INDEBTEDNESS |
6 Months Ended |
|---|---|
Jun. 30, 2026 | |
| Debt Disclosure [Abstract] | |
| INDEBTEDNESS | INDEBTEDNESS Warehouse Facility In June 2026, the Company established a trust (the “Trust”) to enter into a warehouse credit facility (the “Warehouse Facility”) with Goldman Sachs Lending Partners LLC. The Warehouse Facility has a maturity date of June 1, 2028 and is used to fund purchases of loans held for investment originated by certain bank partners. The facility provides for a total commitment amount of $200.0 million and an uncommitted amount of $300.0 million, for a total facility limit of $500.0 million. Uncommitted advances may be made at the lender’s sole and absolute discretion. Borrowings under the Warehouse Facility are secured by certain of the loans held for investment. In connection with the Warehouse Facility, the Company maintains a reserve account, which is contractually constrained as to its withdrawal and use, and is included in restricted cash on the condensed consolidated balance sheet. As of June 30, 2026, $50.0 million was outstanding under the Warehouse Facility. Loans under the Warehouse Facility bear interest at a benchmark rate based on the secured overnight financing rate (“Term SOFR”) for a one-month interest period, plus an applicable margin of 1.90%. The Term SOFR rate is at all times subject to a floor of 0.50%. The Trust is also obligated to pay a draw fee of 0.30% per annum on each incremental advance above $200.0 million and an unused commitment fee of 0.25% per annum on the undrawn committed amount. During the three and six months ended June 30, 2026, the Trust drew down an aggregate of $50.0 million on the Warehouse Facility. Interest expense for the three and six months ended June 30, 2026 was $0.2 million and was recorded within general and administrative expenses in the condensed consolidated statement of operations. The Warehouse Facility contains certain customary affirmative and negative covenants and financial covenants including minimum liquidity and minimum tangible net worth. The Trust was in compliance with all covenants as of June 30, 2026. Revolving Credit Facility In March 2025, the Company entered into a $475.0 million senior secured revolving credit facility maturing on March 31, 2030 (the “credit facility”), which replaced its prior $125.0 million revolving credit facility. As of June 30, 2026, no funds have been drawn under the credit facility and the Company had letters of credit outstanding thereunder of $23.2 million. Loans under the credit facility initially bear interest at the Company’s option of (i) an annual rate based on the forward-looking term rate based on the Secured Overnight Financing Rate (“Term SOFR”), based on an interest period of one, three, or six months, plus an applicable margin of 1.50% or (ii) a base rate (the “base rate”) equal to the highest of (A) the prime rate, (B) the effective federal funds rate, plus 0.50%, and (C) Term SOFR for a one-month interest period plus 1.00%, in each case plus 0.50%. The applicable margin for (a) Term SOFR loans shall be either 1.50% or 1.25% and (b) base rate loans shall be either 0.50% or 0.25%, in each case, depending on the Company’s Consolidated Total Debt to Consolidated EBITDA Ratio (as defined in the credit agreement for the credit facility). The Term SOFR rate is at all times subject to a floor of 0%. The Company is obligated to pay other customary fees for a credit facility of this size and type, including letter of credit fees, an upfront fee, and an unused commitment fee. The Company’s obligations under the credit facility are required to be guaranteed by certain of its subsidiaries. Such obligations, including the guaranties, are secured by substantially all of the Company’s assets and those of the subsidiary guarantors. The credit facility includes customary affirmative and negative covenants, including, among others, restrictions on debt, liens, investments, fundamental changes, dividends, distributions, repurchases and/or redemptions of equity interests, and transactions with affiliates. In addition, the credit facility requires the Company to satisfy a minimum liquidity covenant. The Company was in compliance with all covenants as of June 30, 2026.
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