangement; however, the arrangements do not meet the criteria for offsetting within the Company’s consolidated balance sheets. A master netting arrangement derives from contractual agreements entered into by two parties to multiple contracts that provides for the net settlement of all contracts covered by the agreements in the event of default under any one contract.

The outstanding borrowings under the Company’s repurchase facilities and the pledged value of the related loans and securities pledged as collateral are presented on a gross basis on the Company’s consolidated balance sheets as of June 30, 2026 and December 31, 2025. The table below presents the gross amounts on the consolidated balance sheets for these arrangements:
Gross Amounts Not Offset on Balance Sheet
June 30, 2026December 31, 2025
Gross amount of recognized liabilities $311,507 $407,072 
Gross amount of loans and securities pledged as collateral468,163 553,927 
Net Collateral Amount$156,656 $146,855 

Secured Bonds Payable

The Company uses securitizations as a primary financing structure. The Company is the primary beneficiary of certain securitization trusts, classified as VIEs, and therefore consolidates them. The loans held by the consolidated securitization trusts remain on the Company’s consolidated balance sheets, and the notes issued by such trusts and held by third parties are presented as secured bonds payable on the consolidated balance sheets. The securitization VIEs are structured as pass-through entities that receive principal and interest payments on the underlying mortgage loans and distribute those payments to the holders of the notes. The notes issued by the securitization trusts are secured solely by the mortgage loans held by the applicable trusts and are not obligations of the Company or secured by any of its other assets. The residential mortgage loans of the applicable trusts are the only source of repayment and interest on the notes issued by such trusts. The Company does not guarantee the obligations of the trusts under the terms of the governing agreements or otherwise. The Company’s exposure to the obligations of the VIEs is generally limited to its investments in the entities.
The Company’s rated securitization trusts are generally structured as “REIT TMP” transactions which allow the Company to issue multiple classes of securities without using a real estate mortgage investment conduit structure or being subject to an entity level tax. The Company’s rated securitization trusts generally issue classes of debt from AAA through mezzanine. The Company generally retains the mezzanine and residual certificates in the transactions. The Company has retained the applicable mezzanine and residual certificates from the four rated securitization trusts outstanding at June 30, 2026.

Servicing for the residential mortgage loans in the Company’s securitization trusts is provided by Newrez, an affiliate of the Company, at a servicing fee of 0.42% of outstanding UPB and is paid monthly.

The following table sets forth the status of the notes held by third parties as of June 30, 2026 and December 31, 2025, and the original balance at the securitization cutoff date:
June 30, 2026December 31, 2025Original Balances at
Securitization Cutoff Date
Class of NotesCarrying Value of MortgagesBond Principal BalancePercentage of Collateral CoverageCarrying Value of MortgagesBond Principal BalancePercentage of Collateral CoverageMortgage UPBBond Principal Balance
2019-D$82,654 $50,131 165 %$85,105 $52,508 162 %$193,301 $156,670 
2019-F77,138 37,940 203 %81,025 41,676 194 %170,876 127,673 
2020-B82,513 45,158 183 %86,096 48,894 176 %156,468 114,534 
2021-A104,636 79,421 132 %109,382 83,816 131 %206,506 175,116 
$346,941 $212,650 (1)163 %$361,608 $226,894 (1)159 %$727,151 $573,993 
(1)Represents the gross amount of secured bonds payable and excludes the impact of deferred issuance costs of $0.4 million and $0.7 million as of June 30, 2026 and December 31, 2025, respectively.

Corporate Debt

Unsecured Notes, Net (2027 Notes)

In August 2022, the Operating Partnership issued $110.0 million aggregate principal amount of 8.875% senior unsecured notes due September 1, 2027 (the “2027 Notes”), which are fully and unconditionally guaranteed by the Company. The 2027 Notes were issued at 99.009% of par value and have a five-year term. Interest is payable semi-annually on March 1 and September 1. The net proceeds from the issuance of the 2027 Notes totaled approximately $106.1 million, after deducting the original issue discount, commissions and offering expenses, which are amortized over the term of the notes using the effective interest method.

On June 30, 2024, the Company received notification that the 2027 Notes were downgraded from BBB- to BB+. Under the terms of the indenture governing the 2027 Notes, the downgrade resulted in a 100 basis point increase in the interest rate from 8.875% to 9.875%, effective September 1, 2024.

As of June 30, 2026 and December 31, 2025, the aggregate principal amount outstanding of the 2027 Notes was $110.0 million, and the aggregate unamortized discount and deferred issuance costs were $1.1 million and $1.5 million, respectively.

The following table presents interest expense on the 2027 Notes for the three and six months ended June 30, 2026 and 2025:
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
Interest expense$2,716 $2,716 $5,432 $5,431 
Amortization of discount and deferred expenses
215 215 430 430 
Total Interest Expense on 2027 Notes$2,931 $2,931 $5,862 $5,861 
The indenture governing the 2027 Notes restricts, among other things, the Company’s and certain of its subsidiaries’ ability to incur certain additional debt, make certain investments or acquisitions, sell certain assets, and merge, consolidate or transfer all or substantially all of its assets. Additionally, the indenture governing the 2027 Notes requires the Company to comply with certain maintenance requirements, including certain levels of cash and liquidity, such as: (i) Net Asset Value (as defined in the indenture agreement) as of the close of business on the last day of each of its fiscal quarters must be equal to or greater than $240.0 million, plus the greater of (x) zero dollars and (y) 65% of the Company’s net equity capital activity; (ii) the ratio of the Adjusted Unencumbered Assets (as defined in the indenture agreement) as of the close of business on the last day of each of its fiscal quarters to the aggregate principal amount of the 2027 Notes outstanding as of each such date must be equal to or greater than 1.6:1.0; (iii) the ratio of the debt to equity as of the close of business on the last day of each of its fiscal quarters must be less than 4.0:1.0, (iv) a quarterly minimum liquidity covenant of $30.0 million. As of June 30, 2026, the Company was in compliance with all covenants.