v3.26.1
Fair Value
 6 Months Ended
Jun. 30, 2026
Fair Value Disclosures [Abstract]  
Fair Value

 

2. Fair Value

 

The Company had no financial instruments measured at fair value on a recurring basis as of June 30, 2026 and December 31, 2025.

 

The following tables present the balances of non-financial instruments measured at fair value on a non-recurring basis as of June 30, 2026, and December 31, 2025:

 

   Carrying Amount [Member]   Estimated Fair Value [Member]   Level 1   Level 2   Level 3 
          

Quoted Prices

in Active

Markets for

   Significant Other   Significant 
   June 30, 2026   Identical   Observable   Unobservable 
   Carrying   Estimated   Assets   Inputs   Inputs 
   Amount   Fair Value   Level 1   Level 2   Level 3 
                     
Foreclosed assets, net  $586   $586   $–   $–   $586 
Individually evaluated loans, net   4,500    4,500    –    –    4,500 
Total  $5,086   $5,086   $–   $–   $5,086 

 

   Carrying Amount [Member]   Estimated Fair Value [Member]   Level 1   Level 2   Level 3 
          

Quoted Prices

in Active

Markets for

   Significant Other   Significant 
   December 31, 2025   Identical   Observable   Unobservable 
   Carrying   Estimated   Assets   Inputs   Inputs 
   Amount   Fair Value   Level 1   Level 2   Level 3 
                     
Foreclosed assets, net  $499   $499   $–   $–   $499 
Individually evaluated loans, net   6,192    6,192    –    –    6,192 
Total  $6,691   $6,691   $–   $–   $6,691 

 

 

The following methods and assumptions were used by the Company in estimating the fair value of assets and liabilities valued on a nonrecurring basis:

 

   Estimated Fair Value   Valuation Technique  Unobservable Inputs  Range of Discounts   Weighted Average Discount(1) 
June 30, 2026               
Individually evaluated loans, net  $4,500   Underlying collateral value, third party appraisals  Collateral discounts and estimated costs to sell  $0%-100%   19%
Foreclosed assets, net  $586   Underlying collateral value, third party appraisals  Collateral discounts   18%   18%

 

(1) The weighted average discount is calculated by multiplying each asset’s fair value by its discount rate then adding all the weighted values together and dividing the total sum of the combined estimated fair values.

 

   Estimated Fair Value   Valuation Technique  Unobservable Inputs  Range of Discounts   Weighted Average Discount(1) 
December 31, 2025               
Individually evaluated loans, net  $6,192   Underlying collateral value, third party appraisals  Collateral discounts and estimated costs to sell   0%-26%    12%
Foreclosed assets, net  $499   Underlying collateral value, third party appraisals  Collateral discounts   7%   7%

 

(1) The weighted average discount is calculated by multiplying each asset’s fair value by its discount rate then adding all the weighted values together and dividing the total sum of the combined estimated fair values.

 

Fair Value of Financial Instruments

 

Borrowings under Credit Facilities

 

The fair value of the Company’s borrowings under credit facilities is estimated based on the expected cash flows discounted using the current rates offered to the Company for debt of the same remaining maturities. As all the borrowings under credit facilities or the Notes are payable on demand or at similar rates to what the Company can borrow funds for today, the fair value of the borrowings is determined to approximate carrying value as of June 30, 2026 and December 31, 2025. The interest on our Notes Program is paid to our Note holders either monthly or at the end of their investment, compounded monthly. For the same reasons as the determination for the principal balances on the Notes, the fair value approximates the carrying value for the interest as well.

 

 

The table below is a summary of fair value estimates for financial instruments:

 

   Level   Carrying Amount [Member]   Estimated Fair Value [Member]   Carrying Amount [Member]   Estimated Fair Value [Member] 
       June 30, 2026   December 31, 2025 
   Fair Value   Carrying   Estimated   Carrying   Estimated 
   Level   Amount   Fair Value   Amount   Fair Value 
Financial Assets                         
Cash and cash equivalents including restricted cash   1   $3,041   $3,041   $3,740   $3,740 
Certificates of deposit   2    2,275    2,275    2,275    2,275 
Loans receivable, net   3    73,814    73,814    59,223    59,223 
Accrued interest on loans   2    1,488    1,488    1,111    1,111 
Financial Liabilities                         
Refundable prepaid interest   2    986    986    965    965 
Loan deposits   2    1,188    1,188    838    838 
Notes payable secured, net   2    28,010    28,010    18,445    18,445 
Notes payable unsecured, net   2    40,523    40,523    35,774    35,774 
Accrued interest payable   2    4,706    4,706    3,595    3,595